The Trend of Accelerating Industrial Growth Along with Retail Trade Will Also Contribute to GDP Growth in Q3

The Deputy Prime Minister and Minister of Regional Development and European Union Funds, Branko Grčić, stated on Tuesday that the growth of industrial production by 1.3 percent last year and by 1.9 percent in the first eight months of this year clearly indicates an acceleration in the trend of industrial growth and expects that, along with the growth of retail trade, this will be a strong contribution to GDP growth in the third quarter.

– Last year’s industrial growth of 1.3 percent, and 1.9 percent in the first eight months of this year clearly indicates an acceleration in the trend of industrial growth and I truly expect that along with the strong growth of retail trade, as an indicator of personal consumption growth, this will be a strong contribution to GDP growth in the third quarter, said Grčić.

– It is increasingly likely that the rate in the third quarter could be higher than that in the second quarter, he said, but did not want to estimate how much it could be.

Grčić emphasized that this is certainly also a result of the improved business climate in Croatia, which is also shown by the business climate index published by the European Commission. This index, as he noted, stagnated this month, but it is important to note that it is currently the highest in Europe. The Croatian Bureau of Statistics announced on Tuesday that industrial production, according to seasonally adjusted data, increased by 2.8 percent compared to August last year, and overall, in the first eight months, it increased by 1.9 percent compared to the same period last year. Grčić states that industrial production has been growing for seven out of the last eight months. He mentioned the growth of production in the manufacturing industry by 4.6 percent in August this year compared to the same month last year.

– This particularly interests us considering all that we have invested in restructuring and launching the industrial sector, he said.

He also noted the interesting data on shipbuilding growth of 95 percent in August this year compared to last August.

– This is in line with what we have emphasized in recent days, that we have managed to restructure this sector and that this year we are seeing real, significant effects of that process, said Grčić.

He added that in the first eight months of this year, production in the shipbuilding sector increased by 36 percent, and order books are filling up. Uljanik, for example, currently has more than one billion euros in orders, which is excellent news, not only for the growth of industrial production but also for further export growth. He emphasizes the important growth of capital goods production by 14.7 percent compared to last August, as this is directly reflected later in the investment variable. Increased production of capital goods means that investments will again grow in the third quarter. This is a good indicator that investments are being made in Croatia and that from this aspect, the industry is contributing.

In response to the question of whether the Government received a letter from the European Commission’s finance commissioner regarding the negative potential effects of the Government’s measures to address the CHF loan issue, Grčić said that everything has been said by Finance Minister Boris Lalovac and that there is communication with the European Commission on this matter.