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Croatia says it needs $10 bn to combat COVID-19 crisis

Croatia says it needs $10 bn to combat COVID-19 crisis

Croatia requires about $10 billion in the next few months to fight successfully against COVID-19 and its consequences in the economy, said Finance Minister Zdravko Maric said on Wednesday.

Croatia’s government isn’t ready to introduce all needed measures to curb coronavirus as well as to shore up the economy. In addition, writing off tax obligations or deferring of tax payments over the next three months also requires attention. As Reuters reports, the Croatian government will also pay part of the salaries of workers employed by the commercial firms in trouble.

For Zagreb, financing the measures it undertakes to combat the crisis caused by the COVID-19 pandemic is a top priority, confirmed finance minister Maric and said the country’s economy needs at least 70 billion kuna in the next couple of months. Earlier, the Croatian finance ministry planned to start talks with trade unions on possible wage reductions in the public sector.

“We will need at between 65 and 70 billion kuna to secure financing of our needs in the next three months,” Maric said in an interview with the N1 TV news channel. “We’re seeking the funds now primarily on the domestic market, but we will also turn to the international markets and financial institutions.”

In fact, prior to COVID-19 hitting the country, its planned budget spending in 2020 had been set at 147.3 billion kuna.

So far, the health ministry reported on 18 deaths due to coronavirus. The country is in lockdown since mid-March, so, its tourist industry, which generates almost a fifth of its economic output, has been hit hard. Normally, foreign tourism alone brings in more than $10.9 billion.

According to the top financial official, Croatia would also look at how best to take advantage of the money managed by the national mandatory pension funds, without elaborating. Moreover, the government would also rely on European Union funds to cope with the crisis caused by COVID-19.

“We’re already considering some measures for the day after, once the acute crisis is over, because then we will need to have the measures ready to spur the economy. The focus is likely to be on boosting domestic demand at that moment,” minister Maric said.