Croatia’s economy is expected to post a strong growth in the third quarter of the year, which gives grounds for improvement of the end-year GDP growth forecast to 8.5%, central bank governor Boris Vujcic said on September 30.
This projection is significantly above the central bank’s previous forecast, made in July, that the economy will expand by 6.8% in 2021. The much higher forecast is based on better-than-expected performance of the tourist sector during the summer season, and the strong growth of exports.
Croatia’s economy is highly dependent on tourism and contracted by more than 8% in 2020 due to the coronavirus (COVID-19) pandemic and the restrictions imposed to contain its spread, which badly hit the sector.
Vujcic noted that the projection for 2021 is based on rise of revenue from tourism to 90% of the 2019 level.
According to Vujcic, in 2022 economic growth will slow down compared to 2021, but will remain robust at 4.1%.
Inflation is expected at 2.3% in 2021 and is seen falling to 2.1% in 2022, backed mainly by rising prices of oil and food.