Economy swung to a real 4.3% year on year growth in January-March after contracting throughout most of 2012. The strong GDP growth in Q1 partially reflects a low prior year base when an extremely cold weather in early 2012 undermined the country’s industrial and tourism sectors. CPI slowed in May as shrinking transport, restaurants and hotels and furnishing prices helped offset rising food, alcohol and tobacco charges. Industrial production increased 22.4% year on year in May on the back of growing utilities output, which offset falling manufacturing and mining and quarrying production. Tourism proceeds rose 4.5% year on year in January-May on the back of 12.4% year on year increase in the foreign tourist numbers fo rthe same period.The public debt rose 8.1% year on year to EUR 1.77bn in May and a recent activation of state guarantees issued on KAP’s bank loans will likely further increase the country’s financing needs.