Tuesday, 18 February 2020

Economic Situation in Croatia Satisfactory, But Is it Sustainable?

ZAGREB, February 18, 2020 - Finance Minister Zdravko Marić said on Tuesday that the economic situation in Croatia is satisfactory but that further reforms are necessary given the always present question of how sustainable the existing situation is.

"Progress is necessary because even though the current economic situation is satisfactory, with a growth rate of around 3%, balanced public finances, a current account surplus and a further drop in public debt, there is always the question of the sustainability of such a situation," Marić told reporters who after a meeting of EU finance ministers in Brussels asked him what he expected of the report on macroeconomic imbalances in the EU which the European Commission is expected to publish soon.

The minister went on to say that the global financial crisis of several years ago showed that things can change rapidly and that it was necessary to constantly work on structural reforms.

"As far as Croatia is concerned, monetary and fiscal policies have yielded and will continue to yield results, but focus must now be on reforms," he said.

Marić expressed the belief that the report to be released by the EC next week would recognise the progress made but that Croatia had to focus on the recommendations which it had not implemented yet.

He called for launching a public debate on the health care system and on the dependence of the national economy on imports, with a systematic approach and with as little populism as possible.

Asked which reforms he considered the most important, Marić cited the issue of wages and bonuses, the organisation of work in the state and public administration, reform of the health sector as well as of the judiciary, which, he said, should be more at the service of the business sector.

Speaking of ECOFIN, Marić said that the EC was today given recommendations for the 2021 budget, which is the first budget to be drafted as part of the new multiannual financial framework.

"I expect the multiannual financial framework to be adopted in the coming period and the EC to make a draft budget for 2021 in May or June," Marić said.

Answering a reporter's question, Marić said that today's ECOFIN meeting also included an informal discussion on the process of selection of the new head of the European Bank for Reconstruction and Development (EBRD).

The current EBRD president Suma Chakrabarti's term expires in May this year.

Marić said the dialogue on the matter would continue, primarily at the level of finance ministers. "I cannot speak or speculate about the candidates at the moment," he said.

He recalled, however, that with regard to the EBRD as well as the European Investment Bank (EIB), a debate had been launched about the EU's new financial architecture.

"The selection procedure for the EBRD president should be viewed in a broader context. As a country with long-lasting membership in multilateral organisations, including the EBRD, Croatia wants activities in countries where the EBRD has been active so far to continue, but we will take into account also new proposals regarding the new financial architecture and expansion to some other countries of the region," he said.

The EBRD signed its first agreement in Croatia in 1994 and so far it has supported 211 projects worth more than €3.8 billion.

More economy news can be found in the Business section.

Tuesday, 18 February 2020

Finance Minister: Greater National Share of Co-financing EU Projects Would Burden State Budget

ZAGREB, February 18, 2020 - Finance Minister Zdravko Marić said on Tuesday that increasing the national share of co-financing EU projects would mean additional pressure on the state budget, adding that he was confident that discussions on this topic at the EU level would result in a good compromise.

Ahead of a second meeting of Economic and Financial Affairs Council (ECOFIN) under Croatia's EU presidency in Brussels on Tuesday, Marić commented on plans to increase the national co-financing component for EU projects from 15% to 25%.

European Council President Charles Michel on Friday proposed a new Multiannual Financial Framework (MFF) for the period 2021-2027 worth €1094.8 billion, which is equivalent to 1.074% of the 27 member states' gross national income

Michel also proposes that the member-states should be supposed to co-fund projects by 25%.

"The proposal is here, a lot of countries have their own opinions about that," the Croatian minister said and added that that is an important issue for Croatia as the youngest EU member state that still has not managed to completely absorb EU funds.

Croatia currently has agreements for the absorption of 86% of allocated funds and a little more than 31% has been paid out.

"Naturally, we are taking account of the national budget too and in that light, an increase in the national component of co-financing would create additional pressure the state budget. The proposal put forward is a good basis for debate and dialogue," Marić said.

The minister is confident that the dialogue will be constructive and, in the end, that it will produce a good quality compromise.

Today's ECOFIN meeting of EU finance ministers has been convened to adopt a revised list of non-cooperative jurisdictions for tax purposes in the framework of new conclusions on this matter.

Marić recalled that the first two lists were compiled in 2017 with the aim of meeting standards and best world practice in an effort to improve the exchange of tax data, boost transparency and generally to curb tax evasion.

"In the period behind us more than 50 countries met the demands that we had defined for them, and this is the result of constructive dialogue. They are no longer on those lists. The intention now is to continue that dialogue with those still on the list so that they too meet the criteria," Marić said.

As of 14 November 2019, the EU list is composed of American Samoa, Fiji, Guam, Oman, Samoa, Trinidad and Tobago, US Virgin Islands, and Vanuatu.

During today's meeting, EU finance ministers are expected to expand that list to include Panama, the Cayman Islands, Seychelles and Palau.

More news about EU funds can be found in the Business section.

Tuesday, 18 February 2020

Vrdoljak Opposed to Orban Calling on Croatia to Join "Alliance Against EU"

ZAGREB, February 18, 2020 - Croatian People's Party (HNS) leader Ivan Vrdoljak on Tuesday condemned an announcement by Hungary's Prime Minister Viktor Orban that "the alliance against the European Union will include Croatia too," and called on PM Andrej Plenković and President Zoran Milanović to "stand in defence of a pro-European Croatia."

Vrdoljak said in a press release that "extremists, nationalists and populists like Orban want to drag the EU and Croatia backwards," to violations of the fundamental principles of democracy, rule of law, freedom of the press and human rights.

As a liberal party that advocates a pro-European, open and tolerant Croatia, the HNS condemns Orban's announcement that the "alliance against the EU will include Croatia too."

"We no longer have the right to remain silent and passively observe initiatives that directly threaten the freedom of each one of us, the freedom of all EU citizens," the press release said. It is up to the liberals to stand up in defence of common values - from freedom to humanity.

Vrdoljak called on Prime Minister Andrej Plenković and President Zoran Milanović and other political stakeholders in Croatia to take a clear stand on Orban's initiative and to stand in defence of a modern and pro-European Croatia.

Underscoring that a united Europe with its democratic and economic standards is a good place for its population to live and work in, the HNS wants to say that anyone that works against it is working in the interest of others and not Europeans.

More news about Croatia and the EU can be found in the Politics section.

Tuesday, 18 February 2020

Zoran Milanović Inaugurated as President

ZAGREB, February 18, 2020 - President Zoran Milanović said in his inaugural address on Tuesday that elections are a way of reaching a peaceful compromise between the opposed wishes of different people, and that he will play a constructive role as President.

Addressing the inauguration ceremony, Milanović said that the truth and voters' desire should be kept apart and that elections are not the way to find the truth but to reach a peaceful compromise between the opposed wishes of different people.

"It seems to me that there is only one right way, and that is full and active support by the government to academic and scientific independence and independence of the judiciary and media. That's the strongest defence against tyranny, tyranny of any kind," he said.

The scientific community, judiciary and media must work incessantly on perfecting the anti-corruption mechanisms. Protection and promotion of the independence of the judiciary, media and science are the most important constitutional responsibilities of the President of the Republic in ensuring the stability of government, Milanović said.

He stressed that he is not going to be a corrective, but a constructive factor in areas of direct competence or co-competence of the President of the Republic, adding that this arises from the spirit of the Constitution.

In foreign policy, he said he will focus on promoting cooperation and prosperity. There is no doubt that there are incomparably more points on which we can build cooperation and prosperity than those that distance us from our neighbours and from the world, even when it comes to countries with which we have the largest number of unresolved issues, he added.

In his speech, Milanović asked beforehand for "a seed of understanding" for possible mistakes on his part, stressing that they will never be intentional or made to hurt or degrade somebody. "I will do my best to make sure that this seed produces a presidential term to the benefit of Croatia and its citizens."

He said it would be a mistake to doubt a person's motivation or patriotism because of differences in opinion, noting that patriotism, unlike raw nationalism, is a critical commitment and negation of exclusiveness.

Patriotism implies an indelible memory and an eternal gratitude to men, women and children who were killed and who suffered for our freedom both in the 1991-1995 Homeland War and during the antifascist struggle in the Second World War. "Patriotism is also awareness of the failures of triumphalism that unfortunately sometimes accompanied our victories in the wars, but we should not compare or equate those failures," he said.

Milanović said that the wars are over and that it is our duty and responsibility to ensure that no citizen of Croatia feels intimidated, discriminated against or in any way excluded just because they are different.

"When I say different, I also mean weaker or smaller in number, and that according to several criteria: gender, ethnic, social, religious, work and age. Such patriotism is based on the highest values of our constitution and our sheer humanity, if you will, and not on myths, past traumas and prejudice," he said.

Our future depends, first and foremost, on the quality of education and the belief in the fact that knowledge is key to a more fulfilled and successful life, as well as on our treatment of our own culture, Milanović said.

He said that Croatia is the home of an unskilled worker and a respectable academic alike, stressing that promoting solidarity in society, a fairer division of national wealth, and the fight against clientelism, a culture of lies and greed is the most effective instrument in combating inequality and the growing gap between rich and poor.

"Our republic needs every person and every person in Croatia must be given a chance to find their way and their place, to live in dignity from decent work. This is a home to us all, to us who live here and to the generations to come, as well as to those who are yet to return," Milanović said in conclusion of his speech.

More news about Zoran Milanović can be found in the Politics section.

Tuesday, 18 February 2020

Dubrovnik Belvedere: American, French, Croatian Investors Interested

This is not the first time Americans have shown interest in the now devastated Dubrovnik Belvedere Hotel, constructed back in 1985 and once known as one of the best hotels in all of former Yugoslavia.

As Poslovni Dnevnik writes on the 18th of February, 2020, after eight whole years of failing to make a new investment at the site of the war-ravaged Dubrovnik Belvedere Hotel, Russian billionaire Viktor Vekselberg is now tired of the charade and could sell the Dubrovnik Belvedere Hotel to another, new investor.

Over recent days, American investors have visited Dubrovnik Mayor Mato Frankovic because they are interested in opening a new five-star hotel in Dubrovnik, according to local portal Dubrovacki dnevnik.

That would likely involve the rebuilding of the old Belvedere hotel, a now ruined complex for which Vekselberg had demolition plans in order to build a new but more luxurious hotel in its place, according to the preliminary design of the 3LHD architectural office.

As Mayor Mato Frankovic told Jutarnji list on Thursday, he was visited by a delegation from a renowned American hotel chain interested in rebuilding the Dubrovnik Belvedere Hotel, which in its current form is synonymous of Dubrovnik's immense suffering during the Homeland War.

''They came with reconstruction visuals and studies, but first they wanted to see how the project was spatially planned, that is, to check what could be done within the area. They're interested in the reconstruction of the existing project, in the existing dimensions, and the advantage is that the project has a building and an occupancy permit, while the investors would need to obtain a reconstruction permit,'' said Frankovic, who believes that the idea for the Belvedere's renovation is a realistic one.

Unofficial sources have learned that potential American investors have reportedly not started actual negotiations with Belvedere owner Viktor Vekselberg so far. It has also been unofficially learned that both French and Croatian investors are also interested in the project, in addition to the aforementioned Americans.

According to their source(s), the American delegation wants to get better acquainted with the complete spatial-planning situation of the project, that is, to get information from the city administration about what types of interventions could be done at the Dubrovnik Belvedere Hotel's premises.

This is, as stated, not the first time Americans have shown interest in the devastated hotel which showcases the uglier ghosts of Dubrovnik's recent wartime past. Through several auctions, US hotel chain Hyatt International has shown interest in buying Belvedere.

Kempinski, Valamar and Rixos, the British company Fenestra Village, the French consortium BCC, the Canadian-Swiss group Fairmont Hotels have also shown a degree of interest in the huge complex which is currently home to little more than cats and snakes.

Make sure to follow our dedicated business page for more.

Tuesday, 18 February 2020

Croatian Hospitality Industry Begins Search for Foreign Seasonal Workers

As Novac/Tanja Simundic Bendic writes on the 17th of February, 2020, never before have Croatian hospitality industry employers from the coast set out in search of a workforce so early before. The situation is alarming, there is a shortage of chefs, waiters, support staff, to such an extent that the search for a good worker began as early as October last year.

In comparison, in the previous tourist seasons, Croatian hospitality industry employers started looking for staff at the end of March. This year, the situation is already desperate. This is known firsthand, from the famous Croatian chef, Duje Pisac from Split, a man who last year brought 200 workers from neighbouring Serbia to work in Dalmatian restaurants.

''This year, more are coming, people of all profiles,'' he stated for Slobodna Dalmacija.

Ever since he became known as being some sort of help in getting foreign workers, his mobile phone hasn't stopped ringing. Croatian hospitality industry employers have been calling him non stop, from Dubrovnik to Istria, begging him not to forget about them, otherwise they'll end up with huge workforce issues. Pisac in Serbia two weeks ago, as he had last year rented a hotel, gave a cooking presentation and then a workshop where he sought to fill the gaps of the staff shortage in Dalmatia. He tells us that 800 people came to work in Croatia.

''It's a miracle, people really want to come to Croatia. They have a safe job here, and if they prove to be good, they also have a place here next year. Their salaries are twice as high as they are over in Serbia. They're provided with accommodation and food, and if they're good at what they do, excellent tips. We're the eldorado for them. This year everyone is interested in Dalmatia because of the strained relations between Serbia and Montenegro, too. They told me that they felt they might have some discomfort [in Montenegro] and that's why they responded en masse to us. I can’t say I was shocked by such interest, but I admit I was surprised. Obviously, those who worked with us last summer told us a lot about what was good about us,'' Duje Pisac said.

But it is far from just Serbian hospitality workers who are interested in the Croatian summer buzz. There are also Bosnian and Macedonian chefs, who have been coming to work for Croatian hospitality industry employers for years now. Owing to the utter lack of manpower, employers from Croatia throw their ''nets'' out to much wider areas in their increasingly desperate search. Their support staff come from as far away as Nepal and India to work in Dalmatian and Istrian restaurants.

''Eighty percent of the workers who came from Serbia last summer will work in the same locations this year. These are the professionals that I myself included in my team at the top restaurant of the heritage hotel in Pucisca, on Brac. The workshop is attended by top chefs. In winter, they work in luxury Serbian hotels, speaking three languages ​​each. In addition to the chefs, there are waiters who know their business well. I will tell you frankly, there is no language barrier, no thinking about where anyone came from. The guest doesn't care, he doesn't care what dialect or with what accent they speak. He just wants superior service. These people eventually get another paycheck from the tips they earn. I take my hat off to them, because when you see that old school style, the service they provide, the masterful work, I have to say that they deserve it,'' says Pisac.

Why did Croatian hospitality industry employers run into this kind of problem in the first place? When annoying political philosophising is removed, the bare truth remains. And the truth says - Croatian youth has gone. Many unemployed people wouldn't even get jobs in kitchens for auxiliary tasks such as cutting, chopping, cleaning, washing dishes. No, they think they can do more. Schools cannot produce as much staff as the market needs.

''Split has turned into a big kitchen, it smells like oil, like fat. My job is to go to restaurants and see what's on offer. For the most part, this is something inedible, which is often accompanied by poor service. Food aside, what about the waiters? They must be agile, fast, quiet, unobtrusive. They need to know how to suggest, advise, know how something is served, whether it's just a coffee or a top dish. We don't have these people.

They don't come out of schools with the knowledge that today's hospitality sector needs. And that's why we import foreign waiters. There should be some order, not every space in the city can be turned into a restaurant. The worst part is that we haven't even reached the maximum yet, and when we do, this story will just burst like a soap bubble,'' notes Pisac.

''Split is bursting at the seams in terms of the the number of restaurants. The infrastructure in the old centre is hardly sustaining it. The city under Marjan has transformed from a transit centre into a tourist destination, so many who are looking for light, fast, seasonal earnings see it as a cash cow,'' he adds.

Make sure to follow our business page for more on Croatian hospitality industry employers and the current Croatian demographic crisis.

Tuesday, 18 February 2020

Croatian Telecom Expands Business in Osijek Owing to 5G Introduction

Croatian Telecom (HT) have managed to expand their business in the Eastern Croatian city of Osijek owing to the previously announced introduction of a 5G network in the city.

There has been a lot of talk about the introduction of 5G in Croatia. With rumour recently being confirmed about the continental Croatian city of Osijek becoming the first Croatian 5G city, the new technological step forward has attracted as much criticism as it has praise.

From arguments about potential health issues arising to praise about how 5G's introduction will only help Osijek's encouraging IT and tech community to grow and develop, thus encouraging economic stimulation and the creation of more jobs, discussions on the issue have been relentless.

As Poslovni Dnevnik/Bernard Ivezic writes on the 17th of February, 2020, the City of Osijek is home to one of four Croatian Telecom call centres, and with other operations in the city, this huge operator employs more than 500 workers.

Croatian Telecom has, in a more than encouraging sign of things to come, opened another, brand new call centre in Osijek which employs more than 400 workers.

The new Croatian Telecom business premises in the often overlooked Slavonian city, which the operator decided to invest in after increasing its call centre staff in Osijek by as many as 166 at the end of last year, were opened on Friday by members of the company's management board, Natasa Rapaić and Ivan Bartulović.

The expansion of Croatian Telecom's Osijek-based business is, as previously stated, part of the operator's preparations for the city's introduction of the 5G network.

Many asked why Osijek was chosen to be the first Croatian 5G city, as it is rare that any sort of economic good news comes from that region of Croatia. Unbeknown to some, Osijek has a thriving IT and tech community, and it's more than likely that the introduction of 5G will spur that on.

Make sure to follow our business page for more.

Tuesday, 18 February 2020

200 Million Euro Project: Fourth Tower to be Built in Savica, Zagreb?

The idea of this complex in Savica, Zagreb, first met the public eye and caused somewhat of a proverbial storm back in 2013, and has been bubbling under the surface without much attention ever since.

As Poslovni Dnevnik writes on the 18th of February, 2020, if you're coming off the Bridge of Youth (Most mladosti) the complex in Savica will be the first thing you'll notice. The four towers, the tallest as high as 135 metres, will rise up from the ground at the entrance to Savica, Zagreb, according to a report from Vecernji list.

More specifically, the fourth tower will be located between the Chromos sports field and the intersection with Drziceva, and a plot of about 13,000 square metres will accommodate skyscrapers boasting 30 to 37 floors - two will be residential buildings which will be 95 and 74 metres tall, the 120 metre-high tower will house a hotel, while the other will be home to a business centre.

As stated, the idea of this complex first came to light back in 2013 when a conceptual design was selected in a public tender financed by an investor, the Savica company, and the project belongs to Austrian M.O.F. Immobilien AG, whose programme was developed by IGH. The work of a team led by architect Dario Travas was selected from among fifteen works, and since then a public debate has taken place.

The calm which followed and indeed lasted for the next six years, was interrupted by a publication at the beginning of 2020 in the Official Gazette of the City of Zagreb, from which it is evident that the procedure for obtaining a location and building permit had been initiated.

Vecernji list asked M.O.F. Immobilien AG about the project and at what stage it is currently at, and despite several attempts, they failed to get an answer. However, Martin Kutscher and Martin Vabitsch, who were the directors of the Savica-project company back in 2014, explained the value of the project "for Trnje, Zagreb and the whole of Croatia" in a letter sent to the then-Assembly Speaker Darinka Kosor.

Make sure to follow our dedicated business page for more.

Tuesday, 18 February 2020

Valamar Riviera Inviting Porec Citizens and Sports Clubs to Use Future Pool Facilities

February 18, 2020 - Valamar Riviera, the Poreč Sports Community and the City of Poreč, have signed an agreement allowing the city's citizens and sports clubs to use the future pool facilities in the new Pical Zone. 

HRTurizam writes that the agreement continues the successful cooperation so far at the Valamar Diamant 4* Hotel, and makes a large indoor pool and an outdoor tidal pool available to the city and the Sports Community as part of the future Pinea Hotel in the Pical Zone. Thus, with the completion of the investment in 2021, the City of Poreč will receive significantly better conditions for the operation of sports clubs and recreation of citizens. The large indoor pool will be 25 meters long with five swimming lanes, while the outdoor tidal pool will be 50 meters long.

"With the construction of the Pinea Hotel in the new Pical Zone, Poreč, for the first time, is receiving a large indoor five-lane swimming pool, which will be open year-round and, as such, will be of particular importance to athletes and recreational people as well as citizens. We are pleased to provide top athletes with even better conditions for training water sports,” said Andrea Štifanić, Director of the Property Management and General Affairs Division at Valamar Riviera.

"Through this cooperation between the City, the Sports Community and Valamar, citizens will have the opportunity to use the pool. We are aware of the importance of this kind of sports infrastructure for many recreational athletes and athletes and will include it in our investment plan, of course, when addressing priority infrastructure projects such as kindergarten construction, waterfront construction, roads or housing subsidies,” said Poreč Mayor Loris Peršurić.

“By agreeing on the use of the swimming pool at the Pinea hotel, our swimmers and water polo players will have the opportunity to train better throughout the year in our City, and therefore, we expect an increase in the interest of children and young people to participate in these sports actively. Improving training conditions will certainly result in better sports results. Certainly, new opportunities for recreational water sports are being created. We are extremely pleased about the successful cooperation with Valamar Riviera, which has been following the sporting activities and successes of our member clubs and athletes for a long time,” said Alfredo Mendiković, President of the Sports Community of the City of Poreč.

Valamar plans to invest around 1.5 billion kuna in the Pical zone, which will make it one of the most attractive tourist zones in Croatia. In addition to 20,000 m2 of beaches, the citizens of Poreč will have a four-kilometer circular path for outdoor activities such as jogging and cycling and a 10-kilometer promenade.

Pinea Hotel will be positioned as a luxurious five-star hotel, will have the largest hotel event center in Istria, and a full offer for active holidays throughout the year, where in addition to swimming, there will be numerous other sports and recreational facilities for tourists and citizens.

To read more about sport in Croatia, follow TCN's dedicated page.

Tuesday, 18 February 2020

ZSE Delists Seven Former Agrokor Companies

ZAGREB, February 18, 2020 - The Zagreb Stock Exchange (ZSE) decided on Monday to delist the shares of seven members of the former Agrokor food and retail conglomerate over their failure to meet the transparency obligations under the law and ZSE rules.

The shares of water bottler Jamnica, ice-cream and frozen food producer Ledo, cooking oil producer Zvijezda, news agent's Tisak and agricultural companies Belje, Vupik and PIK Vinkovci have not traded on the ZSE since 1 March 2018 when the HANFA regulator temporarily suspended trading in their shares.

The ZSE said in a lengthy explanation that the companies had repeatedly failed to meet their transparency obligations under the law and ZSE rules, including the publication of quarterly and annual financial statements and their financial obligations towards the ZSE.

In taking its decision, the ZSE took into account the 24 December 2019 declaration by the seven companies that they would not be able to meet the requirements of the ZSE's new rules because they did not have the necessary organisational procedures in place to be able to do that.

More news about the former Agrokor can be found in the Business section.

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