Croatian Prime Minister Andrej Plenkovic, in an annual report to the parliament on Wednesday, said that his country has achieved a budget surplus, strong GDP growth, high employment and higher average salary.

"From Jan. 1 next year, tax on fresh meat, fish, eggs, fruit, vegetables and baby diapers will be reduced from 25 percent to 13 percent, and the taxes on salaries will be also reduced. Citizens and businesses will have better living and working conditions," Plenkovic said.

He said that Croatian shipyards are going through difficult days and the government wants them to survive but only in accordance with Croatian and European regulations and based on the market economy.

Plenkovic also stressed the importance of tourism which contributes almost one-fifth of Croatian GDP. This year should be better than last year, he said.

So far this year, there were six percent more arrivals and four percent more guests than in the same period last year.

Croatia has a strategic interest to enter the Schengen area, he noted. The goal is, he said, to meet technical criteria for Schengen so Croatia could join it in 2020.