The European Commission has markedly increased its projection of Croatia's growth in 2016 to 2.6% after its spring forecast was 1.8%.
"Croatia’s economy is expected to grow 2.6% this year on the back of a rebound in consumption, strong investment growth and a record tourist season. Domestic demand is expected to remain strong but net trade is set to continue detracting from growth in 2017 and 2018, due to strong demand for imports," the Commission says in its latest report on Wednesday.
"Unemployment is projected to fall sharply due to employment growth and a shrinking labour force."
"The general government deficit is forecast to decline further, setting the debt-to-GDP ratio on a declining path already this year."
The public debt is likely to account for 85% of GDP by the end of this year, as against 86.7% last year.