January the 4th, 2022 - Did you know that a Zagorje banana plantation exists on the very borders of the much loved Medvednica Nature Park? Head to Donja Stubica if you don't believe us.

As Poslovni Dnevnik writes, the owner of the Zagorje banana plantation rejected all of the typical and traditional local culture and started growing bananas and other unusually exotic fruits on the rolling green hills of Zagorje. Western Europe is his market, and he's expanding production down to Dalmatia, neighbouring Serbia, Albania, and all the way to the distant Ivory Coast. Meet Ivan Sulog, a most unusual Croatian farmer.

At the very border of the Medvednica Nature Park, where Donja Stubica borders Gornja Podgora, Mr. Ivan Sulog planted the very impressive Zagorje banana plantation.

''These are Indian bananas which are older than even the dinosaurs, they survived the ice age,'' explained Ivan for HRT.

''Indian bananas got that name because they were primarily eaten by the Indians, and banana because they taste just like eating banana cream. And that's how the Indian banana got its name. Unlike the chokeberry which you typically buy once and never again because they're too bitter and strong, this is something you try once and want more,'' Ivan explained.

''I heard a story about a lunatic planting bananas, and later I found out that I work for that lunatic!'' said Ivan's employee Mirjana Djurin. The Zagorje banana plantation doesn't just boast the famous curved yellow fruit, but also passion fruit, chili, Surinamese cherries, Indian bananas, juzu, kumquat, and so on. Quite obscure indeed for continental Croatia.

''People hear what I do, and it sounds so beautiful and exotic to them, they expect that my yield is always good and that I'm raking in the cash, which isn't really the case,'' Ivan explained.

''These are the first urban orchards, probably the first in all of Europe, there are urban gardens in Zagreb, where people come and take 20 square metres, and someone maintains it for them or they maintain it themselves. We've got more or less then same model here, if you don't have land, you can't plant your bananas. From now on, people can rent five bananas from us, put your name on them and all of the other information you want, and we take care of them until the harvest,'' said Ivan.

Now the unusual Zagorje banana plantation has even spread its wings and outgrown the borders of Croatia, starting up business in neighbouring Serbia, Indian bananas have been planted down in in Montenegro, and Albania is next on the cards, the Ivory Coast, too.

For more, check out Made in Croatia.

January the 4th, 2022 - Precisely what makes a strategic Croatian company? Are there any firm criteria to speak of? With the National Recovery and Resilience Plan (Croatian: NPOO) requiring explanations, it seems that there are.

As Poslovni Dnevnik/Marija Brnic writes, for years, the state has had a list of companies it owns and which are of special interest to it, but for the first time at last year's session, the government updated the list, citing precise reasons as to why each company is strategically important.

The reason for these explanations are the measures adopted by the NPOO on improving the management of state-owned enterprises, and the competent ministries will have to revise the list which contains information on each strategic Croatian company each and every year and determine the reasons why some companies in their jurisdiction are classed as strategic.

There were once 50, now there are 36...

This is a list that once numbered about 50 strategic Croatian companies, and that number appears to be constantly decreasing. As expected, this has happened again, because three companies have been "removed" from the existing list, and that list now boasts just 36. In two cases, the Institute of Immunology and the Rijeka-Zagreb Highway, the removal is due to technical reasons, while the third company, Maritime Electronics Centre Split, was "transferred" to CERP's extensive portfolio.

As for the remaining ones, as a rule, short lines are given about the company's activities, the size of the state's share in the share capital and the like. Alan Agency takes care of defense production and the procurement of weapons and equipment, AKD prepares ID cards and other official documents for the state, Croatian Post (Hrvatska posta) is the largest service network in the country and holds 83 percent of the postal services market, and Transmitters and Communications is the only network operator for all existing digital terrestrial television networks with 100 percent of the market share in DVB-Ta.

INA remains an exception

When it comes to ACI, their strategic importance lies in them taking care of the country's expansive maritime domain, and for Croatia Airlines (CA), it's crucial that its market share, which otherwise stands at 36 percent, grows to 60 percent during the winter, because most carriers don't fly, or not as much, so the Government believes that CA provides connectivity to, from and across Croatia.

HPB (Hrvatska postanska banka) is the largest domestically owned bank, and for the last decade or so it has been one of the five largest in the Croatian banking system and has deposits with a very high balance from the central government. Its title as a strategic Croatian company is as such indisputable at this time.

For all companies on the strategic Croatian company list, the state is the majority owner, with the exception of INA, which is still on the list because "of the processing and exploration of oil and gas which is important for the security of the energy supply in the Republic of Croatia."

For more, check out our dedicated business section.

January the 4th, 2022 - What made ''Croatia 2021'' be what it was? From the arrival of the long awaited coronavirus vaccines to Mate Rimac's continued business successes to the recovery of the tourism industry with an unexpectedly remarkable summer season, the list is extensive.

As Poslovni Dnevnik/Karlo Vajdic writes, as we draw the line under the previous twelve months, we need to look at both the good and the bad and make assessments and plans for the future. Let's go back in time to Croatia 2021 and try to highlight the events that stood out for the domestic economy, and also provide some sort of general assessment of the state of the Croatian economy last year.

Business is still less than free, it's true to say this is somewhat less than what experienced in 2020, but costs continued to rise in 2021, and there is no sector that isn't desperately craving a full recovery, although at least some of them are finding doing business easier than they did in 2020.

All this was reflected in the numbers. After the shocking events which dominated 2020, the domestic economy experienced a strong jump in the second and third quarters of last year. Gross domestic product (GDP) was more than promising. Back in mid-December 2021, the central bank published forecasts estimating that GDP growth in 2021 would total 10.8 percent.

The year before, in 2020, there was a decline of 8.1 percent, but for 2022, growth of around 4 percent is expected once again, so it seems that we will successfully return to our own average. The Crobex index jumped nearly 20 percent from the end of 2020, but turnover is lower. Throughout the whole of 2020, it amounted to 3.13 billion kuna, and last year, it totalled 2.54 billion.

In general, the question can be asked whether the economic year for Croatia 2021 should be compared with 2020 or with pre-pandemic 2019 in order to have a somewhat more realistic assessment of the state of the domestic economy? In the search for an answer to this question, let's recall some of the key events that marked the economic year of 2021.

In business, the most high-profile event of the year was undoubtedly the merger of Rimac automobili and the legendary luxury vehicle manufacturer - Bugatti. The Bugatti Rimac company is jointly owned by the Rimac Group (55%) and the German giant Porsche (45%), and the company is headed by Livno-born entrepreneur Mate Rimac. The transaction turned into a true spectacle, and the company was even visited by the President of the European Commission (EC) Ursula von der Leyen during her stay in Zagreb back in July.

Political meddling with business didn't stop at mere courteous visits, but the decision to allow Rimac's company to build a new production and development campus in Sveta Nedelja on preferential terms raised a lot of hope for the public. This was followed by the allocation of 200 million euros from the European aid package for economic reconstruction to Rimac's plan for the development of an autonomous vehicle and taxi service in Zagreb by the year 2024. Last year, Rimac continued to be plastered all of the newspapers, hailed a hero.

Another high-profile event in the same category was the sale of Zagreb's Ledo frozen food factory and its subsidiaries. Fortenova (formerly Agrokor) announced in late September that the sale of Ledo to the British corporation Nomad Foods had been concluded, and the transaction itself was worth a massive 615 million euros. In addition to these two major transactions, last year was marked a number of smaller ones, including the sale of the Sunce hotel chain by entrepreneur Jako Andabak, who sold his 11 hotels to the Eagle Hills investment group. The sale of the Croatian manufacturer of glass pharmaceutical packaging, Piramida, to the Japanese conglomerate Nipro was also interesting.

The third high-profile event which marked last year came from the category of stock market listings, and that was the initial public offering of Span shares and their listing on the Zagreb Stock Exchange. The well-known domestic IT company eventually sold its shares at the maximum anticipated price, 175 kuna, and in the meantime their value jumped by an additional 33 percent.

Unlike Span's listing on the stock exchange, the delisting of shares of PBZ, Dukat and Magma, once very happy to trade on the domestic market, went in the opposite direction While Span's listing as a modern Croatian IT company is a laudable illustration of recent, much more digital times, Croatia 2021 didn't disappoint in terms of events related to companies such as the proverbial anchor wrapped around the legs of the Croatian economy and of the local political scene.

The agonies experienced by the enfeebled shipyards (3. Maj and Uljanik) continued, and the troubles faced by the Brodarski Institute in Zagreb ended with a political decision.

With a payment of 45 million euros, the Slovak Tatravagonka took over production in Zagreb's Gredelj and thus concluded the company's long-term bankruptcy proceedings. Just before the end of the year, Djuro Djakovic got another chance to survive when the European Commission (EC) approved Croatia to grant Djakovic, which was restructuring support in the amount of 57.4 million euros.

The planned recapitalisation of Jadroplov failed, the Turkish corporation Yildrim showed interest in the Kutina-based Petrokemija, and the financial restructuring and recapitalisation of Dalekovod became even more complicated.

On the other hand, there was some good news from the blossoming domestic IT sector, traditionally ignored in political debates and games, probably because the vultures in politics don't really understand it all that well. That's for the best, it seems.

Vodnjan's incredible Infobip announced their takeover of the American company Peerless Network and the Irish company Anam Technologies. That same Istrian company also announced its listing on the American stock exchange. At the end of the year, Konzum announced that it was starting to accept Bitcoin as a means of payment in its online stores, thus joining the Tifon fuel station chain, which enabled customers to do the same back at the beginning of the year.

Croatian enterprises and their leaders, despite the pandemic, haven't completely lost heart. Nasice's NEXE announced an investment of 123 million kuna in modernisation and new products, and BAT announced an investment of 200 million kuna in their factory in Rovinj. A similar amount of investments in capacity growth was announced by the Medjimurje-based packaging manufacturer Muraplast, and an investment of as much as 200 million euros in the construction of a laminate factory in Ogulin was also announced.

From last year's high-profile personnel transfers, it is worth mentioning the arrival of former Minister Martina Dalic to the helm of Podravka, a position to which she was appointed at the beginning of February. In the very same sector, and at about the same time, Nenad Klepac was appointed head of Vindija, succeeding the late long-time owner Dragutin Drko. The first man of the Croatian Chamber of Commerce (HGK), Luka Burilovic, also won a third term at that institution back in October.

Some important news related to the Chamber of Commerce itself, and that was the much anticipated passing of a law abolishing the mandatory payment of membership fees for small businesses. Also related to the Croatian Chamber of Commerce is some news from the margins of economics and politics published just before the end of the year, that former longtime head of the chamber Nadan Vidosevic was found guilty of withdrawing money from the Croatian Chamber of Commerce and was sentenced to eight years in prison with the obligation to return 35.5 million kuna to the Chamber.

From the same marginal economic and political position, it is impossible not to mention the death of Milan Bandic, the former mayor and long-time master of Zagreb's local economy, which accounts for a third of Croatia's GDP. Bandic died prematurely and suddenly from what was then cited as a massive heart attack, although many questions surrounding his death remain, even from his widow, Vesna.

The new mayor, Tomislav Tomasevic of Mozemo! (We can!), and the new Zagreb administration have inherited the fight against Bandic's legacy with that they claim to be a ''devastating situation'' in terms of the capital's finances. These issues were only heightened by the earthquake of March 2020.

The post-earthquake reconstruction of Zagreb and Banovina, which is still ongoing and moving at a shameful snail's pace, is the subject of a story about the role of Croatian politics in the domestic economy, which has been repeated for the third consecutive decade. The fiasco with the reconstruction of Zagreb and Banovina is reminiscent of the reconstruction of almost the whole of Croatia after the war in the 1990s.

While back then, issues were due to bad politics and politicians, the opportunity was missed to rebuild the Croatian economy at the same time from the remnants of socialism and the remnants of war, now a similar story is being repeated, only with an indiscriminate natural disaster at play.

The difference is that two and a half decades ago, politicians were unable to create a framework in which to exploit Croatia's potential, then expressed in the number of unemployed people that occasionally approached the level of 400,000, while today politicians are unable to create a framework in which to used the potential of financial assistance provided by the European Union. That said, Prime Minister Andrej Plenkovic and the rest of the political elite have repeatedly tried to gild the role of the Government in Croatia's economic rust over the past year. Among them, we can single out two moments for this occasion.

The first is the development of the famous National Recovery and Resilience Plan. A comprehensive document of more than 1,200 pages was drafted by the government as a justification for withdrawing money from the EU's Recovery and Resilience Mechanism. This is a document that acts as if no one has even ever read it in its entirety and is quickly being seen as just another pile of projects, wishes and empty phrases like countless other unimplemented strategies and plans written and shelved over the last twenty years.

The second bright moment for Croatian politics came back in mid-November when the credit rating agency Fitch Ratings announced that it had raised Croatia's rating to BBB. Prime Minister Plenkovic and Minister of Finance Zdravko Maric hurried to welcome the good news in front of the public, which included the euphoric remark that this is the highest rating for Croatia in history.

What was left out of these celebrations was the fact that that rating was only one level higher than the BBB- rating that Croatia had when it first received a rating way back in 1997 - just two years after the Homeland War secured the nation its independence and saw the collapse of Yugoslavia. At this rate, we'll reach the highest AAA category in a mere 192 years!

Is that why everything is still bleak and everyone is still busy lining cafes and complaining over three hour long coffees? No, Croatia 2021 also gave us some excellent news. For a start, the tourist season was more or less successful, unexpectedly and quite remarkably. Data from the Central Bureau of Statistics shows that from the beginning of July to the end of September last year there were 9.36 million tourist arrivals and that guests realised 57.3 million overnight stays. The arrival of the coronavirus vaccine had a lot to do with this, and visitors saw Croatia as an epidemiologically safe country, especially when compared with its Mediterranean competition.

Compared to the pre-pandemic year of 2019, this is a ten percent lower number of overnight stays and 16.5 percent fewer guests. For yet another pandemic-dominated year, Croatia 2021 did very, very well in this regard.

Export results for Croatia 2021 are even better. In the first ten months of last year, merchandise exports exceeded 15.1 billion euros. There is no doubt that by the end of the year that amount was exceeded and if there is one thing that can make us happy, it is the success of the exporters who suffered terribly as a result of the pandemic. These are mostly small and medium-sized companies that aren't very widely heard about, but which, despite their policies, continue to invest in their capacities and modernisation in order to take full advantage of what it means to have EU membership.

This, in addition to the promising domestic IT sector, is making an apparently clean break from at least one part of the domestic economy, which is the tradition of inefficient, lethargic, economic mastodons who are lost in time and space, giving hope for a brighter future as we walk into 2022 and beyond.

For more, check out our dedicated lifestyle and business sections.

January the 4th, 2022 - The new Novska gaming campus is the first of its kind in all of Europe, and given that it is located in this often wrongly overlooked part of the country, things can't get moving quickly enough.

As Poslovni Dnevnik/Suzana Varosanec writes, the construction of the Pismo video game industry campus in Novska worth 375.5 million kuna, the first gaming campus in Europe, is a strategic project and a prominent component of the programme of social and economic revitalisation of the areas of Sisak-Moslavina County being assisted post-earthquake, with expected rapid realisation.

The new Novska gaming campus will be constructed on an area spanning eight hectares in the Novljan business zone, and the company that will prepare all the project documentation has already been selected.

''The completion of everything regarding the documentation is expected by May the 1st, 2022, followed by a tender for construction. The decision to include this project in the Revitalisation Programme is a sign of the great level of recognition of the work done so far across Sisak-Moslavina County and Novska,'' said Mario Celan, the director of the Simora Development Agency, which manages the Pismo Business Incubator.

According to Celan, 67 newly opened companies generate about a hundred jobs, while on the Novska gaming campus alone, they expect to open up 80 employment opportunities and attract a minimum of 250 startups, as well as numerous investments from abroad.

A few years ago, he explained, they took the opportunity to develop the video game industry in this particular county, as it is a new and modern industry that is constantly growing, which was the reason for them to head in that direction, and "2 percent of the Revitalisation Programme will be invested in developing competitiveness in the best way possible,'' according to him.

There will also be an eSport arena

The new Novska gaming campus will also include the construction of facilities related to the opening of studios, student dormitories, the Business Incubator for the eSport arena with 4,000 seats and the Accelerator of the gaming industry. There are also extensive plans to have a five-year higher education programme with 50 students per year and a high school programme and accompanying classes with 24 students per year.

For more, check out our dedicated business section.

ZAGREB, 3 Jan 2022 - The Croatian government will continue doing its best to help the Đuro Đaković company survive, and conditions are being created for the company's long-term sustainability with the support of a strategic partner from the Czech Republic, the government said in a statement on Monday.

The statement was issued following a meeting between Prime Minister Andrej Plenković and the leadership of the Slavonski Brod-based mechanical engineering company.

"At the meeting, both sides welcomed the European Commission's decision of late December 2021 to approve the program for Đuro Đaković's restructuring. The government had communicated intensively with EC officials and the EC's decision is a clear signal that the plan for the Đuro Đaković Group is viable," said the statement, released after talks between PM Plenković and Đuro Đaković Group Management Board member Pavel Maroušek, Đuro Đaković Special Vehicles Management Board chairman Danijel Marić, and Đuro Đaković Special Vehicles Management Board member Goran Matanić.

The statement quoted PM Plenković as saying that the government would continue doing its best to help the company survive and support restructuring activities.

"Following the stage when, with the government's support, the continuation of production and wages for the workers were ensured, we are entering a stage when conditions are being created for the long-term sustainability of Đuro Đaković, with the support of the strategic partner from the Czech Republic," Plenković said.

The Đuro Đaković officials presented the company's plans and production activities for the coming period.

PM Plenković said that the government would very soon give final approval of the program for Đuro Đaković and adopt other accompanying documents, thus creating conditions for an efficient restructuring process.

EC approved restructuring aid for Đuro Đaković in late 2021

On 22 December, the European Commission approved Croatia's plan to grant Ðuro Ðaković a total amount of €57.4 million in restructuring aid.

The measure will enable the company to finance its restructuring plan and restore its long-term viability with the support of a private investor, the consortium of Czech companies DD Acquisition, the Commission said.

On 8 May 2020, the Commission approved rescue aid to Đuro Đaković in the form of a Croatian state guarantee on a €40.31 million loan. The guarantee allowed the company to meet urgent liquidity needs and continue its activities while limiting distortions to competition until approval of the restructuring plan. At the time, Croatia committed to submit a restructuring plan for Đuro Đaković within six months following the first disbursement of the guaranteed funds.

Croatia submitted a restructuring plan and notified the Commission of its plans to grant restructuring aid to the company. The planned restructuring aid will take the form of a debt-to-equity swap and a guarantee on potential future commercial claims for a total amount of €57.4 million. The restructuring plan provides that a private investor, i.e. the consortium of Czech companies active in the same sector, “DD Acquisition”, will participate in a share capital increase with cash and in-kind contributions of approximately €64 million.

Following the capital increase, the new investor will become the controlling shareholder of Đuro Đaković and will support various aspects of its restructuring with cash and synergies, and contribute its experience and market knowledge.

The Commission found that the aid is necessary to ensure that Đuro Đaković will be viable long-term without the need for continued public support. This will also be ensured by the acquisition of control of the company by a private investor with core activities in the same industry.

The Commission also found that the aid is appropriate, as it supports a comprehensive restructuring plan running until the end of 2023, and proportionate, with an own contribution of over 50% of the restructuring costs provided by the company and the investor at market terms.

Compensatory measures, in particular the withdrawal of the company from the project engineering market through the liquidation of the subsidiary Ðuro Ðaković Industrial Solutions and the discontinuation of the production of three types of wagons, are provided to limit potential distortions of competition on the market for freight wagons where the company operates.

Đuro Đaković employs 733 people and has a diversified industrial portfolio including defense, transport, industry, and energy.

For more, check out our politics section.

ZAGREB, 3 Jan 2022 - The EIZ Online Vacancy Index (OVI) has shown that labor demand in 2021 was up 5.5% compared to the pre-pandemic year 2019 and the positive trend continued in December with labor demand up by 32% year on year, the Institute of Economics, Zagreb (EIZ) reported on Monday.

"Despite the challenges of the pandemic, the calendar year has ended with good news because the latest OVI index has shown a continuing positive image of the labor market," EIZ said on its website.

The OVI index for December 2021 shows that labor demand in 2021 was 75% higher than for data related to December 2020 and 32% higher compared to the pre-pandemic year of 2019. This is the eighth month in a row in which labor demand has exceeded pre-pandemic months.

Labor demand in 2021 was 5.5% higher than it was in 2019 while the OVI index was 48% higher in 2021 compared to 2020.

EIZ reported that positive trends are also visible quarter on quarter with the OVI index for the fourth quarter of 2021 is as much as 60% higher than in Q4, 2020 and 20% higher compared with 2019 Q4.

The most sought-after workers were salespeople, cooks, waiters, warehouse workers, and drivers while 46 percent of advertisements were for fixed-term employment and 44 percent for permanent employment. In 2021, 1.6% of the jobs advertised offered the opportunity of working from home which is a significant increase compared to 2019. Prior to the pandemic, a mere 0.1% provided that option.

In addition, 2.6% of job advertisements in 2021 were for pensioners, up 1.2% from 2020 and 0.6% from 2019, EIZ analysts reported.

OVI is a monthly index of online job advertisements developed by EIZ in cooperation with the MojPosao job search website. The index aims to provide timely information on current labor demand.

For more, check out our politics section.

ZAGREB, 3 Jan 2022 - The organizing committees for two referendum petitions initiated by the Bridge party cost a total of HRK 428,300 (€57,106), the organizers revealed on Monday.

The cost of the collection of signatures for the referendum petitions was capped at HRK 8 million each.

From 4 to 18 December, the Bridge party collected signatures at over 1,200 venues across Croatia for the two referendum petitions: one for the transfer of the powers of the national COVID-19 crisis management team to the parliament, where all decisions concerning COVID crisis management should be approved by a two-thirds majority, and the other one for the abolition of COVID passes.

The referendum activities lasted from 2 December to 2 January, the organizers said on Monday.

The costs include the lease of venues, banking services, transport, advertisement, printing services, etc.

The costs incurred for the initiative to have COVID certificates revoked stand at HRK 203,700.

The organizers said they had raised 205,000 in donations for the initiative to rescind COVID certificates. The bulk of that amount, or HRK 170,000, was provided by the Bridge party, whereas citizens Ivan Pehar and Željko Ilijašević donated HRK 30,000 and HRK 5,000 respectively.

According to the organizers, HRK 224,600 was spent on the initiative for the transfer of the powers of the national COVID-19 crisis management team to the parliament.

The donations for this purpose came to HRK 218,800, with Bridge itself donating HRK 180,000. Furthermore, individuals donated amounts ranging from HRK 50 to HRK 30,000, the maximum amount that can be donated by an individual in a referendum initiative.

When this opposition party started collecting signatures, the Justice and Public Administration Ministry established that the minimum required number should be 368,446 valid signatures, that is 10% of the country's electorate.

Bridge leader Božo Petrov told a news conference on 23 December that the party had collected about 400,000 signatures and that the boxes with the signatures would be delivered to the national parliament on 24 January.

(€1 = HRK 7.5)

For more, check out our politics section.

ZAGREB, 3 January 2022 - Last week, the European Commission disbursed a grant of €277.8 million from the European Union Solidarity Fund (EUSF) to help Croatia repair the damage caused by the earthquakes that struck central areas of the country at the end of 2020 and the beginning of 2021, the Commission said on Monday. 

The Commission has awarded €319 million of EUSF support to Croatia following the devastating series of earthquakes that hit Sisak-Moslavina, Karlovac, and Zagreb Counties in December 2020 and January 2021. €41 million was paid as an advance in August 2021, and the balance payment of €277.8 million was made on 30 December 2021.

"Croatia has gone through two terrible earthquakes in March 2020 and again a series of earthquakes in December 2020 and January 2021. The financial support from the EU Solidarity Fund to Croatia will contribute to the essential recovery efforts after the devastation brought by the earthquakes and it is a visible sign of EU solidarity,” said the Commissioner for Cohesion and Reforms, Elisa Ferreira.

In late October, following an application by Croatia for compensation for the damage caused by the earthquakes, the Commission proposed a financial contribution from the EUSF of €319 million, which was approved by the Council of the EU and the European Parliament in mid-December.

Croatia had previously received a grant of €683.7 million to repair the damage caused by a devastating earthquake that struck  Zagreb in March 2020, which makes up more than €1 billion in total support.

For more, check out our politics section.