Interview with Frane Franičević, Rasco Plans include higher exports and production in Russia
Interliber attracts visitors to Zagreb Fair Books at attractive prices the largest Croatian book fair had an excellent reception
Pannonia Pilot School - first private pilot school Reasonable costs when compared with other countries
INTERVIEW
BOOKS AND ARTS
AIR TRAINING
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Croatian Business & Finance Weekly Established in 1953 Monday / 15th November / 2010 Year IV / No 0130 www.privredni.hr
S U P P O R T E D
Another Milestone eople often say that time seems to go quicker as one gets older. To me, it does not seem a year since I last wrote a small introduction to mark the start of our third year of publication. Now, I find I am writing again to mark the start of our fourth. In Croatia, as on the global scene, we hope we have seen the back of the crisis which has so bedevilled everyone over the past period and I am sure we are all hoping for a prolonged period of general economic strengthening. As usual, we in Privredni vjesnik and PVInternational aim to keep you up-to-date on all developments within the country and the wider region, through our usual mix of interviews, analyses, views from business leaders and more. It is our view that, as the period until Croatian accession to the EU becomes shorter, our task in reporting events in this country will become ever more important. Thank you for subscribing to PVInternational, and I trust that you will continue to find our ‘menu’ of items valuable.
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Darko Buković
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pvinternational pv international C R O A T I A N
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18TH OPATIJA ECONOMIC CONFERENCE CROATIAN ECONOMIC POLICY IN 2011
GOVERNMENT AIMS TO GROW ECONOMY BY 1.5% Investment is no longer to be supported through the budget but to be made available via private channels proposes Prime Minister Jadranka Kosor Vesna Antonić he Croatian Prime Minister Jadranka Kosor believes her government requires no IMF assistance, as local experts have sufficient strength and knowledge to solve current problems. In addition she is positive about the successful closure of EU negotiations and the conclusion of the accession agreement, as stated in her speech at the 18th Opatija Economic Conference Croatian Economic Policy in 2011. “Everything we have achieved in the fields of the economy and economic policy is reflected in the European Commission report on Croatian progress as part of the negotiations. We have put great effort into the negotiating process, the results of which are now becoming noticeable”, concluded Prime Minister Kosor. “Croatian EU membership will not solve all our problems, however, we are surely on the right path’’, added Kosor.
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Actions more important than words She pointed out that the government economic recovery programme has been supported by the World Bank, the IMF and governor of the Croatian Nation-
al Bank, Željko Rohatinski. “The Croatian economic upturn should be based on private initiatives and investment rather than depending on the state budget. The government has developed a catalogue of 30 priority projects with a value of €14 billion. If at least 10 of these are launched by the end of 2010 or spring 2011, they will certainly affect our overall economic success in a positive manner”, concluded Kosor. The government plans to achieve economic growth of 1.5% in 2011. However, the anticipated rate could be exceeded if at least some investment proves successful. While discussing proactive economic recovery measures, Branko Grčić, Dean of the Split Faculty of Economics, concluded that the measures are still not visible despite the fact that time is running out. In his opinion, Croatia will face another ‘’lost year’’, undoubtedly resulting in additional borrowing. Ivan Lovrinović of Zagreb Faculty of Economics concluded that the Croatian National Bank (HNB) is sitting on a high level of reserves, which is completely unnecessary, particularly when con-
sidering the current situation in the country. He proposed the approval of state directed funding at HNB within certain limits. In his opinion, the Croatian approach to the crisis shows that both our monetary and fiscal policies are restrictive, signs of significant economic depression. A lack of trust is exacerbating the lack of investment, which should be restored and strengthened by both government and the National Bank.
2 VIEWPOINT
Privredni vjesnik Year IV No 0130
MATO VIOLIĆ, OWNER AND MANAGER, MATUŠKO VINA, PELJEŠAC
Only top wines for export
All categories of wine show a steady trend in over-capacity. All producers need to work together
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otwithstanding a slight increase in volume, the current grape harvest on the Pelješac peninsula has not met expectations, since the grape quality is only average. The last three harvests of extraordinary quality have been quite memorable, unlike the current one which stretched out until mid-October. A 40% increase in the total harvested is not welcomed since new vineyards also yielded crops thereby exacerbating a wine surplus. Current stocks show a lower level of sales to the local market and Croatian wines have not yet expanded into international markets adequately enough. All categories of wine show a steady trend in over-capacity. Hence, the urgent necessity for all producers to work together is of paramount importance. The only solution lies in expanding into international markets, particularly those having little or no internal wine production and those showing an increase in wine consumption. Plavac mali, as the most productive local varietal, is one of Croatia’s main assets. Only the top Croatian wines should be sold on the international market. Therefore wine producers should expect more active government involvement in branding Croatia as a wine country. The fact is that government has a crucial role in this process, which includes close co-operation with the Croatian Chamber of Economy, wine producers and wine cooperatives. However, each wine maker should take responsibility IMPRESSUM: Privredni vjesnik Kačićeva 9 10000 Zagreb +385 1 5600020 uprava@privredni.hr www.privredni-vjesnik.hr/ subscription
( 20 European countries use Rasco ploughs, machines and equipment
Interview with Frane Franičević, Rasco
Future plans in setting up prod
The situation in Croatia will improve only the general public and operating to the Igor Vukić
for their individual wine sales. The newly established Winemaker Coordination is more than welcome as it should develop a clear set of rules for the industry. The services of internationally renowned marketing, promotion and branding experts are also required, since Croatia has always lacked quality experts in these areas. With surpluses in all categories of wine the implementation of quality steps is a prerequisite, since the local market is already inundated with local brands. When top quality international wines enter the market, the situation will definitely worsen. Matuško vina has prepared for the current situation by expanding their cellars. It currently has a 1,000 m2 visitor area, fashionably designed, wine archives as well as cellars with barrique barrels. The whole area is considered to be one of the most beautiful family owned cellars in Croatia. This title has been particularly important as Matuško vina sells a significant part of its wine production to organised tourist groups.
FOR PUBLISHER Nikola Baučić +385 1 4846661 uprava@privredni.hr
IMC MANAGER Dea Olup +385 1 5600028 olup@privredni.hr
EDITOR IN CHIEF Darko Buković +385 1 5600003 bukovic@privredni.hr
TRANSLATION Tr@duco traduco@zg.t-com.hr
EXECUTIVE EDITORS Andrea Marić maric@privredni.hr Vesna Antonić antonic@privredni.hr
COUNSELLOR, INTERNATIONAL OPERATIONS, LANGUAGE EDITOR Ray Fletcher fletcher@privredni.hr
W
hen a company producing snow ploughs sells these products to Norwegians, it is considered as an encouraging success in business. The example of a Croatian company selling their knowledgebased products to Slovenia can also be considered an example of success. Such is the case with Rasco from Kalinovac, a company producing equipment for road maintenance in both summer and winter weather conditions. Their snow ploughs, salt spreaders, mowers and related equipment are used in some 20 European countries. Through its strict quality policy and innovation, Rasco met the conditions of many public tenders in various countries including Norway, Germany, Austria, Slovenia and Romania. In terms of production volume, Rasco is one of the top five European companies in the sector. It exports more than 60% of production with future plans including expansion into the Russian market. Frane Franičević, Rasco Management Board President and co-founder, presents his strategy for entering the Russian market. Our strategy for entering the Russian market is determined by several factors. Firstly, it is important to determine whether road management in Russia falls under the jurisdiction of public or private companies. In addition, we needed an introduction
to their management. Therefore, we tried to find a company which could operate as our agent on the market. To date, we have not decided to open our own branch office, which has been the case with some other countries, particularly Slovenia, Bosnia and Herzegovina, Macedonia, Serbia and Romania. Which criteria have been considered when opting for an agent in Russia? We hired Ru-usluge (Ru-services), a company representing the Moscow International Marketing Centre (MMC), an agency of the Moscow city government operating as a commercial company. We have been very happy with their work so far. Ru-usluge was given a profile of the type of company we were looking for and they contacted one hundred Moscow companies. MMC representatives interviewed and selected 10 whose profiles were closest to our prerequisites. Furthermore, they organised meetings with these companies, and I must admit that none of the interviews was disappointing. All these companies are very interesting and serious private enterprises, and this is an excellent way to find reliable business partners in Russia. If we were to look for them ourselves it would have taken far more money and time. What were the criteria for further selection? We will negotiate further with 3 or 4 companies; those offering the best plans for our business
INTERVIEW 3
( € 6.30 million income for 2010
clude higher exports and also uction facilities in Russia
y when authorised services and public administration actually start serving benefit of economy rather than exploiting them some 3,000 staff, these companies are not regarded as serious competition, since our products are technically more advanced. In addition, the quality of our products has been confirmed in many public tenders in Western Europe - Switzerland, Spain and Italy amongst others. We export our products to Austria, the market with the most rigorous ecological regulations within the EU, which explicitly lays down the amount of salt to be spread over each square meter of road.
in that market. We will evaluate the way in which our ideas for future business match theirs and also the quality of their sales representatives. Their connections and experience with Russian municipal companies is also one of the crucial criteria. The contract will most probably be signed by the end of the year, and the first shipment of machines is anticipated in early spring 2011. What is the estimated total value of your exports to Russia? It is expected that machines and
equipment with a total value of €5 million will be sold by 2015. We believe the Russian market has long term prospects. If we manage to carry out our plans we will be ready to expand our business in Russia by further connecting with Russian partners and producing some of the equipment there. Does Russia have similar facilities? Despite current local competition, which includes 6 municipal equipment factories employing
Rasco is a manufacturing company and a significant exporter. In your experience, what measures should other Croatian enterprises undertake in order to increase their overall production and exports? As an example let us examine monthly salaries in our company. From a gross amount of €0.15 million, almost €68,500 is allocated for taxation and government contributions. Until this burden is reduced we cannot discuss any significant increase in the level of competitiveness. Taxation is a huge burden and government inefficient. We would like to expand our business by building a new plant. Despite the project documentation being completed on time, we still have not obtained all the necessary permits. The regulations and laws are changed frequently and the situation will improve only when authorised services and the public administration actually start serving the general public and operating to the benefit of economy rather than exploiting
them. We should know exactly how to operate in each specific market. Croatia has not enough products to offer for export yet. However, the products which do have potential are not adequately supported by the state. Do you plan new investment despite these difficulties? In the Kalinovac business zone, we are to build a new plant covering 5,000m2. The plant will also be used as a warehouse. In addition, due to its size, production will be easier. Considering our low level of indebtedness, obtaining a €3 million loan to cover this investment should not be a problem. The investment is worth around €4 million and by this approach we will increase capacity up to 2,500 machines annually which will ensure regular production into the future. How do you view your business results on the local market? The global economic crisis has also reflected on our business. In 2009 we saw a reduction of 37% in business internationally when compared with the same period of 2008. However, the crisis is currently slightly less intense and this year we could reach or even exceed our 2008 results. European markets are recovering, although there have been no signs of recovery in the local market to date. In 2009, our total income reached €5.62 million and in 2008 it was €7.53 million. Our plan for this year is to reach €6.30 million but we will most probably exceed this figure primarily due to a recovery in the European market.
4
Privredni vjesnik Year IV No 0130
( up to 70% discount ( less than € 0.10 on Mozaik encyclopaedias
price of some books
Interliber attracts visitors to Zagreb Fair
Books at attractive prices The largest Croatian book fair has again been given an excellent reception. Generous discounts and 250 mainly local publishers attracted potential customers even in financial crisis Krešimir Sočković nterliber, the international book and learning materials fair, is just one of few Croatian fairs not to have been affected by the current financial crisis. The number of exhibitors has not decreased in comparison with the previous year. This year 250 publishers presented their editions and learning materials in two venues at the Zagreb Fair. Božo Biškupić, Minister of Culture, stated at the opening ceremony that this was a most significant event for the publishing industry and literature and that Interliber offers many surprises for potential customers. “Interliber provides a profound insight into the current local and international publishing market. Hence, it welcomes not only book lovers but also many families looking for good books and culture related events. The Ministry of Culture provides financial support and scholarships for writers as an incentive to further their work”, added Biškupić. The Ministry will also introduce additional copyright fees for books borrowed from libraries, which will improve the current state of affairs on the market. According to Biškupić, the Ministry will continue the programme of buying books for public libraries as well as to financially support the translations of books written by Croatian authors into foreign languages. “The current financial crisis notwithstanding, Interliber reflects the strength of the Croatian publishing industry and the creative force of Croatian authors”, proposed Biškupić.
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The most significant publishers Mirela Bartolec, Head Manager of Zagreb Fair, emphasised that the strength of the fair is reflected in the fact that major Croatian
publishers opted to exhibit their products at Interliber, together with international publishers from Austria, Serbia, Iran, Bosnia and Herzegovina, Germany, USA and Great Britain. Books at acceptable prices and free entrance have proved a winning combination since it has attracted many new visitors. Some books were reduced by up to 90%, with several newly printed editions costing less than €0.10. Several publishers decided to use this occasion to promote their new editions. For instance, VBZ has traditionally awarded “The Best Unpublished Novel of the Year” which this year was presented to Aleksandar Novaković for his novel “The Leader”. Naklada Ljevak presented more than 10 new editions, among which the most prominent are two books written by Miljenko Jergović – the novel “Dogs on the Lake” and a collection of art essays “Does the World Remember Oscar Schmidt?”. Additional Naklada Ljevak titles that may be identified are “Debauchery and Sanctity”, a book based on
Mary Magdalene, written by artist and painter, Dimitrije Popović, and “How to Read a City”, a collection of essays on city life and the phenomena of urban nomads, written by Krešimir Nemec. Fraktura introduced 10 new editions, the most prominent being: “Salai’s Doubts”, the first novel in the Salai series written by Rita Monaldi and Francesco Sorti, “Sharp Objects”, a psychological thriller by Gillian Flynn and “Lala”, the first novel published by Polish prose-writer Jacek Dehnel. Verbum presented the Croatian translation of the international Catholic bestseller “Where There Is Love, There Is God”, written by Mother Teresa. Discounts warmly welcomed However the infrastructure of Zagreb Fair proved to be the only disadvantage to otherwise brilliant organisation. Venues 5 and 6, where the Fair was held, are physically separated. Venue 5, intended for larger publishers, was far more attractive than its coun-
terpart. There were less than 40 foreign publishers, whilst many visitors noted a significant decrease in the number of Croatian editions, especially in Croatian prose. The only conclusion is that the publishing industry was indeed affected by the financial
Naklada Ljevak presented more than 10 new editions, among which the most prominent are two books written by Miljenko Jergović crisis, forcing individual publishers to reprint reliable bestsellers. However, discounts, which usually attract visitors to Interliber, were quite impressive. Fraktura fiction titles cost between €1.35 and €2.70 whereas Algoritam reduced individual prices to €4.00 or €6.70. The most significant discount was offered by Mozaik, since their encyclopaedias were reduced by up to 70%.
www.privredni.hr Business & Finance Weekly
A 2-year pilot training programme in Slavonia costs around €50,000 compared with Ireland and Sweden at €90,000 and €120,000 respectively
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PANNONIA PILOT SCHOOL - FIRST PRIVATE PILOT SCHOOL IN CROATIA
Reasonable costs for training
Together with training, the company offers aircraft maintenance services as well as airworthiness certification Svetozar Sarkanjac n addition to the Pilot School at the Faculty of Transport and Traffic Sciences in Zagreb, Croatia now has its first private pilot school - the Pannonia Pilot School in Osijek. The school offers a 2-year training programme for professional pilots, ensuring an internationally recognised diploma, says Miroslav Vlašić, Pannonia Pilot School founder and owner. The school, operating as a branch of the Air Tractor Airline Company, is certified to perform training programmes for both sport and professional pilots. In addition to training, the company offers aircraft maintenance services, as well as airworthiness certification.
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Family Owned Company Air Tractor, owned by the Osijek pilot family Vlašić, has been in the aircraft business since 1993. “We believe that the future lies in knowledge. Therefore we have invested in younger generations, and employ elite professional and experienced local and international pilots from Croatia, as well as the best instructors to train the young”, says Miroslav Vlašić,
who has been working as a professional pilot since 1980. His daughter manages the marketing and sales whilst his elder son is a professional pilot and mechanic. His younger son, with 55 flying hours, is the youngest certified Croatian pilot. Four aircraft and flight simulator Air Tractor has a fleet of 7 aircraft, 4 of which are intended for training. However, future students will not immediately be allowed to fly. After finishing their theo-
The main part of the school and the central site for training future pilots is Osijek Airport retical education, a student must undergo training in the Elite flying simulator (worth more than €68,500), which was purchased in Great Britain. “Training at the Osijek pilot school lasts 2 years. Depending on the students’ professional orientation, they will acquire different levels of licenses. They
Experienced teachers develop future pilots “The Osijek pilot school currently employs 9 theoretical teachers and an additional 9 flying instructors. We employ experienced pilots and expert educators from Osijek, Zagreb and Belgrade”, stated Goran Stevanović, a former class leader at the JAT Flight Academy and a professional pilot with long-term work experience as co-pilot on Boeing 737’s. Today, Stevanović is the director of the pilot school and has held similar positions in India, Kyrgyzstan, Russia and the USA, where he taught several generations of new pilots. can then become either sport or professional pilots by completing their studies in bad weather condition flying. Alternatively, they can become flying instructors with all official authorities”, explains Domagoj Vlašić. The main part of the school and the central site for training future pilots is Osijek Airport. In addition to all necessary instruments, classrooms and cabinets, the site gives access to the aircraft – three single-engined Cessna’s and a two-engine Piper Seminole. The majority of applicants are expected to start at the beginning of 2011, although the pilot school has already welcomed its first students. “The Osijek pilot school opted for the so-called modular educational system which lasts somewhat longer than the integrated
system, but is of higher quality and more secure. The modular system provides more flying hours, thus enabling students to gain confidence. Rather than 180 hours in the integrated system, the modular system provides 230 flying hours. Whilst the integrated system is faster and slightly cheaper, any airline company will employ an individual with a minimum of 230 flying hours”, explains Miroslav Vlašić. The 2-year pilot training programme, including the minimum of 230 hours of individual flying, costs around €50,000. Whilst perhaps high, this sum, when considering the additional costs including accommodation and living, is extremely competitive when compared with both Ireland (€90,000), and Sweden (up to €120,000).
6 WE PRESENT AXIUM EUROPE
Privredni vjesnik Year IV No 0130
VOLIM NOVAC (I LOVE MONEY) WEB PORTAL
Quick method to identify appropriate financial package The portal provides all relevant information and news on banking and other financial services in Croatia
Canadian robotics in the Croatian business ethos Axium specialises in robotics and business process automation. Their solutions are used by several Croatian companies and their Canadian clients include Ford, Honda, Mars and L’Oreal hree years ago, Gordan Šamija tried to persuade Axium Solutions General Director to establish a branch office in Croatia as its excellent geographical position is considered as an intersection between Middle and Eastern Europe. In addition, Šamija believed Croats were renowned for their westernoriented business ethics. Three years later, his opinion of the Croatian business ethos changed slightly, although he remained a strong supporter of a Croatianbased branch office. Upon returning to Croatia together with his family, Šamija eventually became Axium European General Director, and his project proved
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One of the advantages of co-operating with Canada is the time difference: a project can be developed within 17 hours to be successful not only in connecting Montreal with Zagreb and Canada with Croatia and Europe, but also by connecting Canada with more eastern Asian countries. Axium deals in robotics and business process automation. The company promotional video presenting their products is fascinating – within the video it shows a robotic arm carefully sorting small medical phials into a package sent by a pharmaceu-
tical wholesale trader to a pharmacy upon order. Axium robots can be programmed to manage large and small cargos at warehouses, to sort goods by type, paint products with health-damaging materials, thermal welding and other purposes. Their solutions are used by many Croatian companies for example Badel and Kraš, and their Canadian clients include Ford, Honda, Mars, Anheuser-Busch InBev, L’Oreal, Johnson&Johnson and Kraft. Axium international expert teams can perform an analysis of a company situation and requirements and also prepare the appropriate models and simulations. In addition, Axium will develop longterm, cost-effective solutions as previously agreed with the client. Advice more than welcome Šamija says that one of the advantages of co-operation with Canada lies in time management. A project can be started within Zagreb working hours and due to the time difference, their Canadian co-workers can continue project development. “Thus, a project can be developed within 17 hours of one working day without overtime”, explains Šamija. Employees in Zagreb operate in the same way with their Asian business partners. Šamija and Axium Europe are members of the Croatian-Canadian Business Network, always ready to share useful advice with Croatian companies intending to export to Canada, or co-operate with Canadian companies. (I.V.)
he web portal volimnovac.hr provides all relevant information and news covering banking and other financial services in Croatia. The editorial board consists of several journalists who write regular articles on personal finance, as well as web administrators and agencies providing design services or technical support. If the business proves successful and develops in the future, further team expansion is planned. Iva Jurković, Marketing and Sales Manager at volim-novac.hr, points out that, together with browsing the current credit, card or savings situation, a user can also compare different financial services. “By accessing a range of banking and other financial services, volimnovac.hr provides access to a wide range of packages based on the criteria and needs of each individual user”, says Jurković. For example, if the user is interested in housing loans, the wide database of portals with detailed credit terms of all banks in Croatia will certainly be of great help, as well as accelerate the search for the appropriate financial package.
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A year of speculation Jurković points out that she is very happy with the project development to date. The number of users is as expected. In fact, the idea for setting up the portal was based on personal experience in searching for an appropriate housing loan and roaming through bank proposals. “Considering the fact that these searches take up a lot of time, the idea was to develop a project
which would provide all relevant information and comparisons in one place. We were eager to find out whether there were any similar projects in the EU and our research has shown that web portals of this kind are extremely popular and increasingly successful on the international market. Therefore, we put the idea into practice. After a year of preparation and ‘speculation’, this autumn we have managed to launch volim-novac.hr”, she adds. Jurković says that any competition is more than welcome
The creators aim to become the leading intermediary between banks and insurance companies and client as it keeps them “on the alert” and demands continuous work, innovation and improvement. Their ambition for the future is high, she points out, as their aim is to become the first choice for browsing financial services and to become the leading intermediary between banks and insurance companies and clients. (B.O.)
www.privredni.hr Business & Finance Weekly
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CROATIAN FOREIGN CURRENCY MARKET Currency
AUD CAD JPY CHF GBP USD EUR Source: HNB
EUR
Kuna exchange mid-rate
7.37
5,336863 5,326447 6,548600 5,517475 8,633013 5,376580 7,369140
USD
4.52
5.35
4.50
7.35
5.33
4.48
7.34
5.31
4.46
7.33
5.29
4.44
4.27 9.11. 10.11. 11.11. 12.11. 13.11.
EPSI CONSUMER SENTIMENT
Optimism at a low ebb
When compared with countries participating in the EPSI project, the level of pessimism of the Croatian general public mainly revolves around the current economic situation in the country and reduced personal consumer confidence Vesna Antonić he Consumer Sentiment (CS) survey which monitors expectations related to the current economic situation within the participating country and the level of consumer confidence within its general public, has been implemented as a part of EPSI since 2004. Preliminary results for 2010 are currently available for most participating countries where the survey was implemented during August, September and October. Most of the countries included in the EPSI report show more positive results in both sections, particularly when compared with the year before. However, the Croatian survey conducted by Accent, a Zagreb based company, shows the most negative results. When compared with all other countries participating in the EPSI project, the pessimism of the Croatian general public reflects both to the current economic situation and reduced personal consumer confidence over the next 12 months. However, it is encouraging that Croats expect personal consumer confidence to remain at a higher level than the general economic situation in the country, although the basis for such optimism remains unclear. Unlike other countries participating in the EPSI Rating, younger Croatians (under 39) show exceptionally high levels of optimism in comparison with their older compatriots. However, those on a higher income show more positive views than those having a
CHF
7.36
7.32 9.11. 10.11. 11.11. 12.11. 13.11.
WEEK NOVEMBER 15, 2010
5.37
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4.42 9.11. 10.11. 11.11. 12.11. 13.11.
::: news Agrokor credit rating Standard&Poor has upgraded the Agrokor credit rating outlook from negative to stable. According to S & P, Agrokor has significantly improved the maturity dates of its liabilities and liquidity by issuing bonds for €400 million with a maturity date of 2016, as well as by the recent conclusion of a syndicated loan of €352 million. High ratings have been assigned for the trust that Agrokor has within international banking circles. EU strengthend Tax Administration The ‘Mentor’ project aimed at improving the Croatian Tax Administration IT system, has recently been completed after 17 months. It was co-financed by the EU with €1 million which enabled the Tax Administration to introduce VIES (VAT Information Exchange System) and VES (VAT e-services) which will enable the effective communication between tax administrations. In addition, the project has contributed to the fulfilment of obligations in chapter 16 (Taxation).
lower level of income. When specific Croatian regions are considered, the inhabitants of Lika, Kordun and Banovina show an above average level of optimism regarding the general economic situation in the country. However, they are rather pessimistic when considering their personal consumer confidence. Reliability of results As Croatia entered EPSI programme only this year, this is the first time that the CS survey has been implemented. Consequently the results should be evaluated with a certain amount of care in that there is a degree of possibil-
ity that such low results have their origins in particular cultural differences, with results in Croatia being much below the average of other countries such as Georgia, Kazakhstan or Azerbaijan, whose public regularly show a higher level of optimism. However, cultural differences in Croatia have probably not caused the low level of general public optimism since EPSI results in the areas of banking and mobile phone operators for 2010 do not show significant discrepancies with the EPSI average. Hence, the CS results should be considered as a reliable source of Croatian attitudes on the current economic situation.
World Bank requires urgent and rapid reforms Peter Harold, World Bank Director for Central Europe and the Baltic Countries, pointed out in his last interview that Croatia has not yet realised its full potential and growth. Therefore fiscal consolidation is a prerequisite as it is blocking economic recovery. In addition, structural reforms in the fields of health care, social welfare, pensions and public administration need to be quickly enforced. Hongjoo J. Hahm, the new World bank Country Manager for Croatia, added that if Croatia wishes to achieve economic growth of between 5% and 7%, it must provide better private sector developmental conditions.
8 ::: news Arkod System registers 120,000 farmers
The Payment Agency for Agriculture, Fisheries and Rural Development has registered more than 120,000 farmers and some 700,000 hectares of agricultural land in the Arkod system. This covers over 60% of all those obliged to register. Registration will be in force until the end of this year and is a precondition for obtaining state support in 2011. Podravka to produce ‘goulash’ in the US
Recently the Croatian food manufacturer, Podravka, started producing its beef goulash in the American city of Richmond, Michigan. Goulash will be produced by the Giovanni Appetizing Foods Company according to the original recipe and under the brand already established in Croatia. Several years ago the United States implemented a ban on imports of all chicken and beef meat products from European countries in order to prevent contagious diseases. During that ban Podravka was required to produce its goulash for the US market in Australia. 40 Croatian Companies Attend Baghdad International Fair Croatia was the partner country at the 37th Baghdad International Fair, which closed on November 10. 40 Croatian companies presented their products at the Fair and attended round table discussions. In addition they organised a Croatian Day, welcoming more than 250 attendees, advised the Ministry of Foreign Affairs. Representatives from 60 countries participated in the event. Currently, 14 Croatian companies are operating in Iraq.
Privredni vjesnik Year IV No 0130
CROATIAN WINES PRESENTED IN NEW YORK AND CHICAGO
CROATIA MOVING TOWARDS THE TOP OF THE GLOBAL WINE LANDSCAPE Recently, Ivica Matošević the owner of the Matošević winery, and Ernest Tolj, the owner of Saints Hills, achieved a major breakthrough in the American market Jozo Vrdoljak s a result of their recent joint appearance in New York and Chicago, Ivica Matošević, the owner of the Matošević winery, and Ernest Tolj, the owner of Saints Hills, achieved a major breakthrough to the American market. Although the New York Plaza Hotel usually welcomes the more exclusive presenters of large global wine regions and wine houses, such as those from Bordeaux, this time its management opted for Croatian wines. The Chicago wine-tasting was organised at the up-market restaurant ‘Tru’. Matošević and Tolj presented wines from a country whose competitiveness on the global market has been in doubt to many. Matošević presented a selection of both new and vintage malvasia wines, as well as red and white coupage ‘Grimaldo’, whilst Tolj opted for Dingač and Nevina, which is a Malvasia and Chardonnay coupage. The Croatian wine selection was completed by a selection from the Bibich and Karaman wineries. “Currently, Croatia represents one of the most exciting wine regions. Wineries like Matošević and Saints Hills make incredible wines from the excellent coastal terroir”, opined Fred Dexheimer, a noted wine consultant and New York Times wine panel participant.
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Internationally renowned quality Mike DeSimone and Jeff Jenssen who write for influential magazines such as Wine Spectator and Wine Enthusiast under the name World Wine Guys, appear to share Dexheimer’s opinion. “During our recent visit to Croatia, we discovered that Croatian wines are actually world class. From Matošević in the north all the way to the south-
Croatian winemakers Matošević and Tolj in The Plaza Hotel, New York
ern Saints Hills winery, we were very impressed by the quality of both local and international varietals. We are highly delighted that these talented wine makers have presented their selection at the famous ‘The Oak Room’, thus combining their wines with great food. The tasting was informative, fun and a huge success. It is time these excellent wines took their place on the world scene which rightfully belongs to them”, they concluded. Cliff Rames, the Plaza Hotel sommelier and the spokesman for
Croatia currently represents one of the most exciting wine regions, suggests Fred Dexheimer Croatian wines in the USA under the brand Wines of Croatia, suggests that, through their presentations Matošević and Tolj have announced Croatia’s entrance on the world wine landscape. “The wines presented in New York and Chicago were characterised by quality, character and originality, all of which position them amongst leading world brands. Anyone who is willing to explore new territories and discover the unique Croatian wine scene with
its local varietals will be pleasantly surprised”, believes Rames. A dream comes true American wine experts particularly stress the fact that the American market is currently oriented towards discovering new wine varietals and regions such as Croatia. “The public response was good, as were the reactions of wine experts and this has been a big surprise to us. Those visitors asking for an additional glass of wine were positively surprised. This confirms that we are on the right path and that a significant opportunity lies in the presentation of extraordinary and original wines, offering a completely different experience”, proposes Tolj, whose Dingač especially stood out in the review of Lindsay Ronga. Matošević returned to Croatia with exactly the same impressions. Ed McCarthy, author of Champagne for Dummies, enjoyed Matošević’s ‘Grimaldo’. “Croatia is reaching the top of the global wine scene. Presenting wines in such a legendary place as that in New York is an acknowledgement itself. Ten years ago we could only dream of such reactions to our wines. Who would have thought that the dream would come true in New York with our malvasia and plavac mali”, said Matošević.