Croatia: Investing

FDI in Figures

Direct foreign investment had been relatively low in Croatia until 2005. It is only from that date that FDI started to really develop: its figures jumped from EUR 1.5 billion in 2005 to almost EUR 5 billion today. According to the World Economic Forum (WEF), Croatia ranks 39th, amongst 121 countries, in terms of ease of trade. Therefore, Croatia is placed before other European countries like Italy, Greece, Poland, Slovakia, Romania and Bulgaria.

The biggest foreign investor in Croatia is, by far, Austria, with a total of nearly EUR 4 billion.  It is followed by the Netherlands and Germany, who have invested a bit less than Austria alone during the past 15 years. France is in fourth place with a total of EUR 1.3 billion due to a record investment made in 2006, for almost EUR 1 billion when the Société Generale bought the bank of Splitska Banka.

Foreign investment in-flows have decreased in 2009-2010 due to the financial crisis, especially in the tourism sector, which had less foreign tourists visiting the country. It should not increase but slightly in 2011 due to a lack of dynamism of the government's policies.

Why You Should Choose to Invest in Croatia

Strong Points

Croatia has a number of strong points:
- An advantageous geographical location along the Adriatic Sea;
- A skilled multilingual workforce;
- Good quality infrastructures: Croatia continues to invest heavily in transportation, telecommunications and energy infrastructures; and
- An entry gateway to the EU: Croatia could become a member in 2013.

Weak Points

Croatia still has to face a number of challenges in order to become competitive:
- the country suffers from certain structural weaknesses amongst which are the current account imbalance, a significant private foreign debt and a trade deficit;
- the country also has an image problem. It is more known for tourism than as and investment opportunity. Croatia is also suffering from a backlash of years of war; and
- the legal and administrative systems are slow and could use some improvement.

Government Measures to Motivate or Restrict FDI

Croatia is open to foreign investment. The government has committed itself to increasing foreign investment and has taken measures to improve the investment climate in the country, for example, depending on the type of activity (manufacturing, technology centers, supporting services), through tax reductions and employment incentives. Amongst the main measures established by the government, we can name in particular:
- Equal treatment of nationals and foreigners;
- Low company admninistrative fees; and
- Laws protecting intellectual property.

All measures are established to create an attractive framework for investors and to make Croatia a valid foreign investment recipient.

For more details on FDI's incentives, refer to the Agency for the promotion of trade and foreign investment and to the Croatian Chamber of Economy website.

Procedures Relative to Foreign Investment

Acquisition of Holdings

A foreign investor can hold 100% interest in the shares of a Croatian company, except in some cases specified by the government.

Obligation to Declare

Only for the acquisition of public joint stock companies.

Competent Organization For the Declaration

Croatian Financial Services Supervisory Agency

Investment Opportunities

Investment Aid Agency

Trade and Investment Promotion Office

Tenders, Projects and Public Procurement

Tenders Info, Tenders in Croatia
Ted - Tenders Electronic daily, Business opportunities in EU 27
Globaltenders, Tenders & Projects from Croatia
DgMarket, Tenders Worldwide

Other Useful Resources

Investment Promotion Directorate at the Ministry of Economy
Croatian Economic Diplomacy portal

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