President Kolinda Grabar-Kitarovic said in the eastern Croatian city of Osijek on Wednesday that the government had failed to create conditions for a faster economic development which was why local and regional development policies could not produce better results.

"The government has failed to create conditions for a faster economic development. The crisis that has entered its sevenths year has additionally aggravated the economic and social situation in all Croatian regions, which resulted in a justified dissatisfaction of the people in Slavonia with the government's treatment of this eastern Croatian region. Regional policies can be successful only if the state policy is successful," Grabar-Kitarovic said at the City Council session, which marked the Day of Osijek.

Addressing the special session, the president said Croatia had achieved its historical aspiration for freedom and independence but that the excitement went away after the country joined the EU and NATO and when Croatia was supposed to achieve economic recovery and a better life.

Grabar-Kitarovic warned that between mid-2014 and mid-2015, the number of active population in Osijek-Baranja country dropped by 3,719 persons, mostly due to emigration.

If we add negative rates of the population growth to that we get numbers that threaten"the very living substance" of Slavonia as well as Croatia, she said. The president added that it was impermissible that the local population was dying out, while Slavonia's youth is building other economies and reviving other countries. "We must stop these negative processes," Grabar-Kitarovic said adding that Croatia needed a clear development vision, determination and unity in the implementation.

The president said the new government would have a huge responsibility in that context, adding that its first task should be reducing income taxes and enableing companies to make accelerated investmed and hire people not only to stop emigration but to create conditions for the return of those who already left. She said the new government will also have to carry our decentralisation and provide counties, cities and municipalities with bigger fiscal possibilities to shape their own development.

Mayor Ivan Vrkic stressed that in the past year, over HRK 900 million had been invested in Osijek and that unlike Zagreb, Zadar, Varazdin and Split, Osijek was short-listed in the competition for European Culture Capital 2020.

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