Croatian Economy: is business possible?

Parent Category: ROOT Published: Monday, 21 December 2020 Print
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Business Opportunities In The Croatian Economy

Being one of the most elegant places in Europe, The Republic of Croatia is a real paradise for European and Non-European tourists.

Filled with beauty, culture, and hardworking people, this country is one of the best places to live in Europe.

If you are planning to start a business in the country, then you may very well be venturing into one of the best locations to create a startup in Europe, with favorable policies and tax rates for foreign investors.

Croatia is the only country in the world bordering with the central European, Danube, and Mediterranean regions at the same time. With its unique geographical landmark, your business is available to a wide array of customers from different industries both in and outside Europe. Sounds interesting, isn’t it?

Being one of the best places to start a business in Europe, we decided to see for ourselves what make Croatia a great place to start a business and we found out that this country is super developed with modern transport systems and energy infrastructure, rich fertile soil, unpolluted sea, socio-economic & political stability, skilled and highly educated workforce, and so much more are some of the reasons why investing in Croatia is a great idea.

Croatia is a low hanging fruit for millions of investors and entrepreneurs from all over the world, but only a few people can see this fact. So in this article, we will be looking at the economic aspect and business opportunities in Croatia. If you are planning to move to Croatia with business intent but without knowing where to start, then this guide is for you.

 

Top Sectors

The Croatian economy is a service-based economy with the tertiary sector accounting for over 60% of its total GDP. Tourism is a major moneymaker as long as Croatia is concerned. This part of the service industry is responsible for the creation of most jobs and income in the nation.

Tourism may be Croatia’s largest source of foreign revenue, but it still accounts for a minor part of its foreign direct investment. Another key sector of the country is agriculture. The best business opportunities are focused in this sector.

Croatia is a major producer of organic foods, wines, olive oil, and lavender. Most of these items are on high-demand and exported to the European countries. Even blue water fishes caught in the country are exported to South Korea and Japan.

Other top performing industries for domestic and foreign companies in Croatia are manufacturing, telecommunications, petroleum, cement, pharmaceuticals, power, banking, wood processing, construction, textile, metal and chemical production, and marine engineering.

The major infrastructural development ongoing in the nation includes railways, road networks, power, oil & gas, telecommunications, water, shipbuilding, health care, and construction materials.

 

The business climate for foreign investors

person wearing suit reading business newspaper

The Constitution of the Republic of Croatia as well as the country’s authorities take more than enough measures to secure the funds of foreign investors. 

It is enacted that all rights acquired by an investment cannot be restricted by law or any other legal act; that allows the investors to transfer and repatriate his/her profit and invested capital freely and easily.

Croatia is an open market for entrepreneurs and investors. They have been many impressive policies implemented to create a favorable business environment in line with the EU laws and regulations.

Foreign investors carry out business transactions under the same conditions as domestic businesses. The Croatian Company Act also allows both local and foreign companies to do business under the same conditions, so be assured that you will not be overtaxed or cheated out of your investments.

Foreign citizens that are interested in purchasing real estate and other properties in Croatia can do it only if there is a reciprocal agreement with the investor’s country allowing Croatian citizens to do the same.

Foreign investors from a non – WTO member country are required to meet the reciprocity condition before they can purchase certain assets. Foreigners can also establish or participate in setting up a business/company, and even acquire rights/commitments as any other domestic investor.

 

Doing business in Croatia

Croatia has a good number of policies and modern infrastructure to attract foreign investments but still has some challenges for gaining competitiveness and attracting more FDI. Depending on your business objectives, here are some of the advantages and setbacks of doing business in Croatia.

Pros

Cons

  • It is an EU member-state; that makes business transactions in Europe easier.
  • A multilingual and skilled workforce.
  • Low inflation.
  • Reliable business environment.
  • High quality of life.
  • Strategic geographical location.
  • Advanced infrastructures.
  • Reliable tax system.
  • The national economy is very vulnerable. It depends on the economic situation in the European Union.
  • Sluggish administrative/judicial system needed to be improved.
  • High public debt & Structural weaknesses.
  • Socialist mindset that has not been fully transformed into today’s market economy.
  • Corruption and bureaucracy.

If you take a good long look, you’ll find out that Croatia is a potential goldmine for those aiming to start a business in Europe. If you need help identifying other profitable business ideas in the country, send us a message and we’ll come to your aid.

A pile of passports with visa stamps.

Businessman standing in the airport, waiting for hif flight.

Backpacker looking at a sunrise from the mountain.

Sunny beach on a tropical island.