The Croatian government on Thursday allowed the HEP electricity provider to take a HRK 400-million loan to cover its losses in the first quarter of 2012, with Deputy Prime Minister Radimir Cacic explaining that this state company incurred losses due to a long drought and redoubled costs for fuel, gas and for electricity imports in the first two months of the year.
Cacic, who is also the economy minister, said that HEP's outstanding liabilities to its suppliers came to HRK 366.4 million on 25 May, and the company asked the government to allow it to take a loan from Hrvatska Postanska Banka, Privredna Banka Zagreb and Raiffeisen Bank.
The government approved the borrowing because its policy is that payments from the state budget and from public companies must not be late.
This is the last loan approved for debt coverage and all further borrowing must be for investment purposes, Cacic said.
The government expects HEP to propose by 1 July a plan for its restructuring.
