Fourth Biznis plus Conference Those who will cannot be innovative or invest in new production will not be sustainable in the long run
AgroFructus It is simple: competitive raw material equals competitive products, says in leading exporter of fruits and vegetables
Multimedia again pests It is not a classical scarecrow like that from The Wizard of Oz, it is solar scarecrow
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Croatian Business & Finance Monthly Established in 1953 Tuesday / 7th April / 2015 Year VIII / No 0246 www.privredni.hr
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pvinternational pv international C R O A T I A N
C H A M B E R
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E C O N O M Y
€300 MILLION IN SUBSIDIES FROM EU FUNDS
Grčić: Strong generator of economic recovery We secured end-users help in co-funding and pre-funding, where an EIB loan has an important place in project realisation, notes Government Vice-President Ilijana Grgić ast week, Croatian Finance Minister, Boris Lalovac, and Vice-President of the European Investment Bank, Dario Scannapieco, signed a loan contract for co-funding projects from EU funds for the period 2014-2020. The loan will allow EU member countries to secure local components for financing projects subsidised by EU funds. In December 2014, the Board of Directors at EIB approved a framework loan of €600 million. This created an opportunity to negotiate a further transaction of €300 million according to the need and use dynamics of the first loan.
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Improving the quality of life The EIB loan will be used to subsidise priority projects for improving life quality for the general public. The loan will allow easier absorption of EU funding and contribute to economic growth, strengthen competitiveness and create new jobs, Vice-President of the European Investment Bank Dario Scannapieco said. He also praised the Croatian administration after evaluating the Government
invested considerable effort in improving the administrative capacity for accepting EU funding. The EIB loan of €300 million will help subsidise projects from the Competition and Cohesion Operating Programme in the field of traffic, energy, environment, health, research and development, environmental protection, social infrastructure, ICT technology and urban development (student dormitories primarily). The total value of the Competition and Cohesion Operating Programme 2014-2020 is estimated at €8.1 billion of which €6.8 billion will be allocated from European structural and investment funds. Government Vice-President and Minister of
Regional Development and EU, Funds Branko Grčić, stated that the first transaction will be used primarily for co-funding key infrastructure projects, mainly railways. Thereafter, other traffic considerations will follow (water management, waste management, health and education). This is an extremely favourable loan for Croatia. The interest rate is very low, with the highest indicative rate being 1.3%. We secured our end-users help in co-funding and pre-funding, where the EIB loan has an important place in project realisation, Grčić said, and added that Croatia, as a EU member, can expect stronger co-operation with EIB and other institutions.
EIB has approved €4.4 billion to date From 2001, EIB has approved around €4.4 billion for subsidising 54 projects in Croatia, of which 33 concern the public sector, which they subsidised with €3.3 billion. The other 21 projects concerned the private sector, and the bank issued loans valued at €713.2 million. In the public sector, EIB mainly subsidises large infrastructure projects, for example, infrastructural renovation and modernisation of railways, utility infrastructure in areas of special state care, renovation and construction of roads, motorways and gas pipelines as well as SME’s, through credit lines of the Croatian Bank for Reconstruction and Development.
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Privredni P Pr ivredni vjesnik Year Year VIII No 246 Ye
“Above all, we can have a competitive product, and the basic preconditions
could come from EU funds, but it is first necessary to draft a strategy so these funds could be directed to development.”
Board President of AgroFructus Group, Denis Matijević vićć
FOURTH BIZNIS PLUS CONFERENCE
With joint force to new c
All businesses in the region are faced with the severest competition globally in any field. Those who will cannot be in Vice-President of Agrokor for retail, Ante Todorić Ljiljana Lukić he goal, purpose and dream of every country is to be an economic leader. However, this has been achieved by only one person – Ivica Todorić. Thus the reason why the secret of Agrokor’s success was one of the themes of the fourth conference of the regional business club, Biznis plus. The conference was held in Belgrade, and one of the Croatian co-organisers was Privredni vjesnik. Turkey was the region’s mutual partner at the conference. Over 300 participants, politicians, entrepreneurs and journalists came to Belgrade from Serbia, Croatia, Slovenia, Montenegro, Macedonia and Bosnia
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Agro-business is a great regional opportunity, but it lacks expertise, organisation and money, notes Matjaž Vodopivec and Herzegovina (Albania was missing, but is also a member of the Club). Besides introductions, the programme included a series of panels, namely ‘Reflation of construction as a precondition for economic growth’, ‘How to climb to the top of South-East Europe and survive there’, ‘Agrokor Consortium; Energy safety and efficiency of the region’, ‘Where are good human resources hiding?’, ‘Wasted potential of agro-business’ and ‘How to promote business cooperation between the region and Turkey’. The purpose of this regional project of the six media
houses is to connect companies and associations in order to accelerate the development of their business and extend markets, both together and individually. A vast number of new contracts have been signed to date, and it was announced that after this conference, entrepreneurs would meet in Skopje, Ljubljana and Istanbul. Never better conditions for co-operation The conference in the Plaza was introduced by Serbian Prime Minister, Aleksandar Vučić, with the following words: “Serbia is politically and economically ready to co-operate with the countries of the region; economic integration is crucial for regional countries, since more work can be done and greater prosperity can be achieved if we work together. Political and economic conditions for co-op-
eration have never been better; regional co-operation is not a question of liking, but of competition and interest”. “We are all small countries, with a small populations, and as a market, we are not large enough to stand alone. However, as a unique market we will become more attractive to investors, and this will increase our strength and productivity”, Vučić said. He evaluated that industry and construction hold the greatest potential for partnership, and each country in one way or another co-operates with third countries that could motivate regional co-operation. Agrokor is one of the best examples showing that it is possible to succeed in this region and invest competitively, Executive Vice-President of Agrokor for retail, Ante Todorić, said during the panel dedicated to the success of the company. He re-
vealed that investment is crucial for increasing purchasing power in the region. Those who will not be innovative or invest in new production and human resources will not be sustainable in the long term, Todorić noted. He agreed with an often-mentioned mentioned point – that regional countries are small, with different mentalities, and that only the future will prove who will succeed. In order to be sustainable in the long-term, you have to be as competitive and successful as you can, Todorić said to other entrepreneurs. Invitation from the Turkish Minister It is obvious there is room for regional co-operation in the construction sector, as the participants of the panel evaluated, and this was further confirmed by the Turkish Minister for Customs and Trade, Nurettin Canikli, who invited regional con-
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“ We plan to invest $400 million in construction by 2020, and another $300 million by 2023 in big infrastructural projects, such as the construction of the largest airport in the world in Istanbul.”
Turkish Minister of Customs and Trade, Nurettin Canikli nikli
contracts and markets
nnovative or invest in new production and human resources will not be sustainable in the long run, said Executive
structors to participate in future big contracts. “We plan to invest $400 million in construction by 2020, and another $300 million by 2023 in big infrastructural projects, like the construction of the biggest airport in the world in Istanbul”, he said. He also added that construction companies can perform well in Turkey since hundreds of thousands of buildings will be demolished, and new ones will be built, resistant to earthquakes. Concerning infrastructure, the plan is to construct rapid railways, roads and bridges across the entire country. The potential of this strong market and poorly used opportunities were discussed by Serbian Trade and Tourism Minister, Rasim Ljajić. He reported that all ex-Yugoslavia member countries plus Albania, achieved $3.6 billion of trade with Turkey. This is only 0.9% of the to-
Business the strongest link The Chief Secretary of the Council for Regional Co-operation, Goran Svilanović, evaluated that business is the main factor in regional co-operation. Businesses realised long before politicians that we have to step outside the national framework in order to survive in any business, Svilanović said. Last year, regional countries trade with CEFTA stood at €15 billion. Consolidation of the regional market is also visible on the level of investment within the region. During the past several years it totalled €2.5 billion, and I know more can be done in this sense, Svilanović concluded. tal between Turkey and the rest of the world, and also twice as less that its trade with Romania. The fact that 130 South Korean construction companies are currently building in Turkey proves this is a construction market of global proportions. Agro-business is a great regional opportunity, but it lacks expertise, organisation and money. The goal is not to join forces, but to achieve quality, which is the most important ticket to the global market, said Matjaž
Vodopivac, General Manager of the strategic business area of sweet and salt products for Atlantic. Love does not last forever Board President of AgroFructus Group Denis Matijević, said trade could be the generator for the agro-business. Above all, we can have competitive products, and the basic preconditions could come via EU funds, but it is first necessary to draft a strategy so these funds could be directed to
development. Love does not last forever, but a competitive product is a healthy and long-term foundation, opined Matijević. Regarding the energy sector, panel participants agreed it is more beneficial for the region to invest in energy saving, rather than expensive renewable sources. He assessed that it is doubly profitable to redirect a share of funds for renewable energy towards the energy efficiency of buildings and renovation of facades since constructors would also be employed. Board President of Janaf Dragan Kovačević highlighted that national energy policies do not exist any longer, only regional ones. “You have to be at least 10% networked with regional countries. Croatia already stands at 67% as it left the ex-Yugoslavian network”, Kovačević said. Croatia is in all European and world data in terms of energy supply, which is also good for Janaf. However, whether it will be possible to also count on experts in this part of the world, remains dubious, since highly educated and expert resources tend to leave all the regional countries, a point discussed during the panel ‘Where are good human resources hiding?’, moderated by Darko Buković, Editor in Chief and Director of Privredni vjesnik. Drenislav Žekić, Procurator at Preclarus komunikacija believes that knowledge and experience are the greatest capital, and that good business has to be built on good resources. Organised companies create internal databases of resources, and they know what they have at any given moment, Žekić highlighted.
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Privredni vjesnik Year Yeear VIII No 246 Y
“The North – South divide is rather reminiscent of a former relationship - that between East and West. Croatian EU membership, therefore, during the past 18 months has not had a significant impact.” John Peet, The Economist
CAN POLITICAL, ECONOMIC AND BUSINESS INTEGRATION BE A CATALYST FOR GROWTH?
Ljerka Puljić: Consolidation business an imperative for
A continued and concentrated process of integration of companies in the region will certainly occur during the forth and 40 million and positioning on this market can generate higher revenue in relation to exports to highly demandin Jozo Vrdoljak ollowing the previous two EU South-East Europe Summits, held in Bulgaria and Romania, The Economist magazine organised a similar conference in Croatia for the first time. The Conference ‘Can political, economic and business integrations be a catalyst for growth?,’ was organised by The Economist in co-operation with the Ministry of Foreign and European Affairs of the Republic of Croatia and the Croatian Chamber of Economy. The conference brought together professionals and around 250 participants from a dozen countries from SouthEast Europe.
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Croatia as a leader Branko Grčić, Vice President of the Croatian government and the Minister of Regional Development and EU Funds, emphasised the fact that, considering salaries, retirement pensions and standard of living of the public, Croatia ranks amongst the leaders in South-East Europe. “Our membership of the European Union provides Croatia with immense opportunities and she has a substantial advantage in relation to other countries in the region. The level of Croatian public debt has increased rapidly, primarily due to the growth in real-estate and construction, primarily a result of lending. Nevertheless, the rise in lending saw a slowdown, primarily if the calculation according to the new methodology is omitted from the rise of the public debt”,
stressed Grčić. “A continued and concentrated process of integration of companies in the region will certainly occur during the forthcoming period. It is a market of between 20 million and 40 million consumers and positioning in this market can generate higher revenue in relation to exports to highly demanding developed markets, stressed Finance Minister, Boris Lalovac. Recession and a likely exit John Peet, editor of The Economist magazine pointed out the fact that Croatia has been facing recession for the last six
years. “The general situation is extremely complex, as a result of additional problems concerning the new Greek government, as well as the Russian-Ukrainian conflict. It is a well-known fact that reform implementation in the South is substantially more difficult compared with the North. Consequently, Southern Europe progresses far more slowly than Northern Europe. The North - South divide is rather reminiscent of a previous relationship – that between East and West. Croatian EU membership over the past 18 months has not had a significant impact. It has to be stressed that Croatia needs
to foster investment in order to enhance her competitiveness. A glimpse of hope on the horizon is the renewed economic growth in the Eurozone. Perhaps the weakening of the euro, and a relatively low oil price also need to be mentioned in relation to this issue”, he pointed out. Richard Grieveson, an analyst and regional editor with The Economist concluded that economic recovery in this region, including Croatia, is slower compared with other parts of Europe. “It is certainly due to a large number of reasons, yet I believe it is primarily a result of slow implementation of reforms. Reform implementation
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“In all our business plans we have been conquering country markets through investment, rather than
export. As a result, we were the only ones who did not face financial losses following withdrawal from the CEFTA market.”
Ljerka j Puljić, j member of the Supervisory p y Board of Agrokor g
n and focus on the region
coming period. It is a market with a population of between 20 million ng developed markets, stressed Finance Minister, Boris Lalovac in the countries in this region is of fundamental importance for the European Union, irrespective of the fact that prospects for EU accession in the near future, for certain of the countries in the region, are currently relatively low. Croatia has seen some improvement during the last several quarters and that is certainly a reason for optimism. Thus, we expect Croatia to exit from the recession in 2015. The recovery has been greatly affected by the growth achieved in some European countries that are trading partners with Croatia, as well as by several global aspects such as lower oil prices and a relatively low euro exchange rate. There are many challenges concerning the reforms, yet their implementation is crucial”, emphasised Grieveson. Integration processes in the EU Zvonimir Savić, Director of the Sector for Financial Institutions, Business Information and Economic Analysis at the Croatian Chamber of Economy, pointed out the importance of an increased rate of absorption rate of EU funding. The EU budget for the period between 2014 and 2020 stands at €960 billion, of which €325 billion will be allocated to various countries to foster development. “Croatia will be allocated €8.6 billion during that period, and which will need to be used primarily for the financing of total public investment. Croatia has been provided with a unique opportunity to strengthen her economy through EU mem-
bership, as well as to reposition herself against a backdrop of new circumstances to contribute to the promotion of stability and safety in Southeast Europe that has only recently started the integration process completed by Croatia through EU accession. The EU is counting on Croatia and it has
Credit growth is normally negative in most countries, opines Peter Tabak from EBRD to be highlighted we have been given an opportunity we must not miss”, pointed out Savić. Ljerka Puljić, a member of the Supervisory Board of Agrokor, stressed that Agrokor has been operating in a relatively small market of 20 million consumers, yet it is considered as a role model for successful integration. “Synergy on these markets provides us with a competitive advantage in relation to large European retail chains which operate throughout the region. We invested through takeovers of well-known brands in these markets, as well as
through an investment in the education of our managers in order to be able to keep abreast of the large players. Moreover, we invested in logistics, which is also our significant competitive advantage. In all our business plans, we have been conquering markets through investment, rather than through export. As a result of this approach we were the only ones who did not face financial losses following withdrawal from the CEFTA market”, highlighted Ljerka Puljić. “Consolidation and focus on business are imperative in this region. Consequently, Agrokor turned towards its closest competitor – Mercator – and opted to find synergies with it. The strength of local suppliers is a reserve for growth”, she stated. Banking sector and its impact Banking and the stability of the banking sector are fundamental, according to Andrea Enria, President of the European Banking Authority. “The crisis has significantly affected the banking sector. It is important to provide an answer to the question as to when the crisis started affecting
Four points for exiting the crisis Vedran Džihić, Senior Researcher at the Austrian Institute for International Affairs, highlighted four fundamental points for exiting the global crisis. According to him, stimulating global policy, government effectiveness of individual countries in the region, integration, as well as emotions fostering a return to optimism. These four issues require comprehensive amendments to achieve sustainable competitiveness. The path towards it is long and the slight growth we have currently seen is not a sign of exit. Focus on these four points is the only long-term solution”, pointed out Džihić.
the banking sector, as well as on the current point of bank integration on the market following the start of the crisis. Companies were heavily indebted and the settlement of bank balances was an imperative, as well as the stabilisation of the overall situation. The issue of bank assets is currently being stabilised, whilst lending is slowly gaining growth. It is certain that South-East Europe will see an increase in interest rates over the next three years and consequently a comprehensive assessment of the resilience of the banking sector is currently under way, pointed out Enria. Petar Tabak from EBRD stressed that the crisis has had the greatest impact on SME’s in most countries in this region. “Credit growth is normally negative in most countries. According to research, the approach to financing SME’s throughout the region is a vital issue that needs to be addressed. Enhancing both the effectiveness and efficiency of bankruptcy proceedings is fundamental“, emphasised Tabak. Marko Remenar, member of the Management Board of Zagrebačka banka, stated that pre-bankruptcy settlement proceedings affected primarily SME’s, which was significantly impaired following these proceedings, as small and mediumsized businesses normally cooperated with large companies. “Implementation of judicial reform is imperative in order to accelerate pre-bankruptcy settlement proceedings“, opined Remenar.
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Privredni vjesnik Year VIII No 246
( €2.33 million
of non-repayable funding for Klimaoprema
KLIMAOPREMA TO BUILD FACTORY IN INDUSTRIAL PARK NOVA GRADIŠKA
€4.9 million of investment We understand our investors’ needs, and are capable of responding to them in a short amount of time and with quality products, notes Director of Industrial Park Nova Gradiška, Ivan Sertić arly March marked the beginning of construction work of a factory for air-conditioning and ventilation equipment in the Industrial Park, Nova Gradiška. The investor is Klimaoprema, a company from Samobor. The project is worth €4.9 million and is financed by EU funds, which is the reason why the selection of contractors has to be performed in compliance with strict EU regulations and vast administrative preparations. The contract for building the factory on 6500m2 was won by the company Presoflex gradnja from Požega. The pre-contract for the construction of new halls was signed by Klimaoprema’s CEO Branko Duvnjak and the Mayor of Nova Gradiška, Željko Bigović in December 2013. The first construction phase should be completed by the first half of this year and will create 40 vacancies. By 2020, Klimaoprema announced it would expand its business facilities by another 10,000m2, which would mean the number of staff
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would increase to 200. Nova Gradiška is well-positioned; it has a fully equipped business zone next to the motorway, which is the best opportunity in Croatia to achieve long-term sustainable growth for production oriented companies. We found the representatives of the zone and the community to be friendly and extremely professional, Klimaoprema’s CEO, Branko Duvnjak stated before signing the construction contract. €2.33 million in non-repayable EU funds
Klimaoprema achieved funding for the project of expanding factory facilities through a tender Increasing economic activities and competition with SME’s, from the Operating Programme of Regional Competition 20072013, which started in 2013. In conjunction with the project to increase competitiveness on international markets, worth a total of €6 million, €2.33 million of non-repayable funding was allocated to Klimaoprema, which made the decision on the new investment much easier.
Klimaoprema had to invite tenders for suppliers of machinery and factory equipment. The bidders had to submit their tenders to Klimaoprema by mid-February. Klimaoprema is the leading Croatian producer of air-conditioning and ventilation equipment with 40 years of experience. They have over 200 workers in the main factory in Samobor, and they invested their work and expertise in many business facilities, hotels, sport halls and other buildings in Croatia and abroad. This is a successful business story coupled with the agile Nova Gradiška zone that invests a lot in its relations with fast-growing companies. “We built quality infrastructure, and the cost of our fully-equipped sites are very competitive. We offer a package of local investment subsidies and relief. We understand our investor needs, and are capable of responding to them in a short amount of time and with quality products, Director of Industrial Park Nova Gradiška Ivan Sertić said. (I.V.)
NEW INVESTMENT OF ATLANTIC GROUP
Project valued at €15.8 million In the industrial zone of Nova Gradiška, Atlantic built a factory for producing energy bars, a line of sport and active nutrition foods. This project is valued at €15.8 million, and during the first year of production, 50 new jobs will be created, but the aim is to hire a total of 160 staff based on the planned business growth. The factory started operating in April 2014. The company says that the new factory also presents additional
value in other business segments, since it offers the possibility of exchanging knowledge and expanding the line in co-operation with other businesses in the field of nutritional foods. Modern nutrition trends are dictating the production of food in the direction of healthy and functional meals. The system’s competencies and new capacity will help meet the needs and nutritional habits of today’s busy pace of life.
Atlantic Group is the leading European producer of sports and active nutrition, under the Multip-
ower brand. The majority of their products are produced in their factory near Hamburg (powder products and compressed products), and in Rogaška Slatina (beverages), while energy bars had been produced by a third party until recently. According to the company’s strategic decision on producing energy bars in their own factory, this new investment aims at securing personal production and synergies in the production system. (K.S.)
www.privredni.hr Business & Finance Weekly
7 ::: news
( €2.23 billion
Main Assembly of Luka Ploče in May
level of registered obligations in the construction industry
Financial Agency
1,893 companies signed pre-bankruptcy settlements The amount of total debt creditors reported when submitting the application for pre-bankruptcy settlement is €9.31, and this relates to a total of 7,817 companies employing 63,146 staff y 20th March, 1,893 companies signed pre-bankruptcy settlements according to data provided by the Financial Agency (FINA). The total sum of their reported obligations exceeds €3.92 billion, with these companies employing a total of 27,626 workers. Concerning their financial restructuring plans, these were adopted by 577 companies, employing 6,976 workers. Their reported obligations exceeded €1.33 billion. In simpler terms, between 1st October 2012 and 20th March 2014, financial restructuring plans or settlement was approved in 2,470 cases, and the total amount of their reported obligations exceeded €5.26 billion. Looking at an overview of solved and active cases, it is visible that 7,250 cases have been solved to date. However, it should be men-
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The highest level of corporate obligations was registered in the City of Zagreb (over €3.70 billion) tioned that solved cases relate to those including dismissed proposals for starting pre-bankruptcy settlement procedures, cancelled procedures and procedures that ended with the acceptance of a financial restructuring plan. The amount of reported obligations is slightly over €7.9 billion, and they employ 50,693 workers, according to data provided by FINA. On the other hand, there are 567 active cases cover-
ing 12,453 workers, and the total amount of their reported obligations exceeds €1.4 billion. In reality, the level of reported obligations, that is, the sum of total debt creditors reported when they submitted the application for pre-bankruptcy settlement, is €9.31 billion, and this concerns 7,817 companies with a total of 63,146 employees. The majority of cases (6,928 or 88.63%) related to those with reported obligations under €1.3 million each, but their total reported debt exceeds €0.92 billion. The remaining 11.37% concerns 889 cases with reported obligations over €1.3 million each. The total debt of these companies is slightly over €8.39 billion. Majority of settlements signed in Zagreb Concerning activities, the highest amount of reported obligations relates to the construction sector
(€2.23 billion). The Processing industry is a close second, with €1.95 billion. Wholesale and retail follow, with €1.52 billion, and accommodation and hospitality services have a total debt of €0.95 billion. Concerning counties, the highest amount of reported corporate obligations that applied for prebankruptcy settlement was registered in the City of Zagreb (over €3.7 billion), followed by crafts from the County of Split and Dalmatia (over €1.32 billion), County of Osijek and Baranja (€0.71 billion), County of Primorje and Gorski kotar (€0.67 billion) and County of Varaždin (€0.45 billion). By 20th March 2014, a total of 1,893 settlements were signed in commercial courts. The majority were signed in Zagreb (541), Osijek (451), Varaždin (271), Split (241), Rijeka (183), Zadar (118) and Bjelovar (88). (V.A.)
The Management Board and Supervisory Board of Luka Ploče have scheduled the Main Assembly for May 11. The Board’s report on the company situation for the business year 2014 as well as making the decision on profit distribution will be on the agenda. In 2014, Luka Ploče earned over €3.5 million, of which €0.2 million will be distributed to legal reserves and over €3.3 million will be transferred to retained profit. GRAWE in surplus In 2014, GRAWE Hrvatska achieved positive results. Aftertax profit increased 4.7% (€5.6 million) in relation to 2013. Compared with the Croatian market for mandatory motor vehicle insurance that registered a fall of 20.1% last year, GRAWE highlights their premiums increased by 9.6%. Investment and cost planning helped increase profits and capital as well as our mathematical reserve, which now totals over €0.3 billion, GRAWE Board President for Croatia, Igor Puret, commented. Krka’s Board proposes €2.20 dividend
The Board of Management and Supervisory Board of the pharmaceutical company Krka has proposed a €2.20 gross dividend per share, which is 4.8% more than the dividend paid last year. Payment of the dividend in total amounts to €71.7 million will be proposed to the Main Assembly of shareholders scheduled for 18th June. Concerning other profit reserves, a total of €54.9 million should be distributed, with €54.9 million being transferred to the next year.
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Privredni vjesnik Year VIII No 246
( €43.4 million
amount Valamar Riviera plans to invest this year
IVANA BUDIN ARHANIĆ, BOARD MEMBER OF VALAMAR RIVIERA
Tourism should grow
Hotel owners are advocating a 5% VAT rate reduction, which would bring Croatia €2 billion of new investment over t Jozo Vrdoljak rivredni vjesnik talked with Valamar Riviera Board Member, Ivana Budin Arhanić, about business activity and the plans for this tourism company, as well as the position of Croatian tourism and tourism companies in general.
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How much will you invest this year and where? What do you expect from these investment projects? In 2015, Valamar Riviera plans to invest around €43.4 million into facilities, products and services of our tourist portfolio, with the goal of raising our quality and increasing competitiveness in strategic markets. Our biggest investment for this year is a project worth €32.9 million, concerning the elite family Valamar Isabella Island Resort 4* on the Island of Sveti Nikola, scheduled to open in May. Other announced projects for 2015, worth around €10.5 million concern Istria and Krk, and they will include hotels, apartment complexes and camps. Could you comment on the Tourism Land Act and point to potential flaws? For years, hotel owners and camping associations have been pointing out to the Croatian Government that organising tourism land is an important precondition for investing in and the development of Croatian tourism. True, the Tourism Land Act was adopted in 2010, but it was never implemented. Actually, the Act predicts concessions on tourism land; however, not a single contract based on this Act was signed with the state or local community. This is mainly
Discrimination of large companies What do you think about the decision according to which all companies with 250 employees are considered large-sized, and how does this affect funding from EU funds? Until now, EU member countries have not limited large-sized companies wholly in terms of their participation in funding from the EU, although the priority was given to SME’s for the purpose of their development. However, something similar was not allowed for large companies. We would like to take this opportunity to invite the Government to take concrete measures in order to prevent such discrimination. We are certain that the synergy effects that SME’s and large companies could achieve concerning funding from available funds could accelerate economic recovery.
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( €32.9 million
to be invested in a resort on the island of Sveti Nikola
at a 10% rate
the next five year, 11,000 new vacancies and €0.8 billion in salaries for construction workers because the Act overlooked questionable and non-implementable models of determining ownership or co-ownership of the land. The Government and competent ministries have been working on amendments to the Act for years. However, the new proposal has not made it yet on to their agenda. In the meantime, tourism companies pay 50% of the amount of potential concessions, reducing the interest in solving this issue 50% smaller for both the state and local government. To what extent is the VAT rate a strain on investing, and to what extent is our tourism less competitive in relation to neighbouring countries? VAT rate on accommodation in Croatia is the highest compared with all other Mediterranean countries. It is actually twice as high compared with Greece. This means our direct competitors can offer accommodation at a highly reduced price - and that country going through a horrible debt crisis and under constant pressure of having to increase the income side of their budget. The percentage of money that went to VAT is the money the hotel owners could not invest in developing accommodation capacity. Moreover, in this particular area, the Tourism Development Strategy envisages considerable capacity increase and large investment projects in quality improvement. Increasing the number of hotel visitors is precisely the key to increasing spending per visitor, which leads to a more profitable tourism sector and tourism business activities that offer higher sustainability. This is the reason why
hotel owners are advocating a 5% VAT rate reduction, which would bring Croatia €2 billion in new investment over the next five years, 11,000 new vacancies and €0.8 billion worth in salaries for construction workers. Why do you say the Tourism Development Strategy is not being implemented? The Strategy has to be followed by concrete moves that will allow its implementation. Hotel accommodation in Croatia accounts for 13% of total accommodation, which is simply too low. Last year, total investment in tourism was €410 million,
Around 30% of income today goes to various fiscal and parafiscal contributions. For hotel owners, this is on the borderline of sustainability and the Government’s Strategy envisages €3.2 billion in hotels alone by 2020 – of which the majority would concern investment projects in the private sector. In order to achieve this, hotel owners should have more space – which a lower VAT rate to accommodation would create. It is not a good idea to suffocate through taxation a sector whose investment projects could create a knock-on effect; where investment projects of hotel owners boost the construction sector, spending of visitors, prolong the season – and all these have a positive impact on other economic branches.
What is the impact of fiscal and parafiscal duties on the business competitiveness of hotels? According to present calculations, around 30% of income goes to various fiscal and parafiscal contributions. For hotel owners, this is on the borderline of sustainability. As an export activity with a huge impact on employment, tourism could reach 10% of annual growth instead of the present 2%-3%. Therefore, it is important to review the impact of increasing the VAT rate from 10% to 13%, as well as the effect of the announced Property Act. The proposed model envisages for hotel owners 2.5-5 times higher expenditure than they pay for communal fees. This could stop investments in tourism, which is very dangerous. How was business for Valamar Riviera do last year? Valamar Riviera achieved total income of €0.15 billion in 2014, which is €3.9 million more compared with the same period of 2013. However, it should be taken into account that the increased VAT rate on accommodation reduced income by an additional €3.4 million. In 2014, achieved EBITDA was €37.3 million, and operating profit €10.5 million. Last year Valamar registered 4,284,979 overnight stays, a significant increase compared to 2013 was also registered in Krk and Dubrovnik. Concerning investment, Valamar Riviera achieved a total of €48.7 million of investment in 2014; the largest concerned the Hotel Valamar Dubrovnik President, which became the first five-star hotel for Valamar Riviera, whereas hotels Zagreb in Poreč and Argosy in
Dubrovnik became four-star hotels. How did the camping segment fair, considering the poor weather conditions? The weather had a huge impact on camping in 2014. On the other hand, it also showed that higher investment into camps, their additional offers and service quality could make the camping segment more resilient to weather conditions. Due to continuous investments and good accommodation quality, our camps Lanterna and Kamp Krk received the highest recognition Best Camping 2015, awarded to them by German and Dutch automobile clubs ADAC and ANWB. In 2015, we will continue to invest in our camping portfolio through investment projects totalling €3.3 million. What are the results of being listed on the Zagreb Stock Exchange? What do you expect in the forthcoming period? Last year we united our companies in one strategic company Valamar Riviera in order to rationalise business activities, strengthen our balance sheet assets and provide better understanding to the investing public of our tourism business activities. This is the reason we decided to include ordinary shares in the official market of the Zagreb Stock Exchange at the end of 2014, which was well accepted by the capital market. We believe the shares of Valamar Riviera are welcome on the capital market as an opportunity for quality investors to increase their exposure to the growing segment of tourism activities in Croatia.
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Privredni vjesnik Year VIII No 246
( around HRK500 million invested by the Group during 15 years
AGROFRUCTUS, LEADING CROATIAN EXPORTER OF FRESH FRUITS AND VEGETABLES
It is simple: competitive raw material equals competitive product In 2014 alone, they achieved total turnover of around HRK600 million, and they anticipate the number will increase by 10% by the end of the year Ilijana Grgić groFructus Group specialises in production, repurchase, sale and storage of fresh fruit and vegetables. The Group consists of seven companies in Croatia and abroad. The mother company AgroFructus is located in Croatia, together with its repurchasing centres in Donji Miholjac, Lozan and Pula, including companies Marinada and Bios. There companies abroad are placed in Strumica, Macedonia, as well as in Laktaši and Čapljina (Bosnia and Herzegovina). AgroFructus Group realised there is no development without investment, and so they
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Agrarian policy in Croatia has been a shot in the dark for the past decade, Matijević says
will increase 10% by the end of the year. For Matijević, agriculture is the business of the future, and he knows he needs to continue investing so he could continue playing his role in the future.
invested around HRK500 million over the past 15 years. This investment should be used to produce a more competitive product. Therefore, it is important to have competitive raw material which will result in a competitive end product for the market – this is a simple business philosophy of AgroFructus Board President Denis Matijević. And it seems it is working pretty well. In 2014 alone, they achieved total turnover of around HRK600 million, and they anticipate the number
Investment from IPARD At the beginning of this year over HRK11 million was allocated to the company from the IPARD Programme for investment in their company Marinada, that is, their floor for processing fruits and vegetables, worth a total of HRK25 million. Through an investment worth HRK7 million, they bought new packing and processing lines and adapted the existing production floor. This investment alone increased fruit and vegetable processing to 15 thousand
tonnes, but Matijević does not want to stop here. We have before us, and I am talking about the entire agricultural sector in Croatia, a big investment cycle, consisting of investments in primary agricultural production to be subsidised by EU funds. We have great expectations from this, and participate actively in this process, both our company and our subcontractors. This will be a good generator of development of the entire economy in Croatia, Matijević says. Although great opportunity lies in using EU funds in rural development, Matijević does point out the need of defining a development strategy of Croatian agriculture. We should learn from old mistakes. Our past operative pro-
grammes we spent billions on, resulted today in a non-competitive agriculture. Over the past decade we have based our agrarian policy on meeting local demand for food. We did not base it on producing a competitive product with a comparative advantage. Then we joined the EU on 1st July, and realised several months afterwards, there is no more import – we are all one global market. And so our agrarian policy has been a shot in the dark for the past decade. We should have structured our programmes differently and set different goals. Now we have a new opportunity – EU funds, primarily those concerning rural development. Billions of euros are offered to us, but we do not have an agricultural development strategy, Matijević says. Orientation towards export We are 100% export oriented in the segment of fresh fruits and vegetables. We are the biggest exporter in the segment of processed products, and we might say we filled all capacities in Croatia. Therefore, all of our future investments will be export oriented. Matijević highlights. The 60% share he holds on the Croatian market proves his leading position. They even managed to go beyond the EU and regional market in export of pasteurised fruits and vegetables, and now they place products in Australia, Canada, U.S.A, Switzerland, Israel and Arabian countries.
www.privredni.hr Business & Finance Weekly
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( €2.2 million
investment in Croatian start-ups in 2013
( €21.2 million
investment in Croatian start-ups in 2014
INVESTMENT IN START-UPS
Investment in technology companies standing at €20 million Investment in Croatian start-ups over last year saw a tenfold increase compared with the previous year. Croatian companies primarily attract investment from Europe, the United States and China, with the most significant investment attracted by hardware companies Krešimir Sočković
Investment in WhoAPI
regional survey on investment trends in Croatian start-ups throughout 2014, launched by Netokracija Portal in co-operation with StartLabs, a regional investment fund, provided answers to whether Croatian technology start-ups attract primarily foreign or local investors, as well as what makes them successful. Whilst investment in Croatian start-ups in 2013 stood at €2.2 million, 2014 saw a tenfold increase in the value of investment reaching €21.2 million. Rimac Automobili – a producer of high-technology hardware for the automotive industry, as well as a producer of electric supercars, attracted the most significant investment worth €10 million. The investment into Bellabeat, for the development of its smart devices intended for tracking health and activity of women throughout their lives, was €6.5 million. Farmeron software for food production management attracted investment of €2.3 million, whilst Repsly, a business application for sales operations management, gained investment of slightly over €1 million. Teddy the Guardian ranked fifth among the top five start-ups concerning investment attraction – an interactive smart toy embedded with medical sensors to capture vital data of the child playing with it, having attracted investment of €350,000.
American StartLabs has announced a significant investment of $50,000 in a Croatian start-up. The Rijeka-based company Smart Queries will use the funding for further development of its WhoAPI platform that enables advanced Internet domain search. This business platform enables users to obtain comprehensive information and data on hundreds of thousands and even millions of domains through only several clicks. Such comprehensively structured data on a large-scale are useful to extremely demanding Internet users.
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Investors Bakić and Valić 7 of 19 start-ups or 37 % of startups attracting investment in 2014 are involved in hardware development, as emphasised by Tena Šojer, analyst with Netokracija. “Software projects, accounting for 68.5 % of Croatian start-ups attracting investment in 2014, saw investment worth only 20% of the total, since hardware developers attracted most investment in 2014. It is important to highlight that most individual investment projects originated in Bulgaria – provided by Eleven, a start-up accelerator, and Launchub, a seed and accelerator fund”, she pointed out. 12 investment projects were implemented in Europe, with a total value standing at slightly below €800,000, some 3.4% of total investment funding for start-ups.
Investors from the United States provided over one third – 38% of total investment into Croatian start-up companies, with the highest level of investment originated from Asia where two Chinese investment projects accounted for almost 60% of the total in 2014. Croatian investors funded only two projects; Nenad Bakić invested in the Rijeka-based company E-glas, which is involved in the development of Serwantess, a smart home management voice command system, intended for the disabled and for those with mobility difficulties. Teo Valić invested in Hypersphere, a hardware start-up company, involved in drone development. “Irrespective of the fact that most entrepreneurs believe that businesses should be allowed to operate with a minimum of state
interference, I believe start-ups require a more intensive assistance”, observed Darko Liović, Management Board President at HAMAG-BICRO. “This year we are planning to launch a seed fund with a straightforward operational scheme – once a start-up has attracted private investment, the Agency will participate in investment on a par with the private investor attracted, albeit up to €33,000. Our available funding stands at around €100,000. I believe the funding will be sufficient for a solid beginning, and we will simultaneously enhance the business angels’ scene”, stressed Liović. He also mentioned on-going negotiations with the World Bank concerning a loan that would provide the funding for the launch of a Croatian venture capital fund.
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Privredni Pr riivvre redn dn ni vjesnikk Year VIII Yeeaarr V Y III No 246
( €700 to €800 million annual nett inflow
Research “Business Risks and Business Climate in Central ntral and Eastern Europe”
A weaker euro and lower oil growth in Central and Easter
SME’s will increasingly play a vital role in the economic growth of the region – impacting more significantly in this re European Union. Following several difficult years, the regions of Central and Eastern Europe (with the exception of P that have intensified their search for areas providing new growth potential, according to consultants Igor Vukić weaker euro and lower oil prices could positively impact on the recovery of the countries in Central and Eastern Europe, including Croatia, according to a research conducted by TMF consulting group published by The Economist Intelligence Unit (EIU). The business environment for small and medium-sized enterprises in these countries is becoming increasingly favourable, according to research entitled Business Risks and Business Climate in Central and Eastern Europe. This particularly applies to the Czech Republic, Hungary, Poland and Slovakia. Nevertheless, there are still several administrative, regulatory and tax challenges. According to research findings, SME’s will increasingly play a vital role in the economic growth of the region – impacting more significantly in this region compared with the overall Eurozone
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and the broader European Union. Moreover, SME’s will exploit incentive measures for investment projects, financing opportunities and tax exemptions. “After several difficult years, the regions of Central and Eastern Europe (with the exception of
Real GDP growth (%) Euro area
Central and Eastern Europe Euro Area (CEE)
3.5 3.0 2.5 2.0 1.5 1.0 0.5
SME’s could exploit incentive measures for investment projects, financing opportunities and tax exemptions Poland) show positive trends for international companies. Nevertheless, due to complex tax and reporting systems, as well as a backdrop of uncertainty resulting from frequent judicial amendments, the road to a vigorous recovery is long”, pointed out Juraj Gerzeni, Director of TMF. The TMF Group is a consulting company providing specialised financial, legal and administra-
0.0 -0.5 -1.0
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
Notes: 2014 values are estimates; 2015-19 are forecasts. CEE: Bulgaria, Croatia, Czech Republic, Hungary, Poland, Romania, Serbia, Slovakia, Slovenia Source: The Economist Intelligence Unit.
tive services. It assists investors in the management of their corporate structures and accessing finance and investment funds. TMF Group operates in over 80 countries and has been present in Croatia for 10 years. “Whilst the countries of Central Europe and Romania show positive results, South-East Europe is still lagging behind the others concerning both growth and size,
yet provides ample opportunities”, added Gerzeni. Nearshoring trend TMF analysts have noticed an increasing presence of nearshoring (transferring business in neighbouring countries, as opposed to offshoring or transferring business to distant countries) in Central and Eastern Europe. The trend implies the transfer of facilities
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( €13 billion
could be absorbed by 2020 (TMF forecasts)
prices spur rn Europe
egion compared with the overall Eurozone and the broader Poland) show positive trends for international companies and services and it is particularly frequent in Poland, according to research findings. Countries such as Slovakia and Poland show an
Following EU accession, business growth in Croatia is slowly gathering momentum, according to Silvia Cancedda increasing upswing of technological start-up companies, whilst the growth of centres for joint services still provides a vast range of opportunities in countries such as Hungary and Poland. “Following EU accession, business growth in Croatia is slowly gaining pace. We believe that EU funds, tourism and a new Act on Strategic Investment Projects will greatly assist country development. A large number of administrative hurdles concerning cross-border business have been tackled, which greatly
helps entrepreneurs from other countries of the European Union in their business expansion into Croatia and adapt to the requirements of local law”, pointed out Silvia Cancedda, Managing Director of TMF Croatia. Ability to address risks South-East Europe continues providing growth opportunities, albeit at the same time, many business risks. Potential investors and international companies need to be extremely well prepared to tackle the risks. Local expert assistance is fundamental, as they have extensive experience with the often-volatile legislative and regulatory environment. Furthermore, there are currently still risks of deflation in the Eurozone and the worsening of the Russian-Ukrainian crisis. Irrespective of the risks, the increasing impact of SME’s will shape the business environment in the region, stressed Martin Koehring, Editor at the Economist Intelligence Unit.
Tourism and EU funding against excessive taxes Croatia will prosper due to enhanced availability of both corporate and consumer loans, favourable trends in tourism, as well as a slight overall improvement following EU accession and EU funds absorption, according to TMF analysts. Based on experiences in other central European countries, TMF expects Croatia to be able to absorb between €5.5 billion and €6 billion out of the available €13 billion by 2020. Annual nett inflow is anticipated to be between €700 million and €800 million, which is likely to stimulate the market, albeit not dramatically, considering total market turnover is €45 billion. A positive feature is also the announced sale of neglected state assets. A lower rate of income tax would provide consumers with an additional €39.5 million, which they could use for debt settlement or increased consumption. Of the 23 countries in the regions of Central and Eastern Europe, Croatia is expected to rank 13th according to anticipated market growth, which implies an improvement of 5 places in relation to 2014. On the other hand, negative indicators relate to the tax burden - where Croatia ranks at the top amongst the surveyed countries, as well as concerning the issue of collection of receivables where Croatia ranks 3rd, according to TMF research findings. Neighbouring countries: Serbia showing excellent trading results, Hungary stifling foreign companies Serbian trade showed resilience to austerity measures and it is anticipated it will improve its ranking from a current 10th position by 2 places. Slovenia ranks 20th (near the bottom of the list), as austerity programmes continue with restrictions on government spending and an unfavourable investment climate. Hungary implies risk due to its arbitrary enactment of legislation, primarily laws which are specific for individual sectors and mainly concern foreign companies. Moreover, it is important to highlight a low level of transparency (compared with other countries of Central and Eastern Europe), which taken together adversely affects growth of international companies. Nevertheless, Hungary has a strong market for joint services and a favourable tax climate. Romania growing rapidly, Slovakia providing unfavourable taxation climate Poland is the largest and strongest player in Central and Eastern Europe, as well as the largest provider of outsourcing services globally behind China and India. The government is aiming to create a favourable regulatory environment, both for international companies and for local SME’s. Romania is currently seeing the fastest economic recovery in Central and Eastern Europe, yet needs to continue investment in infrastructure and create greater government transparency. Its SME’s are extremely weak compared with the Visegrád group (Czech Republic, Slovakia, Hungary and Poland), yet it has the greatest potential in terms of qualified labour, primarily in IT industry and is an immensely attractive destination for international business. Slovakia has exceptionally high corporate taxes, substantially higher compared with other countries whose economy is shaped by SME’s. The fact that reforms are not being implemented at the necessary pace and that Slovakia has the highest corporate tax rate amongst the countries in Central Europe is certainly a serious challenge to further growth.
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Privredni vjesnik Year VIII No 246
( €0.4 million
invested in Kokorići eco-ethno village to date
( 12 houses
renovated and operational so far
In addition to the Prvan Hotel and the Vrgorac-based eco-village, there will also be a caravan site
Kokorići ethno village can be reached by helicopter I expect tourism to bloom in the Vrgorac area within five years and now spend most of my time working in Kokorići, stated Pervan As opposed to the situation in the Istrian hinterland, the Dalmatian Hinterland has been neglected and tour operators in the Makarska littoral rarely recommend Dalmatian Zagora – Dalmatian Hinterland to tourists for excursions.
Jozo Vrdoljak n addition to the Prvan Hotel, which includes Kokorići ecoethno village, tourism in the Vrgorac area will be enhanced by a caravan camping site, primarily as a result of the work of Zvonimir Pervan. He and his family own the Vrgorac-based company Prvan. The caravan site is being constructed in the immediate vicinity of the eco-ethno village, which will also include a swimming pool, which is expecting incentive funding through the Ministry of Tourism, as well as a small children’s pool. “The caravan site will comprise of 20 units and will be provided with all sanitary infrastructure. We need to prepare all the required documentation by the end of March, which has then to be sent to the ministries”, pointed out Pervan. 12 houses in the Kokorići Ethno village have thus far been renovated and are operational, with
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four having been redecorated to provide accommodation, whilst the remainder will promote traditional crafts. The ethno village resembles a typical Dalmatian town, both in the diverse programmes and natural sights and stone architecture. It has an ethnography collection covering 300 exhibits. Kokorići eco-ethno village also has a heliport, whilst the construction of an amphitheatre for concerts and cultural and entertainment events is currently ongoing. Prvan Hotel has 22 rooms with 44 beds and a rooftop swimming pool. Entrepreneurial competition Pervan believes that some projects have caused a degree of envy and have been transformed into a motivational force, resulting in the development of entrepreneurial competition in the Vrgorac area. Following excellent results of several of his projects,
showing tourism opportunities even in areas are not located on the Adriatic Sea, five resort homes with swimming pools have been constructed in the area, as well as a large number of wine cellars that accommodate visitors for wine tasting. Pervan believes that the development of this area can further aid his business activities, and is anticipating greater investment by local entrepreneurs in accommodation and tourist programmes. According to Pervan, tourism in the Vrgorac area will bloom over the next five years. His optimism is based on an increasing number of entrepreneurial initiatives and investment in tourism. “An increase in the number of entrepreneurs in the area is fundamental, as it is the only path towards destination development. Monopoly of small places is not prosperous in itself, as opposed to a hotel industry monopoly in a larger city,” opined Pervan.
Operating throughout the year “Any tourist is a good tourist. In order to operate sustainably, I need to organise programmes for tourist groups and I have created programmes for cyclists and mountaineers. I have been negotiating with several agencies concerning the organising of such groups. The hotel operates throughout the year and the ethno village only during the peak season. If mountaineering and cycling prove to be successful projects, my ambition for the ethno village is to operate yearround. It would certainly create new jobs”, highlighted Pervan. The Prvan company currently employs six staff. He is planning to reconstruct eight more houses in Kokorići. The value of investment in the Kokorići eco-ethno village currently stands at €0.4 million, without adding Pervan’s own work and the assistance provided by friends. “I believe I need to invest a further €0.26 million, although this is only an estimate. It is currently impossible to make an accurate evaluation. I can only say that I spend most of my time working here, assisted by my family and friends and I can do a considerable amount of work using moderate funding”, pointed out Pervan.
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( 360 degrees
captured by ‘scarecrow’ camera
( from €400 to €1300 serial production prices
UNUSUAL BUSINESS IDEA
Multimedia against pests I was thinking about how useful it would be to use a device which would monitor crops 24/7 without human presence, provided it is not a classical scarecrow like that from The Wizard of Oz, explained Tanja Putar, creator of the solar scarecrow Svetozar Sarkanjac sijek-Baranja County has been awarding the best business ideas in a special contest over the last several years. Irrespective of the fact that business ideas from the IT sector or marketing are normally awarded in similar contests, this year’s award was won by a ‘solar scarecrow’.
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The most damaging ‘pests’ in orchards are frequently people; the scarecrow owner is notified of their presence by the mobile phone The developer of this unusual idea has no contact with agriculture in her private or business life. Pest repelling sounds “It appears almost unbelievable how a flock of starlings can manage to create substantial damage in vineyards and orchards, or the damage done by field mice in pumpkin or watermelon farms, irrespective of high technology. It is fascinating how people can have so many orchards and vegetable gardens and be completely unprotected. I was thinking about how useful it would be to be able to use a device which would monitor crops 24/7 without the need for human presence, provided it is not a classical scarecrow like that from The Wizard of Oz”, explained Tanja Putar. During the last several years large areas of agricultural land have been damaged by drought and floods.
Moreover, many farmers complain of rodents and birds damaging crops, as well as increasingly frequent crop thefts. “The idea behind my innovative business idea originated from the last two factors. If it is practically implemented and recognised by both clients and professionals, I believe it will significantly help farmers lives”, she pointed out, adding that the ‘solar scarecrow’ has the contours of a classical scarecrow and its basic function is repelling birds and rodents. It is multimedia monitoring of crops using sophisticated technology. In its ‘head’ there are cameras and loudspeakers and can move in all directions. Its trunk comprises a solar panel and inside it, is all the required technological equipment. It is operated by a thermal engine and can also move its ‘hands’. The loudspeak-
ers emit the required ultrasound frequencies to repel birds and rodents. It will also emit sounds that emulate predatory birds, as well as people, in case the camera captures crop thieves. Watch out, we’re filming Scarecrows have been created in three models. The shortest is 1.5 metres tall and the tallest can be up to 3.5 metres in order to enable monitoring of land areas of up to 1 hectare with a single scarecrow. In addition, the scarecrow can be connected with a mobile telephone through a specific mobile application and the owner can be provided with direct sight of what is happening in the field, the orchard or vineyard, and can react without the need for their physical presence. To sum up – it operates as a highly effective method of video surveillance. Its
What next? Tanja Putar announced she is planning to create a prototype for testing a large number of possibilities and in order to identify potential shortcomings. Nevertheless, the production costs per prototype stand at around €25,000. Since she is currently not able to invest into production, she would be happy to accept assistance from interested investors. She emphasised the importance of following an idea, as well as finding a market niche that has not been filled or recognised. estimated retail value will depend on the size of the required model and technological specifications but will range between €400 and €1,300 in serial production.