Croatia

Parliamentary elections in December which saw our long-held view for the centre-left coalition (known as the Kukuriku coalition) come to power has played out. We have raised Croatia's short-term political risk rating to 70.2 (out of 100) from 69.4 previously. The key sub-component we revised upwards was that of 'policy making process' due to the strong majority of 81 seats out of 151. We expect the new government to push forward with tough fiscal consolidation efforts, perhaps with the help of the IMF, and to enact structural economic reforms to improve the long-term economic outlook for the Balkan country.

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