At the beginning of the new European Semester, the European Commission said on Thursday that Croatia was one of 16 countries which needed in-depth reviews of the macroeconomic situation to see if macroeconomic imbalances wee unwinding or accumulating.
The Commission will release the findings of the in-depth reviews in February, together with reviews of each member state’s economic policy.
Today the Commission released the Annual Growth Survey, the Alert Mechanism Report and the Joint Employment Report. The release of these documents marks the beginning of the European Semester, a mechanism to coordinate economic policies within the EU to prevent another financial and debt crisis.
In the Alert Mechanism Report, the Commission noted Croatia’s risks “as regards external and public debt sustainability and labour market adjustment.”
“Therefore, the Commission finds it useful, also taking into account the identification of an excessive imbalance in February, to examine further the persistence of macroeconomic risks and to monitor progress in the unwinding of excessive imbalances,” the document says.
“In February 2015, the Commission concluded that Croatia was experiencing excessive macroeconomic imbalances requiring decisive policy action and specific monitoring, in particular involving risks related to weak competitiveness, large external liabilities and rising public debt, coupled with weak public sector governance, and dismal employment performance in a context of subdued growth,” the document says.