October 12 (SeeNews) - The Croatian economy will emerge from the current recession in the first half of 2010, central bank governor Zeljko Rohatinski said.
"It depends on how we define crisis. If we talk of recession, which started in September 2008, we have touched the bottom and should come out of it in first half of 2010,” Rohatinski told state-run TV station HRT (www.hrt.hr) in an interview posted as a video file on the broadcaster's website on Sunday.
Croatia’s gross domestic product (GDP) dropped by a real 6.3% year-on-year in the second quarter of 2009 after falling 6.7% in the previous quarter.
“But if we look at it from the point of view of trends that caused the crisis, a process which in Croatia began in 2004, such as an increase in foreign debt and deficit, then it will take much longer time and we need other measures to cope," Rohatinski added.
Croatia's current account deficit shrank to 901.5 million euro ($1.3 billion) in the second quarter of 2009 from 1.837 billion euro in the previous quarter.
The Adriatic country's end-July foreign debt rose to 40.8 billion euro from 39 billion euro at the end of 2008.
The steps taken by the central bank have ensured that Croatia avoided a depreciation of its national currency and a credit crunch, the official said, forecasting that the country's economy will shrink about 6.0% this year.
The International Monetary Fund has said that Croatia’s GDP will drop 5.2% this year and will grow 0.4% next year.
($=0.6761 euro)