ZAGREB, April 1, 2020 - Economy Minister Darko Horvat has signed 103 decisions on project financing based on the call for applications "Innovations in S3 Areas", to be supported by EU grants in the amount of HRK 341.7 million (€44.96 million), the Economy Ministry said on Wednesday.

The purpose of the call was to encourage SMEs to commercialise their innovative products or services exclusively in line with identified priority thematic areas and inter-sector topics of the Smart Specialisation Strategy (S3), the ministry said in a statement.

Based on the call for applications, a total of 169 project proposals were submitted, worth HRK 1.4 billion, with the grants sought in the amount of HRK 580.1 million.

Of that number, 112 project proposals were assessed as positive and eligible for EU funding in the amount of HRK 364.3 million, while their total value is 943.6 million, the ministry said, adding that nine more decisions on project proposals remained to be made after complaints were analysed and certain explanations were obtained from the applicants in question.

Minister Horvat said that support for innovative projects would eventually help increase exports and boost the competitiveness of the Croatian economy on the global market.

More business news can be found in the dedicated section.

ZAGREB, March 26, 2020 - The Croatian government on Thursday adopted a decision on the financing of a project to upgrade the rolling stock of the railways transport company HŽ Putnički Prijevoz, the estimated value of the four-year project being HRK 1.29 billion, including VAT.

Transport Minister Oleg Butković said that HŽ Putnički Prijevoz would expand its rolling stock by buying 21 new electric trains, which would improve public transport services.

The eligible cost of the project has been estimated at HRK 1.03 billion, and the non-eligible cost refers to VAT in the amount of HRK 258.17 million.

Under the government's decision, the transport ministry has been entrusted with securing funding for eligible costs until the completion of the process of allocation of EU grants. Those eligible costs refer exclusively to preparations for the project that precede the purchase of trains, for which budgetary funds have been secured.

HŽ Putnički Prijevoz is obliged to secure funds for non-eligible project costs.

The project is expected to be completed by December 2023, said Butković.

Last week the ministry said that the European Commission had granted €119.3 million to co-finance the upgrade of HŽ Putnički Prijevoz's rolling stock.

More news about railways can be found in the Travel section.

ZAGREB, March 17, 2020 - The European Commission on Tuesday approved the allocation of more than €119 million from the Cohesion Fund to Croatia to purchase 21 electric trains.

That is one of 14 large infrastructure projects in seven EU member states with a total value of €1.4 billion.

"Over €119 million from the Cohesion Fund will finance the purchase of 21 new electric trains to boost service quality, reduce delays and encourage more people to use a sustainable transport type. This project will contribute to modernise the country's rolling stock and to improve connectivity and mobility with positive economic consequences. Travel times, noise, vibrations and operating costs will be reduced while safety will increase," the EC said in a press release published on its web site.

Commissioner for Cohesion and Reforms, Elisa Ferreira, said: "In such difficult times for our continent, it is crucial that Cohesion policy continues to play its role in supporting the economy for the benefit of our citizens."

"Today's major project adoptions show that EU funding, and Cohesion policy in particular, delivers concrete results, helping regions and cities becoming a safer, cleaner and more comfortable place for people and business. Many of the approved projects also help delivering on the goals of the European Green Deal. When the European Commission, Member States and regions join forces, we can achieve a lot,” Ferreira said.

More news about EU Funds can be found in the Business section.

ZAGREB, March 12, 2020 - The Croatian state-run HŽ Infrastruktura company and the Turkish Cengiz Insaat Sanayi ve Ticaret on Thursday signed a HRK 2.42 billion contract on the reconstruction and upgrade of a 42.6-kilometre-long railway from Križevci via Koprivnica to the Croatian border with Hungary.

The project, which is co-financed with funds from the European Union's Connecting Europe Facility (CEF), is expected to last 42 months. The works are due to start in April and end in October 2023.

The project envisages upgrading the route to a double-track railway, with nine modernised rail stations, two viaducts, 21 railway overpasses and underpasses and other improvements that will enable trains to drive at a speed of up to 160 kilometres per hour.

This route is part of the Croatian segment of the Mediterranean corridor passing from Hungary via Zagreb to Rijeka.

Speaking at the contract-signing ceremony in Government House, Prime Minister Andrej Plenković said that this was a strategic project and pointed out the fact that EU grants for the investment totalled HRK 1.8 billion.

More economy news can be found in the Business section.

ZAGREB, February 21, 2020 - Prime Minister Andrej Plenković would not say on Friday morning whether the ongoing EU summit would result in a compromise on the 2021-2027 Multiannual Financial Framework (MFF).

The extraordinary summit, which began on Thursday afternoon in Brussels, continued for several hours until late Thursday evening and resumed on Friday morning.

On Thursday afternoon, European Council President Charles Michel held a series of bilateral meetings with heads of state or government of the 27 EU member states.

Commenting on his talks with Michel, Plenković said that he had highlighted the matters important for Croatia, such as cohesion policy and demographic revitalisation.

"We have tried to see to it that the final agreement brings about as good results as possible for Croatia" Plenković said.

Danish Prime Minister Mette Frederiksen, whose country is among those calling for cuts to the EU budget, said on Friday morning she did not believe EU member states would reach an agreement on the 2021-2027 Multiannual Financial Framework (MFF) this weekend.

We are still negotiating. Our position is clear. I am prepared to stay the whole weekend, but it is likely that a new extraordinary summit will be needed, Frederiksen said ahead of the second day of the extraordinary summit on the MFF. She added that she was not sure when the next summit could be convened.

Denmark, Austria, Sweden and The Netherlands, dubbed the frugal four, insist that allocations to the new EU budget should not exceed one percent of the Gross National Income.

More news about Croatia and EU funds can be found in the Politics section.

ZAGREB, February 18, 2020 - Finance Minister Zdravko Marić said on Tuesday that increasing the national share of co-financing EU projects would mean additional pressure on the state budget, adding that he was confident that discussions on this topic at the EU level would result in a good compromise.

Ahead of a second meeting of Economic and Financial Affairs Council (ECOFIN) under Croatia's EU presidency in Brussels on Tuesday, Marić commented on plans to increase the national co-financing component for EU projects from 15% to 25%.

European Council President Charles Michel on Friday proposed a new Multiannual Financial Framework (MFF) for the period 2021-2027 worth €1094.8 billion, which is equivalent to 1.074% of the 27 member states' gross national income

Michel also proposes that the member-states should be supposed to co-fund projects by 25%.

"The proposal is here, a lot of countries have their own opinions about that," the Croatian minister said and added that that is an important issue for Croatia as the youngest EU member state that still has not managed to completely absorb EU funds.

Croatia currently has agreements for the absorption of 86% of allocated funds and a little more than 31% has been paid out.

"Naturally, we are taking account of the national budget too and in that light, an increase in the national component of co-financing would create additional pressure the state budget. The proposal put forward is a good basis for debate and dialogue," Marić said.

The minister is confident that the dialogue will be constructive and, in the end, that it will produce a good quality compromise.

Today's ECOFIN meeting of EU finance ministers has been convened to adopt a revised list of non-cooperative jurisdictions for tax purposes in the framework of new conclusions on this matter.

Marić recalled that the first two lists were compiled in 2017 with the aim of meeting standards and best world practice in an effort to improve the exchange of tax data, boost transparency and generally to curb tax evasion.

"In the period behind us more than 50 countries met the demands that we had defined for them, and this is the result of constructive dialogue. They are no longer on those lists. The intention now is to continue that dialogue with those still on the list so that they too meet the criteria," Marić said.

As of 14 November 2019, the EU list is composed of American Samoa, Fiji, Guam, Oman, Samoa, Trinidad and Tobago, US Virgin Islands, and Vanuatu.

During today's meeting, EU finance ministers are expected to expand that list to include Panama, the Cayman Islands, Seychelles and Palau.

More news about EU funds can be found in the Business section.

ZAGREB, February 8, 2020 - Prime Minister Andrej Plenković said on Saturday he would do everything so that in the European Union's next seven-year budget Croatia was given appropriate cohesion funds, which he added were the driver of development and investment.

"We must do everything to get as much as possible now that a big member state, a net contributor, Great Britain, has left the Union," he said in Brussels.

"Alongside Portugal, we are one of those countries in which European funds account for the bulk of public investment. Also, the fact that we have been an EU member state only seven years puts in a special position and I'm sure the colleagues will acknowledge that," Plenković said after talks with European Council President Charles Michel.

They talked as part of preparations for an extraordinary EU-27 summit at which member states' leaders will try to agree the EU's 2021-27 budget. Michel convened the summit for February 20.

Plenković said that when his government took office in 2016, only 9% of the financial envelope for Croatia had been contracted and only 1% paid.

"Today 86% of the funds have been contracted and over 31% paid. That is this government's legacy in the absorption of European funds, which are the driver of agriculture, infrastructure, the economy, equal regional development. We put special emphasis on less developed parts of Croatia such as Slavonia."

Negotiations on the EU's seven-year budgets are always difficult and challenging. This time they are harder because of the departure of the UK, which contributed €12-14 billion to the EU budget. It is also necessary to fund new challenges such as the fight against climate change, migration, and allocations for innovation and digitisation so the EU can keep up with global technological development.

Member states' heads of state or government first have to reach a political agreement on the total budget and the distribution of the funds by sector. This calls for a unanimous decision and reaching a consensus is very difficult.

After leaders reach a consensus, talks begin on legislative acts by sector that are necessary to implement the seven-year budget.

Plenković and Michel also talked about enlargement, negotiations on future relations with the UK, the Conference on the Future of Europe, and the European Green Deal.

More news about Croatia and the European Union can be found in the Politics section.

ZAGREB, February 4, 2020 - Croatian Prime Minister Andrej Plenković has warned that EU member countries' leaders should reach a political agreement on the Multiannual Financial Framework (MFF) for the period 2021-2027 as soon as possible, so that the legislative part of the work could also be completed as soon as possible.

One should bear in mind that having a political agreement on the negotiating framework at the European Council is not enough, it is necessary to negotiate with the European Parliament the legislative part of the work as well, Plenković said in an interview with the politico.eu website during his visit to Portugal this past weekend, where he attended a meeting of the Friends of Cohesion informal group.

At the level of the European Council, the EU's highest political body made up of member-states' heads of state or government, a consensus needs to be reached regarding the amount of the budget for each year in the seven-year period as well as amounts for individual areas that are financed, such as cohesion, agriculture, research, etc.

After that, the Council of the EU and the European Parliament must agree on a set of legislative acts for the implementation of the MFF.

The meeting in Portugal was held three weeks ahead of an extraordinary meeting of the European Council, called by its president Charles Michel in an attempt to help reach a compromise on the EU's new seven-year budget.

The extraordinary summit, to be held on February 20, will give new political impetus to attempts to reach an agreement but it is too early to say if it will result in one, Plenković said.

Michel is in charge of preparing a draft agreement on the MFF, which Plenković says is good for Croatia as the country currently chairing the Council of the EU as it gives it more room to defend its own national interests.

Plenković repeated that for Croatia cohesion policy was extremely important, notably in light of the fact that Croatia was the youngest EU member and had so far used cohesion funds for a much shorter period of time than other members.

More news about Croatia and the EU can be found in the Politics section.

ZAGREB, February 2, 2020 - Prime Minister Andrej Plenković said at the end of the Friends of Cohesion summit in Portugal on Saturday that the participants reached a unanimous conclusion that all EU members - net recipients of the European funds were in favour of preservation of adequate funds for the cohesion policy.

All the countries that are net recipients of European funds want that the final agreement on the future seven-year budget of the European Union retains adequate funds for the cohesion policy, Plenković told reporters in Portugal.

The rationale behind that is that countries lagging behind the most developed ones in the EU could make sure that the living standards of their regions could move upward, Plenković said adding that the message is to ensure adequate funds for the cohesion policies.

This is the most important message of the conclusions adopted today, Plenković said.

The informal Friends of Cohesion group met on Saturday in Portugal ahead of an extraordinary meeting of the European Council set for 20 February when an agreement should be reached between the countries described as the net contributors to the EU budget and those net recipients.

Some of the countries seek to reduce the EU budget and direct most of the reduced budget at new priorities, such as climate change, at the expense of cohesion and agricultural policies.

The meeting in Portugal followed after officials of the 17 member-states convened in Prague on 5 November 2019 to define the group's further steps in defending the cohesion and agricultural policies in the next financial framework. During their gathering in the Czech capital city they demanded that in the 2021-2027 EU budget, the same amount should be set aside for the purpose of cohesion as it has been so far the practice.

The member states of the group are: Bulgaria, Croatia, Cyprus, Czech Republic, Estonia, Greece, Hungary, Latvia, Lithuania, Italy, Malta, Poland, Portugal, Romania, Slovakia, Slovenia and Spain. They are perceived as net recipients considering the EU budget.

More news about Croatia and the EU funds can be found in the Politics section.

ZAGREB, February 1, 2020 - At the summit in Beja on Saturday, the leaders of the Friends of Cohesion group will define their positions on cohesion policy that is important for all, and especially for those European regions that are yet to catch up with those most developed, the Croatian and Portuguese prime ministers said in this Portuguese city.

"Our task today is to define our positions ... on the so-called traditional policies, and those are, first of all, cohesion policy as well as agricultural policy," Croatian Prime Minister Andrej Plenković said at a joint press conference with his Portuguese counterpart Antonio Costa.

"Cohesion policy is the redistributive strength of the European budget that EU citizens need, regardless of where they live, and especially in those regions of our member states where we still strive to reach the development level of the most developed regions in Europe or those of average development," Plenković said.

Costa said that Portugal and Croatia have different experiences in the EU, but that there are also common aspects such as cohesion. Both countries are interested in getting adequate funding from the EU budget in the next seven years.

"Our message regarding cohesion is clear. We want to make it clear that Europe is one and united in its interests. It is important to us that Britain has left, but it is even more important that Europe should stay coherent," Costa said.

Today's meeting of the informal group Friends of Cohesion is important ahead of an extraordinary meeting of the European Council on February 20, which was called by European Council President Charles Michel in an effort to reach a compromise between the Friends of Cohesion and the countries that seek to reduce the EU budget and direct most of the reduced budget at new priorities, such as climate change, at the expense of cohesion and agricultural policies.

The new Multiannual Financial Framework (MFF) will largely define what the EU will be like in the next ten years or so. The EU member states are divided over the MFF, the first without the United Kingdom which left the European Union on January 31 at midnight Central European Time.

Cohesion policy is an inseparable part of the single market and concerns all EU member states, Costa said, recalling that cohesion is important for all member states because they have all used these funds.

"It's no coincidence that the Friends of Cohesion have gathered together 17 countries, from the Baltic to the Mediterranean, which is a real proof of how important this policy is. It enables every village, every town and every citizen to deal with their problems and get closer to the European level standard," Costa said.

He added that it would be bad for the EU if these funds were cut in favour of some other policies.

"Of course, we need a compromise. We have the position of the European Commission, Parliament and Council and we need to bring them closer and reach a final agreement," Costa said.

Plenković reiterated that Croatia would be pleased if this agreement was reached during its presidency of the Council of the EU, but noted that it wanted it to be a good agreement. He said that the agreement should be reached this year.

Plenković used his working visit to Portugal to meet with Costa. They concluded that the two countries had very good and friendly relations.

Both countries are interested in strengthening their trade, which reached about €115 million last year.

"We think we should get both Croatian and Portuguese companies more interested in investing and cooperating. I am particularly glad that we are seeing a growing number of Portuguese tourists," Plenković said.

More news about relations between Croatia and Portugal can be found in the Politics section.