Moody's affirms Croatia's A3 credit rating with stable outlook

Moody's has affirmed Croatia's credit rating at 'A3' with a stable outlook. The agency highlighted the country's strong institutions, effective governance, and robust economic growth as key positive factors. The rating signals low credit risk to investors and reflects the successful implementation of the National Recovery and Resilience Plan.

However, Moody's warned of economic vulnerability due to a high concentration in the tourism sector, which leaves the economy exposed to fluctuations in external demand. While public debt is expected to stabilize at approximately 56 percent of GDP by the end of 2027 before gradually rising toward 60 percent, fiscal metrics may face pressure from increased spending on pensions, social welfare, and defense.

Prime Minister Andrej Plenković stated that the rating confirms the government's effective measures to protect citizens' standards and ensure economic resilience amid geopolitical uncertainty. Separately, the Governor of the Croatian National Bank, Ante Žigman, noted that Croatia is expected to avoid recession next year, maintaining positive growth even under unfavorable energy price scenarios, provided productivity increases.