Business Environment in Croatia among Worst in EU

Total Croatia News

ZAGREB, May 12, 2018 – Despite some progress made in recent years, Croatia is still a non-entrepreneurial country and among the worst in the European Union in terms of the business environment, and for the situation to improve it is necessary to change regulations and the education system, a presentation of the Global Entrepreneurship Monitor (GEM) study for 2017 was told in Zagreb on Friday.

The study has been conducted in Croatia since 2002 and provides a picture of the entrepreneurial climate, relations and development. It was carried out on a sample of 2,000 respondents and financed by the Ministry of Economy, Entrepreneurship and Crafts. The results were presented by a team of researchers from GEM Croatia and the SMEs and Entrepreneurship Policy Centre (CEPOR), headed by Slavica Singer.

Only 48 percent of respondents see a high status for entrepreneurship in Croatia, while the EU average is 67 percent. Only 33 percent of people in Croatia manage to recognise and seize a right business opportunity, compared to 79.5% in Sweden and the EU average of 42.6 percent. Only 9 percent of start-ups in Croatia develop and pay wages, as against 19 percent in Estonia, Singer said among other things.

“Although Croatian companies are slightly better technically equipped than the EU average, they are slow in developing and launching new product lines. We have very few growing companies that are a source of new employment as only about 20 percent of companies had grown for three consecutive years and the new employment rate was merely 0.73 percent,” Singer said.

Since employees are very important for measuring entrepreneurial activity, Singer said that they should be given greater attention in the future and should be paid more because the study showed that employees have a great potential, knowledge and will for change and that in this regard Croatia is quite strong in relation to the EU.

Economy Minister Martina Dalić agreed that entrepreneurship was extremely important for the GDP, employment, growth and development of both the economy and society in general, but noted that Croatia was not moving forward as fast as it would like.

“The economy and the standard of living with which we would get closer to the EU are not growing as fast as we would like, which is why reforms are necessary, because they show that we want and know what to change. The government is dealing with not just the priorities and policies it itself has defined but also with those imposed by life, such as Agrokor, whose collapse has shown that this company was actually a barrier to many improvements both in the country and in the companies within it, because it obstructed certain business plans, investments and development,” Dalić said.

She added that the process of restructuring Agrokor best showed that a successful implementation of reforms required not just knowledge and perseverance, but also social understanding and the capacity of society to accept reform processes.


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