ZAGREB, 27 Oct 2021 - Social Democratic Party MP Sabina Glasovac said on Wednesday the measures against the spread of COVID-19 were inconsistent and illogical, calling out Prime Minister Andrej Plenković for deciding to close schools without explanation.

"We still don't know on what basis the measures are being adopted. Is it based on the number of new infections or those hospitalised? Or those who end up on ventilators? Or based on the number of deaths?" Glasovac said in parliament.

Euro referendum

Hrvoje Zekanović of the Croatian Sovereignists called on MPs to sign today a petition for a referendum on the introduction of the euro.

"It's time we say that we stand by the people, that we are not politicians but activists," he said, adding that the will of the people was more important than protecting the national currency and that "the people must decide on key matters."

Jeckov: Fight against Serbs is the basis of politics in Vukovar

Dragana Jeckov of the Independent Democratic Serb Party criticized a conclusion of the Vukovar City Council on the need to expand the rights of ethnic Serbs.

She said that every year the conclusion stated that the degree of tolerance between Croats and Serbs "has not progressed and that conditions have not been created for expanding the rights."

"This year, that justification sounds bad, which is that we must wait for the data of the population census to see exactly how many Serbs live in Vukovar," Jeckov added.

As long as the current city administration remains in power, the conditions to expand Serbs' rights will not be met because collective guilt is ascribed also to those born in 1997, 2007, and 2017, she said.

"The fight against Serbs and presenting Serbs as scapegoats are the basis of politics in Vukovar," Jeckov said, adding that Serbs only wanted what they were entitled to under the law and the constitution.

She said the city leaders continue to stigmatize Serbs. "They make the treatment of Serbs a measure of their own patriotism in order to be recognized as the only true patriots because they are always and strictly against anything Serb. Serbs are a threat to all in Vukovar, except during local elections when good and suitable Serbs are put on slates and then those same Serbs vote that there are no conditions to expand Serb rights in Vukovar."

Jeckov said it was not only about Cyrillic signs on public buildings but also proportionate representation and the rights to education and housing. "I am much more worried that the climate was better in 1997," she added.

For more, check out our politics section.

October the 23rd, 2021 - Finance Minister Zdravko Maric has spoken out about rebalances, projections for the future, stability and of course, the topic on the lips of most - Croatian Eurozone entry, which is edging ever closer.

As Poslovni Dnevnik/Ana Blaskovic writes, at the end of this year or at the very beginning of 2022, the situation in the Republic of Croatia should return to pre-crisis levels. This is of course good news for the domestic economy with the perspective of Eurozone entry in 2023, but this generally optimistic picture is still being threatened by numerous risks, from poor vaccination levels to so-called ''bubbles'' on the Croatian real estate market. These matters could be heard being discussed at the conference of the Zagreb Stock Exchange and pension funds entitled "The Challenge of Change/Izazov promjene".

Finance Minister Zdravko Maric announced that he would step out next week with a rebalance and a few new projections.

"At the end of this year, or at the beginning of next year, we should reach pre-pandemic figures," he assured. The Croatian Government will also refresh its fiscal expectations for the next three years, which will be marked by the implementation of the National Recovery and Resilience Plan, the effects of which should boost GDP by 1.5 percentage points on average.

818 million euros have been pumped into Croatia so far, and the new cash injections will depend on the fulfillment of 34 different criteria by the end of the year. If they're met, the government will submit a report to the European Commission (EC) in January or February, and then "we can expect a new payment in May or June."

In terms of Eurozone accession, Finance Minister Zdravko Maric says, everything is currently going according to plan. Interest rates and the exchange rate aren't in question, but inflation is a new fear. "Inflation is a priority for us because of society, the economy and of course because of people, but we should also look at it through Maastricht, even though Croatia is at the EU average. According to these projections, we should satisfy that as well. The real date of joining the Eurozone is 2023, I see no reason as to why we won't manage to meet the criteria,'' said Maric.

The introduction of the euro as Croatia's official currency could reduce the risk premium by two levels and thus partially amortise the possible growth of interest rates, which has been a current topic lately.

Croatian National Bank (CNB) Governor Boris Vujcic, on the other hand, expects a quick recovery "in the shape of the letter V", for 2021 in the form of GDP growth of 8.5 percent, and then of 4.1 percent. He noted that inflation is a consequence of supply disruptions, making it somewhat difficult for ordinary monetary tools to address it.

"Raising the reference interest rates over the next two years isn't going to significantly affect the price of oil and gas, which make up half of inflation," said Vujcic. He underlined that the current figures (3.5 percent in September, op.a.) are historically low, but that we have become accustomed to a long period of low inflation, which has in fact been too low.

"This year we expect an inflation rate of 2.3 percent, which isn't worrying, it's actually very close to the goal of monetary policy and it will calm down slightly next year,'' he assured.

Risks in the macro environment...

In addition to energy, the CNB sees numerous risks in the macro environment in the form of the slower cleaning of the market from bad companies and the creation of a real estate bubble, among other things. Prices are also being pushed by foreigners buying properties, especially on the coast.

“The availability of property has started to deteriorate, loan installments in relation to disposable income are slowly growing. "If this trend continues, property purchasing becomes inaccessible to a part of the population with lower incomes, and this should be kept in mind because it's now also becoming a political problem," the governor warned.

Assessing the risks to financial stability, Hanfa's Ante Zigman briefly summed it up by saying that "it isn't exactly great, but it isn't terrible either".

“We’re not too worried about it all, but we’re on guard,” he said. In the second quarter, the risks were somewhat reduced, and for the third, in which inflation returned to the scene, there is no data to be looked into yet. There are a range of risks present; from investment concentration, labour market issues to, once again, the issue of real estate.

"Currently, there are high risks of valuation, the question is whether or not we have an overheated market. The risk of things falling due to high valuations is very possible ", warned the head of Hanfa. Labour Minister Josip Aladrovic out that there is reason for optimism at the end of the global coronavirus pandemic.

"We've never had closer cooperation between politics and economics. The government acted in a timely and adequate manner, we can say that we saved the economy. We're now going into the job creation phase,'' he said, announcing that a very important role is played by pension funds that manage 130 billion kuna.

“They need to invest in long-term sustainable investments, which will create pensions and increase them in the future. It's up to us to redefine the regulations in the direction of the diversification of investments and goals, which we'll do in the short term and in cooperation with those pension funds,'' he concluded.

For more, follow our politics section.

October the 18th, 2021 - As many as half of all Croatian ATMs could end up being put out of use as a result of incoming regulations which involve the safety and security of ATM machines.

As Poslovni Dnevnik writes, there are very many Croatian ATMs, and it's always quite amusing to be strolling through an ancient street steeped in history and come across an ATM lodged in the wall. While perhaps not always that tasteful, they're certainly handy.

The Republic of Croatia has 6,000 ATMs, and half of them could be shut down and removed due to the introduction of additional regulations for the protection and security of ATMs, as was reported by HTV's Potrosacki kod (Spender's code). That's a very large expense indeed for banks should it occur.

They have already abolished Croatian ATMs for which they estimated that the cost of their maintenance is greater than the benefit they have from the amount of turnover and the number of customers they get. According to these new regulations, greater security of the banking network is necessary in order to reduce criminal actions taking place at ATMs.

Banks should therefore invest several thousand euros into ATM security, and as a result of that expensive move, some have announced the withdrawal of some Croatian ATMs from use entirely, especially those in rural areas which simply can't afford such a security undertake.

However, not everything is so bleak and the banks are asking the Ministry of the Interior (MUP) for a compromise solution regarding the security of Croatian ATMs, because they are now investing 80 to 100 million euros into their IT systems in order to convert the kuna into the euro, which is necessary due to Croatian Eurozone accession, which is edging ever closer now.

The Ministry of the Interior says that it is prescribed that ATMs are protected by an electrochemical protection system which permanently marks and destroys banknotes in an attempted violent burglary. ATMs protected by this system already must bear a prominent indication of that type of protection in a visible place so that all users are aware of it.

For more, make sure to check out our lifestyle section.

October the 17th, 2021 - A brand new institution is set to manage Croatian state owned companies as the country edges ever closer to Eurozone accession, and the response is likely to be a very mixed bag.

As Poslovni Dnevnik/Marija Brnic writes, the establishment of a new body for the management of state property, more precisely Croatian state owned companies, is currently being prepared. This is the result of the commitments that Zagreb has accepted within the process of introducing the euro as Croatia's official currency, in order to raise the efficiency and improve the quality and operations of Croatian state owned companies.

Last week, the government appointed a steering committee to work on an Action Plan for this task, and the competent Ministry of State Property, headed by Darko Horvat, has taken its first step - launching a public debate on a preliminary assessment of the new Law on Legal Entities owned by the Republic of Croatia, which intends to bring order to corporate governance policy.

The basis will be the guidelines given to the government this summer by the OECD, which proposes the establishment of a coordination body that will monitor the activities and results of all Croatian state owned companies, meaning the placing of all enterprises under state ownership across Croatia under one ''cap'' for monitoring and management.

This new body, according to the OECD, would be of the agency type directly accountable to the government or possibly located in a ministry, provided that it isn't in charge of enacting regulations.

It sounds like a mere formality and a new accumulation of administration, which the public will hardly welcome, especially if we remember the numerous transformations that the state-owned company management system has undergone in Croatia already, from the Privatisation Fund, the State Property Management Agency to the Centre for Restructuring and Sales. and now here's a special ministry in charge of state property.

However, the OECD claims that the introduction of such a specialised body is very necessary, because the existing system, although improved in the meantime, is still not up to par in any way, shape or form. That is likely not a shock to anyone who has had dealings with one of these companies.

In short, their analysis of Croatian state owned companies and the entire corporate sector identified a number of ambiguities and shortcomings that this new “unit” will seek to address, from regulatory inconsistencies to insufficiently defined ownership policy objectives in terms of financial and non-financial expectations, and incoordination and poor communication between ministries.

The new agency should not only gain a range of powers in overseeing management standards, monitoring performance and publishing public reports of these Croatian state owned companies, but also take on an important role in appointing supervisory boards.

More specifically, it would propose candidates, which, according to the OECD's estimates, would allow for greater expertise and a shift away from politics, which is desperately needed in Croatia. There is also the possibility that the new agency will get direct ownership in state owned companies, first for a small part of the portfolio, and gradually for the entire thing.

For more, make sure to check out our politics section.

September 21, 2021 - Speculation and doubts continue to appear about the future financial scenario in Croatia after the eventual introduction of the euro in the country as an official currency, displacing the kuna, and CNB Governor Boris Vujčić gives some clues about what it would look like in the first weeks.

Pay in kunas, get euros back. At least this is how the first two weeks in Croatia would look after the introduction of the Euro on January 1, 2023, reports Poslovni Dnevnik. The objective is to stop the circulation of what would be the old Croatian currency at that time and to start the circulation of the euro. To provide more information and details, RTL Direkt interviewed CNB Governor Boris Vujčić, who in addition to the introduction of the euro, also talks about inflation and tacit minuses.

Why is the Minister of Finance so tough about not lowering VAT, couldn't the introduction of the euro be used to reduce it?

You have to ask him about VAT. As for inflation, I would say that a good part of inflation really comes from food especially now in the summer while in the first half of the year most of the inflation came from rising energy prices. At the moment, about half of the rise in inflation is energy, and now in the summer, food, vegetables and fruits are practically poor due to partly weather conditions.

Aren't you afraid of rising inflation? In the US it is somewhere around 6 percent…

The US has a higher inflation rate, but the economy is overheated there, they also have strong fiscal stimuli that are stronger than European ones and I do not see that at this time such an inflation rate could happen in Croatia, we expect that year-round inflation rate to be 2.2 percent. This is, in principle, the goal of the European Central Bank, so we should not be concerned about that. The problem is if there is a change in expectations, wage growth, but we do not see that at the moment. A significant part of that inflation comes from the fact that the so-called supply chains in the world at this time were disrupted. The Crown has disrupted all that, now you have continents where there are a lot of containers, some countries where you don't have them. You have a situation that road traffic, air travel, is still at a very low level and everything that flew with passengers on airplanes cannot fly… Then companies formed very large stocks that they never had and that logistically present a problem, say in the car industry you have full car parks that you can’t reach at the moment. It all takes some time to clear up and get back to what we had in 2019, one good mechanism, and then prices will slowly start to fall. I would say it won’t happen in the next 6 months.

Especially rising real estate prices. Housing squares are not in the inflation basket?

They are not. I am in favor of having these prices in the basket and what the European Central Bank, where we are going now, has done, and what will be the standard… that these prices will also start to be included in the basket, however, this will only be through two, three years. At the moment we have only the so-called implicit prices through rents and they do not reflect the fact that real estate prices have risen significantly, and they have risen because there is a lot of liquidity, a lot of money, part of which flows into the real estate sector. For example, interest rates that are at zero, or in the countries around us in the eurozone are even negative on deposits of citizens - some of these citizens take money from banks and carry and buy real estate, which inflates real estate prices.

Aren't you afraid that we will enter the eurozone just when euro inflation starts?

I wouldn't say. I don't see it as a danger. I do not see the inflation we measure through the consumer basket as a medium-term danger when we enter the eurozone, but I see the risks arising from these prices that we see at the moment in the bond market, real estate where much money has flowed and even cryptocurrencies. That bubble can always burst, as you know, financial crises arise, but it can blow out easily, prices can stabilize, which will depend on a lot of things, in my opinion, there is primarily a risk. Not these consumer prices.

What do you think would be the best advice for citizens?

Since I do not see any great risk from inflation itself, then I do not think that it should not be insured by investing in those types of assets for which the price is already too high, said Vujčić.

The Governor on the introduction of the euro

How many kuna, physical, banknotes are in circulation?

You have a billion and one hundred million coins and about half a billion of paper money. It is a demanding logistical operation, it all needs to be pulled.

What will it look like? I go to the store, I pay in kunas, the change is returned to me in euros?

That's right. Until 01.01. is HRK, from 01.01. is either kuna or euro for two weeks, after that it is only euro, with the proviso that when you pay in those two weeks, you pay in kuna, the euro is returned to you. And we collect all the kuna.

And then what about them? Are they going somewhere to catch fire?

Coins are a bigger problem. I already said it’s like 120 ZET trams. We have to store and store it somewhere, because it is money for another three years, as long as it changes. As long as they change, they are money. We agreed with the Croatian Army…

Are you building a safe somewhere?

We will build a safe, but at the same time, we agreed with the Croatian Army. It’s really all together logistically difficult.

For more, make sure to check out our dedicated business section.

September the 17th, 2021 - One concern for many that comes with Croatian Eurozone accession is price hikes. Just how much will prices rise, and will it be overall or only in regard to certain items?

As Poslovni Dnevnik writes, the controversy over Croatian Eurozone accession, aside from solely political views, boils down to a debate on whether prices will rise, and if so, by how much. According to data obtained by Jutarnji list from the Croarian National Bank (CNB), it can be expected that after the conversion from the kuna to the euro, people will very likely have to slightly higher amounts for some items than they were used to.

This has been shown by the statistics based on the experience of other Eurozone member states that went through the process of introducing the euro at some point in the past, and in which it was shown that the biggest price increases should be expected in the catering sector, more precisely in restaurants and cafes. That said, other service sectors will not be spared a rise in prices either...

As Andrea Pufnik from the CNB explains in her paper “Effects of the introduction of the euro on consumer price movements and the perception of inflation”, the experience of the Netherlands shows that restaurant prices increased by 3.5 percent after the introduction of the euro. In Finland they increased by two percent, while Austria and Greece, slightly smaller increases in the hospitality segment were recorded, from 0.2 to 0.5 percent, as reported by Jutarnji list.

According to experts looking into this, the reason for these price increases has a lot to do with the so-called ''menu-cost model'', more precisely, most restaurants will be forced to print new menus and this cost will spill over to consumers in the shape of price hikes.

Statistics also show how price increases could occur in the segment of cleaning, repairing and renting clothes, as witnessed, for example, by citizens of France, Germany and Estonia. Hair and beauty services in general could also become more expensive following Croatian Eurozone accession, and prices are also expected to rise in the services of IT, audiovisual and photographic equipment.

However, certain products will also become more expensive as a result of the ''rounding up'' of prices, which could be most noticeable in bakery products and newspapers, according to the Pufnik research.

Namely, prices being round up is one of the most common reasons for price increases, which is most pronounced for products that initially had slightly lower prices, which include newspapers and bakery products.

According to CNB projections, it is expected that newspapers and books could become 2.06 percent more expensive in Croatia from 2023, financial services 1.9 percent, accommodation services 1.7 percent, footwear 1.6 percent, sports services 1.5 percent, and catering services 1.2 percent.

Some Eurozone member states, such as Finland, also recorded an increase in fruit prices after the introduction of the euro as its national currency, although it is possible that this also happened due to climatological reasons. In Ireland, the biggest jump in prices was in sports and recreational services, in Slovakia the prices of food and non-alcoholic beverages rose the most, while neighbouring Slovenia recorded higher prices in restaurants and cafes, then in footwear and household appliances, and then in transport services.

In principle, various surveys provide different estimates of the effects of the conversion of national currencies into the euro, and Eurostat finds that growth averaged between 0.1 and 0.3 percent for the Eurozone back in 2000 and 2001, while some other surveys suggest price rises of 0.34 percent.

What is certain is that the effects vary from country to country. For example, the risk of price increases is reduced in countries with subdued consumption growth as well as in those member states that introduce mandatory pricing in both currencies in stores before the introduction of the euro, and then price growth is usually subdued in those markets where competition is higher.

"We don't really expect price increases, but we do expect smaller price increases in accordance with the statistics that were recorded in other then new members of the European Union," said Governor Boris Vujcic in attempt to calm people's worries.

For more on Croatian Eurozone accession, check out our dedicated politics section.

ZAGREB, 16 Sept 2021 - The government on Thursday adopted a conclusion on amending 46 laws and 72 regulations until 15 July 2022  as part of the roadmap for the euro changeover process.

Finance Minister Zdravko Marić informed the cabinet that in the last month, the competent agencies had itemized a total of 118 laws and regulations which should be amended within the national plan for the adoption of the euro.

The time frame for Croatia's admission to the euro area in 2023 thus entails the amending of the necessary legislation until 15 July 2022.

Prime Minister Andrej Plenković recalled that three days ago, the European Commission Executive Vice President  Valdis Dombrovskis, who attended the 11th meeting of the national council for the introduction of the euro as Croatia's official currency, strongly supported the work and ambitions of the government and other Croatian institutions to join the euro area.

Last Thursday the Irish Finance Minister and Eurogroup President, Paschal Donohoe visited Zagreb and said that Croatia had made important and positive progress on the road to euro area membership.

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

ZAGREB, 13 Sept 2021 - Finance Minister Zdravko Marić said on Monday that the introduction of the euro as the sole legal tender would impact Croatia's credit rating, and quoted the Fitch agency's presumption that the country's admission to the euro area would raise its credit rating by two notches.

Addressing a meeting of the National Council for the introduction of the Euro as Official Currency in Croatia, which was also attended by the EC Vice President Valdis Dombrovskis, Minister Marić recalled that the 2020 COVID-19 pandemic triggered off a rise in the budget gap, and last year the general government deficit amounted to 7.4% of the country's GDP.

This year, it is estimated at 3.8%.

According to the latest estimates, the budget deficit in 2022 will fall to 2.6% of GDP and to 1.9% in 2023, while in 2024 it is projected to be 1.5% of GDP.

Marić recalled that as a consequence of the higher budget deficit, the public debt also rose in 2020 when it reached 88% of GDP.

This year, the public debt is likely to fall by two percentage points to 86.6%, and in 2022, it is expected to be reduced by a further three percentage points.

Marić expects the public debt to be 76.8% of GDP at the end of 2024.

He announced a shift of the focus to inflation, noting that inflation trends were now present worldwide.

Croatian National Bank (HNB) Governor, Boris Vujčić, said that Croatia's admission to the European Exchange Rate Mechanism (ERM) II had brought the country under the Single Supervisory Mechanism (SSM) and it also joined the Single Resolution Mechanism (SRM).

Concerning the HNB, we are already in the bank union to a large extent. Our experience from participation in the SSM and SRM is good, we have adjusted ourselves to that, Vujčić said.

Commenting on fears of higher prices being triggered off by the euro changeover, the governor pledged the protection of consumers and good communication.

"We are preparing the code of ethics which will be offered to businesses and services to sign, whereby they undertake fair performance during the euro changeover, he explained.

We will introduce monitoring and we will use the best practices of countries that have already converted their national currencies to the euro, he said.

For more, follow our business section.

July the 26th, 2021 - The Croatian National Bank has revealed just how long we'll be able to make payments in both Croatian kuna and in euros as the country prepares to join the Eurozone at the beginning of 2023, as is currently planned.

As Poslovni Dnevnik writes, according to previous announcements, Croatia should enter the Eurozone and as such finally adopt the on January the 1st, 2023, and before the euro officially becomes the country's official currency in replacement of the kuna, many preparations will have to be made.

When it comes to just who will be in charge of the technical realisation of some important things about the introduction of the euro and how the euro will work at the very beginning, the Croatian National Bank confirmed for Net.hr that the new euro coins of the Republic of Croatia will be made at the Croatian Monetary Institute.

"The production of euro circulation coins with the Croatian national symbols will begin at the earliest six months before the day of the introduction of the euro, ie after the EU Council Decision that Croatia will introduce the euro," the Croatian National Bank explained.

With the day of the introduction of the euro as the national currency of the Republic of Croatia approaching, a sufficient amount of euro coins will be prepared for circulation to meet the needs of all people and business entities, the national bank added. What everyone is interested in at the moment, however, is just how long it will be possible to use both kuna and euro in parallel before the kuna is phased out and placed in this history books entirely.

"During the first two weeks from the day of the introduction of the euro, kuna and euros will remain in circulation at the same time, and traders should return the rest of the money to customers which have paid in kuna exclusively in euros," the Croatian National Bank explainsed After that period, the euro will be the only legal tender allowed in the country, they added.

"In order to ensure a smooth transition to the new currency, in a short transition period, the kuna and the euro will have the status of legal tender at the same time. In other words, people will be able to pay in both currencies in the first two weeks starting from the day the euro is introduced in stores. After two weeks from the day of the introduction of the euro, the euro will be the only legal tender in the Republic of Croatia,'' they stated from the Croatian National Bank.

Money, meaning Croatian kuna, can be exchanged for euros free of charge for the first six months of the euro being in use in the country. However, if someone does forget to exchange any kuna cash they have into euros after that deadline, it will still be possible. Namely, in the first six months from the day of the introduction of the euro by the bank, Fina and Hrvatska posta d.d. will allow kuna cash to be exchanged for euros in all branches free of charge, and in the next six months they will be entitled to charge a fee for this service.

For more, follow our dedicated lifestyle section.

July the 14th, 2021 - Around 60 percent of Croatian households have no debt to speak of, which is not only surprising but is also below the Eurozone's current average.

As Jadranka Dozan/Poslovni Dnevnik writes, with the continuation of moderate growth rates of total bank loans to the private sector, the latest published data for the month of May confirmed the gradual recovery of household demand for cash loans and a slight slowdown in what was relatively high growth rates of housing loans.

However, this means that for ''cash'', which was the main engine of growth in the volume of loans to Croatia's residents until the outbreak of the pandemic, the annual decline continued to melt, while the growth rate of housing loans slowed to a still high 8.7 percent back in May, which is partly attributed to this year’s first subsidy programme.

The dynamics of credit growth in the household sector, measured by transactions in various loans, accelerated in May to 3.5 percent on an annual basis, from 3.1 percent in April, analysts from Croatian banks note.

In addition to these indicators, which provide a picture of current trends and trends from month to month, the Croatian National Bank gave a somewhat broader picture of the finances of Croatian households and consumption in its annual report for 2020. That report claims that almost 60 percent of Croatian households don't have any debt hanging over their heads. Overall, their level of indebtedness across Croatia is relatively (and quite surprisingly) low and below the Eurozone's current average.

The representation of mortgage debt in Croatia is four times less than the representation of non-mortgage debt on credit lines, overdrafts, credit cards, etc. The gross income of Croatian households, whose median is estimated at 8,400 euros, is also significantly below the Eurozone average, by about a third. Considering the sources that generate income in Croatia, employment income is the most strongly represented.

According to the CNB's survey-based data, 53 percent of Croatian households earn an income from work, approximately one in eight Croatian households (12.7 percent) have income from financial investments, and property rental income is, again also quite surprisingly, the least represented. Survey findings say that only 6.2 percent of Croatian households have this type of income, at least on record.

The CNB also cites some features of the structure of total consumption according to three main categories: for goods and services, for utilities and for food indoors and outdoors.

"According to the assessment of the value of the medial household and the assessment of the arithmetic mean, the consumption of goods and services is about twice as high as the consumption of food, and about three times higher than the consumption of utilities," it states. The median estimates of all three components of spending are lower, they say, than those for the Eurozone, ranging from 60 percent being spent on food at home and outside the home, to 75 percent of estimated spending being for utilities at the Eurozone level.

At the same time, in Croatia, as many as 94 percent of Croatian households have some form of property, while slightly more than four-fifths also have financial assets. However, real assets are very strongly predominant in the total assets of the household sector; with financial assets not even occupying five percent.

While financial assets are dominated by deposits here in Croatia, which account for more than two thirds, the average household in the Eurozone holds 43.7 percent of financial assets in deposits and allocates more to other types of savings and/or investments.

Comparisons with the average of EU member states also show that the inequality in the distribution of net assets among Croatian households is moderate, with a slight increase in financial assets.

However, the CNB warns that it should be borne in mind that the value of non-financial assets is based on the subjective assessment of the respondents, which may differ significantly from the actual market value. The phenomenon of underestimation of both real and financial assets is common, and Croatia is no exception to that.

For more, follow our lifestyle section.