Croatian gold market From tax record breaker to one of the biggest global gold exporters
Results for the first three months Compared with the first quarter of 2011, this year’s gross profit reduced by 73%
Interview: Natalija Mataić Exit from CEFTA seriously affecting wine exports, says Board President of Kutjevo
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Croatian Business & Finance Weekly Established in 1953 Monday / 9th July / 2012 Year V / No 0207 www.privredni.hr
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HAMAG becomes firstclass guarantor The Croatian Agency for Small Enterprises and Investment now offers companies unconditional guarantee at first call. If the entrepreneurs cannot repay the loan, the guarantee can be immediately activated and the bank will receive its money in 30 days Igor Vukić he Croatian Agency for Small Enterprises and Investment (HAMAG) prepared top quality institute for promoting small and medium size companies – unconditional guarantee at first call. If the entrepreneurs cannot repay the loan, the guarantee can be im-
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HAMAG’s gurantee potential doubled to HRK2 billion by the decision of the Government mediately activated and the bank will receive its money in 30 days. This will motivate banks to intensify crediting of smallsized entrepreneurs, pointed out Darko Liović, Board President of HAMAG-Invest, at last week’s business lunch with entrepreneurs organised by the Croatian Employers’ Association. Liović and Anton Kovačev, Board President of the Croatian Bank for Reconstruction and Development (HBOR), presented changes to
credit and guarantee monitoring of the development of SMEs. HAMAG’s gurantee potential doubled to HRK2 billion by the decision of the Government, and this is the basis for greater risk taking, pointed out Liović. He admitted the banks had rarely accepted guarantees of the Agency since a fast collection of the guarantee did not exist. Now they reached an agreement with eight of the biggest banks according to which SMEs could obtain capital for entrepreneurial project in a much more simple way. Even some savings-credit unions expressed their desire to join these guarantee schemes. Besides the banks, the guarantees will also be issued to leasing companies (for equipment and machine
procuring), and sometimes even between two entrepreneurs. The processing of the application for the guarantee should last up to seven working days, says Liović. He added HAMAG is already processing 80 entrepreneurial projects which proves the entrepreneurs recognised their guarantee and loan possibilities. Stricter control over spending Liović said the analysis of last year’s non-repayable subsidies showed the average subsidy totalled only around HRK6000. Therefore, this year’s subsidies will total around HRK87,000, which a sum the entrepreneurs could really use to start realising their business ideas. However,
stricter control will be introduced over spent money and it will be checked whether the users of subsidies are following the suggested plan. Anton Kovačev said HBOR’s credit potential totals HRK7 billion for this year. Credit lines for agriculture, industry, tourism and renewables are offered at favourable interest rates of 1%, 3% and 5%. This year, a sum of HRK840 million has already been allocated to SMEs, which is two and half times more in relation to the same period of 2011. The loans will be approved within the shortest possible period of 30 days, and for the amounts of above HRK50 million, it will be necessary to obtain compliance of the Supervisory Board of HBOR.
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Privredni vjesnik Year V No 0207
Tomislav Čizmić, CO of Autocommerce Hrvatska
Industrial production fall slowed down in May
Eco-excise tax – impetus ANNUAL FALL - 3.8% for local car market T
ocal car market is on its knees – sales of new cars have plummeted over 60% with sales of second hand cars dropping even further, whilst a dramatic decrease in turnover has been noted throughout accompanying activities. Hence, almost 8,000 jobs or one third has been lost in industry within gloomy market outlook. Two questions appear to be crucial: have we finally reached the bottom or can we still plunge further; and secondly, can market be given impetus in any way? Both answers are affirmative, which has both positive and negative implications. The Greek example has shown that a 60% plunge in car market sales is a viable possibility and we have simultaneously been given the opportunity to adjust our excise tax system with the EU practices and use it to our own advantage. One move can imply three positive consequences – revive the car market, increase the state budget which is facing a severe crisis, due to reduced excise tax on cars causing a loss of over HRK1 billion and enable general public to save
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State budget would significantly increase with enhanced sales of new cars on fuel. Implementation of eco-excise taxes is fundamental as it will account for changes in the current practices of charging excise taxes primarily in relation to the value of the vehicle, discouraging the purchase of technologically advanced energy efficient vehicles. Whilst the implementation of eco-excise taxes in Croatia is indisputable due IMPRESSUM: Privredni vjesnik Kačićeva 9 10000 Zagreb +385 1 5600020 uprava@privredni.hr www.privredni-vjesnik.hr/ subscription
to EU requirements, the impact of implementation of a new excise tax system will depend primarily on the courage and determination of the government and on the impact of eco-excise taxes on the purchase of energy efficient vehicles in real terms. The situation is absolutely clear – the lower the prices of energy efficient cars, the greater the demand for them. Hence, huge savings for everyone are implied. In addition to savings, market analysis shows that improvement of sales of new cars will have a significant positive impact on the state budget. Car sales in Croatia of around 40,000 annually are currently over three times below the market potential which has been estimated to stand at around 150,000 new cars annually in real terms. Enhancement of energy efficient car sales will explore Croatian market potential and the budget will increase irrespective of lower excise taxes. Consequently, increase in car sales implies revival of motor industry and creation of thousands of lost jobs.
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 Lučana Banek lucanab@gmail.com Mirjana Cibulka mirjana.cibulka@gmail.com
EXECUTIVE EDITORS Andrea Marić maric@privredni.hr Vesna Antonić antonic@privredni.hr
INTERNATIONAL OPERATIONS Ray Fletcher fletcher@privredni.hr
he industrial production continued its negative annual changes during May, although at slightly less intensity. According to the adjusted data provided by the Central Bureau for Statistics, the volume of the industrial production registered a decrease of 3.8% per year in May (compared with -9.4% in April), while the number of industrial workers reduced by 3.7% on a year-over-year level. Considering the industrial production registered considerably intensive fall rates even during the first four months of 2012, cumulative data for the period between January and May point to a 6.3% decrease in industrial production in relation to the same period of 2011. Besides weak local demand, the industrial production was also negatively influenced by the adverse trends in the EU (Croatia’s most important foreign-trade partner) or weaker foreign demand. Concerning the categories of the main industrial groups (GIG), all activities, except non-durables for broad consumption, registered decreased production in May, where the biggest drop was registered by intermediary products (-8.8%) and durables for broad consumption (-5.7). According to the national classification of activities, the fall in the processing industry slightly slowed down (-2.4% a year in May). However, con-
sidering long-lasting negative rates, the cumulative fall during the first five months totals 5.9% on a year-over-year level. Even though on a year-on-year level the production of coke and refined oil products increased by 7.5% in May, during the
first five months it registered a 16.1% decrease. Furthermore, metal production has continued its strong fall (-20% in May) due to problems of the two biggest factories Željezara Sisak and TLM from Šibenik. Therefore, this activity has also registered a strong employment drop of 29.2% per year. High drop rates are still generated by the machinery production (-35.8% per year in May). Considering the decreased local and foreign demand, RBA analysts do not anticipate any significant improvement in the industrial production over the next few months. (V.A.)
Deterioration of trends anticipated
Will we reach rock bottom in the second quarter? he Central Bureau for Statistics confirmed the GDP drop of 1.3% during this year’s quarter. The data also confirmed a decrease in personal spending (-0.3%), state spending (-1.5%) and investment (-2.8%). The second quarter reveals the public’s inhibited spending due to the unstable labour market and fall in real income. Slower import is also becoming
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more obvious. The decreased demand and low business mood has a negative effect on the entrepreneurs’ investment plans, so it is less likely to expect any serious steps forward in the area of private investment. Until the first GDP outlook for the second quarter is published at the end of August, we anticipate a 1% fall of the real GDP in 2012, says Ivana Jović, PBZ analyst. (V.A.)
www.privredni.hr Business & Finance Weekly
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( to over 20 countries ( HRK186 million Kutjevo wines exported
investment value during the last several years
INTERVIEW: NATALIJA MATAIĆ, BOARD PRESIDENT OF KUTJEVO
Exit from CEFTA seriously affecting Croatian wine exports Grey market, accounting for 40% to 50% of total Croatian wine production, is significantly adversely affecting Croatian wine producers and aggravating their position Drago Živković ecanter, the most eminent wine magazine, has awarded gold medal to Kutjevo Graševina ice 2009, whilst Maximo Bianco 2010 received a recommendation. In addition, these wines received gold medals at the Brussels-based Concours Mondial competition. Similar recognition substantially assist market global penetration, according to Natalija Mataić,
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Kutjevo wine exports stood at 2.1 million litres, which accounts for 55% of total Croatian wine exports Board President. Nevertheless, exports cannot flourish without promotion of Croatia as a wine country. What is your opinion on the situation in the Croatian wine market in 2011 and in 2012? The Croatian wine market underwent significant changes towards the end of 2010 when the structure of consumption commenced changing. Both demand for and consumption of top quality wines has seen a decrease in Croatia, whereas the demand for lower price wine is increasing. Imports trends follow the same pattern – the level of wine imports is increasing, irrespective of the price per bottle. Low-cost wines from Montenegro and Macedonia are currently mainly imported. Grey market, accounting for 40% to 50% of total Croatian wine production, is adversely affecting
Croatian wine producers and seriously aggravating their position, since many have burdened their production with loans for plantations of new vines, purchase of new equipment and construction of facilities. What will change for Kutjevo following the Croatian EU accession? Kutjevo exports in 2011 stood at 2.1 million litres, which accounts for 55% of total Croatian wine exports. Croatia mainly exports to CEFTA markets. Following the Croatian EU accession, her business environment will change substantially and hence we are in continuous contact with the Ministry of Agriculture and the Croatian Chamber of Economy in order to be able to keep the existing benefits of Croatian exports to CEFTA primarily concerning the increase in exports quotas. If export quotas do not increase, Croatian wine exports will be seriously threatened. Hence, we are intensely focused on penetrating new markets and we have managed to increase our sales in Germany, Denmark, Belgium and the USA. In addition, we are negotiating with partners in Poland and in Asian countries. An increase in sales turnover in these markets would compensate for a potential loss in CEFTA markets. Nevertheless, we do not anticipate market disruptions in case EU export quotas increase. What was the investment value in Kutjevo during the past several years? What do you mainly invest in? Investment value during the past several years has stood at over HRK186 million, where
Medals opening doors
Kutjevo is one of the most award winning Croatian wineries. How does it promote exports? Increase in exports is fundamental for Croatian wine industry. Nevertheless, creation of a Croatian wine brand is crucial in expansion of Croatian exports. We have not projected such an image globally thus far which implies that Croatian wine producers will manage to achieve from 20% to 30% lower prices for wine varieties on par with those produced by their French counterparts. Creation of an image or the brand of a wine country is a long-term process which cannot be completed by one producer alone. Every producer needs to play their part. We are contributing by sending our wine samples to a copious number of global ratings which has proved extremely favourable concerning market expansion. A medal received at the globally acknowledged wine rating opens many doors and is a valuable reference. Kutjevo is currently exporting to over 20 countries throughout the continent. investment in winegrowing and wine production stood at HRK86 million. Material resources are managed by planning concerning quantity and their timely availability. In addition, effective use of material resources is monitored with particular attention on infrastructure maintenance to
name several prerequisites for Kutjevo competitiveness. It is almost impossible to significantly impact on other environmental factors, particularly those concerning the economic crisis, movements in global capital markets or constant segmentation and market fragmentation.
4 ::: news
Privredni vjesnik Year V No 207
ABSURDITIES OF THE CROATIAN GOLD MARKET: CROATIAN GOLD
From tax record bre of the biggest globa Polyclinics profitability HRK309 million total revenues or 8% up over 2010 was generated by six major polyclinics in Croatia. Medikol Polyclinic total revenues account for almost one half or HRK161 million, according to the ranking of six major private health facilities published by the Banka magazine. Polyclinic Sunce, which generated HRK92 million total revenues in 2011, ranked as the second, whilst Svjetlost with HRK32 million ranked as the third. Tourism revenues increasing During the first four months revenues in accommodation services, food preparation and serving, as well as in travel agencies and travel organisers stood at HRK4.2 billion or 4.9% up over the same period last year. Natural and legal persons in accommodation services in hotels and similar facilities generated HRK1.4 billion revenue or 12.4% up, according to the data provided by the Ministry of Finance. Revenue generated by camps stood at HRK36.3 million, which was an increase of 14.4%, whilst tour operators’ revenue totalled HRK66 million or 17.7% up over the same period last year. Euromoney awarded Konzum The British magazine Euromoney has published the award winners of the 8th ranking of the most successful companies in Central and Eastern Europe. Konzum won the first award as a company with the most convincing and coherent business strategy in the category of general consumption and retail. Euromoney is one of the most influential magazines in capital market and money milieu. It provides detailed analysis of global economic and financial movements.
On the one hand, enormous quantities of gold are being exported from Croatia, and on t category of investment gold and a total of 60% of tax is paid on each piece of gold. That price of gold relatively low on the local market Goran Šikić hese crisis times have forced people to literally take their family gold out of their hiding places and sell it, while gold buyers have appeared almost everywhere during the past few years. Almost nine tonnes of gold was exported from Croatia by May, which is almost the exact amount of gold
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In 2011 we exported nes of almost nine tonnes d gold and imported only 7.2 kilograms exported during the entire 2011, according to o data provided by the Ministry inistry of Economy that issues licences for gold import or export port to registered companies or crafts. The gold market in Croatia has become distorted almost to an unrecognisable level. According to my knowledge, we are the worst country in the world in these terms, commented Sven Sambunjak, owner of Srebrozlato.com portal, specialising in precious metal investment. According to Sambunjak, Croatia has record high tax on gold with far reaching market consequences. Gold products are divided in two categories in the EU - investment gold and other gold, including jewellery. Investment gold, bars of certain weight and coins by definition, are free of tax in the EU, while other gold products are subject to VAT. Croatia does not recognise these categories and all gold products are subject to 60%, which includes 25% of VAT, 5% of custom fees and 30% of luxury tax. No business logic
exists in exi owning a owni medium-sized small-sized or medium company and surviving such a tax, pointed out Sambunjak. Double capital outflow Then what caused the boom of gold repurchase shops? Their business model enables them to legally avoid paying any tax since they do not sell gold; they merely repurchase it and export it abroad. As a result, Croatia has become of the world’s biggest gold exporters since we export 150 times more gold than we import it. Last year we imported €33.5 million worth of gold and imported only €200,000,
almost like we have a gold mine points out Sven Sambunjak Indeed, in 2011 we exported almost nine tonnes of gold and imported only 7.2 kilograms, according to data provided by the Ministry of Economy. Therefore, the existing legal framework supports the logic of repurchasing gold from the public and exporting it abroad, but it does not support the business logic of repurchasing gold and selling it to other members of the public. Therefore, on the one hand we export enormous quantities of gold, and on the other hand people who want to invest in gold travel abroad to do it. Through his portal Sambunjak cooperates with other foreign
Goldsmiths face great problems In relation to gold purchasers who will close their shops once the people ran out of gold, goldsmiths are a different story, but they are facing big problems due to heavy taxations. A good example is Zlatarna Celje that has an equal number of outlets in Slovenia and Croatia, but 80% of turnover is generated in Slovenia. Croatians visit their outlets in Croatia, take one look at the prices and then head off to Brežice since the prices in Slovenia are 40% lower, explains Sven Sambunjak.
www.privredni.hr Business & Finance Weekly
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EXPORT 150 TIMES GREATER THAN IMPORT
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eaker to one al gold exporters
the other hand people travel abroad to invest in gold. Croatia does not recognise the t is why all repurchased gold is distributed abroad, and this kind of situation keeps the they could offer it at competitive prices on the local market, the increased demand would raise the price. However, due to high tax, the offer is missing and all gold goes abroad. This kind of situation maintains the price of gold in Croatia artificially low in relation to the price abroad. Absurd provisions However, with time this difference would decrease due to bigger competition amongst purchasers, or the fact the price of gold has not raised drastically for almost a year. According to Sambunjak, when we join the EU, we will be forced to make changes. However, it remains to be seen whether these changes will be substantial and companies and enables the public to invest in gold. Therefore, people can legally export their capital and buy investment gold at 0% tax abroad, where they keep it safe. Therefore, they do not have to pay any tax since they do not import it into Croatia. Thus we have a double outflow of capital; gold outflow on one side, and another outflow of money used to buy gold with abroad. Actually, the state does not benefit at all from the entire process, but maintains extremely high taxes with a questionable effect. Difference in price Furthermore, on the basis of this high tax, the difference between the purchase price in Croatia and abroad is dramatic, sometimes between 30% and 40%. In other words, people who sell their gold in Croatia gain much less than they would if they sold it abroad. This is logical since it does not pay off for companies that repurchase gold to offer the same gold on the Croatian market. If
Last year we imported â‚Ź33.5 million worth of gold, almost like we have a gold mine points out Sven Sambunjak whether they will be made at the moment of the accession. Out of all economic branches, the field of precious metals is by far the most regressive compared with the EU, points out Sambunjak, adding the problem is not in the tax, but in other legal solutions. For example, the Open Investment Funds Act already contains a provision that explicitly bans investment funds to invest in gold and anything related. Such a provision is unimaginable in the normally developed world. The open investment fund in Croatia may not offer people to buy shares in gold, which is completely normal abroad, where you invest â‚Ź100 and buy a gram or two of gold, says Sambunjak. Furthermore, the penal code de-
fines gold trade in Croatia as a criminal act. In short terms, there is a negative sentiment in Croatia when it comes to precious metals. Why is the state so much against investing in gold? One logic reason is that the state would lose control over the monetary system since the gold falls outside its scope. However, these provisions would be logic if our foreign currency legislation would be restrictive and foreign currency would not be allowed to be bought or sold. Then all this would make sense. But this is not the case; the Croatian foreign currency is completely liberal, which makes these provisions on gold totally absurd, Sambunjak regards. What if the price of gold goes up? Today, in the situation of global monetary crisis, all those wanting to stabilise their investment portfolio consider precious metals. If the monetary crisis continues to complicate, I fear we will suffer great damages as a country. What if the gold becomes even more appealing? No one in Croatia will be able to reach it, Sambunjak says. What will happen when we enter the EU? Custom duties will be removed, tax will be halved, and I am not sure what will happen to luxury tax since the state administration does not pay any attention to this. So what can happen is that special companies open only for Croatians in border zones of Hungary and Slovenia, where people will go to buy gold free of custom duties, VAT and luxury tax. It would not surprise me if shopping tours become popular, like in the past when people went shopping to Trieste. Maybe than the people in charge will realise how absurd all of this is, and things will start to change.
Bad debt threatening business The Croatian Chamber of Economy has deliberated on a Draft law on pre-bankruptcy financial transactions and bankruptcy proceedings. Consequently, it has positively assessed the proposal to address the issue of bad debt by summary proceedings, since it is a major threat to businesses. Members of the Croatian Chamber of Economy have fully approved the enactment of the draft law and highlighted that the prebankruptcy agreement proceedings need to be simplified and a copious number of companies, particularly small businesses, need to be entitled to summary bankruptcy proceedings. Incentive payments The Agency for Payments in Agriculture, Fisheries and Rural Development has commenced payment of the second round of incentives for 2011. Hence, around HRK1.15 billion will be paid in the near term. The second round of direct payment for 2011 comprises incentives for capital investment, eco-agricultural production, integrated agricultural production, areas with aggravated conditions of agricultural management and payments for production output in crop farming and cattle breeding. 22 new Porsche cars registered Sales of new cars in Croatia have continued a downward trend. According to the data provided by the agency Promocija Plus, 20,201 vehicles for personal use were registered during the first six months in 2012, which is 2,936 vehicles less or 12.7% down in relation to the same period last year. The best selling car brand during the first six months in 2012 was Volkswagen. The most vehicles were registered in Zagreb and surrounding areas (6,969), as opposed to LiÄ?koSenjska County with 84 registered vehicles. Nevertheless, a remarkable 22 Porsche cars were registered during the first six months in 2012.
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WE PRESENT
WOOHOO.HR
Privredni vjesnik Year V No 0207
AGILE CROATIA
Internet platform for the creative From volunteering to more effective software Launched in August 2011, Woohoo.hr, hosting over 6,000 hand-made items, is currently advertised by over 1,200 craftspeople oohoo.hr is a unique platform for advertising and sale of hand-made items both locally and throughout the region. Woohoo internet service portal was launched by three friends: Andrea Kučiš, an economist, Boris Kovačev, a Cropix photojournalist and Nebojša Grbačić, editor and web consultant. Woohoo.hr was launched in August 2011 and it currently hosts over 6,000 handmade items advertised by over 1,200 craftspeople. In addition, over 1,000 orders have been placed through the portal thus far.
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Over 1,000 orders placed through the portal According to Grbačić, the web site hosts mainly hand-made items, whereas the system is based on communication through intermediaries. The platform primarily focuses on promotion of craftspeople and their work and it serves as an intermediary for customer orders, whereas further communication concerning delivery, additional customer requirements and other issues can be arranged direct. The craftspeople advertising through the portal are mainly enthusiasts of hand-made crafts who, encouraged by the sales of their hand-made items, have turned their hobby into a small business.
Many of them were prompted by high demand and ample room in the market. Hence, the portal hosts a wide range of handmade items: jewellery, handbags, baby clothing, sculptures and illustrations to name a few. Business advertising model used by Woohoo.hr is Freemium service. Interest is not charged for transactions as profits are generated by the sale of advertising space. Three advertising models are available: one is free of charge, whereas monthly rates for other models stand at HRK69 and HRK169. In addition, craftspeople are promoted on Facebook with currently around 10,000 fans, as well as on Twitter, Instagram, Pinterest and other platforms. According to Grbačić, the concept behind Woohoo.hr is due to Andrea Kučiš, the company Director, who originally intended to promote her own hand-made items. Subsequently, she decided to bring together enthusiasts of hand-made crafts with the assistance provided by Kovačev as the project investor and Grbačić as a web expert. Following several months of research, around 1,000 craftspeople were contacted initially and their response was amazing. Consequently, do!ts, a magazine for hand-made culture, was launched several months later and we are currently working on its third issue. (J.F.) OBJ
The primary goals of the association are promotion and agile software development in Croatia, as well as professional development of its members gile Croatia is an association drawn from the general public engaging in agile software development methods in Croatia. The concept is often used in IT concerning project management, engineering practices or company management in order to enhance operational effectiveness. The primary goals of the association are promotion and agile software development in Croatia, as well as professional development of its members. Agile Croatia achieves its goals by organising public gatherings, lectures, public discussions and conferences and through co-operation with competent institutions in drafting regulations concerning software development. Zvonimir Križ, President of the Association, emphasised that Agile Croatia operations primarily focus on individuals who directly or indirectly participate in software production. “The concept behind the foundation of the association originated when we identified huge interest in the topic in Croatia and there were no associations operating and promoting a similar way of thinking in Croatia at the time. Hence, several
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of us, who had already been involved in agile development, decided to found the association”, he explained. The company LinkedIN network consists of over 150 members and their number is increasing almost daily. Everyone involved works on a voluntary basis and employment is currently not planned. The association has not significantly co-operated with state institutions thus far. “Nevertheless, we are planning to become actively involved in addressing the issues in Croatian IT at the state level. We have already taken several steps, yet we are only in the inception phase”, stressed Križ. Hence, the association will primarily focus on promotion of agile development in Croatia and assist companies and individuals to adopt it more easily and in a quality manner. “In addition, our goal is to become the strongest agile community in the region. We would like to bring together agile groups from other countries and prompt them to act jointly. We have already achieved high level co-operation with our Slovenian colleagues”, he highlighted. (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
Kuna exchange mid-rate
EUR
7.53
6,205657 5,957292 7,570399 6,235114 9,401212 6,048736 7,487125 WEEK JULY 7, 2012
USD
6.05
3.7.
4.7.
5.7.
6.7.
6.27
7.52
6.03
6.26
7.51
6.01
6.25
7.50
5.99
6.24
7.49
5.97
6.23
7.48 2.7.
CHF
5.95 2.7.
3.7.
4.7.
RESULTS FOR THE FIRST THREE MONTHS OF 2012
HRK2.5 billion – gross profit of entrepreneurs
5.7.
6.7.
6.22 2.7.
3.7.
4.7.
5.7.
6.7.
::: news General purpose loans with insurance Hypo Alpe-Adria-Bank and BNP Paribas Cardif have recently signed a contract on business co-operation which enables the clients to obtain general purpose loans with insurance against nonpayment. Hence, loan users can adapt their monthly instalments in case of adverse circumstances, such as lay offs or temporary incapacity for work, by an additional loan repayment insurance, since BNP Paribas Cardif insurance will cover the payment of monthly instalments during a specified period of time. In addition, Hypo Alpe-AdriaBank is providing specific terms and conditions for these loans within the co-operation scheme.
Compared with the first quarter of 2011, this year’s gross profit reduced by HRK6.9 billion or 73% uring this year’s first quarter, Croatian entrepreneurs, taxable profit payers, excluding banks, insurance companies and other financial institutions, generated gross profit (total income minus total expenditure) of HRK2.5 billion, according to data provided by the Financial Agency. In relation to the first quarter of 2011, when gross profit totalled HRK9.4 billion, in the first quarter of 2012 gross profit decreased by HRK6.9 billion (-73%) to HRK2.5 billion. The main reason is the decrease in total income of entrepreneurs in the shipbuilding sector (-84.1%). Actually, during the first quarter of 2011, the shipbuilders generated high super-normal profit on the basis of expropriation according to the decision of the Croatian Government. Furthermore, profit decrease in the first quarter of this
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year was partly influenced by smaller volume of industrial production and construction activity in relation to the same period of the year before. During the first three months of this year, the Croatian entrepreneurs generated HRK135.9 billion in total income and HRK133.4 billion in total expenditure, with gross profit (surplus of income over expenditure) HRK2.5 billion. Compared with the same period of 2011, totalled income decreased by 0.8%, while total expenditure increased by 4.5%. Most income on the local market Traditionally, the biggest share of income is realised on the local market where HRK102.3 billion worth of goods was sold in the first quarter of 2012 (3.8% more in relation to the same period of
2011). At the same time, sales on the foreign markets increased by 2.7%, generating income of HRK21.2 billion. This continued the positive trend of increasing export and the number of entre-
Positive trend of export and entrepreneurs increase continues preneurs who sell their goods and services on foreign markets. During this year’s quarter, the entrepreneurs set aside HRK7.7 billion in fixed assets, which is a 7.2% increase on a year-on-year level. According to data provided by Fina, these results were achieved by 88,299 entrepreneurs, of which 805,668 were employed, which is 1.6% more in relation to the first quarter of 2011. (V.A.)
HT share purchase Croatian Telecom, the leading telecommunication services provider in Croatia, has been notified that Raiffeisen Mandatory Pension Fund Management Company has purchased its shares. Damir Grbavac, Board President of Raiffeisen Mandatory Pension Fund Management Company is also a Member of the Supervisory Board of Croatian Telecom (HT). Grbavac purchased 3,278 Croatian Telecom equities on behalf of Raiffeisen Mandatory Pension Fund Management Company at HRK203.2375 per share. These shares account for 0.0040% of Croatian Telecom equity.
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Privredni vjesnik Year V No 0207
DOUBLE TREE BY HILTON IN ZAGREB NEXT AUTUMN
Hotel bookings for 2013 began Golf tournament in Zagreb and Mokrice 300 golf players from 22 countries will participate in European Senior Golfers Championship which will be held from 8th to 12th July in Mokrice and Zagreb - on Golf & Country Club Zagreb golf course. During the press conference held prior to the tournament, Veljko Ostojić, Minister of Tourism, pointed out the support provided by the Ministry of Tourism, highlighting the proactive role of the Ministry in providing logistics assistance to investors in golf courses through amendments to regulatory framework and in providing financial support for the implementation of golf projects. Free backpacker’s guide Association for promotion of tourist destinations, programmes and services has recently issued the first mobile backpacker’s guide in English which will assist backpackers in discovering why, when and how to spend holidays in Croatia. The guide comprises of 4 units. A typical backpacker is between 18 and 35, well educated and acquainted with the current prices. They opt for affordable accommodation and have a thirst for meeting local people. In addition, they do not carefully plan their holidays and the length of stay and prefer active holidays. Backpacking promotes freedom – to go where you want, when you want and stay as long as you want. EnjoyIstra tourist guide A new issue of the popular tourist guide called EnjoyIstra has been published to announce a copious number of events and attractions in July throughout Istria. The guide comprises of a wide range of articles in English, German, Italian and Croatian and is an 80 page portrait of Istria through artistic and sports events, festivals, local cuisine and wines, as well as information on natural and historical monuments.
€25 million estimated value of investment in Zagreb Hilton hotel franchise on 7 floors with 152 rooms Sanja Plješa ouble Tree by Hilton will open in Zagreb next autumn. It is an aspect of the prestigious global brand. The first Hilton hotel in Croatia was opened several years ago in Dubrovnik. The estimated investment value of Zagreb Hilton hotel franchise on 7 floors with 152 rooms is €25 million. It is
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Zagreb Hilton hotel franchise is owned by Branko Perković, a Croatian businessman owned by Branko Perković, a Croatian businessman, who has signed a hotel management contract with the Hilton group. “As a proud member of Hilton Worldwide Portfolio of brands, Double Tree operates in accordance with the
philosophy of Conrad Hilton who famously stated that: “it is our responsibility to fill the Earth with the light and warmth of hospitality”. The Double Tree by Hilton Care culture is a unique reflection of this philosophy which is a competitive advantage of Hilton brand”, explained Karin van den Berg, Managing Director of Double Tree by Hilton Zagreb. She is Dutch and has been appointed to the current post following her work in the Hague in one of 23 Hilton Double Tree hotels. She emphasised the importance of the
ongoing project – Marjan Hilton franchise in Split. Zagreb Hilton hotel franchise will employ 70 staff who will be fully trained prior to the opening of the hotel. Zagreb franchise was to open in spring, yet its opening has been postponed for autumn due to the remaining construction work. The hotel is intended for business people and other tourists and, according to Karen van den Berg, the bookings for 2013 have already begun. The hotel comprises a wellness & spa centre, fitness, an indoor pool and sauna and six facilities for meetings and social events.
Link-up between Medical Tourism Cluster and Steiner telecommunications
Croatia Call for tourist safety Medical Tourism Cluster and Steiner telecommunications have agreed joint co-operation on the project Croatia Call. The project value is HRK21 million and it is implemented throughout Croatia, providing two types of service mainly intended in order to preserve tourist safety. The first service called 144 Croatia Safety Call is a service where by calling 144 the user will be transferred to operational communications cen-
tre where they can talk direct to an on duty operator in their language and will be given accident assistance. Tourists can subscribe to the service for the duration of their stay after paying for their vacation or via the Croatia Call web site. The second service, GPS Safety Button, is intended for mountain climbers, yachtsmen and those with health problems. When the device is activated they will have
immediate access and full assistance. Croatia Call project is supported by the Ministry of the Interior, emergency services, Croatian fire service, Croatian Mountain Rescue service, diplomatic consular representatives, road and sea assistance, medical services, dentists and pediatricians to name a few. Daily rate per person stands at €1.6 and €2 per family. These charges reduce for longer period of time.