Before the dissolution of Yugoslavia, the Republic of Croatia, after Slovenia, was the most prosperous and industrialized area, with a per capita output perhaps one-third above the Yugoslav average. Western aid and investment, especially in the tourist and oil industries, would help restore the economy. The government has been successful in some reform efforts partially macroeconomic stabilization policies and it has normalized relations with its creditors. Yet it still is struggling with privatization of large state enterprises and with bank reform.
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