ZAGREB, 21 March 2021 - In the next seven years, Croatia will work to absorb as much money from EU funds as possible and direct it to its less developed regions to improve citizens' living standards and stop emigration, Regional Development and EU Funds Minister Nataša Tramišak has said in an interview with Hina.

The minister noted that EU funds were changing Croatia for the better in all its parts.

"I want their impact to be felt by every citizen, and for them to stop negative demographic trends and bring back people who are now emigrating," the minister said, noting that she had personally planned operational programs for the regions of Slavonia, Baranja, and Srijem.

Surplus won't go to waste.

From 2014 to 2020, Croatia had at its disposal €10.7 billion of EU funds as part of the European Commission's cohesion policy, designed to help reduce differences between developed and undeveloped parts of the EU.

Projects contracts in the amount of 115% of the allocation have been signed, and in that regard, Croatia is at the very top in the EU, together with Ireland, Greece, Portugal, and Finland. Those countries, too, have signed project contracts whose value exceeds the amounts allocated to them.

The contracted surplus will be carried over to the new period, which began in 2021 and will last until 2027.

"Those projects will be carried over to the next period. There won't be any delays. We are talking about large projects such as railway infrastructure and water utility projects," she said.

The value of those projects exceeds €50 million. Small projects will continue as planned ad they should be completed by the end of 2023, the minister said.

"I believe that by then, we can implement all the contracted projects and thus absorb the entire financial envelope," said Tramišak.

While project contracting was satisfactory, what was problematic for smaller project beneficiaries was the slow payment of money into their accounts, with 50% of the €10.7 billion having been paid so far, which puts Croatia at the bottom of the EU ranking, along with Spain, Slovakia, and Romania.

In October, the European Commission said that this was because public procurement procedures in Croatia last long and that the Croatian administration imposes complex procedures on beneficiaries.

"Those procedures have been simplified, and they were made public in December, so every user knows how the body in charge of checking their costs and activities will act. We have also simplified procurement procedures for entrepreneurs. The conditions now are minimal," says the minister.

She notes that since she took office in August 2020, the amount paid to end-users has grown from 33% to 50%.

"We will continue additionally simplifying the procedures," she said, adding that there were no delays in payments.

Five goals

In the period from 2021 to 2027, Croatia will have €9.6 billion for cohesion policy goals.

The EC has requested from Croatia a list of priority areas for co-financing in that period. When the list is submitted and the EC approves it, the two sides will sign a strategic agreement, after which Brussels will start approving individual projects.

The minister said the list would be submitted by June.

Project proposals will have to meet one of the five goals set by the new EU regulations, and those are a smarter Europe, a greener Europe, a more connected Europe, a more social Europe, and a Europe closer to citizens.

Emphasis has been put on research, innovation, a stronger economy, enterprise and health system, science and education, and social care.

Investments in the infrastructure of towns, municipalities, and counties will continue through a special fund, said Tramišak.

The biggest project co-financed by the EU in Croatia so far is the Pelješac Bridge. For the time being, it is not known whether there will be any new major infrastructure projects.

"A decision on strategic projects has not been made yet. It will probably be discussed in the next two to three months, and the government will decide what those big projects will be. We will then know how much money we have in each operational program, and we will see if there will be any major projects like before," said Tramišak.

Once the programming period is over, project beneficiaries will have three more years to complete them until the end of 2030.

Earthquakes

Due to last year's earthquakes, Croatia was forced to seek help from the EU Solidarity Fund, with €683.7 million having been paid into the state budget to help remove damage caused by the 22 March 2020 earthquake in Zagreb.

"Those funds are now available for the reconstruction of Zagreb and its environs, and project calls have been published, contracting will start soon. We have until mid-2022 to use the money," she said.

Last week, Croatia sent a request for additional aid from the Solidarity Fund to Brussels, asking for €319.19 million to help remove damage caused by earthquakes Sisak-Moslavina County at the end of last year, and it remains to be seen how much money the EU will grant.

"We expect payments from the European budget very soon, during this year," the minister said.

Croatia is also a member of two EU macroregional strategies, the Adriatic-Ionian and the Danubian strategy, as part of which the EC finances cross-border projects.

Tramišak notes that most funding goes for cooperation with Bosnia and Herzegovina and Montenegro as part of that European territorial cooperation.

She says that €186 million will be available in the coming period for cross-border cooperation projects focusing on environmental protection, infrastructure, tourism, education, and connecting people.

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ZAGREB, 19 March, 2021 - The percentage of Croatian citizens who support the adoption of the euro in February this year has reached 45%, up by four percentage points from 41% in a previous survey, conducted in March 2020, the Croatian National Bank (HNB) said on Friday.

The fourth public opinion poll on the adoption of the euro was carried out for the HNB by the Ipsos agency from 23 February 2021 to 1 March 2021.

Nineteen percent of citizens are against the adoption of the euro, while 26% are either against or in favour depending on other factors, and 10% of the respondents do not know, the HNB said.

Also, they said, an increasing number of citizens think that the effect of the euro will be positive. Some of the advantages they see include easier payment and business, as well as the fact that the euro is the common currency in the euro area, which would make Croatia equal to other members of the monetary union.

On the other hand, they see a decline in the standard of living and purchasing power as the main risk, and over a third of citizens think that the adoption of the euro will further increase prices.

To date, the poll has been carried out four times: in August 2018, in February 2019, in March 2020 and in February 2021. The survey is conducted on a nationally representative sample of 1,000 respondents, aged 18 to 79, using computer-assisted telephone interviewing (CATI), and it covers four thematic units: the use of the euro in the Republic of Croatia by foreign citizens, how informed citizens are on the adoption of the euro, citizens' attitudes to the adoption of the euro and their expectations.

The aim of the survey is to determine whether Croatian citizens support the strategic commitment of the government and the HNB to adopting the euro as the official currency in Croatia and whether they are aware of all the benefits that the adoption of the euro will bring to them and the national economy.

For more about business in Croatia, follow TCN's dedicated page.

ZAGREB, 18 March, 2021 - In the fourth quarter of 2020, hourly labour costs rose in the EU and euro area at rates that were almost twice as high as in the previous quarter, while Croatia was again among the countries that recorded declines, a Eurostat report shows.

In the 27-member EU, hourly labour costs increased by 3.3% in the fourth quarter of 2020 compared with the same period in 2019. In the third quarter, they increased by 1.8%.

At the same time, hourly labour costs in the euro area were 3.0% higher than in the last quarter of 2019, following a 1.6% increase in the third quarter.

The higher labour costs reflected a rise in the costs of hourly wages and salaries, while the non-wage component moderated the growth in hourly labour costs, in particular due to the tax reliefs and subsidies granted by EU governments to support enterprises affected by the coronavirus crisis.

In the EU, the costs of hourly wages and salaries increased by +3.7% in Q4 2020, following a 2.4% rise in Q3. In the euro area, the costs of wages and salaries per hour worked grew by +3.5%, after a 2.2% increase in the third quarter.

In the EU, in the fourth quarter of 2020 compared with the same quarter of the previous year, the economic activities that recorded the highest increases in wage and salary costs were "Arts, entertainment and recreation" (+11.0%) and "Accommodation and food service activities" (+10.2%)

The non-wage component increased by 1.8% in the EU and by 1.5% in the euro area, following stagnation in the previous quarter.

The largest increases in hourly labour costs were recorded in Austria (+11.6%) and Bulgaria (+10.0%), while the lowest increases were observed in Hungary (+0.7%) and France (+0.3%).

Croatia, along with Ireland, Malta and Finland, had lower hourly labour costs in the fourth quarter of 2020 than in the same period in 2019. Ireland observed the largest decrease in hourly labour costs, of 4.8%.

in Croatia, hourly labour costs in Q4 2020 were 1.1% lower than in Q4 2019, while in Q3 they fell for the first time in four years, by 0.6%. In the fourth quarter, wage and salary costs fell by 0.2% and the non-wage component shrank by 6.3%, the largest decline since Q2 2016. In the third quarter, wage and salary costs rose by 0.3%, while the non-wage component fell by 5.8%.

For more about politics in Croatia, follow TCN's dedicated page.

ZAGREB, 17 March, 2021 - A recycling yard worth HRK 3 million and co-financed by EU funds has been constructed in Novi Marof, and during his visit on Wednesday, Economy Minister Tomislav Ćorić said that the northwestern part of Croatia has progressed more than other parts of the country in terms of waste management.

The recycling yard in Novi Marof was co-financed from the Cohesion Fund in the amount of more than HRK 2.5 million, while the entire project is worth over HRK 3 million.

Novi Marof Mayor Siniša Jenkač underscored that the recycling yard was a continuation of the policy of efficient and responsible waste management in that northern Croatian city.

"In addition, the remediation of our landfill Čret is currently in its final phase, and it cost a total of HRK 17.5 million, including 30 years of monitoring," he said, adding that they had also procured waste sorting containers.

The remediation of the Čret landfill was co-financed with HRK 13.3 million of EU funds.

According to Jenkač, when it comes to total financing with European money, about HRK 40 million has been invested in waste management in the area of Novi Marof.

(€1 = HRK 7.6)

For more about politics in Croatia, follow TCN's dedicated page.

ZAGREB, 16 March, 2021 - The European Commission on Tuesday disbursed €9 billion to seven EU member states, including €510 million to Croatia, in the fifth instalment of financial support to preserve employment during the coronavirus pandemic under the SURE instrument.

This is the second instalment this year. Czechia has received €1 billion, Spain €2.87 billion, Italy €3.87 billion, Lithuania €302 million, Malta €123 million and Slovakia €330 million.

So far, 16 member states have received a total of €62.5 billion under the SURE instrument in loans which the Commission is taking out on financial markets at the best terms.

Croatia received the first instalment of €510 million on 17 November.

For more about business in Croatia, follow TCN's dedicated page.

ZAGREB, 15 March, 2021 - Prime Minister Andrej Plenković said on Monday that a coordinated stance by the European Medicines Agency (EMA) regarding the AstraZeneca vaccine should be known tomorrow, after several countries have temporarily suspended administering the vaccine due to the emergence of certain side effects.

"Our stance is that a sound test has to be conducted to determine if there are any reasons, based on the findings so far, for Croatia also to go in that direction. From what the experts are telling me, there are no such indications for the time being. Tomorrow, we will probably see a coordinated stance by EMA, which as far as I understand, will proceed cautiously, that is, continue testing the vaccine itself and continue with consultations with the company regarding any possible consequences of the vaccination," Plenković said ahead of a joint meeting of the Croatian Democratic Union (HDZ) Presidency and National Council.

He added that the director of Croatia's HALMED drug regulator, Siniša Tomić, today participated in EMA meetings which discussed what to do next considering the emergence of several side effects that have been reported throughout Europe.

In reference to the procurement of the Russian Sputnik V vaccine, Plenković said that Croatia would wait for it to be approved and that the EMA had launched the relevant procedure. In the meantime, we will obtain additional information and test the vaccine, he added.

Asked who made the decision on how many doses of a vaccine Croatia would order, Plenković said that the procurement of vaccines was launched in the summer before reports that AstraZeneca had had certain problems with clinical trials.

"The vaccine that at the time was way ahead in terms of testing and the fact that it could be finished and its approval sought was AstraZeneca's and we, like the majority of other countries, immediately ordered the largest quantity of that vaccine. Then we ordered the Pfizer, Moderna and Johnson and Johnson vaccines. Croatia ordered a total of 8.7 million doses," said Plenković, adding that no one could have known that problems would emerge in vaccine production when the initial orders were made.

Asked whether anyone would be held responsible for the poor estimate in procuring vaccines, he said that for the entire time the aim had been to protect citizens, which was why more doses had been ordered than Croatia needed.

"The problem has emerged because one company, from which we ordered the biggest quantity... now has a problem in delivering the vaccine to the entire European Union. If that problem didn't exist, the rate of inoculation in Croatia would be very high," he explained.

Asked why Croatia didn't order the largest quantity of the Pfizer vaccine, which was the option many countries used, he said that only a few countries did that and that Croatia's decision was based on an expert opinion at the time.

"Croatia has a population of four million people and can immunise a maximum 3.4 million, and how could it justify buying 20 million doses?" "We did everything that was logical and correct based on the information that was available at the time and as time is moving on, we are looking for other solutions, just like everyone else," he said.

He added that it was necessary to find a corrective mechanism to redistribute the vaccines.

As far as continuing inoculation with the AstraZeneca vaccine in Croatia is concerned, Plenković said that the experts would decide on that. "As far as I understand, EMA's stance is that when the risk and benefits are taken into account, at the moment it is better to be vaccinated," said Plenković.

With regard to the European initiative for a vaccination certificate, Plenković said that the European Commission would release its proposal on Wednesday and that that would enable free movement and the tourism season.

For more about vaccinations in Croatia, follow TCN's dedicated page.

ZAGREB, 12 March, 2021 - In four years Croatia met 281 recommendations in eight acquis areas, successfully completing the Schengen evaluation procedure, the Interior Ministry said on Friday after a meeting of EU interior ministers who discussed security and migrations.

The Portuguese presidency and Commissioner Ylva Johansson informed the Council that Croatia had successfully completed the Schengen evaluation procedure which began in June 2015 and ended in May 2019, the ministry said in a press release.

In the most comprehensive evaluation of preparedness for membership of the Schengen area, Croatia met 281 recommendations in eight Schengen acquis areas, including 145 pertaining to external border control.

Early in February, the Council confirmed that Croatia had met all the recommendations in that, the most demanding evaluation area, the ministry said, adding that in the past two weeks bilateral meetings were held with four member states which were unsure if Croatia had indeed met all the membership requirements.

On 2 March, Interior Minister Davor Božinović met with all the EU ambassadors accredited in Croatia at which he informed them in detail of everything Croatia had done in the past three and a half years to ensure full application of all Schengen standards.

"The ministers endorsed the report by the Portuguese presidency and Commissioner Johansson, without debate thereby confirming the completion of the Schengen evaluation procedure for Croatia," the ministry said.

Croatia's job and goal now is to prepare everything that is necessary for the Council of the EU to adopt a political decision on the Schengen membership, the ministry added.

Croatia evaluated as no other EU member state

"Croatia successfully passed the most comprehensive and the most detailed evaluation, like no other EU member state," said Božinović, who attended a video conference of the Home Affairs Council.

He added that Johansson said that this was the final confirmation of Croatia's preparedness to join the Schengen Area, while the chairman of the Council of the EU, Portuguese Interior Minister Eduardo Cabrita, supported Schengen enlargement to Croatia.

The ministry said the Council held the first debate on a draft directive on the resilience of critical subjects, which is aimed at further contributing to the implementation of EU Security Union Strategy targets.

The Portuguese presidency reported on the external dimension, border protection and solidarity. Another priority is working on the establishment of legal migration routes to more effectively curb illegal ones.

Stronger cooperation with third countries

The European Commission presented a report on strengthening cooperation with third countries in returns and readmissions as well as a 2019 report on the evaluation of cooperation in readmission.

Božinović said Croatia saw the former report as an important step forward in dealing with the return of migrants illegally staying in the EU.

"All Commission activities to use the potential of the EU visa policy are welcome, in an effort to encourage third countries to cooperate more constructively in the readmission of their citizens, as well as the possibilities available to us in other areas, development and trade arrangements for example," he said.

It would be useful to supplement initiatives with lists of safe third countries and safe countries of origin which would make it easier for the relevant services to swiftly make decisions on asylum or returns, Božinović added.

In concluding readmission agreements, priority should be given to countries of origin, the ministry said, adding that Božinović also pointed to the problem of transit countries.

Croatia supported strengthening cooperation with North African states in all areas that can contribute to strengthening stability in Africa, which would then facilitate dealing with the root causes of migrations towards the EU, the ministry said.

For more about politics in Croatia, follow TCN's dedicated page.

ZAGREB, 11 March, 2021 - Croatia is ready to make its contribution to the Conference on the Future of Europe, in which Commission Vice-President for Democracy and Demography Dubravka Šuica will have one of the leading roles, Prime Minister Andrej Plenković said in Brussels on Thursday.

Croatia will make its contribution to the discussion on how to respond to global challenges together and how this Conference can improve the responses of the EU and its institutions to citizens' expectations and to numerous issues in the world which are now substantially different than they were before the COVID-19 pandemic, Plenković told reporters after meeting European Parliament President David Sassoli.

The leaders of the three EU institutions on Wednesday signed a joint declaration on the Conference on the Future of Europe, which is conceived as a public forum where citizens will over the next year be able to say what sort of Union they want.

The  Conference is expected to open on 9 May, Europe Day. It should have been launched on 9 May last year but had to be postponed, partly because of the coronavirus pandemic, but mostly because the leaders of the EU institutions were unable to agree on who would chair the Conference.

The Conference will be chaired by a three-member presidency consisting of the Commission President, the Parliament President and the Prime Minister of the country holding the rotating presidency of the Council of the EU.

In addition to the collective presidency, there will also be an executive committee which will be responsible for the organisation and oversight of the Conference's work. Each of the three main institutions will have three members on the executive committee, while the representatives of national parliaments will have observer status. Croatia's Dubravka Šuica will be on the executive committee on behalf of the Commission.

Sassoli said that the Conference should result in the better functioning of the Union, which is expected to be given new competences.

Plenković and Sassoli also talked about problems with COVID-19 vaccines in the EU, EU membership prospects of the Western Balkans, and Croatia's efforts to join the Schengen zone and euro area.

Plenković said that Croatia supports the EU integration of southeast European countries, especially Bosnia and Herzegovina with which it shares the longest border and where Croats live as the smallest constituent ethnic group.

For more about politics in Croatia, follow TCN's dedicated page.

ZAGREB, 9 March, 2021 - The Croatian government on Monday adopted a conclusion authorising Health Minister Vili Beroš to sign an order for the procurement of the Pfizer Inc./BioNTech COVID-19 vaccine.

The conclusion was adopted in line with an agreement signed between the European Commission and Pfizer Inc./BioNTech Manufacturing GmbH on 17 February 2021.

The funds for the procurement of the vaccine will be secured by the Croatian Health Insurance Fund.

The EC has so far signed six agreements on the upfront purchase of vaccines against COVID-19 on behalf of EU member states. The February 17 agreement between the EC and Pfizer refers to the purchase of an additional 200 million doses.

 For more about COVID-19 in Croatia, follow TCN's dedicated page.

ZAGREB, 6 March, 2021 - Croatia is at the bottom of the EU ranking of women at management level and women in the EU are still far from being men's equals, according to an Eurostat report.

The COVID-19 pandemic "has led to unprecedented changes in the workplace," Eurostat said, but data on men and women at management level continue to reveal familiar patterns.

"While both women and men bring different qualities to crisis management, women remain outnumbered at the management level," Eurostat said.

"In Q3 2020, more than 9.5 million people held a managerial position in the EU: 6.2 million men and 3.3 million women. Although women represent almost half of all employed persons in the EU (46%), they are under-represented amongst managers (34%)."

In the past 20 years, the share of women in managerial postions "has gradually increased from just below 30% in Q2 2002."

Latvia and Poland on top

Latvia, Poland, Bulgaria, Hungary and Slovenia have the highest shares of women managers, with Latvia recording the highest share in Q3 2020 (45%), followed by Poland (44%).

Bulgaria, Hungary, Slovenia and Sweden are next, each with a 42% share.

Above the EU average are Ireland, Romania, Finland, Estonia, Spain, France, Portugal, Slovakia and Lithuania, their shares of women managers ranging from 38 to 35%.

In Denmark and Germany, less than one in three managers were women according to data for Q4 2019. 

"At the opposite end of the scale, women account for only around a quarter of managers in Croatia (24%), the Netherlands (26%) and Cyprus (27%)," Eurostat said.