Financial Minister Zdravko Marić: Overdraft Solution in Days or Weeks Ahead
ZAGREB, 8 Sept, 2021 - Finance Minister Zdravko Marić said on Wednesday a solution to current account overdrafts was expected in the days or weeks ahead and that it remained to be seen if the law would need to be amended.
He was speaking to the press after Prime Minister Andrej Plenković's meeting with representatives of banks' management boards, which was also attended by central bank (HNB) governor Boris Vujčić and Economy Minister Tomislav Ćorić.
Marić said the purpose of the meeting was to exchange information and views on current account overdrafts with a view to finding an adequate and satisfactory solution in which, he added, the government emphasised consumer protection.
He said several good proposals crystallised at the meeting, aimed at protecting social sensitivity, fairness, information and transparency as well as at reaching a solution under which authorised overdrafts would again dominate, as they are regulated by law in much more detail, much more clearly and transparently than tacit overdrafts.
The 2010 Consumer Credit Act recognises authorised and tacit overdrafts, but since 2018 the latter have become prevalent, accounting for almost 95% of all overdrafts, Marić said. Tacit overdrafts have been approved for almost 1.8 million consumers and are being exercised by 840,000.
That happened because under a central bank decision from the end of 2017, pursuant to European regulations, the calculation of the effective interest rate includes the fee for having a current account. As a result, authorised overdrafts became less available to lower income citizens and banks switched to tacit overdrafts.
Marić said a solution should be prompt but not rushed and to the benefit of all consumers. He told people living with tacit overdrafts that the government did not intend to nor would support a solution that would result in a drastic cancellation of overdrafts because that would put additional pressure on their everyday lives and livelihoods. "We'll dispel all fears that this instrument will be annulled and disappear."
A solution may be found by changing the decision within the central bank's remit, but if necessary, the law will be adjusted, he said, adding that if the former option was chosen, that would be known in the next few days, and in case of the latter, in the next few weeks. "We are really not talking about months."
The minister said it was necessary to continue to work on people's financial literacy as well as on product transparency.
Vujčić: The goal is that lowest income citizens don't lose current account overdraft option
The central bank governor said that since Croatia was the only country limiting effective interest rate on overdrafts, the inclusion of the current account fee in the rate as of 2018 resulted in the fee "swallowing" interest, primarily on small overdrafts.
He said that, for example, no interest was paid on overdrafts up to HRK 2,000 and a current account fee of HRK 12.
"We have several different regulations which produce such results and that should be put in order, so that for those with the lowest incomes, and consequently overdrafts, those products don't become unprofitable for banks and they start cancelling them."
Vujčić said the point was to return tacit overdrafts under the same regulations that applied to authorised overdrafts, without a certain number of people with the lowest incomes losing the overdraft option in the process.
"That's the point and that's what we'll do," he said, adding that it remained to be agreed on how to do it.
Croatian Banking Association (HUB) director Zdenko Adrović said that representatives of the banking sector spoke at the meeting about practices in other European countries, expressing hope that the new solution would be in line with those practices.
He stressed that there was no cap on the effective interest rate in other countries, so one of the proposals presented was for the cap on the effective interest rate to be removed and a cap on the nominal interest rate to be possibly introduced.
Adrović said that one of the proposals was for costs related to current account overdrafts to be calculated at "a slightly higher minimum amount", but noted that this was a technical solution that still had to be discussed with the HNB.
Asked by reporters how citizens would now be able to trust banks after they had switched their authorised overdrafts to tacit ones, Adrović claimed that everything was done in line with the law and that authorised and tacit overdrafts were two equal products.
He said that he "assumed" that a "vast majority" of citizens had been informed by their banks about tacit overdrafts, but that a large number of citizens, including himself, "relatively rarely" read notices about possible changes.
Marić: No reduction of VAT on food in 2022
Asked is VAT, including on food, would be lowered considering current price hikes, Finance Minister Marić said that the government had already reduced the VAT rate on some food products, including fresh meat and fish, and fruit and vegetables, and that it planned to reduce VAT on all food products during the current term in office.
But that will happen only after the necessary conditions are met, he stressed, noting that currently and in 2022 there was no fiscal room for such a move.
For more about politics in Croatia, follow TCN's dedicated page.
Economy Minister Tomislav Ćorić: No Reason at the Moment for Electricity and Gas Price Hike
ZAGREB, 8 Sept, 2021 - Minister of Economy and Sustainable Development Tomislav Ćorić said on Wednesday that he does not see any reason that would lead to higher electricity and gas bills for citizens.
Asked ahead of an inner cabinet meeting whether electricity and gas bills would increase, Ćorić said that he did not see any reason at the moment for that to happen.
"There is no absolute certainty that that won't occur, however, I do not see any reason for it to happen," he said.
In reference to an electricity price hike for enterprises, Ćorić said that one needs to be aware of the fact that the domestic electricity market is liberalised and functions in line with European and global markets.
"Those enterprises who concluded long-term contracts last year will not feel the price hike in the coming period, however, those enterprises which are doing that now will feel the adjustment on the market," he underscored.
The assumption is that many enterprises have protected themselves against unexpected changes and Ćorić doesn't believe that the price hike for electricity will be as high as 40% as reported in the media over the past few days, however, he added, a certain adjustment in prices will occur.
"This tells us that business conditions need to be stabilised, that is to avoid certain risks, and that can be achieved so that prices are agreed for a longer period," said Ćorić.
Asked whether entrepreneurs who didn't manage to conclude long-term contracts would transfer the higher cost to its consumers by increasing the price of their products, Ćorić said that the price of electricity is one of the key inputs in production which directly results in an increase in the cost of production.
"You either have to decrease your margin or increase the price of your product. That is how the market functions," he concluded, adding that those enterprises which were astute and contracted the price of electricity can now provide more competitive products.
For more about politics in Croatia, follow TCN's dedicated page.
New Generation of Architects Launch Morpharos Studio on Hvar
September 8, 2021 - The innovative and young team that makes up the new architectural office Morpharos Studio on the island of Hvar creates contemporary Mediterranean architecture.
For years, there has been talk of young people leaving Croatia as a problem facing all young members of the European Union. However, instead of going to a bigger town, a young team of architects decided to focus on designing in a smaller town and opened an office in Stari Grad on the island of Hvar. Unlike architecture tied to large urban centers, they turn to authentic, local interventions that balance traditional and contemporary.
Morpharos is an architectural office focused on creating timeless Mediterranean architecture and atmosphere. The buildings are planned from the conceptual stage to the construction details and interiors. The projects combine new technologies and contemporary design with the values of local heritage and traditional construction techniques in the Mediterranean to create architecture that simultaneously belongs to the context of the island but also to the present time.
From the project of small interventions in the city center where the border between interior space and garden is removed, through holiday villas surrounded by olive trees, to the town square in Stari Grad on Hvar, Morpharos puts its stamp on understanding the new island tradition and the Mediterranean region. This is how they create their vision of contemporary Mediterranean architecture.
Stone as a basic building material and a landscape element of the Mediterranean is the basis of the key visuals of Morpharos. Evoking the island's natural elements, they display a set of influences - from smells and tastes, through tactile experiences, to manifested forms - while the Mediterranean context also inspires the color palette. The visual identity for Morpharos is signed by Filburg, an award-winning Zagreb studio for branding, design, and communications.
For more on lifestyle in Croatia, follow TCN's dedicated page.
Croatian Teachers Under Pressure: Angry Parents Behind Straight A Pupil Epidemic?
September 8, 2021 - The flood of straight-A pupils in Croatian elementary schools sadly isn't a sign of brilliance but of Croatian teachers being put under pressure by parents who want their kids to go to the best high schools in the country. The newly launched Facebook group wants to get to the bottom of fake A's, offering Croatian teachers a place for anonymous confessions.
Parents naturally want their best for their children and want to see them succeed and have the best life possible. The smarter the child, the better things will be for them, many would conclude. If a child is like that middle child from the show ''Malcolm in the Middle'', bright enough to be the master of everything you throw at him, be it maths, language, physics, or history, he should be able to sail through life worry-free, right? Well, maybe.
In reality, such gifted individuals, if actually real, are truly rare. However, you wouldn't think that if you were to see the grades of some Croatian pupils, with a large number of them getting straight A's. Unfortunately, this is a distorted picture of reality.
''I teach the youngest kids, and the criteria is owed to the parental pressure. I'm there just to hand out A's. Nothing else is good enough. I was even reported to the inspection because I gave one pupil a B (she was a C, but I knew there would be a problem so I gave her a B, and then chaos began). I justified giving her that grade for weeks with the threat of inspections hanging over my head. The grades are perfect, the knowledge not so much, the kid and their parents are happy, and the teachers crapped all over,'' reads a thread from one of the increasingly pressured Croatian teachers on the recently launched Facebook group ''Why Does it Itch When it's Not 5.0?'' (Zašto žulja kad nije 5.0?).
FB thread translated above, screenshot / Zašto žulja kad nije 5.0?
The flood of straight-A students (or, in Croatian terms, those kids with an average of 5.0, meaning they passed all subjects with a 5, Croatian for A), has been sporadically addressed in the Croatian media over the past few months as elementary school pupils were heading off to their high schools. So many straight A pupils have their results rated as unrealistic and the parental pressure placed on Croatian teachers and professors is seen as what's to blame.
A grades given as a gift and not as a true measure of a child's knowledge was something that was even addressed in the curriculum reform and is waiting to be fully implemented. With high school admissions coming to a close, the situation has since gone rather quiet.
But, then, famous Croatian investigative journalist Ivana Paradžiković published a Facebook thread expressing dissatisfaction that her ''4.8 son'' didn't managed to get accepted into high school in any of the six gymnasiums he applied for, as they were accepting only those kids with a grade of 5.0 in the new school year. She stated that her son was good enough for the European Film Academy but apparently not for the Croatian education system.
''He had the misfortune of going to a school where an A grade wasn't given away, and it was important to the professors that instead, they actually teach kids something. Over there, 4.4 is a B and not an A, and to me, that was always normal and acceptable (...) several classes with 30 pupils each with a straight A grade and nobody finds that unusual nor alarming... The education system is the foundation of the society,'' wrote the rightfully unhappy Paradžiković, as reported by Jutarnji List.
Paradžiković's thread, as well as the previous media coverage of the straight A epidemic across many Croatian schools, triggered freelance journalist Matina Tenžera to start a Facebook group which discusses the matter. The group consists of 249 members at the time of writing this article.
''I want to survey public opinion about this issue. Some say it's the fault of the system, but that's a bit too abstract. I want to find out how much parents really do push their children, is it truly such a big issue or maybe it's blown out of proportion?'' Tenžera said to TCN.
The group invites Croatian teachers to share their inside stories on parental pressure and generally what stands behind this unrealistic picture of the success of Croatian pupils on paper. The response so far is small, but Tenžera hopes that interest will grow. As TCN previously reported, Facebook groups that share anonymous confessions played a crucial role in revealing sexual harassment in the Croatian higher education system, mainly at the acting academy in Zagreb and other parts of the wider region.
Still, the small amount of threads gathered by Tenžera's group already reveals some true horror stories about how teachers in Croatia are perceived more as slaves than as valued individuals tasked with properly preparing the next generation for adulthood out there in the big wide world.
''My mother works as a teacher, and the situation in which someone came to school to attack and threaten to sue her because she gave a low grade to the child of someone famous has happened more than once. She literally had to remove the grade under the threat of getting fired,'' reads one anonymous confession.
FB thread translated above, screenshot / Zašto žulja kad nije 5.0?
Tenžera wants to learn just why Croatian schools and their headmasters don't take a stand and explain to parents that a good grade needs to be worked for and earned.
''I'm just a layman, but I hope that experts and experienced teachers will join the group and provide some of their solutions,'' says Tenžera.
Zagreb's Vladimir Prelog Science School and Mathematical Gymnasium (MIOC) has already taken to the practice of having entrance exams to settle the difference between talented pupils on paper and actual talented pupils.
Introducing and valuing entrance exams more than elementary school grades is one solution Tenžera believes could work, but as she points out, she isn't an expert. So, she hopes the Facebook group will encourage discussion for those who are educated, trained, and qualified to discuss education issues.
The following days will reveal whether or not this Facebook group grow into a bigger voice protesting against unfair and unethical practices in the Croatian education system and the abuse of Croatian teachers.
Meanwhile, in the first week of the new school year in Croatia, pupils are back in their classrooms learning about the world around them. However, the lesson of honesty and getting only what you work hard for is a lesson only their families can teach. Not threatening teachers for giving grades that are a realistic, professional evaluation of knowledge is lesson number one.
Read about Croatian politics and history since 1990 on our TC guide.
For more about education in Croatia, follow TCN's dedicated page.
Croatia's Coronavirus Update: 1,237 New Cases, 10 Deaths
ZAGREB, 8 Sept, 2021 - In the last 24 hours, 10,928 coronavirus tests have been performed in Croatia and of them 1,237 (11.3%) have returned positive, while the COVID-related death toll has risen by 10 to 8,395, the national COVID-19 crisis management team reported on Wednesday.
There are currently 5,009 active cases, and of them 540 are receiving hospital treatment, including 62 patients on ventilators.
Since its first registered case of the coronavirus infection on 25 February 2020, Croatia has conducted 2,618,129 tests. The country has registered 379,963 positive cases and 366,559 recoveries, of which 417 in the past 24 hours.
So far, 43.05% of the total population, or 51.69% of adults, have been vaccinated. The share of the fully vaccinated adult population is 48.50%.
For more about COVID-19 in Croatia, follow TCN's dedicated page
Over 10,000 Yachts and Boats to be Removed From Registry Over Unpaid Fees
ZAGREB, 8 Sept, 2021 - Over 10,000 vessels will be erased from the Croatian registry of boats due to the failure of their owners to pay the navigation safety fee in 2019 and 2020, the Večernji List daily reported on Wednesday.
In late 2020, the Ministry of the Sea and Transport started bringing order to the registry, and so far 21,814 vessels have been removed from the registration list, the daily quoted the ministry as saying.
In October, the ministry will issue decisions on the removal of an additional 10,000 from the registry after it was established that until 15 August this year their owners had failed to pay the navigation safety fee for 2019 and 2020. The navigation safety fees in arrears for 2019 and 2020 exceed HRK 5 million (€666,000).
This national registry covers all Croatian nationality vessels.
Notices of possible removal from the registry will be also forwarded to all port authorities in Croatia and marinas' concession holders.
For more about travel in Croatia, follow TCN's dedicated page.
Marija Vučković Takes Part in Informal Meeting of EU Agriculture Ministers
ZAGREB, 7 Sept, 2021 - The agriculture strategy envisions further investment in public services in rural areas, with an emphasis on digitisation, irrigation, renewable energy production and increasing energy efficiency, Agriculture Minister Marija Vučković said at an informal meeting of EU ministers.
In order to succeed in that, it is essential to continue investing in human capital, the minister stressed.
Minister Vučković was taking part in an informal meeting of the EU Agriculture and Fisheries Council, which was held in Kranj, Slovenia on Monday and Tuesday. The Agriculture Ministry reported on Tuesday that the central topic of the meeting was strengthening dialogue between urban and rural areas in the EU, with an emphasis on possibilities for their further development.
The long-term vision for the EU's rural areas up to 2040 aims to reverse negative trends affecting rural areas, including depopulation, population ageing and the decline in attractiveness of rural areas as places to live. The vision brings together several policies that go beyond the common agricultural policy (CAP) and require a more integrated and coordinated approach at the EU, national and regional level, the press release says.
In order for the process aimed at strengthening rural areas to succeed, it is necessary to continue investing in human resources, Minister Vučković stressed.
We have to provide funds for investments and help young people to realise their business goals in rural areas and respond to challenges by creating added value, she said.
For more about politics in Croatia, follow TCN's dedicated page.
European Junior Windsurfing Championship Begins in Bol with Two Croatian Competitors
September 8, 2021 - Organized by the Sailing Club Labud from Split and the Bol windsurfing club Zoo Station Bol, the Open European Junior Windsurfing Championship in the new Olympic class iQ Foil began on Zlatni Rat.
118 competitors from 17 countries are taking part in the regatta, including the Netherlands, Denmark, Italy, Spain, France, Latvia, Poland, Israel, Slovenia, and others, and Maroje Škoro and Ian Anić are competing for Croatia.
Following the successful organization of the World Windsurfing Championships in July this year, Bol is once again showing its attractive sporting side and will host the young hopes of the World Windsurfing Championships until Sunday September 12 - among whom may be future Olympic winners. Namely, this is one of a series of regattas in which competitors are also preparing to perform at the Olympic Games in Paris in 2024.
The iQ foil class was approved in November 2019 by the World Sailing Council as windsurfing equipment at the 2024 Olympic Games in France. So the IQ foil replaced RS: X, which had been the Olympic equipment of choice since Beijing in 2008. It was a big win for Starboard and North sailboard manufacturers, who have been working on innovations for many years and developing equipment that will be equally exciting and suitable for Olympic windsurfing, but also the average recreational surfer.
"Apart from the fact that it's nice to have a competition of this rank in Bol, which has already proven to be a real mecca for windsurfing, and iQFoil could become the only class that unites all surfers - the Olympic community, PWA, and weekend surfers - I'm thrilled to be in this class. We have our young, talented competitors to whom I wish good luck and good wind," says Toni Bulić, one of the two organizers of the competition.
iQFOiL is the result of many years of development of surfing equipment that allows windsurfing from 6 to 35 knots regardless of sea conditions. It is also characteristic of the class that it is standardized - that is, all competitors in the men's and women's competition ride identical equipment. There are three iQFOiL class formats - course, slalom, and marathon - which will all be run in Bol as well, while the competition always ends with a medal race in which the 12 best competitors in each race enter.
On Sunday, September 12, we will watch three separate medal races - in each of the three competition formats - and the final will include four overall best competitors. After the first day, Ian Anić is an excellent fifth in the under-17 category.
Photos: Clive Bevan/Roni Marinković
To follow the latest sports news in Croatia, follow TCN's dedicated page.
To learn more about sport in Croatia, CLICK HERE.
Croatian Bureaucracy, a Love Story: 3. E-Invoicing (e-racun)
September 8, 2021 - Continuing our appreciation of the joys of Croatian bureaucracy, the TCN Croatian Bureaucracy, a Love Story series shows its appreciation of the e-racun invoicing system.
A few months ago I sent out my monthly invoices to various clients. Within a few minutes, I had two replies.
The first was a dream client, thanking me for my hard work and confirming that the invoice had already been paid. I checked the bank and there was the money. Zero transaction cost, zero stamps, just one emailed invoice and one online payment. Superb.
The second email was from a different client and explained that they were unable to pay the invoice, as they were in the e-racun (e-invoicing) system. Could I please send an e-racun and they could then process the payment?
At this point, I should explain that although I have had a company for 18 years in Croatia, I have been shielded from most of its bureaucracy and paperwork by my wonderful accountant and wife (two different fabulous people). They take care of most of the daily headaches, leaving me to sign documents, a setup for which I am eternally grateful.
I must confess to being more than a little confused by the second email. What could be more perfect in terms of e-invoicing than sending an email with the stampless invoice attached, to be paid within minutes, with no transaction costs? How could this e-racun invoicing system possibly be more efficient than that?
And so began a journey of discovery into the wonderful world of electronic invoicing in Croatia in 2021.
Although there were some paid options to produce the required e-racun online, the classic way is to visit the state financial agency known as FINA. Having been shielded from the bureaucracy by my wife and accountant, my direct contact with FINA has always been limited to queuing to pay some small amounts in order to get documents.
I decided that it was time I took more of an active role and headed off to the FINA office in Varazdin, complete with my non-e-racun invoice. I had no idea what would come next, or how a shiny e-invoicing system could be more efficient than simply sending an invoice attached to an email and getting paid within minutes with zero transaction costs.
And so it began...
I was informed that in order for my company to send an e-racun, I would have to give FINA a power of attorney, cost 37.50 kuna. In addition to that, the cost of processing and sending the e-racun was an additional 25 kuna per invoice. This was already looking a little more expensive than the free service paid instantly that clients not in the e-invoicing system. Would the invoice be sent immediately at least?
Not quite. The invoice would be emailed to both me and the client the following day.
With limited options, I agreed to proceed. I filled in the power of attorney form and handed over my ID card (I have permanent residence). There was a problem.
In order to sign the power of attorney, I needed my passport (which I did not have with me), not my ID (which I did have). This contrasts beautifully with a recent attempt to withdraw money from my bank with my passport. This was not possible, as only my ID would suffice.
A wasted trip - unless you count the educational aspect of getting to know the e-invoice system. A return journey to FINA was necessary with the passport, my 62.50 kuna paid and the invoice finally issued. Let's all celebrate digital progress.
Weeks passed.
Another round of invoices sent out. Again two quick email responses.
The first was from the same client, confirming instant payment again. The second, from a new client, asking me to submit an e-racun. Here we go again...
I was in Zagreb, not Varazdin, this time, and headed to th local FINA office with the offending invoice. The clerk informed me that I would need a power of attorney, cost 37.50 kuna and a transaction fee of 25 kuna per invoice. I pointed out that my company already had a power of attorney to cover all invoices, and why the need to pay for the power of attorney again?
He frowned, looked deep into his computer then agreed that I did indeed have the power of attorney.
"But that is for the Varazdin office. You are now in Zagreb."
"Are you telling me that a power of attorney to a national institution such as FINA is only valid for the town in which it is issued?"
He confirmed that this was the case. After a short exchange, he agreed to see if there was anything that he could do.
It turned out that there was, and it would be possible to process the invoice for just the transaction fee, but it would have to go through the Varazdin office, as that is where the power of attorney was signed. It was a Wednesday.
"Ok thank you. can you confirm that it will be sent out tomorrow, Thursday?" He could not. In fact, given that we were already in the afternoon and the fact that the paperwork had to be sent to another city, he could only commit to the following Monday.
I paid my 25 kuna and left, wondering at the magnificent of Croatia in the digital age.
You can follow the Croatian Bureaucracy, a Love Story series here.
Read more:
Croatian Bureaucracy, a Love Story: 1. The Car Licence Plate
Croatian Bureaucracy, a Love Story: 2. Foreign Father Attending a Birth
Opening a Croatian Business Bank Account as a Foreigner... in 46 Minutes
Croatian Tourism Month Launches in October to Extend Tourist Season
September 8, 2021 - Croatian Tourism Month will be held this October to replace last year's first-ever Vacation-Worthy Week campaign.
On the Croatian Radio 1 - Business Week show, the Minister of Tourism and Sports Nikolina Brnjac announced that to extend this tourist year, in which Croatia reached 60% of tourist traffic realized in 2019 on August 28, last year's Vacation-Worthy Week campaign will now to be carried out throughout the month of October, under the name Croatian Tourism Month, reports HRTurizam.
"On this occasion, I invite all stakeholders in the tourism system to get involved in this action to achieve the best possible postseason. Good results this season are the result of systematic work and planning of all departments of the Croatian Government since the beginning of the year. Thanks to the synergy of the tourism sector, Croatia has been recognized this year as a destination that has taken all measures to create the preconditions for a safe environment," said Brnjac.
The first "Vacation-Worthy Week," a joint project of the Ministry of Tourism and Sports and the Croatian National Tourist Board, took place from October 16 to 25 last year.
In the promotional week, citizens were able to take advantage of a total of 424 offers and services from all parts of Croatia at 50 percent better prices.
Although due to the specific situation in which the action was carried out, following the coronavirus pandemic, it was difficult to assess how successful the campaign was.
Among the numerous tourist entities, national parks and nature parks took part in the action, which was in the special focus of visitors. Thus, Plitvice Lakes National Park, which offered tickets to all visitors at an affordable price of 50 kuna, was visited by almost 30,000 guests in ten days.
Krka National Park, which 2,700 tourists visited in the promotional week, also recorded good results, while the Northern Velebit National Park sold more than 500 tickets in the same period.
The Croatian National Tourist Board pointed out that the Vacation-Worthy Week website attracted more than 150,000 unique visitors, who spent an average of three minutes researching the offers. At the same time, they mostly reviewed offers from the city of Zagreb and Split-Dalmatia, Primorje-Gorski Kotar, and Istria counties.
For more, make sure to check out our dedicated lifestyle section.
