CROATIA
Business climate and opportunities in Croatia
Polish-Croatian Business Forum
Warsaw, 28 January 2016
CROATIA ...
... in numbers
CROATIA
2014
Major cities (population)
Area: 56,594 km²
Population: 4.3 million
Capital: Zagreb (800,000 inhabitants)
Currency: Croatian Kuna (HRK)
1 EUR = 7.606 HRK, 1 USD = 7.64 HRK (January 2016)
Zagreb
Split
Rijeka
Osijek
Zadar
0
200000 400000 600000 800000
GDP per capita in PPS
GDP (2014): 43.1 bn EUR
GDP per capita (2014): 10,158 EUR
GDP growth rate forecast (EC): 1.1% (2015); 1.4% (2016)
Inflation (2014): - 0.2 %
Unemployment rate (ILO, 2014): 17.3 %
Average net salary (Oct. 2015): 749 EUR
Export (2014): 10.37 bn EUR
Import (2014): 17.1 bn EUR
FDI: 30.1 bn EUR (1993-2015 Q3)
0
EU (28 countries)
Hungary
Poland
Latvia
Croatia
Romania
Turkey
Bulgaria
Montenegro
Macedonia
Serbia
Albania
Bosnia and…
50
100
150
GDP per capita
(EU 28=100)
Source: EUROSTAT
Foreign trade 2014
TOTAL TRADE = 27.44 bn Eur
Export 10.34 bn Eur
Import 17.1 bn Eur
89,5%
1,7%
5,8%
1,6%
0,6%
0,1%
Main partners: 1. Italy, 2. Germany, 3. Slovenia, 4. Austria, 5. Bosnia&Herzegovina… 11. Poland (2.1%)
Economic relations – trade
•
Trade (2014) = 568 million EUR
Cro export to Poland: 140 m EUR (+39%)
• 1.4% of total Croatian export (15th export partner)
Cro import from Poland: 428 m EUR (+24,5%)
• 2.5% of total Croatian import (10th import partner)
Million EUR
CROATIA - POLAND
700
600
500
400
300
200
Croatian exports to Poland:
100
Medicaments (10.05%); aluminium foil (4.20%); sauces
& prep,mixed condiments (3.92%); mattress supports,
articles of bedding (3.89%); pantyhose, socks (3.85%)
-100
Croatian imports from Poland:
-200
Cigars, cigarettes (8.24%); sanitary napkins and
tampons, diapers (3.97%); chocolate & other food
products containing cocoa (3.14%); bread, pastry cakes
(2.7%); furniture nesoi and parts (2.54%)
-300
-400
Export
Poland = Croatia’s:
 11th foreign trade partner
 15th export partner
 10th import partner
 32nd biggest investor
Import
Saldo
2014
2013
2012
2011
2010
2009
2008
2007
2006
0
Economic relations –tourism
CROATIA - POLAND
Tourism (I-VIII 2015)
800
 701,735 Polish tourists = +5.3%
 4.5 mil. overnight stays = +5.2%
 6th place in the overall stucture of foreign
overnight stays (6.6%)
600
400
200
0
2010
2011
2012
2013
2014
No. of overnight stays
Millions
Thousands
No. of arrivals of Polish tourists
5,0
4,0
3,0
2,0
1,0
0,0
2010
2011
2012
2013
2014
FDI = 30.1 bn EUR
(1993-2015 Q3)
Financial intermediation
Some of foreign companies active in Croatia...
22%
Other business activities
11%
Wholesale trade
9%
Real estate activities
8%
6%
Telecommunications
Retail trade
6%
Manufacture of chemicals
5%
Prod. of coke, petroleum
5%
Real estate investments
4%
Hotels and restaurants
3%
Leading investors:
NETHERLANDS
20%
AUSTRIA
20%
GERMANY
9%
HUNGARY
7%
LUXEMBOURG
7%
ITALY
5%
FRANCE
5%
SLOVENIA
4%
SWITZERLAND
4%
4%
UNITED KINGDOM
Source: CNB
FDI per capita (1994-2013):
• Czech Rep. = 10.938 USD
• Bulgaria
= 7.934 USD
• Croatia
= 7.863 USD
• Slovak Rep. = 6.971 USD
• Poland
= 5.105 USD
• Slovenia = 4.917 USD
Foreign direct investment
FOREIGN INVESTMENTS
Croatian investments to V4
(1993-Q3 2015; mil EUR)
FDI of V4 to Croatia
(1993-Q3 2015; mil EUR)
160
2.500
140
120
141
2.000
2.177
100
1.500
80
60
1.000
40
34
20
0
Poland
Hungary
500
19
10
Slovakia
Czech
Republic
0
Hungary
Poland:




1993- 3Q 2015= 73.1 m EUR
32nd biggest investor (0.24%)
FDI in 2014 = 5.5 m EUR
FDI in 1Q-3Q 2015 = 34.3 m EUR
320
148
73
Czech
Republic
Slovakia
Poland
CROATIA ...
... why do business
CROATIA - Your reliable business partner

Unique geostrategic location in Europe - linking CEE to Adriatic

Stability & safety of business activity

Stimulating investment climate

Highly educated, multilingual & competent workforce

Long tradition in industrial production

Modern transport infrastructure

EU member

Possibility of using EU funds
MODERN INFRASTRUCTURE
•
•
3 Pan-European corridors passing through Croatia (V, Vb,
Vc; VII; X)
Croatia – a part of the future Trans – European Network –
Transport (TEN – T)
•
•
•
•
26,958 km of roads
2,722 km of railroads
7 international airports and 2 airfields
3 intermodal terminals
•
Internationally important seaports – Port of Rijeka (among
main European sea ports), Port of Ploče
IMPROVING BUSINESS ENVIRONMENT
 Act on Investment Promotion
 Act on Strategic Investment Projects
 New legal framework in construction and
physical planning)
 E-Construction permit
 Obligatory e-contrigution payment

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e-Consultations
e-Court Case
Fiscalisation
e-Construction permit
Open data portal
e-Class register
 e-Employment records &
e-Employee registration
 e-Medical Appointments
 e- Polling Place Registration
 e-Craft
 e- Residence Registration
World Bank – Doing Business 2016
Report:
CRO 40/189
Recognized improvements:
Starting up business
Crossaboarder trade
More efficient enforcement of
judgment
Registering property
The Global Competitiveness
Report 2015–2016
CRO 77/144
STIMULATING INVESTMENT ENVIRONMENT
 Avoidance of double taxation
 0% profit tax on reinvested capital
 Numerous incentives for business activities to investors
INVESTMENT PROMOTION ACT:
Equal rights for foreign and domestic
investors
Free transfer of return on equity from the
country
• Tax incentives (reduction of profit tax to 10-0%; regular
profit tax 20%)
• Employment grants (up to 18,000 EUR)
• Education grants
• initial and capital expenses
• labor intensive investment projects
Incentives for:
•
manufacturing activities, technology centers,
strategic business support and high value-added
services, tourist activities (4 plus star hotels..)
REQUIREMENT:
Minimum investment: 150,000 EUR + 5 new workplaces
Micro entrepreneurs:
50,000 EUR + 3 new workplaces
Stimulating investment environment
50
45
40
Labour costs EUR/hour (2014)
Business economy
35
Industry
30
Construction
25
Services
20
Mainly non-business
15
10
5
0
Source: Eurostat
CROATIA ...
...business possibilities
Business possibility 1/4
INDUSTRY
 17.8% of GDP (2014)
 18.5% of total employment (2014)
 Industrial production growth rate: 1.2% (2014);
1.5% (I-VII 2015)
 Main industrial branches (export-oriented): refined
petroleum products; manufacture of other transport
equipment; electrical equipment; chemicals and
chemical products; food products; manufacture of
fabricated metal products; pharmaceuticals
Investment possibilities:
 Pharmaceutical, ICT, wood, textile & leather
processing, metal, automotive, electrical, chemical,
plastic & rubber industry
18%
5%
23%
Industry
total
income
5%
6%
17%
7%
9%
10%
food processing and beverages
oil & refined petroleum products
chemicals, plastics & pharmaceuticals
electronic, ICT & optical products
metal products
wood processing, furniture & paper industry
transport equipment
textiles & leather
Croatian companies - suppliers & contractors supporting the investment:
 tradition & quality in manufacturing
 educated workforce
 experienced with extensive track record on foreign markets
Characterictics:
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TOURISM
Natural beauties
Climate
Geographical location
Cultural and historical heritage
Tourism in numbers:





Revenue: 7.4 bn EUR (17.2% of GDP; +2.8%)
13.1 mil tourists (+5.6%), increase in tourist traffic in all counties
66.5 mil overnight stays (+2.6%)
More than 15,500 registered companies
85,000 employees (6.4%); average gross salary: 911 EUR (2014)
Most important products/services:
•
•
•
Accomodation services: hotels, camps, private accomodation,
hostels
Food&beverage preparation and catering services: restaurants,
caffe bars
Special forms of tourism: holiday, nautical, health, cultural,
business, adventure, eno-gastro tourism
Export markets:
Germany, Slovenia, Austria, Italy, Czech Republic,
Poland, France, UK, Hungary, Slovakia
Business possibility 2/4
Business possibility 2/4
TOURISM
No. of overnight stays
Revenue (Mil. Eur)
7.000
65
6.000
60
5.000
55
4.000
3.000
50
2.000
45
1.000
40
0
2000.
2001.
2002.
2003.
2004.
2005.
2006.
2007.
2008.
2009.
2010.
2011.
2012.
2013.
2014.
Millions
8.000
70
Investment possibilities:
 Priority - Investments in high quality tourist
facilities
 Greenfield/brownfield projects
 Nautical tourism
 Health tourism
 Congress tourism
Business possibility 3/4
AGRICULTURE & FOOD PRODUCTION
 6.5% of GDP; 4.8% of total employment (2014)
 1.3 million hectares of utilized agricultural area
 Wide range of products (wine, cereals, fish, olives,fruits,
vegetables etc); internationally known food products –
confectionary, diary products, olive oil, mediteranean fruits
 2,500 year old wine
producing tradition
 Prize-winning top
quality olive oil & wine
Investment possibilities:
 Aquaculture
 Healthy food production
FOOD PROCESSING INDUSTRY
(in relation to the overall processing industry):





21% of employees
28.1% exchange
23.7% added-value
25.5% gross operating surplus
14% share in number of companies
 Business activities conducted according to the highest food quality and safety standards (ISO 9001,
ISO 14001, ISO 22000, HACCP, Halal, Kosher, IFS, BRC, OHSAS 18001 etc.)
Business possibility 4/4
ENERGY
•
Favourable climate & unpolluted natural environment:
 Over 2,700 hours of sunshine per year
 Windy regions by the Adriatic sea and East Slavonia
 Geothermal energy from natural sources on the continent
 Access to vast amounty of biomass
 substantial, mostly already engaged, hydro-power potential
 Investment possibilities: planned increase in capacity – modernisation and
construction of new powerplants (hydro power plants, thermal power plants, LNG
terminal); RES; environment protection & production of clean energy
INFRASTRUCTURE
• 3 Pan-European corridors passing through Croatia, a part of
future TEN-T
• 7 inter. airports, 6 seaports, 4 riverports
• 26,958 km of roads, 2,722 km of rail network
• Investment possibilities: sea ports - construction of new
terminals (Port of Dubrovnik, Port of Ploče); airports reconstruction and modernisation (Osijek Airport, Rijeka Airport)
INVESTMENT SITES
• More than 100 ready entrepreneurial zones
- utility services, clear ownership, good logistic & traffic connection
• Strong support form local communities
• Additional tax reliefs:
 relief from utility tax
 lower payments for municipal services
 lower land prices
POLAND AND CROATIA – POSSIBILITIES OF COOPERATION
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Energy sector
Infrastructure, transport & logistics
Tourism
Food industry
Pharmaceutical industry
Construction
Joint cooperation on third markets
EU Structural & investment funds
CROATIA
... how to proceed
CROATIAN CHAMBER OF ECONOMY
modern, professional institution with a 164 year old tradition
represents, promotes and protects economic interests of its members
a reliable source of information to companies
110,000
member
companies
Professional
associations
20 county
chambers in
Croatia
Representative
offices abroad
(Bruxelles,
Moscow)
WHAT WE OFFER...
Numerous
databases
Online catalogue of investment projects
Croatian company directory – more than 110,000 active members
Business opportunities exchange
Business zones
Croatian export directory
Croatian Waste Materials Exchange
Information
On relevant regulations and laws in the field of investment and economics
On current economic situation in Croatia
On how to start-up business in Croatia
On national and local investment incentives and opportunities
Assistance
Linking investors with project holders
Facilitating communication with institutions on national and local level
Support in dealing with administrative procedures on all levels
Providing suppliers’ database & facilitating contact with potential business partners
Organizing tailor-made vistits of potential investors to Croatia
CROATIAN CHAMBER OF ECONOMY
INTERNATIONAL AFFAIRS SECTOR
Tel.:+385 1 4828 382
Fax:+385 1 4828 379
Rooseveltov trg 2
10000 Zagreb, Croatia
e-mail: [email protected]
www.investincroatia.hr
www.hgk.hr
We promote, we connect, we can help!