"I hope that by the end of this year we will reverse the negative trends and that a stable recovery will start, first of the economy and then of citizens' living standards," Grcic said in Split where he attended a celebration of International Workers' Day.

He underlined that the government's first four months in office was too short a period for the measures it had taken to start yielding visible results.

Asked if the government had a strategy to salvage ailing companies, notably those in Dalmatia, Grcic said the strategy was solving such cases "one by one". He mentioned in that context the government's decision to have the Brodosplit shipyard privatised and talks with union representatives from the stone and marble manufacturer Jadrankamen.

"Privatising Brodosplit is the only possible positive solution at the moment... The government believes that Jadrankamen can start doing business again normally because it has a market. The government is willing to support the restructuring of Jadrankamen and its restarting production, and we will try to find solutions in a similar way for problems in many other companies," the minister said.