Damir Novotny

Although Croatia is proud of its booming tourism industry, some analysts are warning that relying on one sector of the economy is potentially risky.

According to the EU statistic's agency, Eurostat, Croatia had 86.1 million overnight stays in 2017, as tourism grew by 10.6 per cent in comparison to 2016.

As the Croatian government prepares to spend more on 1990s war veterans, as well as purchasing 12 military jets and covering debts in the health sector, it risks increasing the country's budget deficit, experts warned.

Croatia's State Property Ministry told BIRN that it intends to meet the goal of earning around 128 million euros for the state budget, by selling state-owned property and stocks in non-strategic companies.

Experts have expressed divided opinions after the Croatian Bureau of Statistics reported that the volume of the industrial production in December 2016 was 14.9 per cent higher than 12 months earlier.

The figure represents the biggest annual growth since 2001, when such statistics were made for the first time by the Bureau, as well as a rise of four per cent on November 2016.

Croatia's planned purchase of the shares of the national energy company INA from the Hungarian energy company MOL is bound to increase Croatia's public debt, an economic analyst told BIRN.

Prime Minister Andrej Plenkovic said on Christmas Eve that purchasing MOL's share of INA - 49.1 per cent of the shares - can be done without enlarging the public debt.

Recent political tensions between Croatia and Russia are not the only factors behind the steady decline in the value of trade between Russia and Croatia, experts say.

Economic analyst Damir Novotny told BIRN that falling trade levels, mostly caused by a fall in imports from Russia, are not "a dramatic issue for Croatia".

Croatian Prime Minister Tihomir Oreskovic has announced a new property tax for 2017, which will slap bills on people with more than one home, or who do not use their real estate.

"When one taxes a single property, it's a social category, but when a second, third or fifth property are taxed, then it is an economic category," Oreskovic said on Monday.

As a part of budget rebalance, Croatian Ministry of Finance is planning to cut some of salary supplements in the public sector.

Government is seeking a way to cover their budget deficit which will probably reach more than 2 billion euro or 4.8 per cent of annual GDP, which is 0.2 per cent more than envisaged in talks with the European Commission.