Announcing the government's new relationship with banks, Linic told the press the government was not considering the imposition of new taxes on the banking sector, stressing that the banks would have to take part in salvaging the manufacturing sector and jobs "by putting their claims in the function of the consolidation of the economy."

The state is prepared to give up a large share of its claims to encourage production and economic growth and it expects the same from the biggest creditors - banks, said Linic, adding that this would not be an easy burden for the banking sector.

The finance minister said he was not concerned that this could cause damage to the state which must borrow money from those very banks because if the government manages to reduce the deficit this year, the state will depend less on the banking sector.

Linic said that in the preparations for the transfer of power, the government's relations with bankers were more than good, adding that bankers showed understanding for the situation in the Croatian economy. This is why I believe we will be excellent partners because we have the same objective - a healthy economy, Linic said.

He stressed that there was no need to increase interest rates to save bankrupt companies. Should the state reduce the deficit, the financial situation in the country will change, and with the consolidation of the economy we shall be able to turn to investments and stop interest rate growth, Linic said.

Commenting on media announcements of the issuing of a national bond, Linic said this could be discussed next year at the earliest, should the government manage by then to regain public trust in state institutions.