A Mission of the International Monetary Fund, which arrived to Croatia for the purpose of Article IV Consultations, as is the usual practice with all other IMF state members, had today an introductory meeting with the highest officials of the Croatian central bank. It can be expected that a possible new arrangement negotiations of the Republic of Croatia with this financial institution will start, but without a final agreement on the arrangement reached during the two-week stay of the Mission in Zagreb.
Deputy Governor of the Croatian National Bank Dr. Boris Vujčić and his associates informed the members of the Mission about the latest economic and monetary developments. Mr. Hans Flickenschild, the head of the Mission, was interested in prospects for Croatia to preserve the attained macroeconomic stability. In addition, he wanted to know whether there is danger that the high growth of bank lending might initiate the price increase.
According to the central bank estimates, the 2002 inflation should be between 3 and 4 percent. The realization of this forecast could only be jeopardized by a higher growth in oil prices and prices of other energy products. The effects of the bank lending activity are being monitored carefully and should it prove necessary, the central bank will undertake the available measures. It is encouraging that the share of investment goods in the structure of imports is growing, which points to the conclusion that a considerable share of credits is channeled in long-term investments, which should contribute to the growth in production and employment.