CROATIA | Vinayak Patil |

PGDMBDI3CM/2218
INTRODUCTION

 Flag :
 Geographical Location :
 Capital : Zagreb
 President : Zoran Milanovic
 Population : 39Lakhs (2021)
 GDP : 6,783.78 crores (2021)
 Official Language : Croatian
Brief Timeline

 Romans ruled the land today known as Croatia until the 5"century and there are still ruins around the
country today
 Around the middle of the 7" century, Croat tribes arrived in the land.
 Shortly after, they came under Frankish rule and much conversion to Christianity resulted, which is
still evident today, with 90% of the population identifying as Catholic.
 In 925, a king was crowned and Croatia the Kingdom was created
 The Kingdom of Croatia eventually merged with Hungary in the Middle Ages.
History Continues

 Croatia became part of the Austro-Hungarian Empire in the19 century until it fell in
1918.
 Croatia then became part of communist Tito’s Yugoslavia in the 1950s.
 Croatia declared independence from Yugoslavia in June 1991.
 A civil war resulted from the breakup of Yugoslavia and Croatia faced many casualties.
 Croatia joined the European Union in 2013.
 Economy

 Following the demise of communism in Croatia in 1990, the Croatian

government began a course of restructuring the economy from the
Yugoslav system of socialist self-management to market-oriented
capitalism. This required such measures as the sale of state-owned
enterprises to private owners, the establishment of functioning markets,
and the creation of stable prices, interest rates, and currency. The
accomplishment of these tasks proved difficult, largely because of the
destabilizing effects of war.
 Heavily relies on tourism, especially on it’s Adriatic Coast which is
15% of the GDP (10million foreign visitors/year)
 By the late 1990s nearly one in five members of the working-age
population were jobless, with young people particularly affected; high
unemployment remained a problem into the 21st century.
 The war also helped to foster an informal economy and a black market.
 Trade, Imports and Exports

In 2020, Croatia was the number 81

economy in the world in terms of
GDP (current US$), the number 72
in total exports, the number 66 in
total imports, the number 59
economy in terms of GDP per capita
(current US$) and the number 35
most complex economy according
to the Economic Complexity Index
(ECI).
MAJOR MACRO ECONOMIC INDICATORS
 STRENGTHS WEAKNESSES

•Long coastline •Dependence on tourism (20% of GDP),

•Oil and gas potential which has strongly suffered from the
•The country joined ERM II in 2020, pandemic
perspectives of joining the Eurozone in •Private and public debt still high
2023 •Institutional gaps: inefficient
•Support of EU funds administration, health and justice;
•High-quality infrastructure overlapping administrative levels,
corruption
•Time-consuming and inefficient
business insolvency procedure
•Low industrial diversification / lack of
competitiveness
•High youth unemployment (20% in
September 2021), low participation of
women
•Labor shortages fueled by emigration of
skilled workers and a declining
population
Political Standpoint

Croatia gained its independence from Yugoslavia in 1991 and joined the European Union in July 2013.
Its membership of the EU is perceived by many as the most significant foreign policy achievement
since its independence.

Croatia’s legal framework is based on a continental European model and its constitution guarantees free
transfer of capital and free profit repatriation to investors.

Croatian laws guarantee equal rights for domestic and foreign private and legal entities. Since July
2020, the centrist coalition Croatian Government has been led by Prime Minister Andrej Plenković.
 Croatia is a parliamentary republic that regularly holds free
Political Issues 
elections. Civil and political rights are generally respected, though
corruption in the public sector is a serious issue. The Roma and
ethnic Serbs face discrimination, as do LGBT+ people.
 In recent years, concerns about the presence of far-right groups
and figures espousing discriminatory values in public life have
increased.
 Local elections were held in May, and saw the conservative
Croatian Democratic Union (HDZ) win most mayoral and
municipal races throughout the country
 Police violence against migrants, refugees, and asylum-seekers
continued throughout the year, with nearly 12,000 illegal
pushbacks documented along the country’s border with Bosnia
and Herzegovina, leading to criticism from human rights
advocates and European Union (EU) representatives.
 Conclusion

 Between the pandemic and two large earthquakes, Croatia has been severely tested,
and the country’s resilience has come through. The economic contraction in 2020—
painful as it has been—was not as severe as those experienced by many other
economies with a strong tourism component.
 As conditions improve, support measures need to rotate toward preparing the
workforce for the post-pandemic world and facilitating balance sheet repair of viable
businesses. Thereafter, the challenge of once again reducing deficits and the public
debt whilst shifting growth into a new high gear must be taken on.
 The generous funding from the EU represents a historic opportunity, to help meet
these challenges successfully—an opportunity that must be fully utilized, in a timely
fashion.