The International Monetary Fund on Friday added to calls for the incoming government of Croatia to tackle fiscal woes energetically, particularly by undertaking cuts in public spending, Reuters news agency said.
"This year is the first year in a long period that Croatia has growth and now would be the time to tackle fiscal consolidation energetically and to shift to the expenditure side," Reuters quoted the head of the IMF mission to Croatia, Johannes Wiegand, as saying during a visit to the Slovenian capital of Ljubljana.
He said there was a considerable potential in the budget for expenditure cuts, notably in budget transfers, public sector employment and public administration. Social benefits could be streamlined where they overlap at national and local level.
"Croatia has a much higher share of budget transfers than most of the economies in the region... Government structure is also in need of reform as its different layers have overlapping responsibilities," Wiegand said.