ZAGREB, January 28, 2019 - The Croatian Bank for Reconstruction and Development (HBOR) and the European Investment Fund (EIF) on Monday signed a 70 million-euro investment programme to support fast-growing SMEs and mid-caps established and operating in Croatia.

The investment programme is supported by the European Fund for Strategic Investments (EFSI), the core of the Investment Plan for Europe, according to a press release issued on the EIF web site.

The event at which the NPI Mandate Framework Agreement was signed, launched the initiative called CROGIP - Croatian Growth Investment Programme.

The HBOR management board chair Tamara Perko said at the ceremony in Zagreb that the agreement was supposed to help develop venture capital industry in the country.

HBOR and EIF each will participate in the programme with 35 million euro, "to finance this jointly developed programme and the combined commitments of 70 million euro are expected to catalyse additional private-sector investments into equity funds."

"A key programme objective is to support the emergence of fund managers, which focus a significant part of their investments into Croatian SMEs and midcaps," reads the press release.

EIF Chief Executive, Pier Luigi Gilibert was quoted as saying that "this new agreement will support the emergence of a sustainable private equity market in Croatia and to attract private investors to this market, by helping both national and international fund managers to target SMEs and midcaps," he added.

The European Investment Fund (EIF) is part of the European Investment Bank group.

More news on the HBOR can be found in the Business section.

ZAGREB, January 21, 2019 - A World Business Angels Investment Forum (WBAF) office was opened in Zabok, northwestern Croatia as of Monday and it will gather business angels from all over the European Union.

The office makes Krapina-Zagorje County part of the world's financial and business network aimed at facilitating access to capital for startups and scaleups, it was said at the opening.

The WBAF is an international organisation helping new companies finance their business endeavours and the people that are part of it are called business angels.

WBAF president Baybars Altuntas said at the inauguration that last year 340,000 business angels in Europe invested 9.8 billion euro in startups.

Today innovation is important. The challenge for entrepreneurs in the 21st century is to find investors, but they need the know-how, mentoring and networking. Money can be found in a number of sources, but only business angels can provide the rest, he said.

Altuntas said he chose to open an office in a small country while watching the 2018 FIFA World Cup in which, he said, small Croatia played. It doesn't matter how big a country is but how big the dream is, he added.

Among those attending the opening was the Macedonian minister without a portfolio in charge of investments, Zoran Šapurić, who hopes a regional office will be opened in Skopje too. We expect that to be an incentive to economic cooperation in the region, including between Macedonia and Croatia, bearing in mind that our relations are excellent in every sense, he said.

Šapurić, Kosovo Innovation and Entrepreneurship Minister Besim Beqaj, Ghanaian Business Development Minister Ibrahim Mohammed Awal, and Croatian Deputy Parliament Speaker Siniša Hajdaš Dončić took part in a panel on global cooperation in facilitating access to international financing for startups and scaleups.

Hajdaš Dončić said support institutions today were expected to help the 5-7% of the population which had the entrepreneurship gene. They are formal and informal social networks which operate in contemporary economy through innovation, investment and integration, and Krapina-Zagorje County has now provided one of those networks, he added.

The opening of the WBAF office in Zabok has also been supported by Croatian President Kolinda Grabar-Kitarović. She will receive a WBAF delegation in Zagreb on Tuesday.

More news on doing business in Croatia can be found in our special section.

ZAGREB, January 10, 2019 - Croatia's government on Thursday sent to parliament a draft act on the ratification of the treaty on the establishment of Inter-American Investment Corporation.

Based on the 1993 regulations on the succession to the former Socialist Federal Republic of Yugoslavia (SFRY), Croatia's adoption of the relevant legislation on the membership of IDB (Inter-American Development Bank) implies that Croatia embraces that membership and thus possesses 6,895 shares worth 83.8 million dollars in the IDB bank's equity, Finance Minister State Secretary Zdravko Zrinušić said at the government's meeting today.

In 2015, the annual general assembly of the IDB and the Inter-American Investment Corporation adopted a resolution on the consolidation of the private sector of the IDB Group into the Inter-American Investment Corporation.

Considering that resolution, the Croatian government on 22 March 2018 adopted a decision on launching the procedure for the establishment of Inter-American Investment Corporation.

The purpose of the proposed legislation is to ratify the contract on the foundation of Inter-American Investment Corporation.

"The Inter-American Investment Corporation (IIC), a member of the Inter-American Development Bank (IDB) Group, is a multilateral organization based in Washington, D.C., that is committed to the development of Latin America and the Caribbean through the private sector," the IIC says on its website.

"As part of its mission, the IIC supports the private sector and state-owned enterprises through financing in the form of loans, equity investments, and guarantees. The IIC also partners with clients to provide advisory and training services.

"In January 2016, the IDB Group consolidated its private sector operations in the IIC to better serve the region, clients and partners, and to maximize its development impact. The consolidated IIC offers the full array of private sector products and services previously offered across the IDB Group," according to the information on the IIC website.

The decisions made by the Croatian government will facilitate the access of Croatian companies to the tenders advertised by the IDB Group.

More news on Croatia’s economic policies can be found in our Business section.

ZAGREB, December 10, 2018 - Croatian companies plan to increase their research and development investments and allocations in the coming years, according to a survey conducted by Deloitte, a leading international agency specialised in audit, tax, legal, financial advisory, risk advisory, and consulting services.

The survey about Central Europe corporations' plans for R&D in the coming period shows that over two thirds of companies in the said region (67%) intend to increase expenditure on R&D in next three to five years.

As many as 80% of the Croatian companies covered by the survey have expressed that intention.

A majority of the companies in Central Europe covered by the survey have already increased their R&D investments in comparison to 2016.

The survey was conducted among 300 respondents in nine countries: Croatia, the Czech Republic, Estonia, Hungary, Lithuania, Poland, Romania, Slovakia and Slovenia.

The poll was carried out in Croatia among some 40 respondents, in cooperation with the Croatian Employers' Association and the Croatian Exporters association.

Asked about the biggest obstacle in the current system of state aid for research and development investments, 31% of those polled cite the identification of activities that can satisfy the requirements for being granted aid or tax relief.

As many as 76% believe that there are not enough available incentives for this purpose.

Also, 71% of those polled say they would prefer grants to tax breaks when it comes to their research and development investments.

Only 38% of Croatian companies are informed about non-repayable grants for R&D and are using them.

For more on doing business in Croatia, follow our Business section.

December 2, 2018 — While high-profile conferences about tourism investment hightail out of Croatia, Plava Laguna (Blue Lagoon) plans to invest another HRK 300 million in 2019, according to hrturizam.hr.

The Poreč-based company announced next year's investments will focus on a new administrative building, rejuvenating camps and improving workers’ quarters, as well as other expenditures.

The announcement flies in the face of complaints of a lackluster investment climate; one so bad it reportedly led the Adria Hotel Forum, a hotel investment conference, to flee from Zagreb to Belgrade next year.

Plava Laguna’s spending is part of a larger re-branding scheme which aims to put its various locations and offerings across Istria under one large umbrella.

Plava Laguna will build 150 new two-bed accommodations for their workers, following a summer in which it increased employees’ wages. It will also buy 60 mobile homes, to be distributed across its various locations.

The company’s investment in its camp “Stella Maris” will increase its capacity and offerings, adding a pool complex and mobile homes.

The company spent about HRK 487 million in 2018, culminating in a new hotel called “Park Resort” in Poreč. The EUR 35 million-project included a complete tear-down of an existing resort, Laguna Park. It was one of the company’s largest investments to date.

In Umag, the company dismantled its old bungalows and replaced them 54 new accommodations.

Istria continues to draw strong, long-term tourism investments. It has seen accommodation capacity grow across several sectors of the industry, including camping and hotels.

Read more about investment in Croatia on our dedicated page.

The hotel investment conference Adria Hotel Forum (AHF) is leaving Zagreb, and its seventh edition will be held at Hotel Crown Plaza in Belgrade in late February next year. The reason for the move is the investment climate in Croatia, reports Poslovni.hr on November 23, 2018.

Although organizer Marina Franolić tried to explain that the move actually fits in with the regional character of the conference, sources say that the major factor in the decision to leave Zagreb was the inactive investment climate in Croatia, with low interest for foreign investors and hotel brands. The atmosphere in Belgrade is very different, said the entrepreneur who launched the AHF to revive the market and bring leading global tourism investors to Zagreb.

“The relocation news was positively accepted by forum partners, such as global hotel companies, consultants and investors, who have confirmed their arrival, as well as local hotels who have been fully supporting us. Croatia has not been able to capitalize on the fact that the AHF was held for six consecutive years in Zagreb. We can still see that investment activities, especially those related to foreign direct investments, are very low. That is not the main reason for the relocation of the conference, but it certainly influenced our decision. People are asking us daily about investment opportunities in Croatia, and we have nothing or little to offer,” explained Franolić.

The AHF is the only hotel-investment conference of international character in the region and one of the five largest in Europe. Franolić added that the conference gathered more than 1,800 participants, 250 panelists and 150 partners in six years, and its importance was demonstrated by the arrival of some of the most important players in the global hotel industry who came to the conference. Last year, they brought to Zagreb investment funds which manage assets worth over 500 billion dollars, as well as high-ranking representatives of AccorHotels, Hilton and other companies.

Belgrade was not selected by accident as the new conference seat. Although Croatian tourism is considered more developed than the one in Serbia, in the corporate and public sector, apart from the fact that Serbia has significant growth in the number of foreign tourists, Belgrade has been attracting foreign investors and global brands more successfully than Croatia. In addition to the Holiday Inn, the Hyatt Regency, the IHG Crown Plaza and the Falkensteiner Hotel, Hilton and Accor's Mama Shelter were opened this spring, while in 2020 it is expected that Hilton’s DoubleTree and Marriott' St. Regis brands will also open their hotels.

For more on investments in Croatia, click here.

Translated from Poslovni.hr (reported by Marija Crnjak).

ZAGREB, October 25, 2018 - A project of the Regional Development and EU Funds Ministry and the European Investment Bank, designed to help develop investment platforms for smart islands and cities, was presented in Dubrovnik on Thursday.

ZAGREB, October 23, 2018 - US Ambassador Robert Kohorst said in Split on Monday Croatia should attract capital from his country and commended the highly skilled workforce which he said that entrepreneurs need.

October 18, 2018 - The 2018 Global Competitive Index is out. How did Croatia fare? Some good, some bad - a rather accurate snapshot of the modern Croatia. 

October 17, 2018 - A new global index of the safest (and least safe) countries to invest in. Where is Croatia?