1. No category

CROATIA: ECONOMIC
NEWS IN BRIEF
No. 1 / 2015
Embassy of the Kingdom
of the Netherlands, Zagreb
content
MACROECONOMICS AND ECONOMIC POLICY DEVELOPMENTS
Snapshot overview of Croatia’s macroeconomic indicators [2]
ECONOMIC ANALYSIS & SURVEYS
The European Comission's Economic Report: Croatia a
country with excessive imbalances [3] / World Bank's Doing
Business 2015: Croatia 65TH of 189 countries [3] / The Global
Competitiveness Report 2014–2015: Croatia as the second best
performing country in SEE [3] / 2014 Euro Health Consumer
Index: Croatia 23rd of 35 European countries [3] / Snapshot
overview of Croatia’s Statistics [3]
LEGISLATION AND REGULATION
Selection of new legislation in force as of January 2015 [3]
EU FUNDS & OPPORTUNITIES
Partnership Agreement 2014-2020 for Croatia approved [4]
Croatia's Operational Programmes 2014-2020 adopted [4]
Projects to be tendered in 2015 [4] / EIB’s financing agreed [4]
Rural Development Programme adjusted [4] / EU 250 million
grants for the Croatian health system approved [4] / Decision
on Financing for Dubrovnik Airport Upgrade [4]
SECTORAL DEVELOPMENT AND OPPORTUNITIES
HEP invests in hydro power and renewable energy [5]
Construction of a new LNG terminal in Omisalj [5] / Construction
sector in 6-years recession [5] / Awarded licences for oil and
gas exploration and production in the Adriatics [5] / Port of
Ploce became a logistics hub for hydrocarbons exploration
in the Adriatic [5] / Catalogue of the Croatian agricultural
producers interested in export and investment [5] / The
Rudjer Boskovic Institute developing O-ZIP platform [5]
TENDERS AND PUBLIC PROCUREMENT [6]
UPCOMING EVENTS [6]
THE NETHERLANDS IN FOCUS
IWCZ Christmas Bazaar [7] / Launch Croatian-Dutch dictionary
[7] / The Striking Deal project in Croatia [7] / Two weeks of
Amsterdam in Zagreb [8] Embassy a partner of the Cities of
the Future project [8]
Note to the reader: This is an information service by the Embassy of the Kingdom of the Netherlands. The information is
based on data and news items published by governmental institutions and the Croatian media and does not necessarily
reflect the opinion of the Embassy. The Embassy does not accept any claims for damages and loss resulting from the
use of the information contained in this newsletter.
MACROECONOMICS AND ECONOMIC POLICY DEVELOPMENTS
Snapshot overview of Croatia’s macroeconomic indicators
• GROSS DOMESTIC PRODUCT
2015 GDP forecasts: Government: 0,5%
EBRD: 0.5%; CNB:1%; EC: 0,2%; WB: 0.5%;
EIZG: 0.5%, IMF: 0,5%, EIU: -0.3%; EIZG:
0.2%
• INFLATION
2015 inflation forecasts:
CNB: 0.2%, EC: -0,3; EIU: -0.5%
• CREDIT RATINGS OF CROATIA
Fitch:
01/2015: BB stable outlook of
the foreign BB+ downgraded to
BB, and domestic BBB-currency
rating downgraded to BB+ in
July 2014; outlook stable
Standard &Poor’s:
01/2015: BB stable foreign
and domestic currency rating
changed from BB+ negative to
BB stable in January 2014, i.e.
two levels below investment
grade
Moody’s:
01/2015: BA negative
foreign and domestic currency
rating downgraded from Ba1
stable to negative in March
• EXCHANGE RATE
• UNEMPLOYMENT
2015 unemployment forecasts:
Government: -0,3% (or 19.5%)
CNB: -1% (or 18.8%), EC: 16,8% ;
EIU: 19.3%
31 March 2015: 1 EUR = 7.64 HRK
28 February 2015: 1 EUR = 7.69
HRK
• AVERAGE MONTHLY NET/GROSS SALARY
(Total labor costs in economy)
January 2015: EUR 745 net/EUR
1050 gross
(HRK 5.660 net/ HRK 7.977
gross)
• TRADE EXCHANGE BETWEEN THE NETHERLANDS AND CROATIA
Trade exchange ratio with the Netherlands in 2014 at 27 %
• DUTCH FOREIGN DIRECT INVESTMENTS TO CROATIA
2
Central Bureau of Statistics Ministry of Finance
Croatian National Bank
Ministry of Economy, Labor and Entrepreneurship
Eurostat
Index:
CROATIA: ECONOMICNEWS IN BRIEF
Sources:
Q1-Q3 2014: EUR 1.49 billion, or
80% of the total FDIs in Croatia
2013: EUR 38.9 million
EC – The European Commission
WB – The World Bank
IMF – The International Monetary Fund
EBRD – The European Bank for
Reconstruction and Development
CNB – The Croatian National Bank
EIU – The Economist Intelligence Unit
EIZG – The Economic Institute Zagreb
ECONOMIC ANALYSIS & SURVEYS
the european comission's
economic report:
croatia a country with
excessive imbalances
As part of the European
Semester, the European
Commission has
published an economic
report on Croatia in
February determining
excessive macroeconomic
imbalances for the
second time in a row. This
requires from Croatia a
specific monitoring and
decisive policy action.
Croatia is expected to
submit its National Reform
Programme by the end
of April. In case the
programme is not approved
by the Commission, the
procedure for correcting
macroeconomic imbalances
will be launched. The full
report is available at
WORLD BANK'S Doing
Business 2015: CROATIA
65TH OF 189 COUNTRIES
Croatia is ranked 65th
of 189 economies as for
how easy or difficult it is
for a local entrepreneur
to open and run a small
to medium-size business
when complying with
relevant regulations. An
increase of two places
when compared with
2014 accounts mainly to
the ease of dealing with
construction permits
and to lower start-up
costs. On the downside,
corporate taxes in
Croatia became more
complicated.
www.doingbusiness.org/data/
exploreeconomies/croatia/~/
media/giawb/doing%20business/
documents/profiles/country/HRV.
pdf?ver=2
THE GLOBAL
COMPETITIVENESS REPORT
2014-2015: CROATIA AS THE
SECOND BEST PERFORMING
COUNTRY IN SEE
According to the World
Economic Forum’s The
Global Competitiveness
Report 2014–2015,
Croatia is ranked 77th
of 144 economies; an
improvement of two
places. It is in the group of
countries marked by the
transition phase from the
efficiency to innovation
driven economy, and
ranked as the second best
among the South-East
European countries.
2014 Euro Health Consumer
Index: Croatia 23rd of 35
European countries
Croatia’s healthcare
system deterioreated by
four places compared
to 2013. The EHCI study
shows an improved access
to medical treatment in
Croatia, while the quality
of health protection
deteriorated.
www.healthpowerhouse.com/files/
EHCI_2014/EHCI_2014_Index_
matrix_A3_sheet.pdf
www3.weforum.org/docs/WEF_
GlobalCompetitivenessReport_
2014-15.pdf
http://ec.europa.eu/europe2020/
pdf/csr2015/cr2015_croatia_en.pdf
Snapshot overview of Croatia’s Statistics:
• Average hourly labour cost 2014: EUR 9.4 (in EU: EUR 24.6). The share of contributions in total hourly labour costs is 14.9% (in EU: 24.4%)
• Research and development expenditures in 2013: HRK 2.03 billion (EUR 270 million), or 0.62% of GDP
• Tourism revenues in 2014: EUR 7.4 billion, an increase of 2.8% compared to 2013. Tourism industry account­ed for 17.2% of Croatia’s GDP in 2014, up 0.6% y-o-y
• In 2014 92% of tourists in Croatia were foreigners, i.e. non-resident tourists
LEGISLATION AND REGULATION
Selection of new legislation in force as of January 2015
• Amendments to Income Tax Act – the basic personal tax
exempt amount of HRK 2.200 is raised to HRK 2.600, and
the income tax rate brackets are changed – NN 157/14
• Amendments to the tax on savings income - 12% taxes are
imposed on interest income from savings deposits in HRK,
foreign exchange currency deposits on current accounts,
or foreign currency accounts in banks, savings banks and
savings and credit cooperatives, as well as interest income
from securities – NN 157/14
3
• Taxation of income from the sale of financial assets,
unless being a registered activity of the taxpayer or
when the financial assets are sold before the expiry of
three years after the acquisition.
• The tax-exempt amount for payment of dividends and
profit shares in the amount of HRK 12.000 per year is
abolished and taxed as capital income tax at a rate of
12%
– NN 157/14
• Amendments to VAT Act – small businesses can now pay
VAT after they receive the money paid for their goods and
services, instead of upon the issuance of invoices.
• Amendments to the Law on Pension Insurance – deadline
for submission of insurance registration for the employees
is changed - NN 151/14
• The transitional period for the payment of VAT on
construction land came to end.
• From 1 January 2015 land is subjected to a 25% Value
Added Tax.
• Public Private Partnership Projects Regulation –
regulating the conditions and procedures for small-valued
PPP projects up to €5 million– NN 152/14
CROATIA: ECONOMICNEWS IN BRIEF
EU FUNDS & OPPORTUNITIES
Partnership Agreement 2014-2020 for
Croatia approved
CROATIA'S OPERATIONAL PROGRAMMEs
2014-2020 ADOPTED
The Partnership Agreement between the
Republic of Croatia and the European
Commission on the absorption of EU
structural and investment funds in the
period 2014-2020 was approved at the
end of October 2014. The Agreement
details the strategy and objectives for
using EU funds. Croatia is eligible for EUR
8.6 billion under the European Regional
Development Fund, the Cohesion Fund
and the European Social Fund.
In December 2014, Operational
Programmes (OPs) 2014-2020 was
adopted. This is the strategic document
for utilization of the EU funds in the
related period.
www.strukturnifondovi.hr/UserDocsImages/
Novosti/Programme_2014HR16M1OP001_1_2_
en.pdf;
www.strukturnifondovi.hr/UserDocsImages/
Novosti/FINAL%20OP%20EHR.pdf
www.mrrfeu.hr/UserDocsImages/EU%20fondovi/HR_
PA_FINAL_ADOPTED_30_10_2014.pdf
Overview of opportunities
in the Croatian water
and waste management,
and the transport sector
based on OPs 2014-2020
are compiled by the
Netherlands
Embassy
Zagreb, and available
upon request via zag-ea@
minbuza.nl
Projects to be tendered in 2015
The Government of Croatia has announced to publish tenders worth around EUR 600 million by the end of 2015 :
• development of water-utility infrastructure in the area of Rijeka, Valpovo, Petrinja, Rovinj, Krk, Nova Gradiska, Virovitica,
Vodice-Tribunj-Srima and Osijek ( EUR 390 million);
• construction of county waste management centers “Bikarac (Phase II)” in Sibenik-Knin County; “Biljane Donje” in
Zadar County and “Baba gora” in Karlovac County ( over EUR 100 million);
• development of transport infrastructure: Bypass Split; Vodice; Kastel Stari - Kastel Sucurac;
• Port of Rijeka;
• the entrance to the Port of Ploce (EUR 200 million);
• establishment of the Centar for Competencies in Transplatation Medicine (EUR 45 million);
• refurbisment of student dormitories in Zagreb (EUR 29 million);
• archeological park “Vučedol” (EUR 17 million)
Published tenders can be viewed at www.strukturnifondovi.hr/natjecaji
EIB’s financing agreed
The Croatian government signed a first tranche of
EUR 300 million loan agreement with the European
Invest­ment Bank, EIB. The total approved loan
amounts to EUR 600 million. The loan is intended
for financing the national co-financing of the
EUR 8.1 billion eligible Operational Programme
Competitiveness and Cohesion 2014-2020. It will
primarily be used for key infrastructural projects
in the rail sector, water and waste management,
education and healthcare, but also for financing
smaller projects. The national component of the
co-financing amounts to EUR 900 million, of which
EUR 600 million will be provided by the said EIB
loan and EUR 300 million from the state budget.
http://www.eib.org/infocentre/press/releases/all/2015/2015-075EIB-supports-co-financing-of-projects-with-EU-grants-in-Croatia.
htm?media=rss&language=en
RURAL DEVELOPMENT PROGRAMME ADJUSTED
The European Commission had confirmed that the
Croatian Rural Development Programme had been
adjusted. As much as EUR 5 billion is available to the
agricultural sector until 2020. Indicative procurement
plan in 2015, based on 2014-2020 programming period is
available at http://www.mps.hr/ipard/UserDocsImages/Postpristupno
%20razdoblje%20%20EAFRD/PLAN%20NATJEČAJA%202015/INDIKATIVNI%2
0PLAN%20OBJAVE%20NATJEČAJA%20PRR%202015.pdf
4
CROATIA: ECONOMICNEWS IN BRIEF
EU 250 million grants for the Croatian health
system approved
The European Commission has approved EUR 250
million grants for the Croatian health system.
The grants will be used for equipping primary
healthcare ambulants, outpatient hospitals and
integrated emergency departments; for the
renovation of the Hospital for Children’s Diseases
in Zagreb; for the construction of a spine center, a
palliative care center and a forensic centre.The list
of planned procurements by the Croatian Ministry
of Health (only in Croatian) is published at
http://www.zdravlje.hr/content/download/15140/112029/file/PLA
N%20NABAVE%20MZ%20ZA%20%202015%20g..pdf
Decision on Financing for Dubrovnik Airport Upgrade
The EUR 145 million co-financing for a project of
upgrading the Dubrovnik Airport has been approved by the
Croatian government. The total planned investment in the
Dubrovnik Airport is valued at EUR 220 million. The project
is approved for EU financing. The European Commission
has so far approved grants of approximately EUR 5 million
for the preparation of the project documentation. The
works on the airport’s upgrades are announced to start in
May and last until 2019.
More info at http://www.eib.org/projects/pipeline/2014/20140592.htm
SECTORAL DEVELOPMENT AND OPPORTUNITIES
HEP investS in hydro power and REnewable
energy
Awarded licences for oil and gas exploration and
production in the Adriatics
Croatian state-owned electricity company HEP announced
an investment of EUR 466 million for upgrading and
increasing its hydro power capacity. HEP group owns and
operates over 4.000 MW of installed generation capacity
and 974 MW of heat production capacity, including 26
hydroelectric plants and eight thermal power plants fired
by oil, natural gas or coal.
HEP generated 14.7 TWh of electricity in 2013, up 21.1%
on the year, with its HPPs contributing 8.1 TWh of total
output.
On 30 January HEP invited Croatian developers of
renewable energy projects to file expressions of
interest for selling their projects to HEP. The company
is interested in wind farms, solar powerplants of at
least 300kW capacity, hydro power plants up to 10 MW,
biomass and bio gas power plants'projects that were still
at the development stage, but not under construction or
already in operation.
Croatia has awarded ten licences for oil and gas
exploration and production in the Adriatic Sea. For the
first round of licensing for hydrocarbons exploration and
production in the Adriatic, six companies submitted their
bids for 15 of the 29 blocks on offer. A consortium of
U.S.-based Marathon Oil and Austria’s OMV was granted
seven licences for offshore oil and gas exploration with
two awarded to Croatian oil and gas firm INA and one
issued to a consortium of Eni and Medoilgas. More at
www.hep.hr/hep/en/news/default.aspx
Construction of a new LNG terminal in Omisalj
Port of ploce became a logistics hub for
hydrocarbons exploration in the Adriatic
The Port of Ploce has become the logistics centre for
oil and gas exploration in the Croa­tian Adriatic. As the
logistics centre, the Port of Ploce will offer maritime, port
and repair servic­es. In addition, the Rijeka Port Authority
plans to turn the Port of Rijeka into the second logistics
hub for hydrocarbons exploration in the Adriatic.
The LNG receiving terminal in Omišalj on the island of
Krk, North Adriatic, with a regasification capacity of 4.06.0 billion cubic meters annually, is one of the projects
classified by the European Commission as key energy
infrastructural projects. The investment costs for the
terminal are valued at EUR 760 million. The project
is currently under the process of obtaining a location
permit. The company started accepting non-binding
bids for the pre-allocation of terminal capacity. The
submission deadline is May 1. Info at
Catalogue of the Croatian agricultural
producers interested in export and investement
www.lng.hr/en/open-season
FEBRUARY%202014%20-ISSUE%201.pdf
Construction sector in 6-years recession
The Rudjer Boskovic Institute developing O-ZIP
platform
The physical volume of construction activity in Croatia
has dropped by 40% since 2009 when the crisis began.
Signs of recovery are still not in sight. In 2014, the
construction sector recorded a decrease of 6.6%
compared to 2013. In January 2015, the number of issued
building permits dropped 22.6% y-o-y. Only 377 building
permits were issued.
5
www.azu.hr/en-us/
CROATIA: ECONOMICNEWS IN BRIEF
In a cooperation with the Ministry of Foreign and
European Affairs and the Ministry of Agriculture the
Croatian Chamber of Agriculture have created the
Catalog of the Croatian producers who are interested
in investment and export. Catalog contains data on the
agricultural companies and their products.
http://www.mps.hr/UserDocsImages/MEDUNARODNA/CATALOG-
The Rudjer Boskovic Institute’s ‘Open Scientific
Infrastructur­al Platform’ (O-ZIP) project has officially
been incorporated in the European Commission’s
Competitiveness and Cohesion Operational Programme
2014- 2020. The project, valued at EUR 55 million, is
directed towards strengthening the networking between
the most competitive sections of the Institute and the
private sector and industries. In a period of ten years
the Institute plans to renew and upgrade its complete
infrastructure, including laboratories, equipment and
human resources. http://ozip.irb.hr/
TENDERS AND PUBLIC PROCUREMENT
EBRD - Croatian Railways Trans-European Corridor X Railway Rehabilitation - works, supply and
installation of new railway tracks equipment and
consultancy services for supervision of works
Deadline 27 April 2015
http://www.ebrd.com/work-with-us/
procurement/pn-46290.html
Documentation Preparation for the EU Project to
Modernise the Sava River Embankment
Deadline 12 May 2015
https://eojn.nn.hr/SPIN/application/ipn/DocumentManagement/DokumentPodaciFrm.
aspx?id=489193
Consulting services for preparation of the
design and permitting documentation for the
construction of the LNG Terminal in Omisalj
Deadline 13 May 2015
http://www.lng.hr/upload_data/editor/files/
Invitation_to_Tender..pdf
Šibenik: Sewage-treatment plant construction
work
Deadline 13 May 2015
https://eojn.nn.hr/SPIN/application/ipn/DocumentManagement/DokumentPodaciFrm.aspx?O
znakaDokumenta=2015%2fS+005-0009351
Delivery, installation and commissioning of air
navigation systems for locations in Pula, Zadar,
Rijeka, Velika Barna and Dubrovnik
Deadline 21 May 2015
https://eojn.nn.hr/SPIN/application/ipn/DocumentManagement/DokumentPodaciFrm.
aspx?id=490805
Documentation Preparation for the EU Project to
Modernise the Sava River Embankment
Deadline 9 December
2015
www.ebrd.com /work-with-us/procurement/ppn-141209c.html
The EC Calls for proposals and Procurement notices for Croatia– available at the European
Commission – https://webgate.ec.europa.eu/europeaid/online-services/index.cfm?do=publi.welcome&nbPubliList=15&orderby=upd&orderby
ad=Desc&searchtype=AS&pgm=&ZGEO=35461&debpub=&finpub
UPCOMING EVENTS
The Power of Croatian Food Conference
6
Lisinski Hall, Zagreb
12 May 2015
http://www.poslovni.hr/events/shh
6th Croatian Water Conference with international
Adriatic Hotel,
participation “Croatian Waters on Investment wave” Opatija
20 – 23 May 2015
http://www.initrogen.org/sites/
default/files/attachments/
6th%20CROATIAN%20WATER%20CONFERENCE%20%20FIRST%20ANNOUNCEMENT_2.pdf
RIGHT AGE Senior Fair
Zagreb Fair, Zagreb
21 – 23 May 2015
www.zv.hr/default.aspx?id=4240
INTERGRAFIKA
Printing and Paper Industry Fair
MODERNPAK
Materials and Packing Technology Fair
Zagreb Fair, Zagreb
27 – 30 May 2015
http://www.zv.hr/default.aspx?id=1254
HI Design EMEA 2015
Hotel interior design event
Hotel Dubrovnik
Palace, Dubrovnik
3 - 5 June 2015
http://www.hidesign-emea.com/
ZAGREB BUSINESS SUMMIT CITIES AND REGIONS
- Drivers of development
Zagreb Fair, Zagreb
16 - 18 September
2015
http://www.zv.hr/default.aspx?id=3840
EKOTEHNO
International Eco-Technology, Environmental
Protection and Municipal Equipment Fair
Zagreb Fair, Zagreb
16 - 18 September
2015
http://www.zv.hr/default.aspx?id=2034
Current Issues in Water Supply and Sewage
Conference and Trade Fair
Solaris Beach
Resort, Šibenik
21 - 25 October 2015
http://www.revelin.hr/en/conferences/currentissues-in-water-supply-and-sewage/
Biograd Boat Show
Marina Kornati,
Zadar
22 - 25 October 2015
http://www.bbs.com.hr/index_eng.html
Cities of the Future Conference
Lisinski Hall, Zagreb
11 November 2015
http://www.poslovni.hr/specijal/pametni-gradovi
CROATIA: ECONOMICNEWS IN BRIEF
http://www.zv.hr/default.aspx?id=1269
THE NETHERLANDS IN FOCUS
some Highlights of our recent and upcoming activities
IWCZ Christmas Bazaar
The Striking Deal project in Croatia
In the framework of the project “Striking Deals”, supported
by the Dutch Social Council, a workshop for the metal
sector was held in January 2015 in Zagreb. Dutch social
partners are assisting the Croatian Metal Trade Union, the
Croatian Employer’s Association, Ministry of Labour and
Ministry of Education in establishing a lifelong learning
centre for competencies in the metal sector in Croatia.
At the Christmas Bazaar, the annual charity fundraising
event organized by the International Women’s Club Zagreb
last December, the Netherlands Embassy raised over
EUR 1.500 for the Neonatal Unit of the General Hospital
Sveti Duh in Zagreb. This was made possible thanks to
donations from the sponsors of the Dutch Stand. Thank
you,once again!
Launch Croatian-Dutch dictionary
The workshop, led by consultants from Peer Consultancy
BV and BNF Bondgenoten, was an opportunity to learn
about the work of bipartite centers in the Netherlands, the
cooperation between the centers and the business and the
Dutch system of recognition of qualifications.
Dutch company will build two biomass plants
in Croatia
Dutch company HoSt B.V. will together with the Croatian
Djuro Djakovic build two cogeneration biomass plants for
the Croatian electricity company HEP. The plants will be
located in Osijek and Sisak.The contract was signed at the
beginning of April
To launch the first Croatian-Dutch dictionary, the
Netherland’s Ambassador Ellen Berens hosted a
reception at the Dutch Residence. Ambassador Berends
congratulated the author Radovan Lučić, Project leader
Prof. Wim Honselaar, Pegasus Director Susan van Oostveen
(the Dutch publisher), Croatian distributor Nediljko
Dominović, the Nederlandse Taalunie, and the many others
who have contributed to the realization of this important
project. Let’s hope money will be found for the DutchCroatian counterpart!
7
CROATIA: ECONOMICNEWS IN BRIEF
THE NETHERLANDS IN FOCUS
some Highlights of our recent and upcoming activities
two weeks of Amsterdam in zagreb
Project Pop-up Amsterdam, from 8th to 25th April, brings the
spirit of the Amsterdam's lifestile, culture, beer and gastro
tradition in the centre of Zagreb. It's time to Amsterdamize!
https://www.facebook.com/PopUpAmsterdamBabbar/photos_stream?ref=page_
internal
EMbassy a partner of the cities of
the future project
The Embassy of the Kingdom of the
Netherlands is a general partner to
Poslovni Dnevnik business daily and
the Croatian Association of Cities in
the newly launched project Cities of
the Future 2015. The project promotes
the concept of smart cities in Croatia.
Follow its development at
http://www.poslovni.hr/specijal/pametni-gradovi
For further information about the Embassy of the Kingdom of the Netherlands, please refer to our website www.netherlandsembassy.hr and Facebook
www.facebook.com/nlembassyzagreb. For any QUESTIONS related to economic matters, contact us through the email address ZAG-EA@minbuza.
nl. For any matters concerning Agriculture, Nature, or Food Quality, please contact [email protected]. For information on doing business
in the Netherlands please check the link: www.answersforbusiness.nl
This Newsletter has been compiled by Andreja Kocijan.
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CROATIA: ECONOMICNEWS IN BRIEF