Croatia - Balance of payments

Before the civil war, Croatia led the Yugoslav SFR in worker remittances, as thousands of Croats held factory jobs in Germany and elsewhere. In order to provide a framework for economic recovery, the government organized the Ministry for Reconstruction, which plans to rebuild war-damaged regions and infrastructure for tourism, which could bring in much needed foreign currency. Croatia had almost no foreign exchange reserves in 1991, but by the beginning of 1996 the National Bank of Croatia reported $1,386 million in foreign exchange reserves.

Croatia's balance of payments situation has been helped by tourism receipts, but its strong export sectors registered declines in the early 2000s. In 2000, Croatia's main exports were ships and boats, petroleum products, and textiles and apparel. The textiles and apparel sectors were faced with competition from low-wage countries, and in wood product exports, Croatian producers compete with lower-priced Southeast Asian products. Croatian farmers state they are unable to compete with subsidized farm products in the EU. The food processing and chemical industries have been losing their markets due to their inability to produce competitively priced goods of high quality.

The US Central Intelligence Agency (CIA) reports that in 2002 the purchasing power parity of Croatia's exports was $5.1 billion while imports totaled $9.7 billion resulting in a trade deficit of $4.6 billion.

The International Monetary Fund (IMF) reports that in 2001 Croatia had exports of goods totaling $4.75 billion and imports totaling $8.76 billion. The services credit totaled $4.87 billion and debit $1.94 billion. The following table summarizes Croatia's balance of payments as reported by the IMF for 2001 in millions of US dollars.


Current Account -642
Balance on goods -4,012
Balance on services 2,932
Balance on income -529
Current transfers 966
Capital Account 133
Financial Account 2,242
Direct investment abroad -121
Direct investment in Croatia 1,447
Portfolio investment assets -6
Portfolio investment liabilities 722
Other investment assets 312
Other investment liabilities -112
Net Errors and Omissions -391
Reserves and Related Items -1,342

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