miro kovač.jpg
Croatian Foreign Minister Miro Kovac
Photograph: HINA/ Damir SENČAR/ ds

Moody's made its assessment based on the work of the previous government, Foreign and European Affairs Minister Miro Kovac said on Saturday when asked to comment on Croatia's downgraded credit ratings.

"Moody's made its rating based on the previous period and the work of the previous government. But you will see very soon (...) the new ratings will be different," Kovac said.

Reporters asked Kovac to comment on the fact that the agency had not recognised the new government's efforts and projected Croatia's economic growth at 1.5%, criticising the government for delaying the reform agenda.

"But of course. The government is expected to carry out reforms. We are now in the process of adopting the budget and after that we will launch reforms. We will be successful, you will see," Kovac told the press.

He underscored that the government had drawn up a reform budget, adding that this was the first sign that the government was serious. "I believe the parliament would soon adopt the new, reform-oriented budget," Kovac stressed.

He also expressed satisfaction with the fact that the European Commission had recognised the efforts this government was making, adding that "the government, led by Prime Minister (Tihomir) Oreskovic has managed to avoid the corrective measures."

"We are on the right track and we will succeed in changing Croatia, and after this reform-oriented budget we will start implementing the necessary structural changes," Kovac concluded.

Moody's Investors Service, a ratings agency, on Friday downgraded Croatia's long-term issuer and senior unsecured debt ratings to Ba2 from Ba1 and maintained the negative outlook, explaining that the rationale for the downgrade is a large and increasing public debt and weak medium-term growth prospects.

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