Croatia's growth pace could be high in coming years -IMF

ZAGREB, June 23 (Reuters) - Croatia's economy looks set to grow between 5% and 6% this year driven by a rebound in the services sector and investment, the International Monetary Fund said on Wednesday.

Last year, Croatia's economy, which strongly relies on tourism, contracted 8.4% due to the COVID-19 pandemic.

"Since the first quarter, the recovery has picked up noticeably, with areas like construction and manufacturing already reaching activity levels higher than in 2019," the IMF said in a statement.

In the first quarter, Croatia's economy contracted 0.7% year-on-year.

However, the IMF said tourism and related sectors were yet to fully recover.

"This process is likely to take another year or two. With sufficient luck regarding tourism outcomes and a successful vaccination drive within the next months, growth could even exceed 6% this year," the IMF said.

It said that growth could remain high over the next few years if the country makes full and timely use of available European Union funds and pursues reforms to make the public sector and finances more efficient and resilient.