Investment with one click Croatian Chamber of Economy data on investments valued at almost €6 billion from throughout Croatia
New era for Luka Rijeka Over the next 20 years, ICTSI plans to invest €70 million in Brajdica container terminal in Luka Rijeka
Fear dominating entrepreneurs Croatia now must think about how achieve participation in creating EU standards
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Croatian Business & Finance Monthly Established in 1953 Monday / 3rd June / 2013 Year VI / No 0226 www.privredni.hr
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pvinternational pv international C R O A T I A N
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ENTREPRENEURS DAY 2013
Aiming for consensus, yet all depends on government According to Mudrinić, Croatia needs a Prime Minister and politicians who will implement comprehensive reforms to boost the heritage for future generations Igor Vukić, Drago Živković he Croatian Employers’ Association has proposed a social consensus on comprehensive measures to spur Croatian economic growth and revive society as a whole. “There is currently a lack of both vision and a consensus on our future economic targets. The government has focused on solving several issues, yet I believe we need a set of unified measures”, stated Ivica Mudrinić, President of the Croatian Employers’ Association (HUP) during Entrepreneurs Day. According to Mudrinić, the government has not implemented the most demanding reforms during its first year in office. The overall tax burden and contributions have increased considerably. The credit rating downgrade was also the result of a lack of credibility in government policy. Several reforms, such as the re-
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structuring of state-owned companies, were primarily prompted by EU funding requirements, according to Mudrinić. He believes that Croatia needs a Prime Minister and politicians who will implement comprehensive reforms to boost the heritage for the future generations and not only to aim at winning the next election. Politics is not mathematics “Consensus is a noble ideal, yet is hardly ever achieved”, pointed out Prime Minister Zoran Milanović. Even countries such as Sweden and Germany with a consensus-based political system have often faced substantial difficulties in achieving consensus. “At the end of the day it is up to the government”, stated Milanović wondering how to reach a consensus with trade unions that are threatening to block the operations of the state due to a 3% reduction in gross sala-
ries. Private sector employees have also taken their share of the burden. I am prepared to discuss our moves and the results we have achieved, yet politics is not mathematics”, emphasised Prime Minister. He highlighted several decisions reached by his government that had been postponed for years, such as the privatisation of shipyards. He stated that the government
would proceed with its measures and implement enhancing work place climate changes and improve conditions for investment. Privatisation will be implemented to strengthen the market and reduce room for political clientelism. According to Milanović, Croatia has had sufficient time to adapt to EU regulations and Croatian companies are well prepared to take opportunities.
Is Croatia prepared for the EU? Are we ready for the EU, and what are our opportunities? – were questions posed by participants at a panel discussion during Entrepreneurs Day. Ivica Mudrinić, President of Croatian Employers’ Association (HUP) believes that a large number of Croatian companies are adequately positioned for the EU market, yet several are likely to encounter serious difficulties and hence the need for an active government policy over the next six
months. On the other hand, Emil Tedeschi, Board President of Atlantic Group, believes food prices will drop, yet companies also need to adapt to that. Agrokor has been well prepared for the EU for a long time, stated by Damir Kuštrak, Board President, who expressed satisfaction to see most of the EU funding used by the private sector in order to foster competitiveness. Podravka sees the EU as its second most important market as it has
been competing with the largest global players, and Zvonimir Mršić, its Board President, believes there is ample room for development in acquisitions throughout Eastern Europe and in halal market penetration. According to Branko Roglić, Board President of Orbico, cost reduction is an imperative, whereas Franjo Luković, Board President of Zagrebačka Bank sees great potential in overall improvements throughout Croatian society.
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Privredni vjesnik Year VI No 226
( €1.334 billion
::: news Končar signs contract in Norway Končar Generators and Motors has recently signed a contract in Oslo for the renovation and upgrade of two generators for the Norwegian hydro-power plant, Klosterfoss. The contract with the Norwegian electricity producer Akerhus Energi is worth €13.4 million and has been signed irrespective of severe global competition as a result of successful exports by Končar to Scandinavian countries. Končar has thus far delivered equipment for 11 small Norwegian hydro power plants and it is currently producing equipment for four more. Bosch growth stable Bosch Group revenue in the Adria region increased from €32 million to €33 million in 2012, continuing the positive trend from Croatia and Bosnia and Herzegovina. According to Javier Gonzalez Pareja, Managing Director of Bosch for the Adria region, 2013 will see a significant increase in sales. Since its start in Zagreb in March 1993, Bosch Croatia has expanded from 3 to 65 employees. Bosch Group generated revenue of €52.5 billion and a pretax profit of €2.8 billion in 2012. In 2013, Bosch is anticipating an overall sales increase between 2% and 4%.
Tommy faces fine for Kerum property purchase The Croatian Competition Agency has issued an enforcement order of a €12.300 fine on the Splitbased retail chain Tommy due to its failure to report retail property accumulation that was the result of the purchase of substantial Kerum retail space. The Agency has concluded that the Tommy retail chain was obligated to report the retail property accumulation on 10th May 2010 when it purchased 10 Kerum stores in Dubrovnik-Neretva County. Nevertheless, the retail chain reported it only on 16th November 2012 following a warning from the Croatian Competition Agency.
Level of potential investment in Zadar County
Croatian Chamber of Economy
Investment with one click
Within the framework of their business network, through county chambers, data on investments Croatia is published in both Croatian and English, and can be browsed based on geographical ar Igor Vukić he entire country is debating how to attract investors. From government and economic analysts to discussions over coffee, everyone is talking about models of investment subsidies, and criticizing slow administration. The Croatian Chamber of Economy decided to give a concrete contribution to this. Within the framework of their business network, through county chambers, data on investment valued at almost €6 billion from throughout Croatia have been collected in one place.
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Well laid-out catalogue The investment catalogue Invest in Croatia may be found at www. hgk.hr. It is published in both English and Croatian and is well laid-out. It can be browsed based on geographical area, according to each county and the economic sector each of the offered projects falls under. Since investment projects are in their early final phases, potential investors may also find analyses
of documents required for the project and lists of others yet to be obtained. Total sums required for completion are also indicated, as well as the amounts of money already invested in preparation. Most investment projects include photographs and designs of conceptual project solutions. To each project is also attached addresses and telephone numbers of people who can give additional information and point the investors to easier ways for achieving projects. The highest amount of total potential investment projects is in Zadar County. Their value stands at €1.334 billion. Some include a tourist complex on Pag, the Pašman Riviera project, or Bravar, a combined power plant near Obrovac. The County of Primorje and Gorski kotar follows with potential of €1.308 billion. Fifteen projects include the Kukuljanovo solar power plant, Platak sports centre, Miklavlja (intermodal logistic centre) and several others. Privredni vjesnik will present the projects of these two countries in more detail in the next issue.
Counties with the highest number of presented projects are Lika-Senj (15), Zagreb (12), Istria (11), and Krapina-Hrvatsko zagorje (8). Looking for investors in development Tourism investment projects take the lead regarding economic sectors. There are 32 in the investment catalogue. Other projects relate to energy renewable sources (16) and infrastructure (15). There are 9 industrial projects valued at €62.2 million, including the iNavis Development Centre in Šibenik, intended to support SME’s in developing final products, primarily in the aluminium industry. The Sinteza-Slatina Project (County of Virovitica-Podravina), for producing second generation synthetic biodiesel, could be classified as industrial production. Investment in production, listed also in the energy strategy of Croatia, could reach €160 million according to the plans. Some projects have already started, so investors into development and additional capitalisation are in
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( 32 tourism projects ( 15 projects in the CCE investment catalogue
waiting in County of Primorje and Gorski kotar
valued at almost €6 billion from throughout Croatia have been collected in one place. The investment catalogue Invest in rea, according to each county and economic sector each of the offered projects falls under demand; for example the production of bio-diesel in the County of Varaždin, where €3.9 million has been invested into production. Half of the work on storage containers for biodiesel is complete, and additional equipment ordered. With an investment of €2 million, the project could be completed in three months. Factory capacity would total 20,000 tons a year. One of less known, but very interesting projects is Hortus-Croatiae, currently in preparation in Prelog. The project concerns the production of electric and thermal energy from geo-thermal sources for medical tourism in the form of a water
park, hotels and residences. The project also envisages an unusual tropical garden for growing fruit and spices, and a collector of spring water. The power plant and tropical garden would be built in the first phase, followed by a polyclinic, apartments, hotels, golf course (nine holes) and finally the collector of Aqua Hortus mineral water. A thoroughly elaborated investment project would cost around €152 million. Traditional sectors, for example agriculture, are planning more projects. In Županja, €5 mil-
Most investment projects include photographs and designs of conceptual project solutions
lion has already been invested in Agro Square Agricultural Centre, intended for promoting and selling agricultural products and developing services relating to the cultivation of land. This is a brownfield investment in which a further €5 million should be invested. Public-private investment projects also The catalogue also includes a series of public-private investment projects. It is possible to participate in the landscaping of waterways near Osijek in co-operation with Hrvatske vode. Total investment has now reached €350 million. Nature would be preserved by raising barriers on the Drava River at the 29 kilometre upstream mark from its delta at the Danube, and by constructing a large lake. Sustainable microregional development would be achieved by producing energy from renewable sources, improving protection against flooding, and irrigation systems for agricultural land. The construction of a multi-purpose hydro-technical system would modernise
the water-supply and drainage system as well as sailing conditions on the River Drava. As in the case of other projects listed in the catalogue, here it is also possible to participate in tenders for attracting money from EU funds. The Dubina Project, the first golf course in the County of Primorje and Gorski Kotar, is highlighted as one of the ideas on how to develop golf tourism. The course is special since it would be a part of the Grobnik SportsRecreational Centre, which includes a motor racing circuit, Grobnik Sports Airfield and the future Platak county sports centre. The sports complex is being developed by the Municipality of Jelenje, which plans to build the golf course in an area of a reconstituted gravel pit. The ecological dimension would be completed by preserving the drinking water spring. The documentation for this investment is partly prepared, and the investor would have to participate with €10.5 million. Additional questions regarding all these projects may be sent to investicije@hgk.hr.
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Privredni vjesnik Year VI No 226
( Polish insurance company PZU is ten times larger than Croatia Insurance
Polish-Croatian Economic Forum
Polish company interested in Croatia Insurance Komorowski invited Croatian businessmen to co-operate in the creation of an energy route connecting future LNG terminals on the island of Krk to the Baltic Sea. Polish partners are interested in investing into tourism and rail transport Igor Vukić epresentatives of the Polish insurance company PZU have shown considerable interest in the purchase of Croatia Insurance company during the recently held meeting in Zagreb. “Croatia Insurance is an interesting company. The purchase could result in huge benefits for both parties,
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Croatia needs to follow the Polish example to attract EU funding as well as the Croatian insurance market as a whole”, stated Ryszard Tropczynski, Board Member of PZU during the Economic Forum held recently at the Croatian Chamber of Economy. Representatives of PZU visited the Agency for Investment and Competitiveness where they were provided with fundamental information on the forthcoming tender for the privatisation of Croatia Insurance. They are prepared to meet all require-
ments and should they not able to purchase the company, they are prepared to become a minority stakeholder. Tourism and transport sector projects The Polish economic delegation was headed by Bronislav Komorowski, President of the Republic of Poland, an indication of the high level of interest in business co-operation. Komorowski invited Croatian businessmen to co-operate in the development of an energy route connecting future LNG terminals on the island of Krk to the Baltic Sea. Polish partners showed considerable interest in investment into tourism
and rail transport and primarily in the rail link to Rijeka. They are also interested in tourism, since some 500,000 Polish tourists visit the Adriatic coast annually. Andrzej Zarajczyk, owner of the Polmot company, has had very positive experiences. His company acquired an hotel on the Opatija Riviera several years ago and it has generated high revenue and strengthened co-operation with local staff. “There is only one Pole amongst 50 employees; you need not fear the EU and co-operation with foreign companies. The hotels will operate as they currently do, and your expertise in tourism is invaluable”, stated Zarajczyk.
Polish market sales Co-operation is expanding continuously; following the access of the Polish company Asecco into the Croatian market, it identified an excellent small Croatian company involved in programming. As a result, it now sells its products in both Polish and other EU markets, as was stressed during the forum. Nadan Vidošević, President of the Croatian Chamber of Economy, and Ivo Josipović, the Croatian President, expressed their support for co-operation. Vidošević emphasised the fact that Polish investors are always welcome and problems can occur primarily due to the fact that Croatia currently still lacks investment experience, both locally and foreign. Nevertheless, the situation in Croatia has been gradually improving and the country has the opportunity to gain valuable knowledge from Polish success in attracting EU funding, highlighted Vidošević. President Josipović pointed out the possibility of a joint appearance of similar Croatian and Polish companies in third country markets.
PZU has over €2 billion capital The Polish insurance company PZU currently has over €2 billion capital and it is planning to invest in the takeover of insurance companies in Central and Eastern Europe. It is primarily interested in Croatia Insurance, as recently announced in Zagreb by Andrei Klesyk, Board President of PZU. He was accompanied by the PZU Supervisory Board President and three Board members, as well as the Polish President, clearly showing the high level of interest in the issue. PZU has several similarities with Croatia Insurance: it was once a state monopoly and has faced a fall in market share after the liberalisation of the
Polish market. It was privatised through a public share offering on the Warsaw Stock Exchange three years ago, although the Polish state has retained a 35% ownership stake. According to Klesyk, the similarities between the two companies have resulted in a deeper understanding of the importance of Croatia Insurance to the Croatian financial system. Consequently, PZU would even opt for a minority stake in the company during the privatisation phase. Nevertheless, they are aiming towards majority ownership in the long term, with the Croatian state retaining a substantial stake in the company.
According to financial data, PZU is ten times larger than Croatia Insurance, with gross premiums of €4.5 billion, nett profit of around €780 million and a market capitalisation exceeding €9 billion, which ranks it the 13th largest insurance group in Europe, between Berlin and Moscow. Success with the purchase of Croatia Insurance will enhance its regional market expansion, with Slovenian Triglav Insurance as a subsequent target. On the other hand, according to Klesyk, a failure to acquire Croatia Insurance may result in the Polish company leaving the region, as it is primarily interested in Croatia Insurance. (D.Ž.)
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( 14%
level of bad loans in total loans
( 42% of bad loans covered by reserves
CROATIA SEEN BY THE EYES OF BORIS VUJČIĆ
Banking system is one of the last strongholds of stability Vujčić claims that if HNB policy is not counter-cyclical, a package with the IMF would be inevitable as has happened in certain countries Drago Živković he counter-cyclical monetary policy of the Croatian National Bank enabled Croatia to avoid asking the International Monetary Fund for assistance in 2009, since the local banking system had sufficient capacity to finance local needs. However, from today’s perspective, it would have been better had they requested one, since this would have accelerated structural reform, opined HNB Governor, Boris Vujčić, at the 16th Conference of the Croatian Money Market held in Opatija. Vujčić claims that if HNB policy had not been counter-cyclical, assistance from the IMF would have been inevitable as has been the case with certain countries. He also claims that the expansive policy of the HNB directly and indirectly enabled a lower fiscal deficit and lower public debt, decreasing risk inside the banking system.
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Regulatory expense For Vujčić, the best example of a counter-cyclical regulatory policy in Croatia is the regulatory expense that decreased from 2.13% in 2008 to 0.8% today. For this reason lending contraction did not occur in Croatia as in the case of the USA, or for example, a total lending freeze in the Eurozone, even though economic growth was much lower than in the USA or the eurozone. GDP in Croatia has dropped 11.8% since
the third quarter in 2008 to the end of 2012, whilst the rate of growth of private lending totalled 15.2%. During the same period, GDP increased 3.6%, even though private sector lending fell 4.4%. In the eurozone, GDP decreased 2.1% and similar lending increased by 3.1%. Therefore, monetary policy and the banking system did not turn Croatia into one of the slower countries to recover from the recession, as some claim, concludes the Governor. In fact, monetary policy
and the banking system are, as is explicitly stated in rating reports of agencies, the IMF and investment analysts, that area of the Croatian economy that still maintains the country’s economic stability and rating on the same level. Those trying to destroy one of the last strongholds of Croatian stability, must publicly say what to do next, the Governor warned in Opatija. Undermining credibility His sharp criticism was levelled at those banks he accused of undermining their own credibility, lobbying against increasing
reserves by exaggerating how this increase influenced their balance sheets. HNB must increase its reserves since the level of outstanding debts in the banking sector increased to 14%, causing the cover of bad loans by reserves to fall from 50% in 2008 to 42% in 2012. Even though he
Reserves will not increase in one move, but gradually over years does not dispute that an increase in reserves decreases profitability in the banking system, the Governor explained this decrease is permanent only if the bank fails to collect its loans. Otherwise, reserves are released and profit increased. In other words, if reserves are exaggerated, banks will achieve profitability in the future, rather than in the present, even though they are not sure whether they really achieved it. Reserves will not increase in one move, but gradually over years, announced Vujčić. He also said it is clear that bankers are not happy with the delay in paying out profits, but regulators, as opposed to them, or politicians as some would also say, cannot be short-sighted. They need to consider the stability of the system in the medium and long-term.
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Privredni vvjesnik Year VI No 226
( €9 millionn of funding available le
WORLD BANK
Millions for research and innovation The project should help public research organisations to commercialise research and improve co-operation with the real economy he CEO Committee of the World Bank approved Croatia’s Second Science and Technology Project (STP II), with a value of €20 million and intended for research and innovation. STP II follows in the footsteps of the previous STP I for the purpose of strengthening Croatia’s innovation potential and increasing its competitiveness through the implementation of the Science & Research Programme managed by the Business Innovation Agency of Croatia (BICRO) and the Unity Through Knowledge Fund. This
project should also help public research organisations in commercialising their research and improving co-operation with business. The Business Innovation Agency has secured €9 million (7.5 million from the World Bank and €1.5 million from the state budget), through the project of the World Bank intended programmes in 2013: Proof of Concept (€3 million for 120 projects), Development of the KnowledgeBased Companies (€4 million for six projects) and Co-operation between Enterprises and Academia on the Development of New Products and Services (€2 million for 22 projects).
CONSUMER PRICES
LABOUR MARKET
Krešimir Sočković
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Furthermore, the average annual budget of EUREKA/Eurostars for 2013 totals over €0.5 million and includes the implementation of already agreed projects as well as projects yet to be agreed, and the operating costs of programme implementation. The maximum sum of each grant (per individual project) is up to a 50% share of the Croatian partner on the project or up to €150,000, depending on which is less for a three-year project. Invitations for the tender for the PoC Programme will be made in mid-May 2013, while the implementation of subsidies for RAZUM and IRCRO programmes is in preparation.
Slowdown in the rate of 355,598 unemployed annual price rises in April According to latest data from the Croatian Bureau of Statistics, April saw a continuation of weakening inflationary pressure on consumer prices. Consumer prices in April 2013 rose by 3.3% over April 2012, a mild reduction compared with March (+3.7%). When energy prices are excluded, annualised price growth stood at 2.5%, indicating that the influence of the increase of administratively determined prices has slowly diminished, although when, in addition to energy, food is also not omitted, consumer prices have saw an annual increase of 1.2%. Housing, water charges, energy and fuel prices soared by 11.1%, mainly due to a 19.8% increase in fuel and energy prices, pri-
marily energy prices (+19.8%) and gas (+20.8%), whose impact on the growth rate will also be felt in May. On the other hand, liquid fuel prices decreased by 7% in relation to April 2012, whilst transport prices seeing a drop of 3.1% over the same period. Consumer prices rose by 0.4% month-on-month; inflationary pressures were substantial mainly due to a 4.6% increase in fruit prices showing seasonal fluctuations, as well as clothing (+5.0%) mainly as a result of new collections of clothing and footwear. On the other hand, liquid fuel prices saw a drop of 0.7%, due to lower crude oil prices on global markets in March. Consequently, transport prices in April were 1.4% down over March.
According to data provided by the Croatian Employment Agency (HZZ), at a monthly level the number of unemployed continued to fall during April. Therefore, unemployment is growing on a year level. There were 355,598 individuals unemployed and registered with HZZ in April, 3.5% less than in March, but 9.8% more than in April 2012. The decrease in numbers unemployed in April compared with March is the result of a greater outflow from records. Hence, 20.594 newly unemployed were registered with HZZ during April, which is 6.1% less than March, but 8.6% more than April 2012. The highest share (61%) of those newly registered are people who became unemployed due to business rationalisation and redundancy. A total of 33,554 people were deleted from records, 28.2% up on a monthly level, but also 10.9%
down on an annualised level (lower levels of employment compared with 2012). Of 33,554 people, 24,787 (73.9%) were deleted as they found jobs. The decrease in numbers on a monthly basis is the result of seasonal movements, and a similar trend should continue during the months to come, since the beginning of the tourist season implies greater demand for seasonal workers, thus having a positive effect on monthly changes of the unemployment rate. Notwithstanding, on an annualised basis, data (higher unemployment rate, lower record outflow, greater record inflow) show that negative trends on the labour market continue.
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( €2 billion
EU funding for SME’s to 2020
( €1.3 billion
lending by HBOR to businesses in 2012
GOLDEN BALANCE AWARDS
Businesses achieving good results deserve special recognition Minister Maras will support a proposal concerning small businesses with revenue of under €0.4 million being obliged to pay VAT only on paid invoices ism, and the overall impact of these measures is estimated to be €0.5 billion. During 2012 HBOR granted €1.3 billion in loans to businesses, 40% up compared with 2011. Maras strongly supports the abolition of several parafiscal taxes, such as mandatory contributions for sustainable for-
Drago Živković n 2012, 97,254 Croatian businesses, excluding financial institutions, generated total revenue of €80.7 billion and €0.65 billion nett profit, €0.34 billion down over 2011. Consequently, 2012 was a year of further economic downturn and it is anticipated 2013 will not differ from this. Hence, GDP will contract between 0.5% and 1%, according to Zdeslav Šantić, Chief Economist at Splitska Bank, an opinion given at the 5th Golden Balance award ceremony organised by the Financial Agency. According to Šantić, investment recovery is a slow and arduous process, primarily due to unfavourable circumstances over the previous period: construction work accounted for almost 50% of investment, although investment into machinery and equipment was substantially lower, leading to Croatian exports accounting for just 20% of GDP, placing Croatia on a par with Albania. “Our principal objective in 2013 cannot only be GDP growth, as it is becoming increasingly unattainable; Croatia needs to focus primarily on sustainable
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Tenders for €30 million will be invited on 15th July 2013 growth over the medium-term”, according to Šantić. Mandatory contribution for sustainable forest management A contraction in GDP will result in a further increase in unemployment, implying a slump in overall income. In addition, it is not realistic to expect a substantially positive impact following Croatian EU accession in the near term, due to a declining demand in the Eurozone. If the Croatian exit from CEFTA is considered, Croatian exports are likely to contract in 2013, whilst the country will simultaneously face
severe competition as a result of European business penetration inside the Croatian market. Moreover, a significant reduction in interest rates is not to be expected due to the current low rating, and hence Šantić can only hope that Croatia will see 2014 as being slightly more favourable compared with 2013 and 2012. Businesses achieving good results this year deserve special recognition, according to Gordan Maras, Minister of Entrepreneurship and Crafts. Nevertheless, he reiterated that the government substantially assisted businesses by reducing contributions for health services and VAT in tour-
est management. In addition, he will strongly support a proposal concerning small businesses with revenue of under €0.4 million being obliged to pay VAT only on paid invoices rather than on all issued invoices as has been the case thus far, as a large number of businesses are ever more reluctant to issue invoices to avoid VAT payment on unpaid invoices. Around €2 billion in EU funding support will be available to SME’s over the next six years and it will be primarily used in production, as announced by Maras. The first tender for €30 million will be invited on 15th July 2013.
Golden Balance award winners 2012 Overall winner – CROATIAŠPED-
ZAGREB d.o.o.
Agriculture, forestry and fisheries –
POLJOPRIVREDNO PREHRAMBENI KOMPLEKS d.o.o. Mining & mineral extraction – SOLANA PAG d.o.o. Processing industry – TVORNICA STOČNE HRANE d.d.
Electricity, gas, steam and air conditioning supply – TERMOPLIN d.d. Water supply, waste water management, waste management, environmental protection – UNIJA NOVA d.o.o. Retail and wholesale trade – DM-
DROGERIE MARKT d.o.o.
Transportation and warehousing –
CROATIAŠPED-ZAGREB d.o.o.
Construction – FORSET d.o.o. Accommodation services, food preparation and food services –
MASLINICA d.o.o.
Information and communications technology – EKOBIT d.o.o. Professional, scientific and technical services – DIVJAK, TOPIĆ & BAHTIJAREVIĆ
ODVJETNIČKO DRUŠTVO d.o.o.
8 ::: news
Privredni vjesnik Year VI No 226
( 18 km of waterway
( 1,7
on River Drava
on River
Velibor Gacik, Vice President of Danube Lloyd Arrival of police from 13 countries Tourism Minister, Darko Lorencin, and Interior Minister Ranko Ostojić signed a co-financing agreement for the Safe Tourist Season project. This year, the Ministry of Tourism provided €26,500 to cover the expenses of around 50 foreign police who will join their Croatian colleagues in safeguarding tourists during the season. The Ministry of Tourism has been participating in this project since 2009, and has managed to secure a total of €0.13 million to date. Police from 13 countries from which tourists mainly arrive will join this project.
The River Rhine may be consid motorway - whilst the River Sa
Transportation costs vary considerably even between equal distances and are greatly influenced on the River Sava. A higher quality waterway for the River Sava would improve the price competi
Svetozar Sarkanjac ccording to some views, one’s profession is determined by place of birth. That was certainly the case for Velibor Gacik, an inland waterway captain and began his navigational career in 1989 and has navigated through the rivers Danube, Drava, Sava and Tisa. In 2007, he became a member of Danube Lloyd Management Board and is currently Vice President. He was President of the Inland Waterway Transport Association at the Croatian Chamber of Economy until recently and thus is extremely well acquainted with the fundamental issues for Croatian ship operators and river ports, as well as with the horrendous situation of Croatian inland waterway transport. “I was taught at school that inland waterway transport was the most affordable method of transporting goods. Nevertheless, according to the current situation and considering the meagre utilisation level of inland waterways, apparently this lesson is currently not taught in school,” he states.
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Subsidies and grants to agriculture The Payment Agency for Agriculture, Fisheries and Rural Development paid subsidies and grants of €100 million, successfully concluding payments for the second half of 2012. Direct payments, measures for rural development, income subsidies, interventions on the fisheries market, and market interventions for tangerines were paid. A total of €0.3 billion was paid to agricultural producers based on approved applications for subsidies for the production year 2012. Green aspect of urban planning The Green Building Council in Croatia organised the 12th Symposium on Green Building, Green Aspect of Urban Planning. The Symposium was held during the 4th Zagreb Energy Week in co-operation with the City Office for Energy, Environment Protection and Sustainable Development in Zagreb and the Association of Croatian Urban Planners. The role of the green building certificate and significance of good urban planning were some of the things that were discussed. Furthermore, the areas of energy, sustainability and EU policy were also covered.
Minimal tourism interest Danube Lloyd had serious plans for tourist-passenger transportation several years ago. What is the situation today? In 2008, we purchased a passenger ship for €0.3 million in Hungary. The vessel was 34 metres long, 6.5 metres wide, with capacity for 200 passengers. We planned to use her for tourism, intending to rent her to tourist agencies. Unfortunately, in Sisak there was minimal interest for her use and we subsequently rented her in Budapest, from where she currently sails.
Inland waterways cargo transport is the most affordable transport of goods for large quantities of goods using high quality inland waterways. Nevertheless, transportation costs vary considerably even at equal distances and are considerably influenced by waterway conditions. Transportation costs over 300 km on the River Danube are 40% cheaper in relation to transportation costs for the River Sava.
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67 km of waterway ( over 40 years Danube
average vessel age of Croatian inland waterway fleet
dered a motorway - the Danubian ava may be considered as a village path
by waterway conditions. Transportation costs over 300 km on the River Danube are 40% cheaper over similar distance costs tiveness of Croatian factory products, since transportation costs significantly impact overall production costs
There are three inland waterways in Croatia – Sava, Drava and the River Danube. However, Croatians do not appear to show much interest in them except in cases of flood or drought. The utilisation level of the River Rhine is 90%, but for the River Sava it stands below 1%. The River Rhine cannot be compared with Croatian inland waterways. The utilisation level of the Rhine is not only as a result of the many industrial centres located on the Main and the
ity on the Sava is still questionable. Is it possible that no one in Croatia is interested in its navigability and an improvement in the level of use of this Sava waterway? There has been some interest in cargo transport on the Sava, mainly shown between 2005 and 2008 by Sisak Steelworks, Đuro Đaković, Agrokor and Ina, to name a few in Croatia, and Brod Refinery, Cement Factory Lukavac, Zenica Steelworks and several more in Bosnia and Herzegovina. Nevertheless, the cur-
na and Serbia. What has been achieved since then? The Inland waterway transport operators are not adequately informed on the work of the Sava Commission. A higher level of co-operation would certainly positively affect inland waterway transport.
What is the current situation concerning navigability of the Drava and Danube? Currently, there are only 18 km of navigable waterway on the River Drava, from its emptying into the Danube to Osijek port, whilst the Danube has currently 1,767 kilometres that are navigable.
What would be the implications of upgrading the Sava ranking to international navigability class IV? How much would the project be worth and who would finance it?
How would better navigability of the Sava affect Danube Lloyd and the Croatian economy in general? Better quality navigability on the Sava would imply more competitive final prices of Croatian factory products. Transportation costs have a considerable effect on total production costs through the supply of raw material or prices of finished goods delivered to customers. A competitive economy would imply higher transportation demands, which would in turn foster the development of shipping companies.
Danube Lloyd has a fleet of 10 vessels plus 31 container ships operating mainly from Serbian and Bosnian ports to the Black Sea
Rhine whose success has been partly a result of affordable inland waterway transport, but also to the high quality of these waterways. If we are to compare the Rhine with the Danube and Sava, we might well consider the Rhine a motorway - the Danubian motorway - whilst the River Sava can be viewed as a village path. Navigability of the Sava was very adversely affected by war, and although this ended some fifteen years ago, the navigabil-
rent dire situation and low-level use of the Sava waterway are primarily due to dismal quality of service, mainly through the months having a low water level. Consequently, inland waterway transport operators cannot guarantee safe navigation and transport of goods to potential clients. The International Sava River Basin Commission (the Sava Commission) was established in 2005 and its members are Croatia, Bosnia and Herzegovi-
International navigability class IV implies a higher and constant profile of inland waterways that ensure safe and unimpeded navigability of cargo ships with a draft of 2.3 metres over 360 days annually, which is of fundamental importance for the provision of top quality transportation services, and to enhance the interest in using inland waterways transport. I have no idea of the project value, yet such investment would certainly foster economic development and investment in facilities in places having river ports.
What is the current state of the Croatian inland waterway fleet? The Croatian waterway fleet is currently in extremely poor condition with an average vessel age of over 40 years. Investment into the inland waterway fleet requires substantial funding which is currently unfeasible. What is the make-up of the Danube Lloyd fleet, and where does it operate? The Danube Lloyd has a 10 fleet of vessels and 31 container ships operating mainly from Serbian and Bosnian ports to the Black Sea.
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Privredni vjesnik Year VI No 226
( €23 million
Value of new cranes and bridges in Luka Rijeka
( around €30 million ICTSI investment to date
NEW ERA FOR LUKA RIJEKA
Time for Trieste and Koper to be worried
Over the next 20 years, ICTSI plans to invest €70 million in Brajdica, and terminal annual turnover should increase from 150,000 to 245,000 container units by 2015 Drago Živković
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nternational Container Terminal Services Inc. (ICTS) was founded in 1987. Its majority owner is the third richest Filipino, Enrique Razon, whose wealth is estimated at $3.6 billion. After taking over the management of the port in Manila in 1988, ICTSI began to expand globally in the mid2000’s. The final phase of this
Reconstruction of the rail link between Rijeka and Hungary required to ensure load transfer expansion is its public-private partnership with Luka Rijeka, established two years ago, when ICTSI bought 51% ownership of Jadranska vrata company (Adriatic Gate Container Terminal), which obtained a concession for
the management of Brajdica container terminal until 2041. Over the next 20 years, ICTSI plans to invest €70 million in Brajdica, and terminal annual turnover should increase from 150,000 to 245,000 container units (TEU) by 2015, with an increase in maximum capacity to750,000 TEU. The key step for achieving this has been the recent purchase of two coastal cranes and eight container bridges worth €23 million. Since the equipment is of giant proportions (cranes are 26 metres high, and the range of the bridges is 26 metres), the ship delivering it from Shanghai travelled for two months to reach Rijeka, passing through the Suez Canal and sailing around Africa. Faster loading and unloading By purchasing cranes and bridges, total investment by ICTSI in Brajdica reached almost €30 million, which includes the recently constructed new termi-
nal that will enable reloading from large vessels and storage of up to 600,000 containers a year. The new quays, 14.2 metres wide and with a draught of over 11 metres, will be able to receive the largest ships plying the north Adriatic. Loading and unloading is faster, productivity is higher, a new information system is adopted, people work seven days a week, and employees received additional benefits, 30 days of holidays and a gym. The only thing left now is to attract loads, which will require the reconstruction of the rail link connecting Rijeka and Hungary. This would mean that 60% of loads arriving at Luka Rijeka would be transported by train, and loads via the Suez Canal could arrive to Rijeka six days earlier to north European ports. The first port of call The new cranes and bridges should start operating on 1st
July in order to use the effects of Croatian EU accession to the maximum. The first effect is already visible: the port of Rijeka has already received a new veterinarian-phytosanitary station that allows goods of animal or plant origin to be inspected directly within the port. This makes Rijeka the first port of call in north Adriatic. Simplification of documentation and transport onwards towards EU countries will soon be finished, and this will reduce transit time and enable an uninterrupted flow of goods. This also marks the end of the Rijeka Gateway Project, says Vlado Mezek, Director of Rijeka Port Administration. He anticipates the port of Rijeka will become the first serious competitor to Trieste and Koper when Croatia joins the EU. Last year, 8.5 million tons were unloaded and loaded in the area of the Rijeka Port Administration, of which 4.5 million tons covered liquid loads at Omišalj Port.
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( €450 million
from EU funds by the end of the year
( up to €1 billion
this amount should reach in 2014
To what extent is Croatia prepared for membership and EU funds?
Fear dominating entrepreneurs During the past ten years the only thing concerning Croatia was harmonising with EU standards but now we must think about how achieve participation in creating those standards
Vidošević thinks Croatia will not be as horrendous as Bulgaria or Romania
EU, she thinks the country has to be more ambitious and strive to become one of the more successful members. The Foreign Ministry will contribute to this through two intellectual products that were created over the past ten years. They concern consulting services intended for sale to other countries that have just started negotiations with the EU, for example Moldavia or Georgia. The second product concerns the experience of re-building countries in post-conflict conditions, which Vesna Pusić believes we could sell to countries outside Europe, for example North Africa.
al companies. Those who manage to survive will operate in an organised system that will highlight our creativity, and this might be the biggest benefit of membership, noted Vidošević in his opening speech at the conference “How much are we prepared for membership and EU funds”? organised by the CCE and Ministry of Foreign and European Affairs. Vidošević suggested Croatia is not sufficiently prepared. However, he believes we will not be as horrendous as Bulgaria or Romania, but that it is important we come close to Poland. In order to achieve this, we need rational relationships with foreign investment and strategic guidelines to withdraw money from EU funds. It is positive that we can sit at the table where decisions are made, and where our ‘small hand’ will be of use to someone in outvoting. Upon entering, we will not be able to afford vacations, but
Forthcoming strategies EU funds are a great opportunity for Croatia for co-financing development projects since it will be possible to draw down some €450 million from the Cohesion Fund in the second half of the year. Next year, this amount should rise to €1 billion, as stated during the Conference Round Table. The precondition is the drafting of strategic documents that define the use of EU funds until 2020. Deputy to the Ministry of Economy, Alen Leverić, announced an industrial strategy would be finished by June, and a development strategy for the whole economy will be finished by the end of the year. Before that, it will be required to establish institutional structures for fund management, preparing sufficient number of projects and to secure the local level of funding for their co-financing.
Drago Živković he feeling dominating entrepreneurs on the eve of Croatian EU accession is not optimism, but fear, mainly due to a lack of information, claims President of the Croatian Chamber of Economy, Nadan Vidošević. Hence, this year will be extremely difficult, as many will find themselves under attack from competition by multination-
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will have to go full speed ahead, and I believe we will succeed, opined Vidošević. Even though some say the alliances we enter into start to break down immediately, the CCE President does not believe this. Nothing falls from the sky For the Minister of Foreign and European affairs, Vesna Pusić, the 1st of July will bring one crucial change. During the past ten years the only thing which concerned us was harmonising with EU standards, but now we must think about how we can participate in creating those standards,
the Minister says. As an example, she mentioned the uproar over new regulations on seeds and planting material, which raised wider issues on the Common Agricultural Policy. As a member of the EU, Croatia will continually have to create alliances, mainly with the countries of the Danube and Adriatic-Ionian region, but also with other geographically more distant countries from time to time. There is no more room for irresponsibility and acceptance of standards as if they fell from the sky, said Vesna Pusić. Even though she is convinced Croatia can survive within the
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Privredni vjesnik Year VI No 226
( $648 export price
::: news
per tonne of Croatian products 4 years ago
8th Convention of exporting companies
EU accession: first Slightly improved insurance sector results Croatian insurance companies showed total gross premiums of €0.4 billion during the first quarter of 2013, 0.3% up in relation to the same period in 2012, according to data provided by the Croatian Insurance Bureau. Nonlife insurance accounting for 74.62% of total premiums, saw a 2.1% downturn compared with the same period last year. Conversely, life insurance showed growth of 8.2% to €110.2 million. Private savings soar to €0.87 billion Private financial assets soared by some €2.25 billion in 2012 or 5.9% to reach almost €40.5 billion. When an inflation rate of 4.7% is considered, the increase in real asset value was 1.1%. Bank savings and savings and loan associations rose from €22.4 billion to €23.3 billion accounting for 57.5% of financial assets. Holdings of shares decreased by 6.1%; assets in investment funds dropped by 10.2%. €8.6 million loss for Mercator During the first quarter of 2013, Mercator Group accounted for €658.4 million in sales revenue, 2.6% down over the same period last year, and an operating loss of €8.6 million, which was included in the annual plan, as announced by Mercator. Market share in both Slovenia and Croatia are stable, with growth coming from Serbia and Bosnia and Herzegovina. During the first quarter of 2013, MercatorH invested €2.2 million in price maintenance, irrespective of the VAT increase, as well as in affordable shopping and exclusive privileges for its cardholders.
Croatian businesses will have to operate without the benefits of CEFTA membership, and should be substantially enhanced and the country has to look forward to the future Igor Vukić he Croatian economy is likely to suffer a negative shock following Croatian EU accession, according to Croatian Exporters. Businesses will have to operate without the benefits of CEFTA membership and face severe competition on the local market in the near term. Nevertheless, in the medium term, business activity could be
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EU
Some 500 million consumers from throughout the EU will be enabled to purchase Croatian products free of customs barriers substantially enhanced and the country has to look to the future, according to Darinko Bago, President of Croatian Exporters and Končar Management Board, during the recently held 8th Convention of exporting companies. Advantages following Croatian EU accession imply greater access to capital. Croatian products will be available to 500 million European consumers without administrative and customs barriers. In addition, Croatian products will be labelled as “EU products”, which will significantly influence their reputation. Croatian exporters have carefully prepared for accession. Bago stressed that 4 years ago the average price per tonne of goods exported from Croatia stood at $648; currently this figure is $938 per tonne. “It implies we are currently selling more complex products, with greater added value. The quality of Croatian products has improved substantially over
the past 4 years”, highlighted Bago. On the other hand, the price per tonne of goods imported currently stands at $1,300. Weakening of currency implies negative consequences Ericsson Nikola Tesla, this year’s Golden key award winner, is the best example of the appropriate quality of export products. The company president, Gordana Kovačević, emphasised that there are immense opportunities for success and innovation, highlighting that willingness to learn and use the acquired knowledge whilst keeping abreast of technological development are fundamental.
ENT achieved exports valued at €105.8 million to Russia and in the Commonwealth of Independent States. The company has been present in these markets for 60 years having attracted customers with the cutting edge software and network solutions for businesses in the telecommunications industry. Prime Minister, Zoran Milanović, expressed his utmost satisfaction with results achieved by Croatian exporters. He pointed out that they have opted for an arduous road towards success and in that respect showed many similarities with the Croatian government. “We have started implementing order and regulation. We strive towards an organised society, based on the
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( $938 current average price per tonne of goods exported
a shock, then a blessing
d face severe competition on the local market in the near term. Nevertheless, in the medium term, business activity
Golden key opening global markets Ericsson Nikola Tesla achieved the Golden key award for the most successful large exporter, with Calucem the best medium-sized exporter, and Navis consult as the most successful small exporter. HSTEC was the most innovative exporter. Plamen achieved the best results in the Italian market the largest export market for Croatia. Tobacco Factory Rovinj was the most successful company in Bosnia and Herzegovina. Boxmark Leather achieved the best results in the German market, and AD Plastik the market leader in the Slovenian market. The Kutina-based company SELK was the most successful exporter to Austria in 2012. Cedevita exports primarily to Serbia, and Ericsson Nikola Tesla mainly to the Russian Federation. HS Produkt gained the Golden key for exports to the US, the Viro sugar factory received the award for its exports to Hungary with Pliva exporting primarily to the UK, Genera to Egypt and Klanjec Spinning Mills to Brazil. Kraš saw a significant increase in its exports to Saudi Arabia, whilst Končar Generators and Motors was the market leader in the Turkish market.
Nordic rather than the Byzantine model” he pointed out. He also expressed satisfaction that exporters are no longer demanding alterations in the exchange rate regime and provide assistance in that manner. He mentioned that several countries had weakened their currency prior to EU accession in order to achieve more favourable starting market positioning. Nevertheless, it proved to have resulted in negative consequences over the long term. “Competitiveness and excellence are the two winning cards”, highlighted Milanović. High quality products at affordable prices will always attract customers and the government will provide assistance to businesses by providing the necessary regulations, without protectionism, concluded the Prime Minister. According to the analyses presented by Boris Cota, economic advisor to President Josipović, those countries who joined the EU during the previous enlargement wave have generated substantial profits. Their GDP rose on average by 1.2%, salaries in the export sector were raised and unemployment decreased. Croatian EU accession is occurring against the backdrop of the crisis and irrespective of our preparations, we are likely to face short-term negative market shocks. Getting over the end of the CEFTA agreement using EU funding The economist Sandra Švaljek added that accession would result in a more effective functioning of institutions that will significantly boost the economy. EU cohesion funds absorption will be crucial and in the case of higher absorption, Croatian GDP is likely to rise between 1% and 1.4% over
the medium-term. Croatia will certainly receive EU funding, as emphasised by Branko Grčić, Vice-President of the Croatian government. He believes that Croatian businesses will successfully recover from the termination of the CEFTA agreement. The system of tax-free export quotas, which normally apply to the group, will provide considerable opportunities for well-organised and nimble entrepreneurs. Croatian companies have a long tradition of business activities in these markets and will certainly make effective use of the provided quotas, according to Grčić. Croatian EU accession is not anticipated with trepidation by the Golden key award winners. Hence, Željko Goja, Director of HSTEC, a producer of industrial robotic cells and small special purpose machine tools for the German automotive industry, is the winner for the most innovative exporter. Goja stated that the company has been the market leader for years, gradually building up its reputation and collecting references to attract new customers. Following accession the company’s operation will be significantly enhanced throughout Europe and the potential for its market expansion will be immense. Željko Pavlin of the Karlovacbased HS Produkt has been awarded his fourth Golden key due to substantial handgun exports to the US. The company has been co-operating with the Croatian Army and has thus gained references for its assault rifle, which has been designed as a result of its expertise and extensive experience. Millions in investment have also resulted in the creation of new jobs, showing that top quality products have no boundaries.
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Privredni vjesnik Year VI No 226
( WPD invested around €56 million in the Ponikve Wind Power Plant
RENEWABLE ENERGY SOURCES
Wind takes the lead With 204 existing projects, a further 960 RES projects (total power of 320 MW) are scheduled for completion by the end of April 2014 Boris Odorčić y the end of April, 204 power plants using renewable energy sources (RES) were subsidised. The electro-energy network of Hrvatska elektroprivreda (HEP) has 207.1 MW of these sources. Financially, over €0.5 billion has been invested in the Renewable Energy Sources to date, according to research conducted by the Association for Energy for Zagreb and Energo Media Servis, media agency specialising in energy and the environment. Based on installed power, wind power plants lead with 175.25 MW, with cogeneration plants totalling 10.49 MW, and thirdly bio-gas power plants, with a total of 8.13 MW, according to the report. By the end of April 2014, 960 projects (total power of 320 MW) are expected to be completed. An analysis of the finalised contracts for the repurchase of electricity
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from renewable energy sources, and on the basis of data provided by the Croatian Energy Market Operator (HROTE), there are still 960 units in Croatia that are not connected to the network. According to the planned power, wind power plants account for 229 MW, with biomass power plants supplying 46 MW, and solar power plants with almost 32.7 MW. Funding shortfall HROTE has issued a public appeal to investors, particularly those investing in small-sized photovoltaic systems, to complete their projects as quickly as possible. At the same time, HROTE also pointed to the problem of insufficient funding for subsidising privileged producers of electricity. In fact, in 2012 HROTE was in deficit; it paid out €43.88 million, but collected €10.13 million. The subsidy fee, paid by all electricity users, has been
the same for several years, and the authorised institutions have already taken steps to raise it. Tomislav Marjanović, President of the Association for Energy for Zagreb, says the adoption of a new and unique law on renewables is scheduled for the end of the year. The law on energy ef-
New RES laws scheduled for adoption by the end of the year ficiency should also be adopted, with the purpose of developing its efficiency in use and the production of electricity. Furthermore, greater efficiency will be demanded by transport, as well as cooling and thermal energy. The provisions of the recently adopted Act on the Electric Energy Market have encompassed large-sized hydro-power plants. This Act, among other things, expects from privileged produc-
ers of electricity in the subsidy system, production for a duration of 25 years for the purpose of ensuring stability, points out Marjanović. Concerning new RES projects in Croatia, the Ponikve Wind Power Plant was opened near Ston on the Pelješac Peninsula. This plant has 16 units and meets the annual demand for electricity of around 26,000 households. The WPD investment totals total €46 million, and a further €10 million of additional preparatory work. This wind power plant on Pelješac is not the first investment in Croatia for this company. WPD opened two wind power plants in the Šibenik area, and they intend to invest more (the Katun project near Šestanovac). However, investment has slowed due to endless and complex administration, which is why 12 years have passed from the start of the projects to its completion on Pelješac.
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( some €95.2 mmillion
::: news
invested into fisheries
CROATIAN AQUACULTURE IN THE EU
Conditions met but a considerable shortage in fish supply Fish production once ranged between 17,000 and 18,000 tonnes but currently it stands at 5,000 tonnes Svetozar Sarkanjac he Croatian fishing industry has advanced considerably over the past several years. Nevertheless, production, cultivation and results lag more than a little behind the achievements of Croatia some 20 years ago, as stated at the international economic-scientific meeting on fisheries Croatian Aquaculture in the European Union –present and future recently held in Vukovar and organised by the Croatian Chamber of Economy and the Lavoslav Ružička Polytechnic.
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A development opportunity “If we aim to be competitive in the EU, we will have to comply with existing regulations. The principal issues, such as water fees, property relations, the legal status of fish farms and agricultural land, to name a few, have been identified. We currently have the required infrastructure, genetics, expertise, and water resources, yet we need to implement it”, pointed out Milan Božić, President of the Association of Fisheries and Fish Processing at the Croatian Chamber of Economy. According to him, annual fisheries production once ranged between 17,000 and 18,000 tonnes, but currently it stands at 5,000 tonnes, which does not meet local demand and therefore fish products have to be imported. In 2012, local market consumption of freshwater-farmed fish stood at 2,500 tonnes, with that of warm water fish was 3,500
tonnes. Želimir Filić, Head of the Aquaculture Group at the Croatian Chamber of Economy and Vice President of the Federation of European Aquaculture Producers, also participated at the meeting, pointing out that following EU accession, Croatia needs to significantly increase both quantity and quality of production. “Annual fish production in member countries of the Federation of European Aquaculture Producers, which comprise EU members, as well as Turkey, Norway and Croatia, stands at 2 million tonnes of which 1.3 million tonnes is produced in EU countries, with the value of production slightly exceeding €8 billion. European aquaculture accounts for only 2% of global production. EU member countries meet 65% of their fish demand by imports from third countries, which clearly indicates significant potential for the development of this activity and consequently huge development
opportunities for Croatian fisheries”, emphasised Filić. New investment Ljubomir Kučić, Assistant Minister of Agriculture, stressed that the principal issues in Croatian fisheries have been identified and some significant advancement has been made to date. “This industry employs some 12,000 people and €95.2 million has recently been invested, of which over €13.2 million into the continental region, primarily Slavonia and Baranja. Unfortunately, due to the lack of investment over the past 20 years, the current investment needs to increase substantially to enhance development and reach previous levels”, stated Kučić, adding that Croatia once produced double that of Serbia, whilst currently Serbia is producing 5 times more than Croatia, which is utterly absurd. Production conditions in the two countries are almost identical and yet we have seen huge differences in output”, iterated Kučić.
HPB launches E-invoicing services Croatian Postal Bank (HPB) has recently launched an e-invoicing service providing its retail clients, e-bank users, with the opportunity to receive and settle invoices in a more effective manner and tailored to their requirements, no matter of their current location. The receipt and settlement of invoices using e-invoicing is simple and more efficient compared with dealing with hard copy paper invoices. Moreover, its terms are more favourable and it is environmentally friendly. In addition, customers are provided with a comprehensive overview of their invoices, as well as with a high level of safety, the opportunity to register with the selected invoice issuer, the archiving of invoices and full search transparency. Investment in silver certificates Local investors of the Zagreb Stock Exchange (ZSE) may now invest in silver certificates, that is in turbo-long and turbo-short certificates and another turbo-short certificate on the Frankfurt Stock Exchange DAX index also introduced. Consequently, the number of certificates introduced since September 2012, when trading in certificates was launched at the Zagreb Stock Exchange has reached 27. The three recently launched certificates are quoted in kuna and have been issued by Erste Group Bank AG with headquarters in Vienna. Erste Bank is the representative of the certificate issuer and is also in charge of liquidity maintenance. Grawe Croatia anniversary GRAWE Croatia has marked the 20th anniversary of its business activity on the Croatian insurance market. The anniversary ceremony brought together representatives of the member states of GRAWE Group, Board Members and Board Presidents of other insurance companies in Croatia, as well as representatives of Croatian institutions for the monitoring of insurance companies. GRAWE Croatia is the most successful branch in the GRAWE Group, since it has generated profits for its clients throughout its 20 years of activity.
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Privredni vjesnik Year VI No 226
( 180 wine varieties presented at Urbanovo Fair
Future of wine tourism
Experts as well as entertainers In addition to having to know everything about wine, wine entertainers have to organise a certain kind of show that will arouse tourist curiosity can have the word wine in their title, while visitors mime the title of each song. These are often fun events in which people fully enjoy themselves, Romana Lekić suggested. She added that this is all done since wine tourism presents a full sensory experience through taste, smell and touch. Such tourism includes visits to vineyards, wine shops, wine
Sanja Plješa special type of tourism that promotes wine is becoming more interesting to so-called new-age tourists. Since Croatia is a wine country with many wine roads, the possibilities for developing this kind of tourism are immense. Combining wine and tourism is the next logical step in the development of the wine industry as tourists are offered, through food and wine tasting, an authentic experience and insight into the way of life of a certain area.
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Međimurje is a region paying a lot of attention to gastronomy and oenology, areas with ample opportunities for developing wine tourism. An international wine growing and wine equipment fair was held in May. It was an opportunity to present over 180 wine varieties. In addition to tasting, visitors had an opportunity to visit wine cellars and learn about the development of wine growing and wineries in that area. A series of wine workshops were also held, and one of the most interesting was Tourist entertainment of visitors in the tasting room, held by Romana Lekić, Head of the Tourism Department of Vern University. Trained in tourism When she spoke about entertaining visitors, she highlighted that wine entertainers have to be trained in tourism since not all “wine tourists” are equally motivated. They have different interests and knowledge of wine, thus their reasons for coming are not the same. Some, for example, collect wine labels, others are true wine experts and visit the wine shops to taste new wines.
Promotion and various attractions relating to wine are a market niche for wine shops. festivals and exhibitions, where wine tasting and the experience of staying in a wine growing region are crucial factors for motivating tourists. Even though the majority of wine tourism takes place in natural surroundings (vineyards or trips motivated by wine), as in the case of Urbanovo, they can also be held in urban areas.
Therefore, wine entertainers have to be able to recognise why a certain group of tourists visited the wine shop. Besides the fact they need to be well informed about the wine shop range, wine enter-
tainers have to prepare a type of show that will arouse their curiosity for wine tourism. Wine entertainers should, for example, organise contests in guessing or singing. These songs
Pušipel should be branded Wine producers Štampar, Dvanajščak, Jakopić, Goričanec, Novak, Posavec, Hažić and Tomšić are leaders in promoting wine and wine tourism in the County of Međimurje. Their various wines and the local famous variety, pušipel (also called šipon or moslavac in Moslavina) are well-known in Croatia and abroad. However, according to sommelier Darko Baretić, the quality of pušipel needs to be improved, and it should be mainly used for producing sparkling wine; finally, it should be branded. In fact, Baretić regards that pušipel should have a 30% share of total wine production in Međimurje.
Co-operation with wine producers In order to develop wine tourism in a specific destination, wine producers, tourists and tourist agencies acting as destination management organisations, have to participate, says Rudi Grula, Manager of the Tourism Office of the County of Međimurje. Hey says that wine tourism connects consumer behaviour and demands as well as a strategy with which destinations develop and sell wine on the market. Wine promotion and various attractions is a market niche for wine shops. In fact, this is an opportunity for consumers to become more informed, and the wine and wine products are sold directly in wine shops, he concluded.