ZAGREB, 14 April, 2021 - Health Minister Vili Beroš said on Wednesday that the government and representatives of drug wholesalers had reached agreement on a debt settlement scheme.
The issue of the debt made the wholesalers restrict and defer the deliveries of medicines to hospitals in late March.
"Today's meeting is one more step towards the debt settlement," Minister Beroš said adding that only together the two sides could solve this decades-long issue which became exacerbated during the COVID-19 pandemic.
Finance Minister Zdravko Marić outlined the elements of the scheme.
In the next three months we will transfer some funds to the Croatian Agency for Health Insurance (HZZO), and the Health Ministry so as to enable the cash flow in those institutions and enable them to pay liabilities towards wholesalers and providers, Marić said adding that those funds would be ensured through the redirection and reallocation of outlays in the state budget.
The monthly allocation for hospitals will be HRK 600 million and an additional 300 million for pharmacies.
In June, the government is likely to conduct a budget revision whereby an additional cash inflow for hospitals and pharmacies will be ensured so that debt deferment period lasts no longer than 180 days for hospitals and 120 days for pharmacies.
In June alone, 135 million kuna will be directed to pharmacies and HRK 760 million to hospitals, with the plan to respect the deferment periods in the remainder of the year.
Marić hopes that this scheme will remove any need for any new meeting with wholesalers on the debt.
The finance minister also expects reform efforts in preventing any further accumulation of liabilities and in this context he mentioned the plan to cut the deferment period to 60 days.
The wholesalers' representative Diana Percač thanked the ministers for efforts to provide funds to cover the debt.
She also pledged the continuation of the delivery of drugs to pharmacies until the end of this year.
(€1 = HRK 7.571658)
For more about politics in Croatia, follow TCN's dedicated page.
February the 26th, 2021 - The Croatian Finance Minister Zdravko Maric has stated that more is set to be revealed about the extension of the government's economic support packages to Croatian enterprises in the coming days.
As Poslovni Dnevnik writes, after a government session, Croatian Finance Minister Zdravko Maric commented on the economic measures set out for businesses in order to help them preserve jobs and keep their heads above water after those measures are relaxed on Monday.
"We're going to continue our dialogues with the representatives of all economic activities that are still influenced by these measures. We'll talk and hear their reflections. We still remain of the clear position that the protection of public health and the preservation of jobs are our priorities,'' Maric said.
"We aren't going to ignore certain appeals. Dialogue does exist. Representatives of the caterers' association have had conversations with my colleagues. We're being open here, there will be a dialogue,'' stated Maric, remaining staunch in an apparent avoidance of offering a more concrete answer to the question that is weighing on the shoulders of many company owners.
When asked whether support for job preservation could be expected to continue, the Croatian Finance Minister stated that it would definitely be discussed. He said that the economic measures for preserving jobs will remain in force until March the 1st, so for a few more days.
Warnings that business owners should at least have some sort of vague idea about what they can expect in the coming weeks and months didn't help to push Maric along in offering deeper explanations.
''We know how much money is in the state budget. The budget situation is as it is. We have cash for the continued preservation of jobs costs foreseen and provided. If additional funds are needed, then we will find a way,'' said Maric, who remained a closed book in the sense of offering more precise details.
"Talks will be held on how and in what way we can extend the measures and in which segments," he added, announcing that much more will be known over he coming days when it comes to which measures for preserving jobs will be extended and which will be allowed to expire.
Minister Josip Aladrovic continued in a similar tone despite being asked some very specific questions.
"We can expect continued assistance, but we must know that no one is prevented from working anymore, although it won't be possible for that work to take place in full. We'll protect the labour market and we can expect measures in that direction even after March the 1st,'' stated Aladrovic.
ZAGREB December 5, 2020 – With over 9000 students currently enrolled, the Faculty of Economics University of Zagreb is the largest faculty in Croatia. In 2020, this internationally renowned institution celebrates its 100th birthday, so TCN decided to take a closer look.
Every other student you meet in Croatia seems to study economy. It makes you wonder where they all go to after their studies are complete. Are there really so many positions for economists in Croatia?
In 2020, the Faculty of Economics University of Zagreb celebrates its 100th birthday. The long list of its famous former students gives a clue to where all the Croatian economists go – the tourism sector, diplomacy and international relations, business, politics and government.
Graduates of the Faculty of Economics University of Zagreb have served as mayors of Zagreb and Split, Deputy Prime Minister of Croatia, Minister of Finance, Minister of the Economy, Secretary-General of the Council of Europe, Governers of the Croatian National Bank, Vice-President of the UN World Food Council, President of the Croatian Football Association, Minister of Environmental and Nature Protection, special advisors to the President of Croatia and countless university professors, including several former rectors of the University of Zagreb. Within its graduate professors, it has produced no less than 19 full members of the prestigious Croatian Academy of Sciences and Arts, more than any other single institution in the country.
Savka Dabčević-Kučar, a graduate of the Faculty of Economics of the University of Zagreb. Born on Korčula, she became an anti-fascist in World War II, joining the partisans after her brother was beaten by fascists. After graduating, she continued to study at the faculty and became one of the first doctors of economics in Croatia, raising eyebrows by choosing to write her doctorate dissertation about a non-Marxist economic theorist (Englishman John Maynard Keynes). She became a professor at the faculty in the 1950s and despite her great advances in political life, remained a committed teacher at the faculty until 1971. In 1967, she was elected President of the Socialist Republic of Croatia. In 1969, she moved to an even more important position - that of president of the Central Committee of the League of Communists of Croatia. She was the first woman in Europe to be appointed head of government of a political entity and the first female in Croatia to hold an office equivalent to a head of government. In this picture, she addressed supporters on Ban Jelacic Square Zagreb during the movement called the Croatian Spring, which called for greater autonomy for Croatia. At the address, thousands cheered her as “Savka, queen of the Croats”. For her pivotal role in the movement, she was removed from her positions and public life and retired. She returned to politics in 1990 upon the collapse of communism in Europe and during the Croatian war of independence was one of the few politicians who visited the front lines of battle in Slavonia, Petrinja, Pokupski and the Dalmatian hinterland
The Faculty of Economics University of Zagreb is the largest faculty in the country. Over its 100 year history, it has established itself as an internationally respected institution. Today, it has around 9000 persons enrolled, caters for international students with some courses in English and has produced over 86, 000 graduates, including 856 doctors of science.
The history of the Faculty of Economics University of Zagreb starts with the opening in 1920 of its forerunner, the Zagreb College of Trade and Transport. Its purpose was to educate in the areas of banking, domestic and international trade, transport, consular services, insurance and the education of teachers. Its courses lasted three years and it proved so popular that in the academic year 1923/24, some 1,125 students were enrolled.
The institution held college status until 1925 when Stjepan Radić became the Minister of Education. It must have been unusual for Radić to find himself as part of the government of the Kingdom of Serbs, Croats and Slovenes, the state which preceded the Kingdom of Yugoslavia. Today, Radić is best remembered as a politician outspoken in his advocacy of autonomy for Croatia. Before his appointment to the government, he had always done so in opposition. Indeed, he had been imprisoned several times for his views, which were proclaimed loudly in his writings or in person (he was a gifted public speaker). As recently as March 1925 he had been in prison but, when the political party of which he was a member officially recognised the monarchy and the state constitution, he was freed. In a remarkable turnaround, before the year's end, he was a minister in the government.
Stjepan Radić's desire for Croatian autonomy was not born from the ideals of the political class of Zagreb. The ninth of eleven children, born to a peasant family in a small village on the banks of the Sava river, just north of Sisak, Radić was very much a representative of the people whence he came. To him (and others in his family – his brother and nephew also being prominent politicians), education had the most important role to play in emancipation. He had lived in poverty in order to complete his own - after being banned from university-level educational institutions throughout the whole of the Austro-Hungarian empire for his protests against the state, he travelled penniless to Russia, France and Switzerland to complete his studies. In the latter, finance was one of his chosen subjects.
Under Radić's spell in office, the Zagreb College of Trade and Transport became the Higher School of Economics and Commerce. Its courses extended to four years, it attained university status. With no building designated to the increasingly popular institution, students had sometimes been taught at the Technical College (today's Museum of Arts and Crafts) and in parts of what is now the Mimara Museum. A dedicated home for the faculty was authorised and its construction started in 1927. Classes began at the faculty, located on the corner of Bauerova and Zvonimirova, in 1928, but within the decade the institution had outgrown its home and a plot of land in Svetice was acquired in order to build a new, larger facility. Its construction was interrupted by the Second World War and students would end up being taught on the Bauerova and Zvonimirova site all the way up to 1952.
In 1947, the Higher School of Economics and Commerce became the Faculty of Economics University of Zagreb. In 1952, the faculty officially moved to the new site in Svetice. In 1968 it expanded once more when it merged with the 12-year-old College of Economics. Since then, the building at Svetice has received major upgrades and further facilities of the faculty can now also be found at the university campus in Borongaj, in Varaždin, in Koprivnica and in Bjelovar. After a century of existence, the Faculty of Economics University of Zagreb's longstanding difficulties to meet the popularity of its courses with the space available are now over. Not only can they accommodate every Croatian economy student who makes the grade, but they are also able to offer places to some of the best international students. It would surely come as no surprise if they are still educating the future elites of business, banking, finance and politics in another 100 years.
ZAGREB, November 30, 2020 - Dozens of restaurant and cafe owners whose businesses had to close last weekend due to new epidemiological restrictions expressed their dissatisfaction on Monday by staging a peaceful protest rally and lighting lanterns outside the Ministry of Finance.
The protest rally started before noon at Zagreb's main Trg Bana Jelacica square and ended at about 1 p.m., and the protesters estimate that there were several dozens of them.
From the main square, the protesters walked to Katanciceva Street, where the Finance Ministry's building is located, and they lit lanterns in front of the building.
The rally was not organised by any association, the protesters said, adding that it was a spontaneous gathering to protest against closing hospitality and other establishments, such as gyms, and to protest because tighter restrictions were introduced last weekend and operating was made difficult, which puts the survival of businesses, employees and owners themselves at risk.
Drazen Orescanin, representative of the Voice of Entrepreneurs association, said that the gathering was spontaneous and that they were waiting for the results of the meeting between hospitality stakeholders and entrepreneurs with ministers at the Ministry of Labour and Pension System, but what the government was offering was not in line with their requests, according to what he had heard.
"We will keep asking for the compensation to be fair and in accordance with other EU countries, so that everyone who had a significant drop in business is eligible. We also continue our fight for the survival of the economy, for which it is necessary to reduce the VAT rate and for government to make substantial reforms," Orescanin said.
In addition to owners of restaurants and cafe bars, owners of gyms, fitness clubs and others whose businesses cannot operate now also took part in the protest rally, warning that they can no longer survive in the new circumstances.
ZAGREB, November 30, 2020 - Finance Minister Zdravko Maric presented on Monday, after talks with employers' and entrepreneurs' associations, three measures to help entrepreneurs whose businesses are closed due to new epidemiological measures, including job-retention measures, "COVID loans" and covering fixed costs.
The government, he said, will continue paying HRK 4,000 per worker under the job-retention scheme, and HRK 470 million has been provided for that purpose for the period until the end of the year.
"COVID loans" for liquidity, totalling HRK 1.3 billion, will remain to be available for "closed" business, which are the priority, and for other businesses, as well.
The third measure will cover entrepreneurs' fixed costs, or part of them, such as rent, lease, RTV subscription, monument annuity, music licensing fee, etc.
The decline in turnover in December will be compared to last year's results, the minister said, with businesses that have seen a drop in turnover of at least 60% being eligible for the measure, and the Tax Administration will be in charge of administration, based on fixed costs invoices.
Representatives of hospitality stakeholders said the measures were too weak and insufficient, noting especially that it is necessary to reduce VAT.
ZAGREB, Sept 30, 2020 - The Andrej Plenkovic government on Wednesday launched procedures to conclude the double taxation convention between Croatia and the USA for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income.
Finance Minister Zdravko Maric told the press before the government's meeting that the conclusion of the Convention would lead to many benefits in the taxation of all kinds of income and to the improvement of conditions for boosting bilateral trade.
"This is a great signal for investors. We are tackling the matter that has been present for more than two and a half decades," the Croatian minister said.
In October, the country's Tax Administration will open preliminary talks on holding negotiations on the document.
The convention will be beneficial to all industrial sectors, notably the IT sector.
Companies' income will be taxed in their countries of residence, the draft convention reads.
It will enable Croatian air and shipping companies that transport goods between the two countries to pay profit tax in Croatia only.
Croatian builders operating in the USA for less than 12 months will not pay taxes in the USA.
The convention regulates the taxation of income from real property, income, and salaries of athletes, artists, and so on.
ZAGREB, Aug 21, 2020 - The Finance Ministry has put up for public consultation documents for amending four taxation laws: income tax, profit tax, and Value Added Tax laws and legislation on fiscal receipts in cash flow, the Jutarnji List daily said on Friday.
The finance ministry recalls its promises on the continuation of the reduction of the tax burden and underlines that the income tax legislation will be amended with the aim of facilitating efforts to increase the amount of after-tax available income to citizens.
To this aim, the income tax brackets will be lowered: the current 36% will be scaled down to 30%, 24% to 20%, and 12% to 10%, and the changes could go into force in early 2021.
This move will increase the available income after tax from 100 kunas for lower wages to 800 kunas for the highest gross monthly wages.
The profit tax is likely to be cut from the current 12% to 10% for small and medium-sized companies with the annual earnings up to 7.5 million.
The national VAT regulations are going to be adjusted to the European Union's directives.
ZAGREB, June 11, 2020- The Finance Ministry on Wednesday issued an 11-year €2 billion bonds on the international capital market at 1.5% interest and 1.643% yield, the ministry said in a press release on Thursday.
The issue was arranged by Banca IMI/Privredna Banka Zagreb, Barclays, Deutsche Bank, and J.P. Morgan.
The transaction was announced on Tuesday, after which the ministry held a global teleconference to prepare the broadest market possible.
The investment community's interest was exceptional, with more than 400 potential investors, which was helped by investors who invest only in investment credit rating securities.
Investors were from the UK, the US, Germany, Italy, Austria, France, Benelux as well as Central and Eastern European countries. Strong demand was generated in the amount of €8.45 billion, about 4.2 times more than the nominal amount of the issue.
This enabled Croatia to make the latest borrowing 45 basis points below the initially published price, the ministry said.
The revenue from the issue will be used to refinance a US$ 1.25 billion euro bond due in July. Nearly HRK 360 million will be saved on interest annually.
The rest of the issue will be used to finance government aid for businesses affected by the COVID-19 pandemic, as envisaged in the revised 2020 budget in early May. In it, revenues from financial assets and borrowing increased from HRK 30.5 billion to HRK 63.4 billion. Until then, HRK 35.6 billion of that amount was already covered.
In February, the government issued three bond tranches in the amount of HRK 15 billion at 1% interest. In early May, it issued a seven-year bond on the domestic market amounting to €1.445 billion and refinanced an HRK 7.8 billion treasury note as well as making loan arrangements with banks in Croatia.
Credit agencies say the shock will be temporary
The ministry said the latest transaction came in the week after Fitch affirmed Croatia's BBB- rating with a stable outlook.
The stable outlook reflects the confidence that Croatia will maintain medium-term fiscal stability, while at the same time extending short term support for the fight against the COVID-19 pandemic. In May, Standard & Poor's affirmed Croatia's BBB-/A-3 rating with a stable outlook, while Moody's affirmed the Ba2 rating with a positive outlook, the ministry said.
The agencies say the pandemic will weaken Croatia's economic and fiscal results this year, but that the shock will be temporary and that previous fiscal data improvements and the stronger economy support the country's credit profile, the ministry added.
The final conditions of the issue and the level of interest once again confirmed Croatia's strong status as an attractive issuer on the international capital market, it concluded.
As far as Croatian companies are concerned, the most important thing for them is to ensure liquidity. As Poslovni Dnevnik writes on the 12th of March, 2020, Finance Minister Maric made a guest appearance yesterday on RTL to talk about responses to the economic crisis that could be caused by the coronavirus outbreak.
''I understand, but with all due respect, I think that these are moments for constructive criticism, for us to put all our heads together, which is the message of today's meeting. I think a timely dialogue has been launched,'' Finance Minister Zdravko Maric said during his appearance on RTL Direkt.
"Everything the headquarters [for civil protection] is doing is within existing means. The situation is serious, but at this point, based on all the parameters, nothing has happened that would insist on taking an extreme measure. The ''zero'' goal is people's health, and then the first goal is to preserve jobs and liquidity for our companies,'' Maric pointed out.
''A year and a half ago, five billion kuna was paid out to citizens. We did something long before the crisis came so that employers can pay more to their workers,'' Minister Maric said.
Schools are closing in Istria on Friday, raising the question of what will happen to parents who will not be able to work because they will have to stay home with their child. "We had a similar topic a few months ago and at that time, as parents, we had to deal with it in one way or another," Maric said, alluding to the teachers' strike.
Increasingly, one of the possible measures for the public is the shortening of the working week.
"It's one of the things we can talk about, but we're not specifically talking about it today. Employers are first concerned with liquidity. From the point of view of preserving the workplace, shortening working hours would be possible in the next step if things became further complicated,'' noted Maric.
As Poslovni Dnevnik writes on the 30th of April, 2019, Croatian Finance Minister Zdravko Marić said on Tuesday that he still needs to see if there really is specific interest from the Chinese shipbuilding company, whose representatives are visiting the ailing shipyards in Pula (Uljanik) and Rijeka (3 Maj), saying that it's too early to be able to say anything and that we "need to be completely realistic".
When aked by a journalist about the expectations of the Croatian Government, given that a delegation from the Chinese shipbuilding company China Shipbuilding Industry Corporation (CSIC) has visited the Uljanik and 3 Maj shipyards, Marić said that first of all, we should be realistic and after CISC's representatives get a proper look at the state of affairs with those shipyards and answers to the questions they are interested in, we will need to wait and see what their response to all of it will be.
At this point, it's still too early for that, he added, recalling yesterday's introductory meeting between the Croatian prime minister, his ministers and the aforementioned Chinese delegation at Banski Dvori in Zagreb, where everything was transparent and very clearly presented.
"A really high level team from the perspective of that company has arrived, but on the other hand, we need to be completely realistic. So, today they will spend all day in both Rijeka and Pula and then after that, of course, we can't expect it immediately but within a reasonable time frame, they'll determine what they saw, state what they think about it, and whether or not there is a certain level of interest,'' said Marić when answering journalists' questions after attending the annual European Investment Bank (EIB) press conference.
The CSIC delegation, headed by Hu Wenming, arrived at the enfeebled Uljanik on Tuesday morning, where talks with the members of Uljanik's management board and its supervisory board took place. Assistant Minister of Economy Zvonimir Novak has also been participating in these talks.
Several representatives of the aforementioned Chinese company arrived at Uljanik as early as Monday afternoon, where they viewed the plants and made an unofficial assessment of the capabilities of the Pula shipyard's production facilities, ie, they got better acquainted with its technical capabilities, the processes that take place there, the technology and its general capacities.
What will coe of the visit is anyone's guess so far, but despite suspicion from some, an injection of Chinese money could truly be Uljanik's very last hope.
Make sure to follow our dedicated business page for more information on Chinese-Croatian business relations, Chinese projects and investments in Croatia, working, doing business and investing in Croatia and much more.
