May 25 (SeeNews) - The Council of the European Union said that Croatia needs to wind down the energy support measures in force by the end of 2023, using the related savings to reduce the government deficit.
Should renewed energy price increases necessitate support measures this year and next, Croatia has to ensure that these are targeted at protecting vulnerable households and firms, fiscally affordable, and preserve incentives for energy savings, the Council of the EU said in recommendations to Croatia on Wednesday.
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In March, the Croatian government announced a fourth package of measures to protect households and the economy from the rise in energy prices, which included the extension of a cap on end-consumer electricity prices until September 30.
The Adriatic country should also ensure prudent fiscal policy, in particular by limiting the nominal increase in nationally financed net primary expenditure in 2024 to not more than 5.1%, the Council recommended. Another recommendation is to preserve nationally financed public investment and ensure the effective absorption of grants from the recovery and resilience fund and other EU funds, in particular to foster the green and digital transitions.
For the period beyond 2024, the country should continue to pursue a medium-term fiscal strategy of gradual and sustainable consolidation, combined with investments and reforms conducive to higher sustainable growth, to achieve a prudent medium-term fiscal position.
Brussels also suggest Croatia to continue the steady implementation of its recovery and resilience plan and swiftly finalise the REPowerEU chapter with a view to rapidly starting its implementation, and proceed with the speedy implementation of cohesion policy programmes.
Another recommendation for Croatia is to reduce overall reliance on fossil fuels by accelerating the deployment of renewables, in particular wind, solar, and geothermal sources, finalising the incomplete legislative framework, streamlining administrative procedures for permitting, simplifying the procedures for installing renewable energy sources in multi-apartment buildings and providing more legal certainty.