February the 25th, 2021 - The Croatian Employers Association (HUP) want more European Union cash to be directed towards the private sector, with employers doing their best to urge the government to amend a certain document to ensure this happens.

As Novac/Gordana Grgas writes, at least 50 percent of European Union money is set to be available to Croatia in the next period, which is a total of about 24 billion euros. The Croatian Employers Association believes that around half of that massive amount should be made available to the private sector through calls for grants.

Employers are also urging the Croatian Government to properly amend the draft National Recovery and Resilience Plan (NPOO), the first version of which it has already sent to the European Commission (EC), and to further strengthen the role of the private sector in it.

Although the draft itself hasn't yet been published, and has only recently been roughly presented to the Croatian Employers Association, it appears that most of the 6 billion euros in grants from the NPOO, to be funded by the European Recovery and Resilience Mechanism as a result of the ongoing coronavirus crisis, could end up in reform-related public sector projects. As announced by the Croatian Employers Association at a recently held press conference, they plan to urgently send their remarks and suggestions to the European Commission itself. The final draft, they say, should be ready and sent to Brussels in April.

So far, a quarter of the money available to Croatia from EU funds has gone to the private sector, warned the Croatian Employers Association's Damir Zoric. The rest ended up going to public investments and public infrastructure, and Croatia needs larger investments in production for the development of the economy. Boris Drilo, President of the aforementioned associations's ICT Association explained that previous investments in the private sector have been shown to have a significant impact on economic growth.

"It's a minute until midnight for all of us, after which we can turn into either a princess or a pumpkin," he said in a rather picturesque manner. He also stressed that investments in private sector projects lead to sustainable employment for high-value jobs.

In February, the Croatian Employers Association conducted a survey among 1,700 enterprise owners, which showed that more than two thirds of them have prepared projects or investment plans for the next financial period in the amount of more than 21 billion kuna. As many as 94 percent of them would exclusively utilise EU grants, so there is extremely little interest in these so-called financial instruments, such as loans, and 30 percent say they will not be able to invest if these grants aren't enough.

On top of that, 28 percent of enterprise owners say they will not survive the ongoing pandemic crisis without better co-financing. Most of them stated that they would invest in capacity expansion and modernisation if they could be more certain, and the projects they have in those areas are the ones which are the most ready to be realised.

Drilo explained that, in general, the investment potential of available European Union money is significantly higher if it is directed to private investments, and it is also less burdensome for the state budget. Namely, a private company from the EU receives 40 to 70 percent of the investment amount as support, and the rest is financed by itself. The public sector, on the other hand, receives 85 percent of the money from the EU for the project, and the rest is added from public sources, which is less favourable.

Answering a question related to the National Recovery and Resilience Plan, the Croatian Employers Association said that the state should be prevented from competing with the private sector with its projects.

Ana Fresl, president of the Croatian Employers Association's Association of Professionals for EU Funds confirmed that the draft plan presented to them, in which only state bodies participated, exceeded the available six billion euros, and there has not been any feedback on which parts of the plan will remain and which will be discarded. In their belief, what was presented to them under the name "economy", the first version of the plan envisages a series of projects that have nothing to do with entrepreneurship whatsoever.

For the latest travel info, bookmark our main travel info article, which is updated daily. 

Read the Croatian Travel Update in your language - now available in 24 languages.

Join the Total Croatia Travel INFO Viber community.

ZAGREB, November 26, 2020 - Bar and restaurant owners on Thursday proposed two sets of measures that could help them survive the new lockdown, saying at a conference organised by the Croatian Employers Associations that many would go bankrupt otherwise.

The president of the national association of bar and restaurant owners, Marin Medak, said the first model envisaged long-term compensation by slashing VAT to 5% for three years and to 13% in the long term, and providing job-retention aid until April 2021, i.e. HRK 4,000 per employee and writing off taxes and contributions until 1 May 2021.

They also propose compensation of €10 per square metre of their establishment, COVID loans to ensure liquidity for three years and a moratorium on loan payments for businesses which are not allowed to work.

The second model envisages ensuring revenue for entrepreneurs in the amount of 50% of their turnover at the same time a year ago as a direct grant which would also be used for salaries, including a contribution write-off.

This model also envisages exemption from all fixed liabilities for the duration of the lockdown, including rent and utilities. Bar and restaurant owners also propose exemption from parafiscal levies.

Medak said they acknowledged the extent of the pandemic crisis and were unanimous that the most important thing was to keep their businesses going and prevent layoffs which would ensue without adequate lockdown compensation measures.

The government decided today that as of Saturday, bars and restaurants will be closed until before Christmas.

ZAGREB, May 25, 2020 - Five thousand people will be laid off because of non-working Sundays, Jutarnji List daily said on Monday, adding that the figure was confirmed even by those advocating the ban

Although Economy Minister Darko Horvat is saying he has reached "a high consensus phase" on a Sunday work ban with the government's social partners, this is not the case with employers, the paper said.

Employers are divided on the matter, as conceded by Martin Evacic, president of the Croatian Employers Association's retail division, "but there are a few more of those who are for regulating the matter, based on the revenue they make and the number of workers they employ, than retailers who are against it."

No one has seen yet a bill of amendments with 14 working Sundays a year nor any study on which the minister should base his decision.

His bill might soon become public because Jutarnji List learned from the COVID-19 crisis management team, the next Sunday will probably be the last non-working Sunday imposed because of epidemiological restrictions, after which, as Horvat has announced, the bill will be put to public consultation.

Evacic says "everyone has their own story" concerning Sunday work, depending on the type, size, and location of their shop as well as the number of workers per square meter. Horvat's decision will affect shopping malls more than grocery stores.

Evacic says he is for regulating Sunday work because of the business results of his NTL and not his world view. He also cites "strong resistance to Sunday work among unions and workers themselves."

Jutarnji List said the Konzum, Tommy, KTC, NTL, Ultra and Lonia retail chains were for regulating Sunday work, and that Spar, Lidl, Kaufland, and Plodine were against.

The ban on the work of shops on Sundays has been a talking point for quite some time now. With some being firmly for the idea of keeping Sunday a free day on which shops don't operate, and others, primarily Croatian traders, being entirely against it.

Many Croatian traders are constantly claiming that such a move further damages an already less than ideal economic situation and that this will only become exacerbated in the uncertain times we're currently living in owing to the coronavirus pandemic.

The Croatian economy, much like every other economy across the globe, has been suffering the blows of the coronavirus crisis. Many argue that forcing shops to shut their doors on Sundays will do absolutely nothing to help get the economy back on its feet again, and Croatian traders are growing more and more frustrated.

As Novac/Ivanka Toma writes on the 16th of May, 2020, the Croatian Employers' Association (HUP) and the Trade Association addressed the Ministry of Economy and the Ministry of the Interior with a proposal to relax the measures which are still in place in attempt to slow down the spread of the new coronavirus, COVID-19.

Specifically, this group of Croatian traders demanded that the ban on the operation of shops on Sundays and non-working days be lifted, and that what is known as the ''disinfection break'' also be lifted.

These Croatian traders pointed out that banning work on Sundays isn't an adequate anti-epidemic measure because restricting work on Sundays only works to significantly burden other working days, especially Mondays, Saturdays and Fridays, and creates the potential for much larger crowds of customers on the other days of the week.

They also pointed out that due to inaction, a smaller number of working hours are actually being realised in total due to the ban of shops operating on Sundays, which will have the consequence that traders will need to start firing their staff.

They also stated that the one-hour break required to disinfect the store has no effect because after that break, queues get formed outside of the shop doors and the level of pressure on staff working at cash registers increases. They also warned that such measures don't apply to those in the caterering and hospitality industry, to hotels, or to those carrying out other personal services. However, this group of Croatian traders believe that it is more than likely that nothing will come of their proposal.

''We've already communicated with the public and employers about why Sunday has been set up as a non-working day. By extending our working hours during the week, we got more working hours and two shifts, we wanted to relax certain economic activities on the other side of the scale, and on the other hand, we wanted to prevent the spread of the virus. Every day we're looking at the measures and the situation and the possibilities we have for balancing that scale,'' said the director of the CNIPH, Krunoslav Capak, in response to the question about the proposals of Croatian traders.

Make sure to follow our business page for much more.

The Croatian Employers' Association's request is set to be granted by the Croatian Government early next week, and now even Croatian companies who have been forced to lay off staff during the ongoing and unprecedented coronavirus crisis will be allowed to access support from the government.

As Novac writes on the 5th of April, 2020, the Croatian Employers' Association (HUP) welcomes the announcement from the Ministry of Labour that at the CES Governing Council session on Monday, their request for all Croatian companies who were forced to lay off workers and/or close their companies to be able to access support will be granted.

The ability to seek financial support from the various economic measures recently presened by the government will be given to all Croatian companies who were forced to lay off workers and close down their operations before the entry into force of the measures passed by the Government of the Republic of Croatia in the face of the coronavirus crisis.

Last week, the Croatian Employers' Association addressed three ministries requesting that the second package of government measures, in the part related to job support grants, be made available to all small and micro enterprises who laid off workers because they didn't see any prospect for that in the first package of announced measures. Small and micro-enterprises, as the HUP has repeatedly emphasised, should then have been required to write off all payments, as mere delays were not sufficient to preserve jobs.

''As soon as the second package of measures was announced, the HUP requested understanding from the Croatian Government towards all micro and small enterprises, which were forced to lay off their workers due to discontinued operations or great difficulties. We're pleased that this move means returning workers to their jobs, restarting businesses and believing that this crisis can be overcome more quickly. This crisis teaches us how important it is to preserve our own production, develop and invest in our own knowledge and our own resources,'' stated Davor Majetić, CEO of the Croatian Employers' Association.

More detailed information on the use of government grants is expected early in the coming week following the end of the aforementioned session due to take place on Monday.

Follow our dedicated section for more on coronavirus in Croatia.

The Croatian Employers' Association (HUP) has demanded a new set of measures be implemented by the government to rescue the Croatian economy. They claim, among other things, that mere payment delays are far from enough.

As Novac writes on the 29th of March, 2020, HUP's chief executive Davor Majetic said: ''Continuing on from the GSV session held on Friday, the Croatian Employers' Association reiterates the need for the Government of the Republic of Croatia to urgently adopt new measures to save the Croatian economy on the principle of "zero income, zero expenditure,''

HUP, as he claims, has repeatedly "clearly and unambiguously stated to those in power and to the public what they have been demanding on behalf of businesses and employers", which is a write-off of all fees, contributions, para-fiscal levies, various redundant membership fees, and just not delays needing to pay those things.

''We're seeking that urgently! We can talk about delays during the ''post-corona'' period, not now when a large number of Croatian companies don't know if they will even exist next month,'' HUP stated, warning of the grave threat to the Croatian economy.

In addition, they said they expect a high level of accountability, fact-finding and argumentative debate from all stakeholders in social dialogue, and not merely the "cheap populism that is now appearing in the media by creating distorted personal impressions such as insinuating that HUP is seeking pay cuts for healthcare professionals and other falsities,''

HUP reiterated the measures that should take absolute priority and drew attention to the fact that they have created a whole series of measures and recommendations for all sectors of the economy and that they expect that politicisation will cease at this extremely difficult time for the Croatian economy.

''Immediate realisation and determination is what we need now. If we lose time, we lose the Croatian economy. If we lose the economy, we will lose the country,'' said Majetic.

Here is a list of everything that HUP is asking of the Croatian Government and what they have proposed so far:

1. On March the 3rd, we proposed to the Government a measure to preserve jobs, which would pay support on a part-time basis as a proportion of the amount of wages for the number of hours that a worker doesn't work

2. During business inactivity, employers cannot pay contributions and taxes with delay, the state must write off all of those fees

3. It is necessary to suspend the payment of all mandatory membership fees and charges for the duration of business inactivity and the suppression of coronavirus

4. It is necessary to write-off payments to LSGs

5. The total abolition of all other taxes and fees for concessions during the crisis needs to happen, not just delays

6. The reduction of the corporate income tax rate and the deferred payment of corporate income tax advances

7. The abolition of the payroll obligation/prescribed annual basis for directors

8. The obligation to pay VAT on paid realisation starting on March the 1st, 2020 for deliveries that followed after March the 1st, 2020 must be introduced

9. The suspension of foreclosures on tax payments during a state of emergency must be introduced

10. Credit reprogramming and refinancing must take place

11. The international flow of goods must be ensured

12. There must be a declaration of force majeure

13. A delay of deadlines for the submission of reports, forms and final accounts due to difficulties caused by the pandemic must be introduced

Make sure to follow our dedicated section for rolling information and updates in English on coronavirus in Croatia. Follow our business page for more on the Croatian economy.

As Glas Istre/Mirjana Vermezovic Ivanovic writes on the 13th of December, 2019, it's common knowledge that the situation in the Croatian economy and production as a whole is not exactly great.

Croatia is right at the back, far from where it should be, and all experts warn of the need for restructuring and substantive reform, of which currently, there isn't even the letter "r". Croatia can hardly compensate for the rut it is stuck in with the current way it has of managing things, the biggest problems being high levies, tax and non-tax payments, parafiscal charges and a large and complicated, stagnant public administration.

Gordana Deranja, president of the board of Tehnomont and the Croatian Employers' Association (HUP), warned of all of the above at panel discussion held recently in the Istrian city of Pula. There, on the occasion of the 20th anniversary of the Istrian Development Agency (IDA), distinguished businessmen, professors and politicians debated the current state of the Croatian economy and where they see it by the time the year 2030 rolls around. Deranja noted that Croatian employers have nothing against public administration, but it must be in the context of the general government, in synergy with the private sector, and it must actually create added value.

Croatia also severely lacks manpower. Trade unions have rebelled against its import, saying it will ruin the price of labour and as we thought about it, the pool emptied: why would someone from Bosnia or Serbia come to Croatia when they can go to Germany, Deranja warned.

She cited corruption as the next problem for the Croatian economy, but she related it mainly to Zagreb. Speaking about Tehnomont's survival formula, she said that they were the first in all of Croatia to start manufacturing aluminum ships, and today they are the cheapest and most competitive in Europe. Speaking about the future, she stated that technology is changing very quickly, and Tehnomont is fortunate enough to be working in Germany, where all the information is readily available to it.

''Our market is small. It's amazing that the shipbuilding industry has not been recognised by the state, and other shipyards are working on our tenders. Jadrolinija is a state-owned company that could withdraw European Union funds and build ships instead of buying used ones in Singapore. State relations are also important, we should become a country with normal incomes. Instead of holding on to our hearts, we need to show that we care about people, and we employers will adapt to that. A good example is Istria County, where the businessmen actually listen. We'll be on a good path if we listen to each other, but if we don't jump onto the train of the 4th Industrial Revolution and Digitisation, we'll be left behind,'' Deranja said sharply.

Along with numerous representatives of local self-government units, Istria County, CCE and other institutions and guests from abroad, the discussion was also followed by IDS' honorary president Ivan Jakovčić. Party president and Pula Mayor Boris Miletić stated that the City of Pula is at a crossroads.

''After a hundred-year period marked by the military and joining NATO and the EU, traditions are changing. We can't be satisfied with our demographics, emigration and labour shortages, but when it comes to migration we're in a plus. Local self-government has the role of service, it must be efficient, serve citizens and the economy,'' said Pula's mayor. Despite Uljanik being in "the situation that it is," he sees the future of the city in the development of the IT sector.

Similarly, at the end of the discussion, other participants concluded - the future of the Croatian economy lies in adapting to new technologies. Deranja says Croatia also needs crafts and more education, citing the example of Germany that developed excellently in that sense. People are always an important factor, and Istria has proven that both industry and tourism can develop alongside one another.

Infobip's CEO Silvio Kutić spoke about the success of Infobip, which started in the IDA incubator. He sees the key to success in people, that is, the vision that connects them. Openness, teamwork and learning through academia are key to the success of that company that intends to be listed on the New York Stock Exchange in a few years. In the next five years, they plan to create a technological and scientific city in Vodnjan, where they plan to bring 400 experts from all over the world. But this is difficult because of poor response from city and state administration, Kutić said.

Boris Žgomba, director of the Uniline agency, who is also the head of the Croatian Association of Travel Agencies shared his opinion on the Croatian economy and what could yet come to be.

''Today, we can't know what will be in ten years. People's habits and technological solutions will change. People from some areas we can't even imagine will end up coming here. The technologically advanced “Z” generation makes decisions in seconds. That guest knows more than you do. In the next ten years, there will be a revolution, big changes, and time will tell if we're ready or not,'' said Žgomba.

Prof. dr. sc. Lorena Mošnja Škare, Vice-Rector of Juraj Dobrila University, said that the institution would do everything it could to encourage its students behave in an entrepreneurial and innovative way, by stepping into the STEM field, to prepare experts for the 4th Industrial Revolution.

Make sure to follow our dedicated business page for more on the Croatian economy.

As Novac writes on the 6th of June, 2019, fiscal consolidation, investment and business barriers and the burden on the Croatian economy make things very difficult for business in Croatia, according to the results of HUP Skor for 2018, showcased by the Croatian Employers' Association (HUP).

It is a tool to measure the progress of reforms in the twelve critical areas necessary for doing better business and improving life in the Republic of Croatia when compared to the EU 10.

As Gordana Deranja, HUP's president, explained, "HUP Skor is an objective measure of how much we're really reforming."

Since the countries of central and eastern Europe progressed faster than Croatia last year, Croatia's HUP Skor for 2018 is a rather embarrassing 36 out of the possible 100 points, and what continues to push Croatia to the bottom, as was stated by HUP, are taxes and similar burdens. The ratio of general government tax and social contributions to the GDP in Croatia is continuing to rise, and even now it's exceeding the maximum achieved before the reforms in the tax system.

''Structural problems continue to pose a serious threat to adaptation to one of the next crises and permanently limit the speed of economic growth. Although we're satisfied that [Croatia's] GDP grew by 3.9 percent in the first quarter of this year, the fact is that this is still too little and we should be at least four percent more in the long run,'' Deranja said.

"The Croatian economy is the most burdened and that's reflected in its productivity. The economy is congested and has no power to grow," she said.

In addition to the above-mentioned problematic areas in the Croatian economy, the encouragement of investment, productivity and competitiveness, the justice system and the labour market, education, health and pension systems continue to be ''in the red''.

''This year's result suggests that Croatia is lagging significantly behind the EU member states from Central and Eastern Europe, and what's particularly worrying is the fact that Croatia's score is worse than that in countries which are less developed than Croatia, such as Bulgaria and Romania,'' said Davor Majetić, Director of HUP.

Follow our dedicated business page for much more.

The Croatian Employers' Association (HUP) has welcomed changes to the Law on Companies and has urged that no new burdensome regulations be introduced.

As Ana Blaskovic/Poslovni Dnevnik writes on the 23rd of April, 2019, recent changes to the Law on Companies, which simplifies the establishment and the liquidation of companies, will enable entrepreneurs to be more competitive and help Croatia to climb up and improve its place on lists such as that of the World Bank, Doing Business, on which Croatia occupies 68th position out of 140 countries worldwide. 

The Croatian Employers' Association (HUP) has openly welcomed these positive changes, but has warned that this step in the right direction should not end up with people simply becoming lost once again but this time in a maze of new obstacles.

"The Croatian Employers' Association welcomes the simplification of procedures related either to the establishment of companies or to their liquidation, and we expect the introduction of changes that will stimulate the competitiveness of the Croatian economy and make it easier to monitor rapid changes on the global market," stated Admira Ribičić, the director of legislation and legal affairs at the Croatian Employers' Association which itself proposed changes in the same direction.

Better competitiveness should bring forward the ability to establish a simple and ''normal'' d.o.o. online, just with the payment of court fees, and without the cost of a public notary. The changes to the law open the doors for faster and easier business/company registration. However, even though e-foundation has now come into effect, the application that will enable it to function correctly will only come into force in September.

The Croatian Employers' Association has also readily welcomed the removal of the stipulation of reserving a company name, the shortening of the deadline for the court to make a decision on registration in the court registry from fifteen to five working days, as well as the provisions for the simpler and cheaper liquidation of a company, simply with a statement proving the non-existence of any debts.

"What worries us most is that we don't end up with a situation in which we remove a whole host of regulations and end up accidentally replacing them with different ones through changing the regulations. In Croatia, there are between 300 and 400 new regulations introduced annually, or amendments to existing ones, and each of them "laments" the danger of introducing a new administrative or financial burden,'' Ribičić concluded.

Make sure to follow our dedicated business page for much more on Croatian companies, doing business in Croatia, investing in Croatia and Croatian products and services.

Click here for the original article by Ana Blaskovic for Poslovni Dnevnik

As Goran Jungvirth/Poslovni Dnevnik writes on the 24th of February, 2019, just like in the case of many other industries and categories of workers across the Republic of Croatia, the student population also poses a major challenge to employers when it comes to hiring employees, which is why new web portals and applications are being launched with a view to better connecting the supply and demand markets.

At the end of October 2018, a new law on Student Affairs was finally adopted in Croatian Parliament, with the aim of introducing changes that should provide more ease and significantly better conditions for the country's many students.

The move foresaw that the payment of a contractual fee be guaranteed within fifteen days, the introduction of a digital system was introduced, minimum times and their various accompanying payments were introduced, with an increase for working on Sundays, as well as for working at night and during holidays, as well as some other more than welcome student benefits.

Legislators made the changes justified by the desire to put an end to the exploitation of Croatia's students as little more than cheap labour for greedy employers in numerous different sectors.

Out of about 160,000 students in the Republic of Croatia, about thirty percent are extraordinary students, therefore it is expected that they will also work on student contracts, further strengthen the market for the country's potential student workforce, and more easily meet the needs of the demand market and of their respective employers.

However, it seems that such ''high-quality'' students are hard to come by and all but unavailable, because they're either simply not interested or they're already engaged in some sort of other work.

Labour market agents only noted the initial higher response of these so-called extraordinary students after they too were permitted to work through student contracts, but that situation, like many others, soon became a ''lethargic'' one.

"The problem is also a student's time and availability is limited to their university commitments, and employers of course want the same commitment as full-time employees, but students naturally don't want to lose their often beneficial student rights," stated Saša Jurković of Jazavac's management, an application which seeks to better connect students and their would-be employers.

"Jazavac was created to allow students to find work faster and for employers to reach students as quickly as possible through matching and merge apps," said Jurković when speaking about the project which has been co-financed by the European Union via the European Regional Development Fund.

In addition to increasing immigration and the concerning and accelerated departure of young people from Croatia seeking (among other things) better economic conditions elsewhere, statistics also show a worrying and fairly intensive decrease in the total number of people studying in Croatia at all.

Despite the increasing number of private faculties, polytechnics and colleges across the country, in the last five years alone, the number of students has decreased by more than fifteen percent. Additionally, according to the Central Bureau of Statistics for the academic year 2012/2013, there were 188,285 students actively studying in a facility in the Republic of Croatia, which is nearly 30,000 more than there are currently.

In order to maintain the dynamics of the market between students and employers, it's necessary for them to not only be better connected, but to be more informed in general.

"For now, we have over 900 undergraduate students and over 100 employers who use the search engine and periodically publish their ads. We're growing quickly but we need more students and companies and want to connect with the Student Center (SC) to help them be even more successful. As the oldest source of student affairs, SC has not achieved satisfactory results for a long time for those students who require employers, so employers are forced to use different social networks, portals and pages to find students,'' Jurković described the issue, giving an example of how to create a much better connection between students and their potential employers.

Make sure to stay up to date by following our dedicated business and politics pages for much more.

Click here for the original article by Goran Jungvirth for Poslovni Dnevnik