March 19, 2020 - A look at the first ten measures proposed to help the Croatian economy during the corona crisis. 

Following the decision to prevent the rise in prices of critical products for supplying the Croatian market and exporting those products for which a shortage in Croatia could appear, Minister Darko Horvat presented the first ten measures from the Ministry of Economy, Entrepreneurship, and Crafts, which were proposed at a Government session on Tuesday, reports Vecernji List on March 16, 2020. 

These measures will be aimed primarily at entrepreneurs and craftspeople. 

“The meaning of all the measures we plan to take and which we have held very intensive discussions about so far is to preserve jobs and the domestic economy, and to provide the necessary liquidity to our entrepreneurs, through a moratorium or deferrals of loan obligations, the introduction of new credit lines for working capital funds and the like,” explained the minister. Horvat also stressed that changes in certain economic relations are expected in the coming period, both nationally and globally.

“At the moment, we are aware that carriers, traders and exporters suffer the most, but we must take into account all possible scenarios, considering all branches of the Croatian economy, from craftspeople, through micro, small and medium-sized enterprises, to large companies,” said Horvat. 

You can find the suggested measures below:

1. Reprogram existing loans (with the introduction of a grace period in repayment of the loan principal) and introduce a moratorium on the credit obligations of HBOR clients and commercial banks on existing placements;

2. Approval of new liquidity loans to economic operators for financing salaries, overheads, and other basic operating expenses, in cooperation with commercial banks;

3. Approval of guarantees (insurance policy) to export commercial banks and HBOR within the framework of the guarantee fund for export insurance;

4. Increase the scope of the guarantee fund for export insurance by including the tourism sector, the indirect exporting entities or the suppliers of direct exporters in the eligible beneficiaries;

5. Provide for the possibility of introducing, through the Amendments to the Investment Promotion Act, the extension of deadlines for the implementation of investment projects and the introduction of an additional grace period of three years to preserve jobs;

6. Intervention in the purchase of surpluses in livestock and crop production, fruit and vegetables, and other products from potentially endangered industrial and agricultural producers;

7. Increasing the rate of the HAMAG-BICRO guarantee from 65% to 80% of the loan principal with a shortened processing procedure and an additional allocation of EUR 15 million for Micro working capital loans (up to EUR 25,000), with a maximum interest rate of 1%;

8. Moratorium on all installments of ESIF Micro and Small Loans by 31/12/2020;

9. Increasing the de minimis grant limit from EUR 200,000 to EUR 500,000;

10.The possibility to mobilize part of the budget as a contribution to sectoral intervention grants to entrepreneurs (national grant).

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As Lea Balenovic/Novac writes on the 3rd of June, 2019, the Croatian Ministry of Economy recently awarded Croatian entrepreneurs twenty contracts totalling an enormous 85 million kuna. To be more specific, these are contracts funded by non-refundable EU funds for which the tenders were announced at the end of last year.

The aim of these tenders, as Minister of Economy Darko Horvat explained, is to "increase production and exports and create jobs, as well as to strengthen the competitiveness of small and medium-sized enterprises through the presentation of their products and services on the international market".

One of the companies that which will use these opportunities for job creation and business optimisation is certainly the Croatian company IT-Graf, which deals with printing, and which has plans to invest almost 15 million kuna. Non-refundable EU funds in the amount of 6.6 million kuna were awarded to that particular Zagreb-based company.

"We'll all invest in new machines and modernisation, ie, the automation of printers, with the goal of going to foreign markets and exporting, and our sophisticated products will mean we need high quality staff and we will open about twenty new work positions,'' stated Tomislav Ivičinec, Managing Director at IT-Graf, who doesn't have any issues with the lack of a workforce in Croatia or finding workers because, as he himself said, "you just need to pay the man and then there's no problem".

In addition to this Croatian company, Hangar 18 has also received funds to increase its overall international competitiveness, which is due to its permanent investments remains "a permanent guest of such events", according to Damir Kralj, the director of the company.

''We're dealing with information technology and mobile technology, ie, we produce smartphones, TVs and all of their accessories, and we'll use this 950,000 kuna to present our products at the Barcelona fair,'' said Kralj, adding that Hangar 18 is planning to build a new factory in Koprivnica in which an additional fifteen to twenty people will be employed.

With the help of these tools, Neon Bjorn, a Zagreb-based company offering a software solution for travel agencies, as well as for travelers who prefer to organise their own travel plans, has the opportunity to internationalise their business and product presentation. As explained by the director of this Croatian company, Vesna Kota, "it helps in the overall process and shortens the time involved in travel organisation".

''With the allocated 433,000 kuna, we'll place our product on foreign markets and sell it in far-off locations. We're expanding to Cape Town, Dubai and Beijing and in European destinations such as Barcelona and London, and the solution is available to tourists who wish to visit destinations both in Croatia and those outside of it,'' Kota explained, adding that their desire "to bring more tourists to Croatia''.

Make sure to follow our dedicated business and politics pages for much more on Croatian companies, Croatian products and services and the measures put in place to aid Croatian entrepreneurs.

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