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ZAGREB (Croatia), June 16 (SeeNews) - The European Council closed on Friday an excessive deficit procedure for Croatia, confirming that the country's gap has dropped below the EU's 3% of GDP reference value.
The Council thereby abrogated its decisions on the existence of excessive deficits in Croatia, it said in a statement.
Croatia has been subject to an excessive deficit procedure since January 2014, when it was found to be in breach of both deficit and debt criteria.
The Council issued a recommendation calling for the deficit to be corrected by 2016, and set deficit targets of 4.6% of GDP for 2014, 3.5% of GDP for 2015 and 2.7% of GDP for 2016.
Croatia's general government deficit came in below the target at 0.8% of GDP in 2016, down from 3.4% of GDP in 2015, the Council explained.
The European Commission's 2017 spring economic forecast projects the deficit to rise to 1.1% of GDP in 2017, and to fall back to 0.9% of GDP next year, thus remaining below the 3% of GDP reference value.
Croatia's gross government debt-to-GDP ratio peaked at 86.7% in 2015 and fell to 84.2% in 2016. The spring forecast projects it to decrease further to 79.4% in 2018, backed by strong nominal GDP growth.
"In that manner, the 2016 debt ratio fulfils the forward-looking element of the EU's debt reduction benchmark", the Council concluded.
In the 2010-11 period the Commission opened excessive deficit procedures for 24 member states.