The Croatian government on Wednesday adopted the draft budget plan for 2024, under which real GDP is expected to grow at a rate of 2.8%, the same as this year.

“We expect real economic growth of 2.8% despite recessionary trends in many developed economies and a slight slowdown in expected global growth and foreign trade,” Finance Minister Marko Primorac said.

He noted that real GDP growth would be driven solely by domestic demand.

The government expects positive trends on the labour market, as a result of which survey unemployment should fall to 5.7% in 2024 from 6.1% this year.

Gross wages are projected to increase by 9% in nominal terms, which is a slowdown compared with the growth of 14.6% in 2023.

Inflation should slow down more markedly, from 8% this year to 3.1% in 2024.

As for the fiscal framework, Croatia’s fiscal position is expected to deteriorate as the general government budget deficit is forecast to widen from 0.3% of GDP this year to 1.9% of GDP next year. This, however, still meets the budget deficit criterion under the Stability and Growth Pact.

According to the government’s expectations, the share of public debt in the nominal value of GDP would decrease from 60.7% in 2023 to 58% in 2024.

Drawing up a draft budget plan is Croatia’s obligation after joining the euro area and is the basis for the preparation of the budget for the following year.

Aid to pig farmers and sugar beet growers

The government also adopted aid programmes for pig farmers affected by African swine fever and for sugar beet growers.

The aid programme to compensate pig farmers for the losses due to the measures ordered to combat African swine fever is worth €5 million. It should help pig farmers whose facilities are located in the areas where the measures are in force, because of which they cannot market their pigs at current prices.

The value of the aid programme for sugar beet producers for the period from 2023 to 2027 is €6.5 million.