Prime Minister Tihomir Oreskovic on Wednesday informed a news conference of what the government had done in the past two weeks so that Croatia could avoid European Commission's corrective action over excessive macroeconomic imbalances, adding that yesterday's decision of the European Commission with regard to that issue was "a very positive message."

"A lot has changed in those two weeks," Oreskovic told a news conference in the government headquarters, recalling that European Commission Vice President Valdis Dombrovskis visited Zagreb two weeks ago and sent Croatia a strong message that it would be faced with corrective measures because it had failed to carry out reforms.

"Croatia was the only country about to face those corrective measures," Oreskovic said adding that the implementation of those measures would be a disaster for Croatia. That would be a disaster primarily for investors because Croatia had not launched reforms, Oreskovic explained, adding that this would not be a positive thing for Croatian citizens either because the European Commission would very actively take part in reforms for which it did not believe Croatia could launch on its own.

"Several days later, I sent a letter to European Commission President Jean-Claude Juncker informing him that this government is committed to reforms and that there was no reason for the European Commission to launch the corrective action because we will carry out reforms on our own," Oreskovic said.

The prime minister added that he and Finance Minister Zdravko Maric spent five hours on the phone with each other last Saturday when they defined the reform programme which Croatia then forwarded to the European Commission even before the deadline. It is a detailed five-page document elaborating reforms, Oreskovic said.

"I spoke with Dombrovskis on Saturday, I informed him clearly of our reform plan and I said I was confident that the document would be sufficient for the European Commission to see that we are serious and that there was no reason to carry out those corrective measures," Oreskovic said. "The European Commission yesterday upheld our plan and budget and said it would not activate the corrective measures, and I believe we have received a very positive message," Oreskovic said announcing that the document would soon be presented to the public.

The European Commission said on Tuesday  Croatia had for now escaped corrective action over excessive macroeconomic imbalances and it would reconsider its assessment of Croatia and Portugal in May to take into account the ambitiousness of their national reform programmes, which they need to submit by the end of April.

Croatia is one of the five EU member states found to be experiencing excessive imbalances, together with Bulgaria, France, Italy and Portugal.

Asked about the content of the reform programme, Oreskovic said reforms would be carried out in the health sector so as to halt the sector's growing debt. He also cited consolidation, administrative processes and public procurement. Other reforms refer to pensions and salaries which, according to him, would not be cut but that penalising would be introduced for early retirement.

Oreskovic singled out social benefits and increased efficiency, the public sector and public procurement, as well as additional structural measures, the judiciary, EU funds, non-performing loans in the banking sector and better management in state companies.

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