davor majetić-hup.jpg
HUP director-general Davor Majetic
Photograph: Hina/ Dario GRZELJ/ dag

The Croatian Employers' Association (HUP) said that Croatia's downgraded economic growth forecast was the confirmation but also a warning that reforms were necessary and that time was running out.

"There is no more time, it is already May and a large part of the year is already behind us. Growth and progress recorded last year are insufficient to make up for the difference between us and those we are lagging behind and those who, unlike us, are not afraid of changes. Besides, the question is whether our growth and recovery are sustainable, as they are mostly on the back of favourable external circumstances," HUP said.

HUP also said that reform measures implemented in previous years were insufficient and too slow.

We expected the new government to present its reform plan sooner, given how much they talked about it during the election campaign, according to the HUP press release.

The European Commission on Tuesday released its Spring 2016 Forecast, mildly reducing Croatia's economic growth outlook to 1.8%, the main reason for this being the poor results in Q4 2015.

"Growth is to resume at a slow pace following the disappointing fourth quarter of 2015. Croatia’s real GDP expanded by 1.6% in 2015, the first year of positive growth since 2008. The negative reading of real GDP growth in 2015-Q4, at -0.5% (q-o-q), weakened the momentum for growth into 2016," the European Commission said in its forecast.

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