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Croatia: Absence Of Statistics Sets Economists Pondering

By Milan Gavrovic

Zagreb, 27 March 1997 (RFE/RL) -- Economic analysts in Croatia say they are being kept in the dark these days, since statistical indicators of the country's economic trends have failed to appear for the second consecutive month.

There's been no prior government announcement or any public explanation of why the figures have not been published. When asked why, responsible officials claim the reason for the delay is that a new accounting system is being adopted in Croatia, which will bring the country into conformity with methods already used in the world's industrial economies.

However, An RFE/RL correspondent in Zagreb reports that many economists claim the real reason for the silence lies elsewhere. They note that at the beginning of the year, when figures were last published, both industrial production and the employment rate had decreased again.

This is particularly uncomfortable for the ruling Croatian Democratic Union (HDZ) of President Franjo Tudjman during the campaign for next month's elections to the upper house and municipalities.

The party would prefer to show to the voters that the time is coming for them to stop tightening their belts. "The time has come for a better life", one of the HDZ's top officials recently said. But our correspondent says there's reasonable doubt about the realism behind that sentiment. Where's the money to build a better life to come from, skeptics ask.

Those in power in Croatia show no sign of slowing the present huge spending rates, the country's militarization continues, and at the feast of privatization the main dish is yet to be served.

The domestic economy is not able to cover all these expenses, especially since the main part of the economy still consists of businesses run at a loss, which of course increases the national debt.

In such a situation, figures showing that the production and employment rates are continuing to decline instead of growing could become a very solid argument in the hands of the opposition. The two main opposition parties are the Social Liberals and the Peasants Party. They and the others are counting on support in the election from those who have been impoverished, and those who feel deceived and disillusioned by Croatia's course since independence from Yugoslavia.

The question remains of why production and employment have declined, and why they are presumably still declining. Economic analysts say that the downturn started in the second part of 1996, when so called "income from the peace" was spent. That phrase refers to the revival in economic activities for a short period thanks to factors like reconstruction works, production of building material and the surge in tourist growth, which was insignificant during the 1995 military operations.

But even with these positive factors the country's economic growth in 1996 ranged from under 3 percent to 4.5 percent, depending on which of various estimates one chooses to accept.

The so-called "income from the peace" will be present again this year, at least in part. But experts say it cannot affect the fact that there is no a real underlying development of the national economy, that the country's industry is in a state of ruin and the legions of the unemployed have been getting bigger.

And these are the factors which many analysts see as the real reasons for the non-appearance of the economic statistics. The new accounting system appears only a lame excuse, in that old administrative systems must remain valid and in use up to the moment the new ones are introduced.

Except for instance in the case of a revolution, when the administration is thrown in disarray..... But this is no revolution, it's only an election.

Milan Gavrovic is a Zagreb-based analyst who contributes to RFE/RL regularly.