Growth strengthened in 2016 led by exports, domestic demand and investment recovery. Given the labor market recovery and real wage and disposable income increase, the poverty rate has continued trending downwards to 8.4 percent (at $5/day PPP). Due to the improved fiscal outcomes, Croatia would likely exit the Excessive Deficit Procedure in 2017. Yet, fiscal imbalances would require further narrowing in the medium term, while stronger personal consumption and EU funds absorption would continue to support solid growth in 2017-19. Read more...