Croatia’s economy will contract 2 percent this year on a reduction in industrial production and consumption, said Zdeslav Santic, the chief economist at Soc-Gen Splitska Banka d.d..
The Adriatic Sea nation, which is set to become the European Union’s 28th member in July 2013, is struggling to revive its economy after two years of recession and a period of stagnation in 2011. Economic output fell 2.2. percent in the second quarter of the year, after dropping 1.3 percent from the three months through March.
The World Bank estimated Croatia’s economy will shrink 1 percent in 2012, while the central bank on July 9 revised its forecast to a 1.6 percent contraction from a 1 percent decline forecast in May.
The country will have “modest growth” of 0.5 percent in 2013, Santic said, boosted by Croatia’s entry into the European Union and a recovery in exports.