Finance Minister Zdravko Maric said on Friday the interest by some domestic companies and pension funds in the privatisation of several state-owned companies was more than welcome and that he expected the business community to approve of the privatisation, despite political resistance.

He was speaking to reporters as part of the New Europe Business Forum, organised by the Zagreb School of Economics and Management. Commenting on criticisms of the announced privatisation, he said "there will always be opposition to any reform."

The government wants to send a clear message that, aside from fiscal consolidation and the lowest deficit since the pre-recession period, the activation and privatisation of state property will make the biggest contribution to the stabilisation of debt-to-GDP ratio already this year, Maric said, adding that this was an important message for the rating agencies, international and domestic investors and entrepreneurs.

Commenting on media reports that the government ignored banks' invitation to a meeting before they launched arbitration proceedings over the conversion of Swiss franc loans, he said talks with the banks would continue and reiterated that there was no official information that those proceedings would be launched. He added that 94 percent of those loans had been converted and that going back was not possible, reiterating that the European Commission had requested explanations regarding certain aspects of the loan conversion law.

Maric said he expected to meet with representatives of the rating agencies soon and that the government would do its best to assure them that the National Reform Programme and the Convergence Plan would be implemented in order to stabilise Croatia's credit rating outlook this year.

The rating is currently two notches below the investment level, with a negative outlook for some time now. "We will be very active and not only defend our positions, but try to explain that these aren't just a plan and a programme, but that they have genuine political support," Maric said.

He said the government would tackle the public debt through stronger economic growth, a lower fiscal deficit, and the further activation of state properties so that they can "raise the value of a whole microregion, which has both a medium and a long term component in value creation."

He said a tax reform draft was expected by the middle of the year so that it could go into force on 1 January 2017. "A tax reform is necessary because the system is... complex and does not deliver as it should. We want to make it simpler, more efficient and more stimulating."

After six years of recession, the tax base is markedly smaller and the government cannot think about raising taxes but about how to expand the tax base, create conditions for reducing the tax burden and stimulating businesses as well as citizens, Maric said.

He said the reform would tackle the entire system, including the highest income tax rate, the profit tax, excises, the introduction of a property tax, reducing VAT in tourism and agriculture.

Related stories

Latest news

Syrian opposition rules out future role for President al-Assad

The Syrian opposition said Friday it would not accept any role for President Bashar al-Assad in the future of the war-torn country, reacting to a recent US shift saying that removing al-Assad is no longer a priority for Washington.

Russian Army integrates breakaway forces of Georgian province

Parts of the small fighting forces of the Georgian breakaway province of South Ossetia have been placed under Russian military control, Russian Defence Minister Sergei Shoigu said on Friday.

Czech Republic's Pilsner Urquell beer is now Japanese

Japanese brewing company Asahi completed its takeover of the Czech brewery Pilsner Urquell on Friday, Asahi said in a statement.

Judge approves 25-million-dollar settlement of Trump University case

A US district judge on Friday approved a 25-million-dollar settlement of lawsuits and state fraud allegations against Trump University, the US president's now-defunct business venture.

Former Thai premier Thaksin to junta on reconciliation: 'Cut me out'

Former Thai prime minister Thaksin Shinawatra on Friday announced that he is not interested in the junta-led reconciliation process, three days after the junta handed him a half-a-billion-dollar tax bill for his past business deal.

Dalic: We welcome possible deal between Agrokor and banks

The government welcomes the possibility of an agreement being concluded between the Agrokor food company and creditor banks, and the bill on vitally important companies is not a fallback plan but the result of the government's care for the overall economic and financial stability of Croatia, Deputy Prime Minister and Minister of Economy Martina Dalic told a press conference in Zagreb on Friday.

Croatia, China sign action plan for cooperation in agriculture

The Croatian and Chinese ministries of agriculture on Friday signed an action plan for cooperation in the field of agriculture for the period 2017-2018, the Croatian ministry said in a statement.

ZSE indices up, Agrokor shares in focus of investor interest

The Zagreb Stock Exchange (ZSE) indices on Friday rose by more than 1.8%, with stocks of the Agrokor food and retail concern being in the focus of investor interest again.

Berlin police defend handling of Berlin market attacker

Berlin police defended themselves on Friday against accusations that they stopped surveillance on Berlin Christmas market attacker despite knowing in June 2016 he was dangerous.

Croatia, creditors tailor emergency measures to save tottering giant

Croatia's tottering retail and food giant Agrokor reached an agreement with its creditors, putting its debts standby and allowing it to continue working during emergency restructuring, the Croatian branch of Austria's Erste Bank said Friday.

Agrokor's creditors say standstill agreement to go into force today

A standstill agreement regarding the Agrokor concern's existing financial obligations to banks will take effect on Friday, additional capital will be injected into the concern in the coming days and the concern will be actively restructured, which includes a change of its management, it was said on Friday after a meeting between Agrokor's suppliers and creditor banks.

Palestinians, UN slam Israel's new settlement plan

Palestinians, Israeli activists and the UN lambasted the government of Israeli Prime Minister Benjamin Netanyahu on Friday, a day after it gave the go-ahead for the first new West Bank settlement in a quarter of a century.

South Sudan rebels release three abducted foreign oil workers

South Sudanese rebels have released three foreign engineers they abducted in early March in the oil-rich Upper Nile region, Foreign Affairs Ministry official Mawein Makol Arik said on Friday.

Turkish opposition: Imprisoned party chief has gone on hunger strike

The head of Turkey's pro-Kurdish opposition party has launched a hunger strike from prison.

European leagues threaten Champions League schedule clashes

The European Professional Football Leagues (EPFL) on Friday threatened schedule clashes on Champions League matchdays in an ongoing dispute with the governing body UEFA.

Danish court revokes citizenship of IS volunteer

A Danish appellate court on Friday stripped a man of his Danish citizenship for volunteering to fight for the extremist Islamic State in Syria.

Banks and Agrokor agree on key elements of standstill agreement

Member banks of the coordinating committee of financial creditors and representatives of the Agrokor food company have in principle agreed on key elements of a standstill agreement, which is expected to be signed later today, announcing changes in the company's management team, Erste Bank said in a statement on Friday afternoon.

Syrian man on trial in Sweden; mosque attack labelled terrorism

A Syrian man went on trial Friday in the southern Swedish city of Malmo, charged with terrorism and arson after an attack last year on a building used as an assembly hall by Shiite Muslims.