The structure and economic significance of government guarantees in Croatia and the European Union

In the aftermath of the financial crisis, when countries are facing difficulties in raising the amounts of revenue needed to cover the expenditure side of the budget, fiscal risks can pose a significant threat to the sustainability of public finance. This became particularly evident in the case of public enterprises and their liabilities, which often increased public debt because of difficulties in meeting their financial obligations. The aim of this paper is to evaluate fiscal risks from government guarantees in Croatia and the European Union in general. Moreover, the paper aims to analyse the dynamics of the value and structure of government guarantees in Croatia in the period from 2009 to first half of 2015. Particular emphasis is placed on the impact of government guarantees on direct public debt in the context of methodological changes in the registration of public debt.