Introductory meeting with the IMF Executive Director

Published: 14/5/1999

Mr. Johannes de Beaufort Wijnholds, Executive Director of the International Monetary Fund and Director of the IMF constituency to which Croatia belongs, began on Friday May 14, 1999 his visit to Croatia by meeting high officials of the Croatian National Bank headed by the Governor Dr. Marko Škreb.

On this occasion, Mr. Wijnholds was informed about recent economic and financial developments in Croatia and about the measures introduced for the purpose of the further maintenance of macroeconomic stability. In addition, Mr. Wijnholds was briefed on recent developments in the Croatian banking system as well as on the decisions the central bank made in order to speed up the consolidation of the banking system and the adjustment to market principles of sound banking operation.

In light of the expected negotiations with the IMF about the new stand-by arrangement, Governor Škreb emphasized that the arrangement would be important for Croatia not only because it would enable the strengthening of Croatia's international reserves, but also because it would provide strong support to the credibility of the Croatian central bank in the further maintenance of intact international liquidity and the satisfactory stability of the exchange rate. Maintenance of the stable exchange rate of the kuna, namely, is considered extremely important in Croatian circumstances where enterprises and citizens react very sensitively to every change in the exchange rate. Additionally, the arrangement with the IMF represents an important precondition for the further cooperation with the World Bank and would be a positive signal to foreign investors and international agencies engaged in assessing the credit rating of Croatia.

Mr. Wijnholds informed the central bank officials about recent goals, priorities and standpoints of the International Monetary Fund related to economic and financial policy of countries looking for IMF's financial support. He also briefed the CNB officials on discussions about possible assistance to countries that are suffering mostly from the consequences of the Kosovo crisis, especially from its negative effects on the balance of payments and the budget. From six countries, Croatia among them, which are mostly hit by the Kosovo crisis, five countries belong to the IMF constituency headed by Mr. Wijnholds, a representative of the Netherlands in the Board of Executive Directors of the IMF.