ZAGREB, 24 July, 2021 - The Minister of Economy and Sustainable Development, Tomislav Ćorić, took part in an environmental drive on Saturday, cleaning up the seabed at one of the most famous tourist destinations in Croatia - Golden Cape Beach at Bol on the southern island of Brač.

It is one in a series of drives that will be held along the Croatian Adriatic coast by several diving clubs to protect the sea and nature from pollution and reduce the negative impact on marine habitats, the Ministry said in a statement.

"People are still not aware enough that the nature around us is the only one that we have. It is unbelievable how much waste people throw into the environment and the sea, even though there are legal and simple ways of waste disposal available. Of everyday items, one of the biggest polluters is single-use plastic packaging, which we have reduced to the maximum by the new Waste Management Act," Minister Ćorić said.

He called on people to think of their future and protect the environment for the sake of the generations to come, praising the participating organisations and individuals for helping keep the environment clean.

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ZAGREB, 21 July, 2021 - Minister of Economy and Sustainable Development Tomislav Ćorić on Wednesday spoke of an informal EU meeting of environment ministers in Slovenia on new legislation on climate and the European Commission's recommendation to reduce greenhouse emissions by 55% by 2030 compared to 1990.

He explained at a press conference that this refers to 12 legislative proposals from various areas that are being considered by EU member states in reference to the set objectives.

Ćorić said that this was an important step towards strengthening the EU as a leader in the fight against climate change.

Tax on carbon is a novelty - legislation is very ambitious

Ćorić explained that the new legislation envisages a carbon tax that should protect production in the EU compared to countries that export to the EU but are not encompassed by EU standards and mechanisms.

We are aware that if nothing is done in the next ten years, the potential costs of the damage could be much higher than the costs of transforming economies, he said.

With reference to financing that transformation, Ćorić said that Croatia has more than HRK 60 billion available over the next ten years to be spent in various commercial segments to reduce carbon emissions.

He underscored that the new legislation is very ambitious and a step towards Europe's economic transformation.

Price hikes to be eased with absorbed funds

He said that transition is a huge challenge and is being disputed by some but that it is also a huge opportunity for economies like Croatia through generous allocations of EU funds.

He recalled that Croatia's energy sector has a very small portion reliant on carbon, considering the significant share of hydro-power and potential for renewable sources.

Referring to the announcement for the construction of a new block at the Krško Nuclear Power Plant (NEK) in Slovenia, Ćorić said that that project could take up to a decade to be achieved, adding that Croatia has still not been officially informed of that project.

He recalled that obligations existed under international conventions for projects of that nature with a cross-border impact. Croatia has been advised of extending the lifespan of NEK to 2043.

He underscored that NEK is a stable source of energy and believes that it will continue to be so. He added that his ministry is interested in seeing more formal proposals to see whether Croatia would enter into a partnership with Slovenia regarding the construction of a new block at the Krško plant.

He added that Croatia was monitoring the situation with the Paks Nuclear Power Plant in Hungary because Croatia imports 30 to 45% of energy needs from abroad, depending on the hydrological situation.

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ZAGREB, 29 June, 2021 - Croatia can be a green energy transition leader, Economy and Sustainable Development Ministry state secretary Ivo Milatić said on Tuesday at a conference on  Croatia's energy future organised by Lider weekly.

He said Croatia was preparing legislation and all the prerequisites for "as good and successful an energy transition as possible."

Milatić said Croatia had a 2030 energy strategy with an outlook on 2050, a national climate energy plan and amended laws on energy efficiency and biofuels, and that it was in the process of amending laws on renewables and the electricity market.

The latter amendments, he said, will significantly help with green transition as it will allow market development. "There will be no more random development projects without any physical plans."

Milatić said the National Recovery and Resilience Plan envisages HRK 5 billion for energy, of which three billion to digitalise and enhance the electricity network.

"That will help to achieve the main goals, as we committed to installing in Croatia 1,500 new megawatts by the end of 2024. Croatia's plan is to install 2,500 megawatts by 2030."

Milatić said the National Recovery and Resilience Plan also envisaged large sums for heating and energy efficiency in industry.

He said HRK 1 billion was envisaged for a Sisak biorefinery project, a facility that would produce major quantities of fuel, which could make Croatia influential in this part of Europe as well as develop agriculture.

"Our goal is for Croatia not to import 40% of energy and in order to achieve that, we must have many renewable energy source capacities. Croatia can be a green energy transition leader, but it's up to us."

Neven Duić of the Zagreb Faculty of Mechanical Engineering and Naval Architecture said Croatia's energy transition policy had changed for the better.

"The European transition hurricane that started brings big changes: 55% less greenhouse gasses by 2030, climate neutrality by 2050, we are heading towards 38 to 40% renewable energy sources by 2030, and the EU's green recovery plan brings money which can be used to push new technologies," he said.

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ZAGREB, 12 June, 2021 - Despite efforts by 11 EU countries, energy ministers have not managed to say 'No' to the extension of fossil fuel subsidies for some cross-border energy projects and by supporting this, Croatia has once again demonstrated a lack of ambition in fighting climate change, the Green Action NGO has said.

EU ministers on Friday agreed to extend EU support for some cross-border gas projects despite efforts by 11 countries and the European Commission that had clearly said that such funding should be discontinued in line with climate goals. The Council reached agreement on a revision of the regulation on the trans-European energy grid, thus accepting a compromise text that will extend subsidies for gas projects.

"(Economy and Sustainable Development) Minister Tomislav Ćorić did not attend the meeting but a representative of his ministry endorsed that weak text and Croatia has thus once again confirmed a lack of ambition in the fight against climate change," the NGO warned.

The agreement was not endorsed by Germany, Spain, Austria and Luxembourg.

"Even though the world is on fire, too many member-states still want to extend the use of fossil fuels like natural gas," the Green Action says.

The agreement defines the way the European Commission picks priority projects of common interest which then get EU funding and environmental permits faster. That is how the LNG terminal on the island of Krk ended up on such a list of priority projects, despite opposition from the local community and public at large, the Green Action says, noting that natural gas would probably continue to dominate new projects.

"Even though we should redirect all subsidies to clean renewable energy sources, we will continue paying for unnecessary gas infrastructure and gas pipelines that transport gas mixed with small quantities of hydrogen. The European Parliament must now take a firm stand to end EU subsidies for all fossil fuels," says the Green Action.

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ZAGREB, 26 March, 2021 - A HRK 12.5 million EU grant agreement for the construction of a composting plant in the southern town of Metković was signed on Friday by Economy and Sustainable Development Minister Tomislav Ćorić and the director of the local Čistoća waste management company, Tomislav Jakić.

The project, which will be implemented as part of the Operational Programme Competitiveness and Cohesion 2014-2020, is worth more than HRK 24 million, of which 50% is co-financed by the EU.

Ćorić said that the composting plant would serve Metković as well as Opuzen and neighbouring communities.

The plant's annual capacity is 5,000 tonnes and it guarantees that biodegradable waste in the River Neretva valley will be managed in the best way possible, said the minister.

Dubrovnik-Neretva County head Nikola Dobroslavić said that Metković was the most advanced local government unit in terms of waste management.

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ZAGREB, 19 March, 2021 - Croatia will enter the euro area on 1 January 2023 at the earliest, and introducing the euro has a number of advantages but for those advantages to be greater the economy needs to be more flexible, including with regard to the labour market, a conference heard on Friday.

The conference, focusing on the introduction of the euro as the official currency in Croatia, was organised by the students' association Financial Club.

Croatian National Bank (HNB) Governor Boris Vujčić said in his opening remarks that Croatia cannot enter the euro zone before 1 January 2023.

"Whether Croatia will enter the euro area on 1 January 2023 or a year or two later, depends on when it will meet the nominal convergence criteria," said Vujčić, recalling that in July 2020, Croatia entered the European Exchange Rate Mechanism II (ERM II), a sort of waiting room for the euro.

He explained that the ERM II envisaged a minimum two years of participation in it so that a candidate aspiring to join the euro area can meet the nominal convergence criteria (Maastricht criteria). On the other hand, if it does not satisfy the criteria, which refer to the stability of the exchange rate, prices and interest rates, the budget deficit and the level of foreign debt, a country can remain in the ERM II indefinitely, Vujčić said.

He recalled a survey indicating that citizens fear that with the introduction of the euro the standard of living will deteriorate and prices will increase. However, surveys in countries that have already introduced the euro indicate that prices increased by 0.23 percentage points on average in the year when the euro was introduced, mostly for everyday goods such as coffee. Prices of such products are relatively lower so their increase could have been relatively high due to rounding off.

"That left the impression in public that prices increased more than they did," explained Vujčić, underscoring that the standard of living did not fall in any country that introduced the euro but rather it improved.

Ćorić: Biggest advantage to companies exporting to euro area

Minister of Economy and Sustainable Development Tomislav Ćorić said that it was clear that citizens would not start living better on the first day of introducing the euro, however, what points to better prospects was the fact that the macro environment in the euro area was free of risks that non-member countries were faced with.

The risk premium in all countries that entered the euro area has dropped, said Ćorić, noting that that was something that in normal circumstances should  bring benefits to Croatia, such as reducing yields on long-term security instruments and lower interest rates on commercial and consumer loans.

Considering, however, that we live in "fairly radical economic times," and a period of very low interest rates, the effects which countries that entered the euro area some ten years ago had would be somewhat lower, however, they would still be significant, he said.

The advantages are potentially biggest for export-oriented companies considering that the exchange rate risk will be eliminated, he said.

Ćorić said that the project for euro introduction was not an end in itself but was primarily a very good tool for Croatia's long-term economic growth and development.

Mačkić: Flexibility of labour market, final goods and services market

President Zoran Milanovic's economic adviser, Velibor Mačkić, conveyed the president's message saying that it was necessary to discuss the benefits and potential harm of Croatia joining the euro area.

Mačkić believes that Croatia has not developed its own institutions sufficiently and that that poses a problem. "The country needs a different economy, a much more flexible economy, to be able to benefit more significantly from the monetary union," said Mačkić.

He added that the labour market and the market of final products and services need to be more flexible.

Mačkić underlined the importance of an efficient fiscal policy and of the reform of the tax system which Mačkić believes needs to change from "a consumption-based to income-based tax system."

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