ZAGREB, 4 Sept, 2021 - Cattle farmers lose HRK 4.75  per kilo per head due to the corona crisis, the Zagreb-based Večernji List (VL) reported on Saturday.

Findings of a study, conducted by Osijek researchers Krunoslav Zmaić and David Kranjac, show that the corona crisis has caused disruption on the market.

Before the start of the COVID-19 pandemic, fodder made up about 50% of the material costs in businesses led by cattle farmers. However, cereals and oil crops' price hikes have raised this percentage to 80%.

The average price of soybean skyrocketed 50.49% this year in comparison to their five-year average, and maize prices increased roughly 36%, whereas fodder barley prices went up 19.5%.

For instance, milk producers lose HRK 1.02 per litre due to the crisis.

The researchers warn against excessive imports of meat and milk at dumping prices, and they propose stringent restrictions on this import.

 They also suggest short-term state support schemes.

(€1 = HRK 7.5)

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ZAGREB, Dec 21, 2020 - Health Minister Vili Beros said on Monday that the COVID crisis had so far cost the health system HRK 927.4 million.

Data show that by December 18, HRK 574.4 million was spent on testing, HRK 268.9 million on treatment and more than HRK 83 million on sick leaves, Beros said at the national COVID-19 crisis management team's press conference.

He also said that a meeting was being held at the Health Ministry with drug wholesalers regarding the health system's debt to them.

Beros said that the number of new COVID-19 infections had started dropping.

The average number of services provided in all health institutions in Croatia is at 67.21% compared to the second week of December 2019.

"These are encouraging data as they show that despite the burden of COVID-19 positive patients we are finding ways, strength and opportunities to respond to other needs, especially in oncology," Beros said.

Despite the fact that the health system has completely adapted to COVID patients, the number of services provided in Zagreb's hospitals is at 74% compared to the second week of December last  year, and only the KB Dubrava hospital, which is completely focused on treating coronavirus patients, has provided 11% of other services.

Other patients using KB Dubrava's services, 3,993 of them, have been sent to other health institutions via the call centre, Beros said.

He added that there were also institutions like the Magdalena Clinic which is at 119% of provided services due to taking over some of KB Dubrava's cardiac surgery patients.

Beros said there would be no changes regarding the realisation of the right of health workers to a full salary after getting infected with COVID.

He said that all those who had got infected at work would receive 100% of their salary, but they have to ask their employer for confirmation.

(€1= HRK 7.5)

ZAGREB, Dec 19, 2020 - The outgoing year 2020, which was supposed to have been a year of continued economic growth, has turned into a year marked by the COVID 19 pandemic that has tested the strength of public finances.

At the very beginning, 2020 seemed to be similar to the previous five or six years: nine laws regulating tax changes ushered in the fourth round of a tax reform which shouldincrease the post-tax disposable income by HRK 2.4 billion. The ordinary pace of the social and economic activities continued against a background of more and more information about the spread of the coronavirus infection in China.

25 February - 1st registered case of coronavirus infection in Croatia

On 25 February, Croatia's health authorities reported that they had confirmed the first case of the infection with the novel virus in the country. Immediately after that, citizens rushed to stores to buy large quantities of food and hygienic products. Traffic across borders was also made more difficult due to a high number of passengers going back home and stringent controls at border crossings.

On 12 March, Prime Minister Andrej Plenkovic announced first anti-COVID restrictive measures and reassured the enterprise sector that compensatory measures for businesses were being hammered out. The PM put an emphasis on the retention of jobs.

In mid-March, the Croatian National Bank (HNB) assessed that the earlier forecasts of economic growth would have to be revised, and for the first time in its history the central bank purchased state bonds in the amount of 213 million kuna.

HNB-ECB swap line deal, 1st set of measures to offset lockdown damage to economy

In March, the HNB conducted five interventions on the foreign exchange market to maintain the stability of the exchange rate of the kuna, selling a total of € 2.25 billion. Since then, it has also taken some other measures to mitigate the economic impact of the coronavirus pandemic. The HNB also released HRK 3.8 billion to banks in a structural operation and HRK 1.85 billion in regular ones in that period.

In mid-April, the HNB said it had agreed with the European Central Bank (ECB) to set up a precautionary currency agreement, known as a swap line, that will allow the HNB to borrow up to €2 billion from the ECB in exchange for Croatian kuna. The HNB said in a press release that the precautionary currency swap line would be activated if needed.

This swap line gives the HNB "the space to provide additional euro liquidity to Croatian financial institutions, should they need it, without using its own international reserves."

The central bank said that it "will notify the ECB of the use of euro liquidity acquired through the currency swap line. The currency swap line will remain in place until 31 December 2020, and can be extended if necessary."

In the second half of March, public events and gatherings were cancelled, and the government and the parliament adopted the first HRK 30 billion-worth set of compensatory schemes, with the aim of retaining jobs and ensuring funds for wages. The government also financed a minimum net monthly wage of HRK 3,250. The first package, worth HRK 30 billion (€4bn), included 63 measures aimed at those that were already feeling or were yet to feel the consequences of the crisis.

Lockdown and earthquake

Croatia went into a lockdown on 19 March and on 22 March, Zagreb and its environs were hit by an earthquake with a magnitude of 5.5 on the Richter scale which kille a teenage girl in downtown Zagreb and caused serious material damage, estimated at HRK 42 billion, in the city and nearby counties. Currently, 12 billion kuna has been made available for the reconstruction as an initial fund coming from the EU Solidarity Fund plus a US$ 200 million loan provided by the World Bank.

The fund for the post-earthquake reconstruction of Zagreb and two neighbouring counties has been established in the meantime, with renowned manager Damir Vandjelic at its helm. He has said that the total revenues of the construction sector in Croatia in 2019 came to 18 billion kuna, whereas the activities in the reconstruction of quake-damaged buildings would bring 3-4 billion kuna annually.

2nd set of compensatory measures 

In April, the government introduced the second rescue package to save jobs and help the economy, including increasing the net minimum wage to HRK 4,000 (€725). In total, the state was expected to pay HRK 5,460 per employee as a furlough measure in April, May and June. The state funded the measure with HRK 8.5 billion.

Secondly, the government partly or fully exempted some businesses from taxes for April, May, and July (12 billion kuna).

The third measure in this package applied to VAT payments, making possible for companies to defer such payments until the billing of invoices issued.

In mid-April, the Croatian parliament unanimously (with 120 votes 'for') adopted the government-sponsored law under which the enforcement of monetary assets of natural persons would be suspended for a period of three months, and if necessary for an additional three months.

Throughout May, the epidemic ebbed away, and 23 May was the first day since the outbreak of the infection without any new case of coronavirus.

The favourable circumstances enabled the gradual ease of the restrictions and reopening of non-essential shops and hospitality services.

In late June, Croatia adopted a short-time work scheme as one of the measures to help the businesses affected by the corona crisis.

Tourist season, parliamentary elections

Two summer months, July and August, were marked by the 5 July parliamentary elections, with the Croatian Democratic Union (HDZ) being a relative winner. After that, it and its junior partners formed the new government, the second cabinet led by Prime Minister Andrej Plenkovic.

During the peak summer season, more and more tourists travelled to Croatia. The data for the first nine months of 2020 show that 6.6 million visitors were in Croatia in that period, making 39.7 million overnight stays, or 63.4% fewer travellers and 54% fewer overnight stays compared to January-September 2019.

Coronavirus 'second wave' 

In September, the government unveiled a new rescue package witch also included COVID loans to improve the liquidity of companies in distress due to the corona crisis.

The government adopted budget guidelines for the next three years, which project a 8% GDP drop this year, a 5% growth in 2021, a 3.4% growth in 2022 and a 3.1% growth in 2023.

This year, the budget gap is expected at 6.7% of GDP, while in 2021 it should be reduced to 2.9%, which is within the Maastricht criteria, the government said when unveiling the guidelines in late September.

With the deterioration of the epidemic in November and in the first half of December, the government continued providing assistance through a job-retention scheme and other measures.

However, the dissatisfaction of the worst affected businesses, notably enterprises in the transport and hospitality sectors, was growing. As a result, apart from the HUP, HGK and HOK business associations, one more association -- the Voice of Entrepreneurs ("Glas Poduzetnika") -- was set up, bringing together disgruntled businesses.

In mid-December, Prime Minister Andrej Plenkovic said that Croatia was now facing a challenging period in the coronavirus epidemic which has cost Croatia HRK 30 billion so far and that the human casualties and the high number of people infected call for new measures.

The Prime Minister underscored that since the outbreak of the epidemic the government has spent HRK 30 billion through various activities to maintain a normal life and to enable the health system to continue functioning.

ERM II and journey to euro area, OCED membership

2020 would be also remembered for Croatia's admission to the Exchange Rate Mechanism (ERM II) in July.

The European Central Bank (ECB) and the European Commission announced on 13 July that Croatia had been admitted to ERM II, the key step in the process of adopting the euro, and that the Croatian National Bank (HNB) had established close cooperation with the ECB. Croatia now faces the job of meeting the Maastricht criteria in the next two years.

In mid-December, Plenkovic said that the coronavirus crisis had once again shown the importance of Croatia's membership bid to join the Organisation for Economic Cooperation and Development (OECD), which continued to be one of the government's priorities. The Croatian government sent a formal membership request to the OECD in January 2017 and since then it has candidate status. The decision on accepting it as a member has to be unanimously adopted by the OECD Council after which the accession process begins.

EU's Multiannual Financial Framework, €22 bn to be made availabe to Croatia

The corona crisis has also tested the institutions of the European Union and its response to the new circumstances. The most important event in this context is the July agreement of the European Council on the new Multiannual Financial Framework  (MFF), including a €750 billion recovery fund.

Of the €1.8 trillion long-term EU budget, approved in mid-December by the European Parliament, Croatia should receive a total of €22 billion from those sources.

The Next Generation EU plan was adopted in synergy with the MFF 2021-2027, and it should repair the economic and social damage caused by the coronavirus pandemic, kick-start European recovery and protect and create jobs. Slightly over €12.6 billion from the new MFF and €10.6 billion from the Next Generation EU instrument will be available to Croatia.

Credit rating agencies' assessment 

In mid-November, the Moody's credit rating agency upgraded Croatia's rating to Ba1 from Ba2 and changed the outlook to stable from positive, citing enhanced institutional capacity and policymaking as the country enters a critical phase of euro area accession and reduced exposure to foreign-currency debt risk.

Two other major credit rating agencies, Standard & Poor's and Fitch, keep Croatia's credit rating at investment grade. S&P affirmed its rating of 'BBB-/A-3' with a stable outlook in September.

On 5 December, Fitch Ratings affirmed Croatia's long-term foreign-currency issuer default rating (IDR) at BBB-, assessing the outlook as stable and noting that it expects gradual recovery from the coronavirus crisis with the help of EU funds as well as that limited capacity to absorb EU money poses a problem.

(€1 = HRK 7.5)

ZAGREB, Sept 26, 2020 - Culture and Media Minister Nina Obuljen Korinek has said in an interview for Hina that her department will see to it that the culture and creative industries and the media sector get out of the corona crisis with as few scars as possible.

Commenting on the fact that the world media was added to the official name of her department after she was reappointed the minister in late July, Obuljen Korzinek recalls that since 2002 the ministerial department of culture has been authorized to cover the sector of media. Adding the word media to the official name of the ministry was made with the purpose of highlighting that sector, the minister explained.

Bill on electronic media on government's agenda soon

Considering concrete steps that the ministry is taking to enhance the status of the media sector, Obuljen Korzinek says in the interview published on Saturday that the draft law on electronic media is being fine-tuned by the relevant ministries and is expected to be on the government's agenda in October.

The ministry is preparing activities to release the media legislation for public consultation, she said.

Following the government aid schemes made available in April and May, and enabling the media sector to have access to credit lines for which the government provides collateral, we are considering some other measures to support the media sector within the European Union's funds for recovery, she says.

"We are conducting dialogue with professional associations to finds modalities for assistance aimed at enhancing the status of journalists," the minister said.

"All those assistance measures should be carefully prepared so that they remain neutral and do not affect the independence of media."

 Asked about a growing number of defamation suits against reporters, the minister reiterated that politicians and office-holders should refrain from taking libel suits against journalists and media.

"I am strongly for the preservation of media freedoms as an important pillar for the development of democracy."

In parallel, every citizen who feels to have been defamed is entitled to the court protection, she said recalling that in the first term of the Andrej Plenkovic cabinet abolished the criminal libel act.

Web portal with criteria for the assessment of epidemiological risks for music events

Considering the music industry in the times of the COVID-19 pandemic, the minister says that the authorities in cooperation with the Croatian Musicians Union are hammering out the project of the support to this industry.

One of the steps in the preparation of a web portal for the assessment of epidemiological risks for music events which will standardize the criteria for all kinds of events, she says.

Restoring quake-damaged listed buildings to take a lot of times

Commenting on the damage caused by the 22 March quake to monuments and listed buildings in the capital city and its environs, the minister said that immediately after the earthquake, the ministry experts and representatives of the department of Zagreb's city planning system toured the damaged sites and held consultations so as to immediately respond to the situation.

Conservators and restorers have been engaged in making a list of the damaged buildings and we were also actively involved in the preparation of the law on the removal of the consequences of the earthquake and on preparing the documentation for the European Solidarity Fund, she says underlining that the restoration of the registered sites of heritage significance would take a lot of time.

It will require a complex multi-disciplinary approach with the aim of improving the urban standards in Zagreb, alongside preserving the historical center, she explained.

Damage done by the quake to listed buildings is estimated at 7 billion euros.

Commenting on the achievements of her first term in office, the culture minister says that that the outlays earmarked for the ministry rose both in the absolute figures and their proportion in the total budget, reaching now a 1% share.

This has been achieved through a rise in the original sources of funding from the budget as well as through the better absorption of the EU funds, she added.

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ZAGREB, Sept 15, 2020 - The coronavirus crisis caused the beef industry facing collapse, the Baby Beef association said on Tuesday, adding that Agriculture Minister Marija Vuckovic has promised HRK 60 million in support for that industry.

The association said that the industry was facing collapse and that is why they called for an urgent meeting with Minister Vuckovic.

The meeting was held last week and Minister Vuckovic announced subsidies similar to those in other countries, notably Slovenia and France, in order to bail out the cattle breeding industry.

It was agreed that HRK 60 million would be paid to the industry in two installments, with the first installment at the end of this year and the second installment by the end of February 2021.

That would cover part of our losses and would resolve the issue of current and future surpluses, the association said.

The association warned that the corona crisis has meant huge problems for cattle breeders who produce about 120,000 yearling beef each year and generate about HRK 1.3 billion in revenue.

The association said that currently, producers have a surplus of about 30,000 yearlings, and by the end of the year that could increase to about 70,000.

That is the result of excessive imports of beef from EU countries that subsidize their cattle breeding industry, and this has threatened our market, the association said.

The association said that as soon as the crisis broke out, Slovenia and France subsidized their products with €100 per head.

Croatian farmers cannot compete with those prices, the association added.

The Baby Beef association brings together about 330 cattle breeders who account for 90% of the beef sector in the country and raise about 120,000 yearlings a year.

About two-thirds of cattle are sold live to the Middle East or as meat to Italy while one-third is sold on the domestic market.

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