In Q1 2021 Croatian GDP shrank 0.7 percent year-on-year, the lowest contraction since the start of the pandemic, which "shows that the economy is on the track of recovery," state agency Hina said on Friday.

The state statistics bureau on Friday released its first GDP estimate for Q1 2021, the fourth consecutive quarter which saw GDP shrink. In the previous quarter, Q4 2020, Croatia’s GDP dropped by 2.7 percent.

The latest figures indicate that Croatia’s economy is on the road to recovery after the GDP had declined by a record 8.4 percent in 2020 year-on-year due to the coronavirus pandemic.

The 0.7 percent fall Q1 2021 is attributed mainly to the “continued weakness of personal consumption,” the biggest GDP component, Hina said. Household spending dropped 0.4 percent from Q1 2020.

The export of goods and services fell 0.9 percent in the same period, with commodity exports 8.3 percent up and export of services sinking 18.6 percent. The imports of goods and services fell 2.1 percent, with commodity imports going up 1.0 percent and import of services falling 19.7 percent.

Gross investment in fixed capital went up 4.6 percent year-on-year. Government spending inched up 0.2 percent year-on-year.

According to seasonally adjusted data, Croatia’s GDP in Q1 2021 increased 5.8 percent quarter-on-quarter but slid 0.9 percent year-on-year, so in comparison with the EU average, the Croatian economy recorded better results, Hina said.

According to Eurostat’s seasonally adjusted data, the EU’s total GDP in Q1 2021 shrank 0.4 percent quarter-on-quarter and 1.7 percent year-on-year.