Croatia GDP


Croatia: GDP pace of contraction eases further in Q1 driven by private consumption

June 10, 2014

GDP contracted 0.4% over the same quarter last year in Q1 according to detailed figures released by the Croatian Bureau of Statistics on 10 June. The decline was in line with the 30 May flash estimate and marked an improvement over the 1.1% contraction tallied in Q4. The print represented the lowest pace of contraction since Q3 2011 but marked the tenth consecutive quarter of declining economic activity.

The improvement tallied in Q1 came on the back of expansion softer contraction in domestic demand, which rose from Q4’s 2.1% drop to a 1.4% contraction in Q1, whereas the external sector deteriorated slightly compared to the previous quarter. Private consumption declined 0.5% over the same quarter of last year (Q4: -1.8% year-on-year), whereas government spending swung from Q4’s 1.2% expansion to a 1.9% contraction in Q1. Gross fixed capital formation fell 3.6%, matching Q4’s result.

On the external side of the economy, exports of goods and services grew 6.1% in Q1, which contrasted the 2.9% drop recorded in Q4. Imports rose 2.5% (Q4: -4.9% yoy). As a result, the external sector’s net contribution to overall economic growth decreased slightly from plus 1.0 percentage points in Q4 to plus 0.8 percentage points in Q1.

The government expects the economy to expand 0.2% in 2014. FocusEconomics panelists’ assessment is slightly less pessimistic; they expect GDP to rise 0.3% in 2014, which is down 0.1 percentage points from last month’s estimate. In 2015, the panel expects economic growth to accelerate to 0.9%.

Author: Teresa Kersting, Economist

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Croatia GDP Chart

Croatia GDP Q1 2014 0

Note: Year-on-year changes of GDP in %.
Source: Croatian Bureau of Statistics (CBS) and FocusEconomics Consensus Forecast.

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