VZCZCXYZ0001
RR RUEHWEB
DE RUEHVB #0238 0701503
ZNR UUUUU ZZH
R 101503Z MAR 08
FM AMEMBASSY ZAGREB
TO SECSTATE WASHDC 8741
UNCLAS ZAGREB 000238
SIPDIS
SENSITIVE
SIPDIS
DEPARTMENT FOR EEB/IFD/OMA (Snow, Figueroa), EUR/SCE, EUR/ACE
(Youth) and EUR/PGI (Cunningham)
E.O. 12958: N/A
TAGS: EAID ECON PREL HR
SUBJECT: FISCAL TRANSPARENCY IN CROATIA
REF: STATE 16737
1. (SBU) Per reftel request, the Croatian Law on the Right of Access
to Information, adopted in October 2003, requires the government to
provide information to the public about its activities,
organization, expenditures, and sources of financing. The Ministry
of Finance makes the budget available to the public on its website.
The public version includes almost all central government programs.
It excludes some local government units and expenditures, one
short-term category of pension payments, some highway construction,
and hospital arrears. The government achieves a moderate level of
accuracy in the publicly available budget. Upon request, citizens
can obtain detailed budget information on government programs.
During the course of the year, progress reports, the year-end
report, and the annual auditor's report are also made publicly
available. The GoC has shown a commitment to fiscal transparency,
although further capacity building is needed to achieve full
transparency. Specific areas for improvement include budget
explanation and linkages between strategic documents and budget
planning, introducing performance elements into budget preparation,
more comprehensive coverage of public sector spending and debt
figures, and more realistic macro projections.
2. (U) From 2000 through 2004, USAID provided technical assistance
to the Ministry of Finance in the broad area of fiscal reform. The
assistance focused on two areas: implementation of a modern treasury
system and related accounting and financial management process
reforms, and design and implementation of a program of fiscal
decentralization. The objective of the final project, conducted
September 2003 through September 2004, was growth of a dynamic and
competitive private sector, to be achieved, in part, through
improved transparency in government fiscal operations. Although
USAID has concluded its fiscal reform program, the World Bank
continues to assist the GoC in this area and has included elements
of fiscal reform in the conditionalities of its structural
adjustment loans to Croatia. The IMF last reported on Croatia's
observance of fiscal transparency standards and codes in November
2004. The report said Croatia met the code in a number of areas and
was making significant progress in strengthening fiscal management
and transparency.
BRADTKE