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| Ivor Sanader: deliberately shocking Croatia and Europe |
Government officials in Zagreb, the Croatian capital, are no doubt praying for a scorching August after the latest economic data from the Balkan state showed that the chill winds of recession were blowing strongly at the start of the year. Favourable weather could make all the difference between Croatia entering a shallow or a deep downturn, given that tourism accounts for about 20% of GDP and roughly 45% of foreign-currency earnings.
According to Crostat, the Croatian statistics agency, in the first quarter of 2009 GDP fell by 6.7% year on year in real terms – a figure that generated public dismay in a country that has enjoyed a decade of stable if unspectacular growth.
The grim statistics marked the first drop in GDP since the third quarter of 1999 and the sharpest fall since the end of 1993 – when Croatia was still mired in a bitter war with neighbouring Serbia.
"The message from the first-quarter GDP figures is not a good one and came as an unpleasant surprise for the Croatian public, if not for most analysts," says Alen Kovac, macroeconomist at Erste Bank in Zagreb.