Croatia became the 28th member state of the EU on the 1st of July 2013. The Croatian economy, already oriented heavily towards Europe, remains nonetheless very dependent on the regional economic context in 2014. The country is in recession since 2009: -6% then -1.2% in 2010, 0% in 2011 followed by two years of decline -0.5% in 2012 and 0.6% in 2013.
Croatia adopted measures to boost its economy ahead of the financial crisis and had injected liquidity into the domestic banking sector which was then used to better cope with the effects of the crisis. However, today, looking at the evolution of household debt and business debt there are few signs of sustainable recovery. The forecast for 2014 also suggests stagnation. The crisis has highlighted the limits of the Croatian model, based on household consumption. The key economic drivers in 2013 - industry and construction - showed negative growth rates. However tourism revenues, which stabilized in 2010, have increased regularly since 2011.
Croatia still needs to deal with a very high and fast increasing rate of unemployment: 16.2% in 2013 following 13.7% in 2012.
It seems that growth now depends on investment, on making use of the country's comparative advantages, on the rationalization of loss-making public companies and on modernizing the state administration. To face these challenges, the country will have to show a greater level of openness to direct foreign investment and work towards an improvement in the real wages/productivity ratio.
With its 4.3 million inhabitants, whose average revenue corresponds to 65% of the EU average, as well as an influential Diaspora, Croatia remains the second most developed economy of the Balkan region after Slovenia.
|Main Indicators||2011||2012||2013||2014||2015 (e)|
|GDP (billions USD)||61.55||55.98||57.37e||58.33||59.91|
|GDP (Constant Prices, Annual % Change)||-0.2||-2.2||-0.9||-0.8||0.5|
|GDP per Capita (USD)||14,378||13,077||13e||13,624||13,995|
|General Government Balance (in % of GDP)||-3.8||-2.0||-4.4||-3.3e||-2.5|
|General Government Gross Debt (in % of GDP)||47.4||54.2||60.2||66.3||68.5|
|Inflation Rate (%)||2.3||3.4||2.2||-0.3||0.2|
|Unemployment Rate (% of the Labor Force)||13.6||16.1||16.6||16.8||17.1|
|Current Account (billions USD)||-0.54||-0.07||0.51||1.27e||1.33|
|Current Account (in % of GDP)||-0.9||-0.1||0.9||2.2||2.2|
Source: IMF - World Economic Outlook Database , Last Available Data
Note: (e) Estimated Data
The agricultural sector only represents 5% of the country's GDP. Croatia mainly produces wheat, corn, sugar beet, fruits, wine and olive oil.
The secondary sector represents 22% of the GDP. The Croatian industry is concentrated in competitive activities: textiles, wood, the steel industry, aluminum and the food industry. With more than one-third of the territory covered with forests, the wood industry is one of the fundamental sectors of the economy. The country has limited mineral resources.
The service sector represents 73% of the GDP. The tourism sector is in full bloom. Croatia is welcoming almost 10 million visitors every year and the growth of this sector will be confirmed in the coming years with the development of even more modern infrastructures.
|Breakdown of Economic Activity By Sector||Agriculture||Industry||Services|
|Employment By Sector (in % of Total Employment)||13.7||27.4||58.7|
|Value Added (in % of GDP)||4.3||27.2||68.6|
|Value Added (Annual % Change)||-1.6||-2.7||0.1|
Source: World Bank - Last Available Data.
|Croatian Kuna (HRK) - Average Annual Exchange Rate For 1 USD||5.28||5.50||5.34||5.85||5.70|
Source: World Bank - Last Available Data.
The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.
The business rankings model measures the quality or attractiveness of the business environment in the 82 countries covered by The Economist Intelligence Unit’s Country Forecast reports. It examines ten separate criteria or categories, covering the political environment, the macroeconomic environment, market opportunities, policy towards free enterprise and competition, policy towards foreign investment, foreign trade and exchange controls, taxes, financing, the labour market and infrastructure.
Croatia, which joined the WTO in 2000, became the 28th member State of the European Union on the 1st of July 2013. Its economy depends heavily on foreign trade. The foreign trade's contribution to the GDP was of more than 100% in 2013. Exports, which rose sharply in 2010 and 2011, namely in the petrochemical and marine construction sectors, dried up due to the slowdown of the Euro zone economies. This fact illustrates the heavy dependency of Croatia on the economic situation of the entire continent. The EU continues to represent over 60% of Croatia's exports and was for more than 63% in the country's imports.
Croatia's main suppliers in 2013 were Italy, Germany, Russia, China, Slovenia and Austria. Fuels, equipment, cars and machinery are significant import items.
Croatia mainly exports mineral fuels, ships, boats, electric & mechanical machinery, equipment, wood and wooden articles. Its main clients in 2013 were Italy, Bosnia-Herzegovina, Germany, Slovenia, but also Austria and Serbia.
The Croatian trade balance is regularly in deficit and with the effects of the crisis, this deficit became deeper due to the fall in exports. The revenues related to tourism did help to compensate the global deficit. The most promising sectors in 2014 remains tourism, construction, telecommunications, and retail sales.
|Foreign Trade Indicators||2009||2010||2011||2012||2013|
|Imports of Goods (million USD)||21,203||20,054||22,715||20,832||20,917|
|Exports of Goods (million USD)||10,474||11,807||13,364||12,344||11,849|
|Imports of Services (million USD)||3,791||3,459||3,577||3,593||3,688|
|Exports of Services (million USD)||11,725||11,579||12,644||11,933||12,753|
|Imports of Goods and Services (Annual % Change)||-20.4||-2.5||2.5||-3.0||3.2|
|Exports of Goods and Services (Annual % Change)||-14.1||6.2||2.2||-0.1||3.0|
|Imports of Goods and Services (in % of GDP)||38.2||38.2||40.9||41.1||42.5|
|Exports of Goods and Services (in % of GDP)||34.5||37.7||40.4||41.6||42.9|
|Trade Balance (million USD)||-10,085||-7,670||-8,674||-7,862||-8,352|
|Trade Balance (Including Service) (million USD)||-2,003||-177||224||311||717|
|Foreign Trade (in % of GDP)||72.8||75.9||81.3||82.7||85.4|
Source: WTO - World Trade Organization ; World Bank , Last Available Data
(% of Exports)
|Bosnia and Herzegovina||12.3%|
|See More Countries||44.8%|
(% of Imports)
|See More Countries||46.2%|
Source: Comtrade, Last Available Data
|- bn USD of products exported in 2013|
|Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals||9.5%|
|Medicaments consisting of mixed or unmixed...Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses incl. those in the form of transdermal administration or in forms or packings for retail sale (excl. goods of heading 3002, 3005 or 3006)||3.9%|
|Electrical transformers, static converters, e.g....Electrical transformers, static converters, e.g. rectifiers, and inductors; parts thereof||2.5%|
|Wood sawn or chipped lengthwise, sliced or barked,...Wood sawn or chipped lengthwise, sliced or barked, whether or not planed, sanded or end-jointed, of a thickness of > 6 mm||2.5%|
|Petroleum gas and other gaseous hydrocarbonsPetroleum gas and other gaseous hydrocarbons||2.3%|
|See More Products||79.4%|
|- bn USD of products imported in 2013|
|Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals, crude||9.0%|
|Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals||5.4%|
|Petroleum gas and other gaseous hydrocarbonsPetroleum gas and other gaseous hydrocarbons||3.5%|
|Medicaments consisting of mixed or unmixed...Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses incl. those in the form of transdermal administration or in forms or packings for retail sale (excl. goods of heading 3002, 3005 or 3006)||2.9%|
|Electrical energyElectrical energy||2.8%|
|See More Products||76.5%|
Source: Comtrade, Last Available Data
|- bn USD of services exported in 2011|
|Personal travelPersonal travel||70.32%|
|Health-related expenditureHealth-related expenditure||1.62%|
|Education-related expenditureEducation-related expenditure||0.16%|
|Business travelBusiness travel||2.31%|
|Sea transportSea transport||3.62%|
|Road transportRoad transport||3.37%|
|Air transportAir transport||3.03%|
|Rail transportRail transport||0.21%|
|Inland waterway transportInland waterway transport||0.05%|
|Miscellaneous business,...Miscellaneous business, professional, and technical services||8.30%|
|Architectural, engineering,...Architectural, engineering, and other technical services||2.92%|
|Advertising, market research,...Advertising, market research, and public opinion polling||2.45%|
|Legal, accounting, management...Legal, accounting, management consulting, and public relations||1.24%|
|Business and management...Business and management consulting and public relations services||0.93%|
|Legal servicesLegal services||0.16%|
|Accounting, auditing,...Accounting, auditing, bookkeeping, and tax consulting services||0.14%|
|Research and developmentResearch and development||0.91%|
|Agricultural, mining, and...Agricultural, mining, and on-site processing services||0.50%|
|Waste treatment and...Waste treatment and depollution||0.03%|
|Other business servicesOther business services||0.27%|
|Merchanting and other trade-related...Merchanting and other trade-related services||1.06%|
|Other trade-related servicesOther trade-related services||0.95%|
|Operational leasing servicesOperational leasing services||0.27%|
|Telecommunications servicesTelecommunications services||2.35%|
|Postal and courier servicesPostal and courier services||0.08%|
|Computer servicesComputer services||1.82%|
|Information servicesInformation services||0.11%|
|Other information provision...Other information provision services||0.07%|
|News agency servicesNews agency services||0.04%|
|Construction in the compiling...Construction in the compiling economy||0.69%|
|Construction abroadConstruction abroad||0.69%|
|Other personal, cultural, and...Other personal, cultural, and recreational services||0.30%|
|Education servicesEducation services||0.07%|
|Health servicesHealth services||0.04%|
|Audiovisual and related servicesAudiovisual and related services||0.16%|
|Auxiliary servicesAuxiliary services||0.15%|
|Other direct insuranceOther direct insurance||0.03%|
|Life insurance and pension fundingLife insurance and pension funding||0.01%|
|Franchises and similar rightsFranchises and similar rights||0.01%|
|- bn USD of services imported in 2011|
|Miscellaneous business,...Miscellaneous business, professional, and technical services||21.54%|
|Legal, accounting, management...Legal, accounting, management consulting, and public relations||7.41%|
|Business and management...Business and management consulting and public relations services||6.19%|
|Accounting, auditing,...Accounting, auditing, bookkeeping, and tax consulting services||0.85%|
|Legal servicesLegal services||0.37%|
|Advertising, market research,...Advertising, market research, and public opinion polling||5.55%|
|Architectural, engineering,...Architectural, engineering, and other technical services||4.18%|
|Other business servicesOther business services||3.01%|
|Research and developmentResearch and development||0.93%|
|Agricultural, mining, and...Agricultural, mining, and on-site processing services||0.46%|
|Waste treatment and...Waste treatment and depollution||0.18%|
|Merchanting and other trade-related...Merchanting and other trade-related services||3.41%|
|Other trade-related servicesOther trade-related services||3.41%|
|Operational leasing servicesOperational leasing services||3.09%|
|Personal travelPersonal travel||17.19%|
|Health-related expenditureHealth-related expenditure||1.12%|
|Education-related expenditureEducation-related expenditure||0.66%|
|Business travelBusiness travel||7.07%|
|Road transportRoad transport||6.12%|
|Air transportAir transport||5.30%|
|Sea transportSea transport||3.88%|
|Rail transportRail transport||2.96%|
|Inland waterway transportInland waterway transport||0.03%|
|Franchises and similar rightsFranchises and similar rights||1.29%|
|Computer servicesComputer services||6.05%|
|Information servicesInformation services||1.05%|
|Other information provision...Other information provision services||1.01%|
|News agency servicesNews agency services||0.05%|
|Telecommunications servicesTelecommunications services||4.22%|
|Postal and courier servicesPostal and courier services||0.44%|
|Audiovisual and related servicesAudiovisual and related services||2.21%|
|Other personal, cultural, and...Other personal, cultural, and recreational services||0.82%|
|Education servicesEducation services||0.43%|
|Health servicesHealth services||0.05%|
|Auxiliary servicesAuxiliary services||0.09%|
|Other direct insuranceOther direct insurance||0.04%|
|Construction abroadConstruction abroad||0.05%|
Source: Comtrade, Last Available Data
The world rankings, published annually, measures the violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire sent to partner organizations,150 RWB correspondents, journalists, researchers, jurists and activists of human rights, including the main criteria - 44 in total - to assess the situation of press freedom in a given country. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).
The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.
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