The Croatian economy is expected to grow by 1.6 per cent this year, the UN World Economic Situation and Progress (WESP) report shows.

The growth is supposed to climb to 2.7 per cent in 2012.

According to the UN’s estimates, Croatia’s economy registered a negative growth rate of 1.7 per cent last year while the transitional countries in the south eastern European region as a whole saw a slight rise of 0.1 per cent.

In addition to Croatia, the region includes Bosnia and Herzegovina, Montenegro, Serbia, FYRMacedonia and Albania.

According to UN estimates, the region should see a slight growth of 2.5 per cent this year.

The performance of the transitional economies of south eastern Europe stayed weak last year, with a slight increase in exports unable combat the weak domestic demand.

The rise in exports was the main impetus behind the weak recovery in 2010 in Bosnia and Herzegovina, Montenegro, Serbia and FYRMacedonia. In Croatia, the continued drop of consumption and investments trumped the small growth of exports, the portal Business writes.