ZAGREB, November 29, 2018 - Digitisation of Croatia could increase its gross domestic product (GDP) by 8.3 billion euro by 2025, according to the findings of a survey presented on Wednesday by the McKinsey Croatia.
If Croatia were to focus on digitisation and automation as of tomorrow already and start working on it, by 2025 the potential incremental GDP from a digital economy could be 8.3 billion euro, Tomislav Brezinščak of McKinsey&Company said presenting the survey results.
"If we look at the past five years, Croatia's growth was 12%, which a little less than growth in EU member states in central Europe but it is still significantly a higher growth than in some large EU economies and in digital leaders," Brezinščak said. He said that Croatia was not lagging far behind other EU member states, however, when compared to developed economies, there is an obvious big gap, when measured by GDP per capita.
Compared to advanced economies, Croatia's GDP per capita is as much as four times lower.
He noted that today there are two types of economies – traditional and digital. Croatia's share in the digital economy is 5%, less than in other countries. However, that is not the main problem but rather, when comparing growth in digital economies and traditional ones. "Croatia is the only country in which traditional economy is growing faster than the digital one," he said, adding that a digital economy is the main factor of economic growth.
He added that with regard to employment, with automation today's manual, repetitive jobs will be replaced by jobs that a more productive, creative and lead to a great economic value.
Brezinščak said that it is necessary to start organising retraining for productive vocations that digitisation provides. "We don't have a good education, our infrastructure isn't the best, people find it hard to accept new skills and an entire infrastructure related to improving and accelerating new businesses for a digital economy doesn't exist," he warned.
He added that Croatia has to focus its digitisation based on three existing favourable factors. "The first fact is that Croatia has a large number of students graduating in ICT, next the cost of labour in the ICT sector has a strong competitive advantage and we have representative examples of it in the public and private sectors," he underscored, presenting recommendations for digitisation in Croatia.
For more on Croatia’s GDP, click here.
