Almost Half the Measures to Join ERM II Fulfilled
ZAGREB, February 27, 2020 - Finance Minister Zdravko Marić said on Wednesday that Croatia has fulfilled almost half of the 19 measures in six different categories required to adopt the euro and join the Exchange Rate Mechanism (ERM II).
Early in July 2019 Croatia sent a letter of intent to join ERM II, along with an action plan containing reform measures that need to be implemented by May this year when the European Central Bank (ECB) is expected to deliver its decision on Croatia joining the banking union, i.e. on establishing close cooperation with the Croatian National Bank (HNB).
The fourth meeting of the National Council for the Adoption of the Euro as legal tender in Croatia was held on Wednesday. Speaking to the press the meeting, Marić said that currently almost half of the 19 measures in 6 different areas that Croatia committed to have been fulfilled. Six have been met entirely, three partially and the remaining nine are underway. He expects that all the remaining measures will have been fulfilled before the end of Croatia's presidency of the EU, or even earlier.
After that, depending on the results of the analysis of the quality of the portfolio, further talks will be held with European institutions regarding the next steps in the ERM II process, added Marić.
The measures implemented include the law on credit institutions, rules on the register of beneficial owners, amendments to the law on institutions, the law on the rights and duties of state officials, and so on. Among the laws that still need to be adopted are those relating to unassessed construction land, which is currently in procedure, and tenders for the sale of shares in about 90 state-owned companies.
HNB Governor Boris Vujčić said that the quality of Croatian banks was being examined as one of the conditions for the ECB's decision on close cooperation and Croatia's admission to the banking union.
He said that so far five Croatian banks selected by the ECB had been subjected to a stress test, and an examination of the quality of bank assets was now underway and should be completed soon, said Vujčić.
According to a government press release, Prime Minister Andrej Plenković said that adoption of the euro as legal tender and joining the Schengen area were the two objectives of Croatia's deeper integration with the European Union.
Meeting the criteria for the adoption of the euro as well as for macroeconomic and fiscal stability is one of Croatia's key objectives, he underscored.
"In 2017, during the term of this government, Croatia exited the excessive deficit procedure and last year we were assessed as no longer recording macroeconomic imbalances," he said and added that Croatia used this status and sent a letter of intent to join ERM II, which precedes the introduction of the euro.
Plenković said that Croatia is the smallest EU member state that is currently not in the euro area.
About 61% of loans in Croatia are foreign currency loans or those pegged to a foreign currency and 51% of deposits are in euro or in kuna indexed to the euro.
"The message is that Croatia is already a highly euroised country," added Plenković.
About 56% of Croatia's commodity exports go to euro-area countries and 66% of spending by foreign tourists is generated by those from countries in the euro area, he said.
More news about the introduction of euro can be found in the Business section.
European Commission: Croatia Continues to Make Progress But Not Fast Enough
ZAGREB, February 27, 2020 - After five years of economic recovery, Croatia's GDP in 2019 reached the pre-crisis level but compared to the European average, Croatia did not converge from 2008 to 2018, reads a report the European Commission published on Wednesday.
The report also notes that Croatia has continued making progress in correcting macroeconomic imbalances but that they are still present.
As part of its European Semester Winter package, the EC published reports on the overall economic and social progress in each member state and an analysis of the macroeconomic situation in the countries with macroeconomic imbalances or excessive macroeconomic imbalances.
The report on Croatia has 79 pages, including annexes.
The EC notes that a stable economic growth in the last five years, combined with a careful macrofiscal stabilisation policy has made it possible for the country to gradually reduce the high levels of public, private and foreign debt, which in turn has reduced the economy's vulnerability.
The unemployment rate has continued to fall, thereby raising the disposable income of households. However, in 2018, Croatia’s GDP per capita relative to the EU average was still at the same level as ten years earlier, meaning that there was no convergence at all.
GDP per capita, measured by the purchasing power, in 2018 was 63% of the European average, the same as in the pre-crisis 2008. Moreover, Croatia has fallen behind even more in relation to more advanced comparable countries of Central and Eastern Europe, which have left it behind. Despite a stable growth, a relatively low growth potential will continue to be an obstacle to catching up with other EU countries.
Participation in the labour market and labour productivity remain low, and the business environment and the public administration are insufficiently supportive of faster economic convergence. Implementation of policy measures addressing these weaknesses is proceeding at an uneven pace.
"Addressing structural weaknesses with lasting effect would enable Croatia to converge faster to the rest of the EU," the EC stresses.
Croatia has made limited progress in addressing the 2019 country-specific recommendations and, just as in 2019, it has macroeconomic balances. In 2019 Croatia left the category of countries with excessive macroeconomic imbalances to enter the category of countries with macroeconomic imbalances.
Since the start of the European Semester in 2014, 57% of all country-specific recommendations addressed to Croatia have recorded at least 'some progress'. 'Limited' or 'no progress' has been made in the remaining 43% of the recommendations.
Implementation of the reform agenda has proceeded at an uneven pace in different policy areas.
Most progress has been made on fiscal policy and labour market. There has been some backtracking on pensions after elements of the reform designed to increase the statutory retirement age were suspended as demanded by trade unions, the EC says.
In 2019 Croatia saw limited progress in the implementation of the EC recommendations.
Certain progress was recorded in the implementation of the curricular reform and the management of state agencies.
Certain progress was made with the adoption of a new set of active employment measures.
In 2019 agreements on some key rail transport projects were signed, which contributed to progress on sustainable transport.
Certain progress has been made in court proceedings by expanding electronic communication in courts and reducing backlogs.
As regards the business environment, improvement has been achieved by introducing a number of measures designed to reduce administrative obligations and liberalising services.
Progress has been limited in other areas, such as reinforcing the budgetary framework, improving the social protection system, reforming wage setting frameworks, improving corporate governance and intensifying the divestment of shares and stakes in state-owned enterprises, and in the prevention and sanctioning of corruption.
Macroeconomic imbalances
Croatia has been making progress on macroeconomic indicators but it still has macroeconomic imbalances. In 2019 it exited the category of excessive macroeconomic imbalances.
Public debt remains high, but is falling rapidly. Public finances have improved and Croatia recorded its first fiscal surplus in 2017, and its second in 2018, despite a non-negligible materialisation of contingent liabilities.
Thanks partially to improvements in public debt management, debt is being refinanced at record low and predominantly fixed rates, with extended maturities.
The improvements in public finances were recognised by Fitch and S&P agencies as they upgraded Croatia's long-term sovereign credit rating to investment grade.
Improvements have been recorded also in household debt.
The consolidated corporate and household debt levels for the third quarter of 2019 are estimated at 58.4% and 34.3% of GDP respectively, some 24 and 8 percentage points below the peak registered in 2010.
Although the current account surplus is shrinking, it is still helping to curb external imbalances.
After peaking at 3.3% of GDP in 2017, the current account surplus narrowed to 1.9% of GDP in 2018, as the increase in imports of goods turned the trade balance negative.
The current account surplus rebounded in the first three quarters of 2019 to 2.2% of GDP largely due to growing tourist receipts.
Low potential growth remains an obstacle to Croatia catching up with the rest of the EU more rapidly, says the EC.
After reaching a low point in 2010, potential output growth has since increased significantly, estimated at 2.1% in 2019. Although this is higher than the EU average, it is the lowest among peer countries.
The labour contribution to potential growth turned positive in 2019, due to a gradual recovery of employment, though it remains one of the lowest among peers. Demographic trends and a chronically low activity rate are a drag on labour contribution to growth for future years.
"Significant structural reforms will be necessary to increase Croatia's relatively low potential growth," the EC notes.
Potential growth is projected to remain the lowest among Croatia's peers throughout the 2019-2021 period.
Despite improvements in the labour market, increasing the labour contribution to potential growth will require raising the low activity rate, which will be difficult, notably because of the demographic challenges in the country.
Productivity growth is still limited due to poor allocative efficiency, complex business environment and public sector inefficiency, the EC says.
As for tax policy, the EC says that Croatia’s taxation system is strongly skewed towards indirect taxation and is Croatia is among the member states which collect the least revenue from direct taxes.
This is partly a consequence of very low property taxes, which are considered to be among the most growth-friendly taxes.
The low share of direct taxation is also a reflection of successive cuts in the personal income tax implemented over the past four years.
Aimed at reducing the tax burden on labour, the cuts have resulted in more than half of persons in employment not being liable for any personal income tax.
Still, Croatia ranks around the EU average when it comes to revenue from social contributions in proportion to GDP, despite having the third lowest employment rate in the EU.
At the same time, Croatia collects the highest share of VAT revenue in proportion to GDP of all EU member states.
In cooperation with Croatia, the EC has prepared a special annex on the health system, which says that despite the strong increase in revenue from health contributions, the healthcare sector continues to accumulate arrears.
The revenue of the Croatian Health Insurance Fund (CHIF) is estimated to have increased by 11% (year-on-year) in 2019. In spite of this, payment arrears to suppliers of goods and services are estimated to have grown by over 15%. Furthermore, expenditure is expected to grow strongly in 2020 on the back of wage increases in the sector agreed in September 2019 and the Supreme Court ruling from December 2019 which upheld doctors' claims on unpaid overtime.
Arrears are mostly generated in hospitals, particularly those owned by counties.
Faced with the prospect of suppliers suspending deliveries, the central government settles such arrears through ad hoc financial recovery programmes. There have been 12 such interventions since 2000, ranging from 0.1 to 0.6 per cent of GDP in a given year, the EC says.
With regard to the fight against corruption and organised crime, the EC says that control and sanction mechanisms are weak, notably at local level.
Although there is a considerable number of investigations and indictments in cases related to organised crime and corruption, the inefficiencies of the justice system, such as lengthy court proceedings, often impede closure. Official statistics also show that a significant proportion of corruption offences are recorded at local level.
The Law on Local and Regional Self-Governance, which gives elected local officials considerable discretion in decision-making without subjecting them to asset declarations or other forms of oversight, remains a concern.
The discretionary powers to decide on disposing of assets and finances of up to HRK 1 million and to appoint board members of public local companies create scope for corruption, the EC says.
With regard to environmental sustainability, the EC notes that there is still a long way to go in the transition from a linear to a circular economy in Croatia. Besides some isolated initiatives, Croatia has no comprehensive circular economy strategy, it says.
Despite some progress, shifting waste from landfilling towards recycling remains a priority.
In Croatia, 25% of municipal waste was recycled in 2018 - a big improvement from 4% in 2010, but still substantially below the EU average of 47%. Landfilling of municipal waste remains high at 66% (EU average 22%).
A continued strong effort would help Croatia to converge to the EU average and ultimately contribute to achieving the European target of zero pollution, the EC says.
The EC also notes that air pollution has a significant impact on people's health, that sewage systems are underdeveloped and that the water supply networks face high leakage rates.
As for greenhouse gas emissions, Croatia will have no problem meeting the EU targets for the period until 2020 but it will need additional measures to meet the targets set for the period until 2030.
The share of renewable energy sources is 28%, but in traffic it is very low, standing at a mere 3.9% in 2018, one of the lowest rates in the EU, the EC says.
More news about Croatian economy can be found in the Business section.
Davis Cup: Croatia Tennis to Play India in Zagreb for Spot in 2020 Finals
February 27, 2020 - The Davis Cup match between the Croatia tennis team and India will be held in the small hall of Dom Sportova in Zagreb from March 6-7. At a presentation at the Westin Hotel in Zagreb, the organizing committee confirmed that all preparations were in full swing and once again urged fans not to miss the opportunity to cheer on Croatian tennis stars at home.
HRT reports that the Croatia tennis team will meet the national team of India in Hall 2 of Dom Sportova from March 6-7, 2020. The winner will secure a spot at the Davis Cup finals in Madrid in November.
“The stakes are really high and India needs to be taken seriously, especially since they are coming with the strongest squad possible. We are not complete, we will wait for Coric until the draw on Thursday, March 4, but I think that without him we have enough strength to, with the support of our fans, record the win,” said national team coach Vedran Martic at a news conference in Zagreb ahead of the Croatia-India Davis Cup series.
Borna Coric sustained a hand injury in Rio de Janeiro, but since it is not a serious injury, we will wait until the last minute, Martic added.
Marin Cilic (ATP - 36), Borna Gojo (ATP - 276), Nino Serdarusic (ATP - 295) and two doubles specialists Ivan Dodig (ATP - 10) and Mate Pavic (ATP - 16) will play for the Croatia national team.
India national team coach Rohit Rajpal is bringing the strongest possible lineup for the qualifiers against Croatia in Zagreb, in which the highest-ranked player in the individual competition is 22-year-old Sumit Nagal (ATP - 127), and a strong veteran doubles team will consist of 39-year-old Rohan Bopanna and 46-year-old legend Leander Paes.
In addition, 30-year-old Prajnesh Gunneswaran (ATP - 127) and 25-year-old Ramkumar Ramanathan (ATP - 180) will compete in the individual matches.
“India will base their tactics on two wins against our other player, be it Gojo or Serdarusic, and they have a great and experienced doubles team of Bopanna-Paes if they play. But we also have a great doubles team, Pavic-Dodig, and I believe that Gojo and Serdarusic have a chance to record at least one win. Cilic is in good form, although he lost in Dubai. The good thing is that we also have seven days of training and getting used to the grounds,” Martic said.
The match will be played on a hard court in the Small Hall of Zagreb's Dom Sportova. On the first day, Saturday, March 6, there are two singles matches scheduled, and on Sunday, the doubles will be played first, followed by the singles.
“I am glad that the Davis Cup is back in Croatia again, and this is an opportunity for Croatian fans to finally see our best tennis players. I expect a win and a good atmosphere,” said Croatian Tennis Federation (HTS) President Nikolina Babic.
The match between Croatian and India in Zagreb will be one of twelve qualifying rounds, and the winners will join last year's semifinalists Spain, Canada, the United Kingdom and Russia, as well as the national teams that received the invitation, Serbia and France.
To read more about sport in Croatia, follow TCN’s dedicated page.
Croatian Professor Igor Rudan Addresses Media on Coronavirus
Igor Rudan is a Professor of International Health and Molecular Medicine at the University of Edinburgh in the United Kingdom. The Croatian professor issued a press release intended for the Croatian media and its representatives in the form of a Facebook post on his personal account.
We have transmitted and translated the post in its entirety below:
''I would like to thank everyone for the truly incredible amount of interest and calls that came to me today from virtually all of the media in the Republic of Croatia, to try to calm the atmosphere that has begun to emerge in Croatia because of the first COVID-19 coronavirus patients, as an internationally recognised expert in the field of global health.
I hope you can understand that as the director of a major global health research centre and the head of a World Health Organisation Collaborative Centre at the University of Edinburgh, United Kingdom, I've a lot of work to do over recent days and it's completely impossible for me to respond to your individual requests. Therefore, in this way, I'll try, to at least to some extent, fulfill my social task as a scientist who has been involved in this field for a long time and intensively so, and to share some of my thoughts with everyone who has started to feel anxious about this new pandemic in the 21st century.
In addition, I have agreed to be a guest of Mr. Aleksander Stankovic this Sunday, 03/01/2020. on the "Sunday at 2" show. On top of that, I also agreed to accept an interview from Nenad Jaric Dauenhauer for Index.hr which should be published a week later, on around 08/03/2020.
As well as that, I'll write something for "Vecernji list", of which I'm a columnist. All other media have the right to publish sequels to the series I started on Facebook called "Quarantine Wuhan", in which, throughout the course of this pandemic, I'll systematically explain everything that I think is essential for in-depth understanding and good information about everything that's going on. I really won't be able to offer much more than that, so I'd like to sincerely apologise to everyone in advance.
Whenever I return to Croatia for shorter or longer visits, my friends humorously warn me: "Igor, here in Croatia, caution is not enough. Paranoia is needed!". If this is true, I'm afraid some people have begun to apply this kind of thinking to the new coronavirus situation. I'd like to say that caution is still sufficient in this case, but paranoia is not really needed.
But the question is just how much caution should this be? Although it's not right for a serious scientist to predict anything about the spread of a completely new and unknown virus to the entire human population in the world, and to predict each individual event, over the past two months, we've gathered enough information about the new COVID-19 coronavirus for at least some predictions.
If the new coronavirus completely spreads over Croatia over time and manages to circumvent the many preventive measures currently in place, its casualties should be at least approximately comparable to the deaths from flu or road traffic accidents over the same period. This means that some sound caution is advisable. This caution is reasonable as long as it's at the same level as the mild concern you may feel when sitting in your car preparing for a longer journey, or when you hear on the news that the flu has arrived in Croatia.
If you feel the fear of the new coronavirus more than when you sit behind the wheel or hear that the flu is already well known to you, it means that that fear is no longer reasonable and that you've begun to succumb to panic. This panic is triggered by the constant media coverage and the way it's highlighted, rather than by the generally accepted and scientifically based knowledge of coronavirus. If you've started to behave differently than you usually do during the winter months, during the flu epidemic, for example, such collecting food supplies or wearing masks down the street, this is again not a behaviour that is in line with the actual magnitude of the danger.
People these days, however, often ask me why is so much written about coronavirus and why do people care so much, when the same level of attention isn't given to flu, given that flu may be a more dangerous disease? The reason is partly because flu has been a well-known disease for decades, comes back every year, and we have experience with its manifestation in tens of millions of people worldwide, we know how to develop vaccines against it beforehand, and we've started to get the first somewhat effective drugs out onto the market.
Unlike the flu, the new coronavirus is unknown to us and we're most cautious about not being surprised by it. If this virus is of any interest at the moment, then it's to adapt to the human species as its new reservoir in which it will continue to multiply, and not kill us.
The virus, now spreading through the human species, continues to mutate in order to adapt to us as quickly as possible. Many of these mutations will make it less dangerous for our health, as it will make us more fit. However, some random mutations could make it more dangerous, and we need to be on our guard until we get better acquainted with it and the pandemic is over. It's unlikely that this new coronavirus will mutate in such a way that it could become significantly more dangerous in those who have been infected than it is now, but we'll definitely be able to assert that only when the pandemic is over.
I hope that these thoughts will at least calm my readers a little bit, and I'll offer more detailed information, if everything goes to plan, on the "Sunday at 2" programme, in my interview for Index.hr, in my new columns in ''Vecernji list'', and continuously here on Facebook, as well as through the "Quarantine Wuhan" series, which will slowly follow the development of this pandemic and its most interesting stories.
I'd also like to point out to Croatian media representatives that our top scientist Petra Klepac works at the famous London School of Hygiene and Tropical Medicine, and she is involved in the modelling of infectious diseases, namely possible epidemics and pandemics of coronaviruses. If you know of more Croatian experts in the world who are involved in this field, be sure to refer to them in the comments below. Also, help share this by making this expert view of the coronavirus go "viral" before the coronavirus itself in Croatia becomes "viral", so there will be less unnecessary fear.
Thank you all for your interest and feel free to share my follow-up posts on the pandemic.
Prof. dr. sc. Igor Rudan, FRSE
Director of the Center for Global Health, University of Edinburgh
Director of the World Health Organization Collaborative Center, University of Edinburgh
Editor-in-Chief of the International Journal of Global Health''
This text was written by Igor Rudan and translated by Lauren Simmonds
For rolling information and updates in English on coronavirus in Croatia, as well as other lengthy articles written by Croatian epidemiologist Igor Rudan, follow our dedicated section.
Croatian Company Creates Outstanding Electric Cleaner
Be it Croatian designers or scientists, medics or companies, this little country has no problem in breeding talent that stretches across all possible walks of life. One Croatian company has designed and made a machine that makes it stand out from the crowd on a competitive and demanding market with no problem at all.
As Poslovni Dnevnik/Darko Bicak writes on the 26th of February, 2020, the Croatian company Rasco from Kalinovac near Đurđevac is involved in the production of municipal equipment, primarily equipment for road maintenance and snow clearing, and in its sector it is among the impressive European Top5.
After introducing their new compact cleaner called Lynx, which is entirely a product of both Croatian innovation and technology, at the end of last year, this Croatian company's management announced recently that their electric version of this self-propelled machine is also nearing completion.
The new electric cleaner, eLynx, will premiere in May 2020 at a specialist trade show in Munich, Germany and is expected to hit the market by the end of the year. Ivan Franicevic, CEO of Rasco, pointed out that the brand new eLynx will have a battery that will give it autonomy for between 10 and 12 hours, which is currently a feature not offered by any of its competitors, making it stand out from the rest with an incredible ease.
Rasco, which employs as many as 409 workers, has seen strong growth in recent years and ended up with a massive 170.8 million kuna in revenue in 2019, up by thirteen percent when compared to just a year ago. They have an assortment of about seventy products that they ship to as many as forty countries around the world.
Last year, this highly successful Croatian company delivered about 1,500 products to customers, and it is interesting to see that their equipment helps to maintain the Munich and Istanbul airports in unfavourable winter conditions.
For more on Croatian innovation, design, products and companies, follow our dedicated Made in Croatia page.
Zagreb Company 3D Tech Impresses at MTE 2020 in Kuala Lumpur
The Zagreb company 3D Tech is planning to enter the demanding European and global markets, but they're also seeing great success right here at home on the Croatian market, where they cooperate with the clinic Fiziodent, Simply Smile and even with the likes of Rimac Automobili.
As Darko Bicak/Poslovni Dnevnik writes on the 24th of February, 2020, the Republic of Croatia is once again bathing in success at various international innovation fairs, and the latest is the Zagreb company 3D Tech, which won a gold medal and a special award for best innovation in the product design category at the big international exhibition of innovations and new technologies, MTE 2020 in Kuala Lumpur, Malaysia. they won the awards in the category of design, web and printing technologies.
The Zagreb company 3D Tech has introduced the 3D printing innovation of MLA DLP technology.
''Using a number of our own innovative add-ons to our core technology, we've significantly improved our solutions. The result is recorded through three patents combined in a technology application we called the MLA DLP. We also won the Nikola Tesla Grand Prix at Inova 2019 owing to it, we won at the Zagreb Innovation Fair, and we won a gold medal at the recent Taiwan fair,'' said Luka Biondic, a structural engineer at 3D Tech operating at the Zagreb Innovation Center (Zicer).
The Zagreb company's dedicated team also includes development engineer Ljubomir Lokin, business consultant Zdravko Gabersnik and project coordinator Mirna Gabersnik. Three years ago, they started out as a startup with the idea of providing 3D printing services in the dental industry, and today they are developing it at Zagreb's Zicer.
They are currently pursuing a project for which they have been given the money to develop the concept of 3D metal printing. In March 2020, the European Aligner Society will present its technology for the first time at the Dentex dental fair in Zagreb.
Make sure to follow our dedicated business and Made in Croatia pages for much more on Croatian innovation and companies.
Croatia Airlines Monitoring Coronavirus, Flying as Scheduled
February 27, 2020 - Following the current situation with the coronavirus, Croatian national carrier Croatia Airlines continues to operate all scheduled flights to all European destinations.
HRTurizam reports that since January 23 this year, the company has been continuously monitoring and following the recommendations of the Croatian Institute of Public Health, Ministry of Health of the Republic of Croatia, Croatian Civil Aviation Agency, Star Alliance, International Air Transport Association (IATA) and other Croatian and international competent institutions and associations regarding the current situation around the coronavirus.
Croatia Airlines' Crisis and Emergency Management Office is actively monitoring the situation and continually plans and takes all necessary steps to keep the health of passengers, aircraft crew and all other employees of the company to the highest possible level, emphasized Croatia Airlines, and added:
The company continuously informs its employees about all current information and new findings regarding the coronavirus in Croatia and abroad, advising on the necessary measures and forms of behavior. The company's operating manuals prescribe procedures and processes for detecting infectious disease in crew members or passengers, and the company is in constant and direct contact with all the airports at which its aircraft land to coordinate procedures and processes regarding the possible occurrence of an infected person with the coronavirus. In addition, the company also has access and means to disinfectants and aircraft disinfection, if necessary, Croatia Airlines concluded.
Otherwise, Croatia Airlines planes will fly direct to regular destinations in 40 destinations in 26 countries during this year's tourist season.
The third case of coronavirus was confirmed in Croatia on Wednesday. A Croatian man has been diagnosed who works in Italy and is based in Rijeka.
The Clinic for Infectious Diseases "Dr. Fran Mihaljević ”in Zagreb reported the news that a third case of the coronavirus infection has been confirmed.
"The man works in Parma, Italy. He is housed in a hospital in Rijeka," the Civil Protection Directorate announced.
"The patient became infected in Italy. The diagnosis was performed at the Infectious Diseases Clinic. He will be in isolation until he is healed. The disease is mild," Krunoslav Capak, director of the Croatian Institute of Public Health (CES), said.
To read more about travel in Croatia, follow TCN’s dedicated page.
First Step Taken Towards Establishing Intelligence College in Europe
ZAGREB, February 26, 2020 - Twenty-three countries, meeting at a conference in Zagreb on Wednesday, signed a letter of intent to establish the Intelligence College in Europe.
"The Intelligence College is a tool for cooperation, and cooperation is the only way for Europe to remain safe and prosperous," said the Director of Croatia's Security and Intelligence Agency (SOA), Danijel Markić.
"A safe, stable and prosperous Europe is our common goal," he said, adding that the aim of this initiative was to become "a bridge towards other communities."
The initiative aims to ensure dialogue between the European intelligence community, decision makers and the academic community.
Markić said that it was necessary to find a better way of communicating at a strategic level because of the diversity of intelligence services. Some are internal or external, with police powers or without them, and SOA is a hybrid service.
Prime Minister Andrej Plenković described the Intelligence College as "a very good form of cooperation which is more open than is usual in the intelligence community." He added that it would not be "operational cooperation", but that the College would deal with "strategic issues, communication and training."
The Intelligence College will not function as a platform for the exchange of security and intelligence data. It will be based in Paris, and conferences and seminars will be held in countries that join it.
Thirty countries, including all 27 EU member states, the United Kingdom, Norway and Switzerland, have been offered to participate in the initiative. To date, 22 EU member states and the UK have given the green light to the Intelligence College, while EU members Bulgaria, Slovakia, Poland, Luxembourg and Greece have not yet joined in. Plenkovic believes that "the other countries will join with time."
Ranko Ostojić, the chairman of the parliamentary Committee on Home Affairs and National Security, stressed the importance of intelligence services and their cooperation with other actors, stressing that "whoever is in control of information also controls the situation."
"You see what's going on with the new epidemic which may turn into a pandemic. Professional, experienced people who possess information can be of great help to decision makers," he said.
The idea to establish the Intelligence College was floated by French President Emmanuel Macron in a speech at the Sorbonne in September 2017, when he expressed the need to establish a kind of European intelligence academy where EU intelligence communities would converge through training, education and exchange.
More politics news can be found in the dedicated section.
AmCham: Croatia Lags Behind Other Countries in Region
ZAGREB, February 26, 2020 - Business conditions in Croatia are better compared to last year, but Croatia lags behind other countries in the region, show the results of an American Chamber (AmCham) Croatia survey on the business environment in Croatia, presented on Wednesday.
"Although a significant number of respondents rated their business experience in Croatia as average (43%), when compared to 2018, there is an increase of positive business experience in Croatia, which was 49% in 2019, as well as a decrease of the negative experience. Also, 52% of the respondents have noticed improvement of business conditions in the last five years," AmCham Croatia Executive Director Andrea Doko Jelušić said while presenting the survey, which was conducted on a sample of 111 board members of domestic and international companies in Croatia, from 16 December 2019 to 13 February 2020.
The survey shows that 67% of the respondents assessed their business results in 2019 as positive, while 55% reported an increase in the number of employees.
"Indications for the future are also positive. Around 80% of the companies plan to expand their business in Croatia, while only 2% plan a possible reduction of business," said Doko Jelušić, adding that around 71% of the companies planned to hire new employees in the next three years.
However, the survey shows that, despite progress, Croatia is lagging behind other countries in the region.
"Despite certain improvements in the assessment of the business environment, comparison with other countries in Central and Eastern Europe shows that half of the respondents rated business conditions in Croatia as worse than in other countries of Central and Eastern Europe, and only 13% considered them better," said the AmCham Board of Governors President Ruža Tomić Fontana.
The respondents highlighted taxation of labour, lack of adequate workforce and high business taxes as the three main limiting factors for their business in 2019.
"During the last few years, we have seen four rounds of tax reform. It has somewhat surprised us that labour taxation is again high on the list of the limiting factors for business in Croatia," said Doko Jelušić.
One has to take into account the fact that other countries have also worked on their business environment, Doko Jelušić said, mentioning that Romania and Bulgaria have labour taxation of around 10%, the Czech Republic from 20% to 23%, and Slovakia from 19% to 25%. Those countries are considerably more competitive than Croatia, which at this moment has an initial personal income tax rate of 24%, as well as the higher personal income tax rate of 36% on annual incomes of more than €48,000, she noted.
The respondents said the greatest disadvantages of Croatia compared to other countries in Central and Eastern Europe were the small size of the market, level of taxation and slow administration.
AmCham Croatia represents the business interests of over 250 American, Croatian and other international companies which employ over 88,000 people in Croatia.
More business news can be found in the dedicated section.
Croatian Economy: Banning Work on Sundays Would Cause Confusion
As Novac writes on the 26th of February, 2020, banning shops operating on Sundays would have a negative effect on the growth and competitiveness of the Croatian economy. A far more constructive solution is an amendment to the Labour Law, which would prescribe a minimum increase in wages for those doing work on Sundays, holidays or any other day which would otherwise not be a working day.
Of course, this should be done within the framework of a thoroughly conducted social dialogue with trade unions and employers in the trade sector and other related sectors,'' said Kristijan Kotarski, a professor of political economy at the Faculty of Political Science at the presentation of the Lipa Association's ''competitiveness barometer".
According to his calculations, using the methodology of the World Economic Forum, if the ban were introduced, Croatia would fall from 63rd to 64th in the 2019 global competitiveness ladder, in which case the Philippines would climb one step ahead of the Croatian economy, which is concerning to say the least.
The ban on work on Sundays could, in practice, help boost foreign economies by "diverting spending to online platforms (mostly foreign ones)" and "spillovers of traffic to neighbouring countries" in border areas, Kotarski warned.
He also recalled that in Croatia, despite the opposite opinion, there is a much smaller percentage of employees working on Sundays compared to other European Union countries, and that comparable countries like Poland and Hungary have already repealed similar laws, or are under pressure to abolish them because they're deemed a bad influence to their respective economies.
Although we have not yet been able to see a detailed proposal for a new version of the Trade Act, it is certain, he argues, that its application in the announced model of 8 to 12 working Sundays a year will create confusion in the eyes of both domestic and foreign consumers. It would also see an increase in the monitoring of the competent authorities. In addition, one might expect a problem with the distribution of printed matter, which could adversely affect the publishing business.
Additionally, in border areas along the border with Bosnia and Herzegovina, Slovenia and Hungary, part of the traffic to neighbouring countries can be expected to spill over, resulting in a hit to the Croatian economy and the possible effect of redirecting consumption to online platforms (mostly foreign ones) thus helping to boost overseas economies as opposed to the Croatian economy.
Calling for a ban on work on Sundays ignores comparisons with the situation in other EU member states and does not sufficiently take into account the experience of comparable countries like Hungary and Poland.
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