Croatia's rating is confirmed at BB/Stable but what impact can the workout of the huge Agrokor group have on the economy?

Michael Glazer is the Director of SEE Regional Advisors, one of Wyn River's associated firms in South East Europe.  Here he takes a look at Croatia's investment grade rating and provides a more detailed assessment of the potential impact of the Agrokor workout on the Croatian economy.  For more background on Agrokor's problems, with 60,000 staff and debts of US$ 6 billion used to fund aggressive expansion, read here.

Here is Michael's view and a link to his earlier Agrokor article:

"Fitch’s confirmation of Croatia’s sovereign Long-Term Foreign- and Local-Currency Issuer Default Ratings at BB/Stable is welcome even though expected. And despite Fitch’s Stable outlook, an upgrade could be in the cards relatively soon. As Croatian Minister of the Economy Dalić noted in connection with Fitch's announcement, Croatia is getting its deficit and public debt under control and the country's economy seems increasingly sturdy (; Croatian-language only). The biggest threat to Croatia's rating is a misstep in the Agrokor workout. For our take on the effect of Agrokor's woes on the Croatian construction sector, see our EECFA blogpost"

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