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A new, sophisticated way how to fill state budget - Croatian way

Staff Writer |
According to the Croatian financial agency Fina, 327.176 citizens and 30.900 companies had their accounts blocked at the end of 2016. You may say nothing spectacular if you wouldn't know that the agency is keeping their citizens' accounts blocked for more than a year - in order to invest their money - and fill its own account.

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More over, the money Fina collects in that fashion not only that is pouring on the state's account, a part of it is taken by the institutional employees - on all levels - and it last for years now.

If a citizen asks why they keep her/his account blocked for months, the answer is: "We are working as fast as we can to unblock your account. You must wait your turn." The same answer you got if you want to transfer your money abroad.

The newly appointed financial minister is very much aware of the situation for some time now but he still hasn't find time to inform the public about wrongdoing.

Only the last week he issued two bonds totaling $1.22 billion by favorable terms, and these funds are intended for the refinancing of government bonds in the amount of $792 million that matures on 8 February 2017, and for the financing of "general needs of the State budget".

However, that's not all.

When Fina blocks someone's account, it takes months and years for the account to be unblocked and in the meantime it is not clear what happens with the money and who is earning on interests.

There are also cases when two parties reached the deal, but they weren't able to get access to their accounts for almost a year. In general, excluding the biggest state companies, all other subjects may get their money "when it's their turn."

One of the reasons stated for long waiting is "slow income flow into state budget," although it is not about citizens waiting for their millions, the biggest problem is the working people living from paycheck to paycheck.

That may mean just two things: Either nobody on the top cares for people, or the country is in serious financial problem, more serious that it is ready to admit. Or both.

And that may very well be the case because "general needs of the State budget" is a very vague formulation, without any particular project or investment stated.

This is also a nice try to calm down foreign banks, trading partners and rating agencies saying "We are doing something..." Obviously there is no single big project in sight because if there is, it will be all around the place.

So, it all comes down to two things: "Borrowing" from citizens while it lasts, and borrowing - at high interest - from foreign investors. The financial minister's biggest concern, it seems so, is what the rating agencies will say because the future borrowing depend on it.

In the meantime, Croatian courts are known by their ability to work on cases for years, literally, and it's not rare to spend two decades going forth and back until the case is closed.

During that time, court papers are traveling slowly may be "missed" and hard to trace for years, while parties are paying their lawyers and waiting for the justice.

To divert citizen's thoughts from real problems - and the problem is how to get by until the next paycheck - the new government is "working," "must form a committee," and "will think about it."

And from time to time, some new idea is thrown at the people to give them material to talk about and forget daily worries. Such is, for example, an idea for obligatory serving in the army, for a month or so.

And while the domestic media is chewing that bone, the minister has just one thing in mind: What Fitch will say?


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