Macroeconomic Forecast Croatia

The current account deficit came in at US$7.68bn in January-July. Both import and export growth are running at close to 20% y-o-y, which is in line with our existing forecasts. With the full year current account deficit expected to come in at 7.8% of GDP, we do not anticipate a rapid closing of the external gap. Rather, by the end of our five-year forecast period, the shortfall will still be 5.7% of GDP. To prevent a further widening of external debt levels, and reduce foreign obligations which are weighing on economic stability, higher levels of FDI are needed.

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