SURVEY CONDUCTED BY VALICON FOR PRIVREDNI VJESNIK → Increasing inclination for business ownership PAGES 2-5
SUPPORTED BY THE CROATIAN CHAMBER OF ECONOMY
www.privredni.hr
CROATIAN CHAMBER OF ECONOMY ASSEMBLY → Reforms are good, but pace is too slow
INTERVIEW: MATIJA FOJS, DIRECTOR, HOĆU KNJIGU! – BOOKSTORE FRANCHISE → Our goal is to be the best, not the biggest PAGES 8-11
PAGES 6-7
PVinternational C R O A T I A N
B U S I N E S S
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F I N A N C E
M O N T H L Y
January 2018, Year XI, No 276
CROATIAN BUREAU OF STATISTICS
Economic growth at 3.3% It is now 13 consecutive quarters in which GDP has grown. It is also the third largest rate since the start of the crisis, stated Director of the Croatian Bureau of Statistics, Marko Krištof by Ilijana Grgić
D
uring the third quarter of 2017, Croatia recorded real economic growth of 3.3% in relation to the same period of last year, according to estimates provided by the Croatian Bureau of Statistics. Seasonally adjusted quarterly GDP saw 0.9% growth compared with the previous period, and in relation to the same quarter of 2016 it showed a real growth rate of 3.2%. “GDP growth has been seen for 13 consecutive quarters. It is also the third highest rate recorded since the start of the crisis, stated the Director of the Croatian Bureau of Statistics, Marko Krištof, who highlighted that, according to revised data, for the whole of 2016 GDP growth increased from 3% to 3.2%, and in the second quarter of 2017 it rose from 2.8% to 3%.
INVESTMENT STILL RISING The largest positive impact on the increase in GDP during the third quarter of 2017 was via a rise in the export of goods and services, which were up by 5.7%. Nett foreign demand was negative, since the rise in imports exceeded the increase in exports (imports were 9.5% up). On the other hand, domestic demand made a positive contribution. It is important to note that, amongst domestic demand components, the 3.7% increase in household final consumption expenditure made the strongest impact on economic activity. Investment also positively affec-
ted GDP. Gross fixed capital formation was up by 3.4% in the third quarter on an annualised basis, the ninth consecutive quarter in which it showed growth and a slightly superior result compared with the previous quarter, (3.3%). Furthermore, the third quarter saw an increase in government consumption by 2.3%, slightly up compared with the 1.7% recorded in the previous quarter. According to preliminary estimates, quarterly gross value added during the third quarter of 2017 showed real growth of 2.6% over the same quarter in 2016, according to original data, whilst the greatest impact on growth came from accommodation and food and drink preparation. “Growth was recorded in all other activities with
the exception of agriculture where a 3.1% drop was recorded in the third quarter, due to the consequences of drought”, noted Krištof, whilst pointing out that this year Croatian GDP has seen growth at a faster pace compared with the EU average for the tenth consecutive time. According to data published by Eurostat, GDP in EU member states recorded a quarterly growth rate of 0.6% and 2.5% growth rate on an annualised basis. In terms of economic growth, Croatia ranks in the middle, with Holland, Spain and Austria, whilst the fastest growth rates were recorded in Romania, Latvia and the Czech Republic. Great Britain, Denmark and Bulgaria, on the other hand, showed the lowest growth rates.
SURVEY CONDUCTED BY VALICON FOR PRIVREDNI VJESNIK CONCERNING
INCREASING INCLINA BUSINESS OWNERSH Most members of the general public who participated in the survey, (65% of those questioned), showed interest in starting their own business, whilst 52% of respondents had considered it but taken no concrete steps by Bruno Rakamarić, Valicon, Ilijana Grgić
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roatian general public have been showing a high level of interest in and inclination towards starting a business, according to the latest survey conducted for Privredni vjesnik by Valicon, a regionally operating organisation. The survey was conducted across 314 respondents and focused on entrepreneurial spirit. 65% of those questioned showed interest in starting their own business; 52% stated that they had merely considered it without taking any concrete steps, whereas only 9% stated that they were actively developing a plan and intended to start implementation in the forthcoming future. Only 4% of those surveyed had attempted to start their own business, but were unsuccessful. 8% of those surveyed stated that they currently own a business, a microbusiness or a start-up, and 13% of respondents noted that they used to own a business or that they never considered starting one. It appears logical that the generation with extensive life experience, or the Baby Boomer generation, saw the largest numbers of those who had ventured into entrepreneurship and thus currently own or have owned a business. On the other hand, amongst the youngest generation, the Millennials, the largest number equated with those who have only considered starting their own business or have just started developing a plan for launching one. Those who are considering, planning or have already started their own business stated that their interest in venturing into entrepreneurship was primarily encouraged by the opportunity for the greater personal freedom provided by it, as well as greater potential for creative expression, which was the opinion stated by 29% of those surveyed. An additional 25% of re2 | PVinternational | January 2018 | No 276
spondents stated that starting a business also included the potential for generating higher revenue. Around 15% of those surveyed consider starting a business as a personal challenge that they would like to take and around a similar percentage have shown motivation by the flexibility of working hours. Around 11% have a more opportunistic stance towards starting a business, as they would like to start a business or they have already done so, since they had been given an opportunity at a specific point and they believed that opportunity needed to be exploited. The least frequent reasons for starting a business include an aversion towards authority and the possibility to independently select people or businesses for co-operation. “Nevertheless, concerning public opinion on the issue of the ease of starting a business, 65% agree that it is possible to start a business, yet it requires great effort. Moreover, they believe the process is demanding and fraught with challenges. Unacceptably high taxes and financial charges, a discouraging administrative system with excessive red tape and nontransparent and unstable economic laws and regulations have been pointed out as the greatest obstacles to entrepreneurial spirit and starting a business”, according to the Marketing Consultant and Re-
search Expert in Valicon, Kristina Črep, who believes that the Croatian economy would certainly have substantial benefits from encouraging the start-up spirit.
THE EASE OF STARTING A BUSINESS Irrespective of substantial interest in entrepreneurship within Croatia, 17% of those questioned believe that starting a business is very difficult, with 4% believing it to be virtually impossible. Only 10% believe that it is relatively easy to start a business and that one is faced by only minor challenges on the way, whereas 4% of those surveyed believe that it is very easy to start a business and they do not see any impediments. Simultaneously, a larger proportion of those questioned (23%) of Baby Boomers believe that it is very difficult to start a business, whilst 10% are convinced that it is almost impossible. Unacceptably high taxes and other financial charges are considered as the greatest obstacles to starting a business by 23% of those questioned. The list of potential obstacles to entrepreneurial ventures also includes a discouraging administrative system with excessive and unnecessary paperwork, which is followed by unstable and non-transparent economic laws and regulations and in general a discouraging economic situation in Croatia. Only 9% of those
AMONGST THE BABY BOOMER GENERATION THERE IS A GREATER PREPONDERANCE OF THOSE WHO HAVE ALREADY VENTURED INTO ENTREPRENEURSHIP AND CURRENTLY OWN OR HAVE OWNED A BUSINESS
ENTREPRENEURIAL SPIRIT AND DIGITISATION CLUS EX I
ATION FOR HIP
FO R P VREDNI RI
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N VALICO ESNIK VJ
Interest in starting a business (n=314)
13% 22% 65%
interested own or have owned a business uninterested
Ease of starting a business (n=314)
21%
14% 65% simple demanding but possible difficult
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SURVEY
Reasons against starting a business
OBSTACLES (n=301)
MOTIVATORS (n=274) 29%
greater freedom/creativity higher earnings
25%
challenge
15%
flexible working hours
14%
taking the opportunity
11%
desire to be “one’s own boss” possibility to independently choose associates
5% 1%
questioned believe access to financing is a major impediment for starting a business. A slightly higher number has yet again shown to be more convinced than other respondents that unacceptably high taxes and other financial charges are the greatest obstacles to starting a business in Croatia. “Tax policy and legislation are highly specific and complex topics. We have been discussing the complexity of the administrative system for ages, and can only hope that perhaps the digitisation of society will manage to simplify some matters over time. Nevertheless, additional encouragement to entrepreneurial spirit can be provided through different activities, ranging from training and education, perhaps through a more practical educational system or additional educational activities. Moreover, a more vigorous promotion of sources of investment and incentives, as well as the promotion of clusters and similar interest groups intended to provide support to entrepreneurs, are imperative”, noted Kristina Črep.
taxes/financial charges administration non-transparent laws and regulations discouraging economy financing and promotion of business insufficient expertise/experience excessive stress and risk severe competition customer acquisition organisation of business responsibility of running a business other obstacles
their own capital, whereas those from Dalmatia are more inclined to apply for a bank loan. “Entrepreneurship needs to be encouraged and nurtured from the earliest age and we are hoping both young and future generations will be bolder in terms of economic challenges and that they will more actively achieve their ambitions. It would certainly be important that these ambitions are achieved in Croatia, rather than in some other “promised land””, noted Kristina Črep.
BUSINESS DIGITISATION AND ENTREPRENEURIAL SPIRIT The possibility to provide online services without paperwork, online sales channels, online payment systems and communication with users leading to instant replies to user inquiries and re-
FINANCING SOURCES FOR NEW BUSINESS In case they were to start a business, 33% of those surveyed stated that they would like to do it using their own financial resources and savings, whilst 27% would opt for a formal investor, such as a fund, a sponsor or government incentives. 19% of those questioned would decide to apply for a bank loan, and around 10% would attempt to raise the seed capital by borrowing from parents, friends or relatives. According to the preferences of financing sources, differences have been seen concerning regions and so Zagreb citizens prefer starting a business with 4 | PVinternational | January 2018 | No 276
quests have been pointed out by those questioned as the most distinctive features of modern, advanced digital companies. Respondents also stressed some other more classic and common features of online business, such as the possibility for contracting services online without paperwork, the existence of online shopping sites and online sales channels, as well as online payment systems and
23% 19% 16% 10% 9% 6% 6% 4% 3% 1% 1% 2%
communication with users which lead to instant replies to user inquiries and requests. In addition to believing that some aspects are more typical of digital businesses which distinguish them from other businesses, the same aspects have been pointed out by the general public as highly important for users. Consequently, the abolition of paperwork and online contracting of services have been highlighted as the most important and the most useful features of digital businesses by 39% of those questioned, followed by online payment systems, which was pointed out by 29% and the communication system, which was stressed by 25%. Online sales channels were highlighted by 24% of those questioned, whilst 24% of them believe instant replies to user inquiries or requirements to be extremely important. Furthermore, the possibility to personalise services, the use of different platforms and devices, a higher quality of services and the existence of a mobile app to provide an overview of the range of products or services, as well as of a spending review, to be highly significant. Irrespective of its being pointed out as ultimately the most important feature, the abolition of paperwork is a slightly less important aspect of digital business, according to Baby Boomers and they ranked it fourth, following online communication channels, the use of different platforms and devices and a higher quality of services.
ATTITUDE TOWARDS DIGITAL BUSINESS The majority of those questioned showed a positive attitude towards digitisation.
Characteristics of digital businesses
IMPORTANT FOR THE USER (n=314)
no paperwork online payment solutions 45% online communication online sales channels 31% instant reply to customers personalisation of services 22% use of different platforms and devices higher quality of services 16% availability of a mobile app 8% products or services presented in an interesting way simple and intuitive use 6% social media presence
OBSTACLES TO USING DIGITAL SERVICES (n=314) no obstacles loss of privacy loss of personal relationship with customers loss of jobs no confidence in this type of service no insight into the functioning of such service
They believe that by this method of doing business, advantages considerably outweigh disadvantages. Only 3% of surveyed participants believe digital business to be negative and to result in more obstacles than benefits, whereas 30% showed a neutral attitude towards digitisation. 4% of the survey participants felt they were insufficiently informed about this issue to provide an opinion. “Concerning attitudes towards digitisation, there are not many differences amongst various population segments. Nevertheless, it appears that a smaller proportion of Baby Boomers attribute importance to paperwork abolition, as an advantage of introduction of digital business, whilst Millennials are more inclined to point out the loss of privacy and jobs as disadvantages of using digital services”, emphasised Kristina Črep.
their personal information, the loss of personal relationship, communication and contact, in addition to the loss of jobs caused by computerisation and digitisation. Moreover, they also stressed a lack of confidence in this type of service, a preference towards traditional business forms, inability to understand it and insufficient insight into digital services and processes.
THE ABOLITION OF PAPERWORK AND THE ONLINE CONTRACTING OF SERVICES HAVE BEEN HIGHLIGHTED AS THE MOST IMPORTANT AND THE MOST USEFUL FEATURES OF DIGITAL BUSINESS In line with the dominantly positive attitude towards digitisation of business, as many as 45% of those questioned believe that there are no special obstacles that could prevent them from opting for online and digital offers. Amongst the potential obstacles to using digital services, respondents most frequently mentioned the loss of privacy due to their giving
DIGITISATION IN BUSINESS It is important to note that 44% of Millennials questioned see the loss of privacy and 29% of them the loss of jobs as greater obstacles to using digital services compared with the remaining population. On the other hand, they attribute minor importance to obstacles such as the lack of understanding and
39% 29% 25% 24% 24% 21% 18% 17% 17% 15% 12% 8%
insufficient insight into digital services. In addition to showing a positive attitude towards digitisation, the general public mainly believe that the adoption of a digital way of doing business is in general important for Croatian businesses, as it helps both users and businesses. An additional 45% of those questioned are convinced that digital business is extremely important and crucial for market survival of businesses in the forthcoming future. Nevertheless, when asked to provide an opinion on the current situation in leading Croatian companies in terms of digitisation, those questioned stated that local companies have started this process in some business areas, yet substantial improvement is required. Amongst Zagreb citizens, 50% of those questioned, generally believe that local companies have only just started the digitisation process in some aspects. In accordance with the positive attitude towards the use of digital services and the importance attributed to digital business, the general public believe that they would consider the digital aspect of doing business in case they decided to start their own business. Hence, 40% of them would organise their business in such a way that it is primarily digitised, whereas 15% of those questioned would fully digitise their business should they decide to start their own business. An additional 38% of survey participants stated they would at least partially digitise their own business from start-up, whilst the smallest proportion were those who would not become involved in business digitisation at all or who stated that they would postpone it for some future period of the development of their own business. January 2018 | No 276 | PVinternational | 5
CCE CROATIAN CHAMBER OF ECONOMY ASSEMBLY
REFORMS ARE GOOD, BUT PACE IS TOO SLOW The Chamber has turned completely to its membership with the intention of becoming the key decision co-creator for the economy, entrepreneurship, exports and investing, since politics have to take the voice of the economy in consideration, Luka Burilović highlighted by Krešimir Sočković
We welcome the present amendments to the Act on professional education
which envisages transforming schools into regional competence centres. However, we believe the model proposed by the CCE, according to which the private sector could play a larger role, could be a more efficient solution to the problem. Luka Burilović
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he main goals for the Croatian Chamber of Economy for 2018 will be internationalisation and the promotion of the economy, supporting the interests of its membership through chamber associations and communities, education, peaceful dispute resolution and the implementation of public authorities and projects – as announced at the sixth Assembly of the Croatian Chamber of Economy. Planned total revenue for the Chamber for 2018 is €28.6 million, and anticipated surplus of revenue over expenditure is slightly over €4,000. In 2017, the Chamber’s revenue was 13% higher than planned (€25.6 million), and income from the sale of goods and services increased 18%. We are especially pleased with the revenue increase from EU projects and the growing number of voluntary members, such as many family farms, crafts and other operators that recognise the benefits of our services. This clearly shows that the CCE is moving in the direction of the strategic goal of increasing personal revenue as well as revenue from European funds in relation to revenue from membership fees, CCE President Luka Burilović highlighted. He also added that even better results are anticipated for 2018, since the economic recovery could be followed by membership greater interest in shows, training seminars and other services offered by the CCE. Hence why total structure of planned revenue for 2018, personal and other revenue, amount to 31% of the total, and with the aim to increase it above 50% by 2020, Burilović said.
NEW REPRESENTATIVE OFFICE ABROAD In 2018, the CCE plans to organise over 50 incoming and outgoing delegations for members, around 100 international shows, and will
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offer support in entering new markets through the three existing representative offices in Brussels, Moscow and Shanghai as well as six new international representative offices that will be opened in Bosnia and Herzegovina,
WE WILL CONTINUE WITH THE PROMOTION CAMPAIGN OF LOCAL PRODUCERS AND PRODUCTS, BURILOVIĆ SAID Serbia, Austria, Germany, Italy and Turkey. The goal is to enable Croatian entrepreneurs to expand their business through exports. We have to build an image of a country at a global level and brand our quality products abroad, Burilović highlighted. In order to continue promoting the development of the Croatian economy, Buy Croatian and Croatian Product promotion activities will continue during 2018. Also, the promotion of the holders of the marks Croatian Quality and Croatian Creation will continue. It is also planned to organise 73 local shows. We will continue with the promotion campaign for local producers and products since we need to make buyers aware that by purchasing Croatian products we are investing in the development of our economy and are contributing to the presence of local production in the tourism sector, Burilović notes. Concerning the economic situation, the CCE
President evaluated the past year as a positive one. An upward trend in production, spending and exports continued, whilst debts and deficit decreased. Fiscal consolidation was successful. The Government’s decisive reaction to the Agrokor situation was crucial for preventing a collapse that could have affected society as a whole. We should be satisfied with the direction of economic policy and initial results, but this is not the case with the speed and level of required changes and reforms. Reform processes should speed up this year so that we may keep up with other countries and stop the threatening negative demographic trends, Burilović evaluated. He also added that the most important aspect is to find a solution for the lack of workforce, and the Chamber will continue insisting on this matter through the dual education project.
SCHOLASTIC SYSTEM IS A PRIORITY Professional education represents 70% of high school programmes, so it is worrying that it ranks low on a list of priorities. We welcome the present amendments to the Act on professional education which envisages transforming schools into regional competence centres. However, we believe the model proposed by the CCE, according to which the private sector should play a greater role, could be a more efficient solution to the problem. We have to learn from the example of good practices in Germanic countries and avoid making the mistakes of our neighbour – Slovenia – where the entire expense of professional educational reform, after initial financing provided by EU funds, was covered by tax payers. This is potentially a huge problem. This entire process is 20 years late, but if we implement it, the de-
mands of education and the labour market will be balanced. Today we have 180,000 unemployed, and the market needs 20,000 workers. This is absurd. We don’t have sufficient number of qualified workers to cover the sectors in deficit: shipbuilding, tourism and the wood industry. Actually, there isn’t a sector which does not have this problem, Burilović warned. It was announced at the Assembly that the work of associations and communities of the CCE will continue. The CCE will continue to participate in creating national and European laws and economic policies of promoting members’ interests. The intensive promotion of resolving disputes outside the courts will continue with the aim of faster and more rational resolution of disputes through the work of the Permanent Court of Arbitration– Mediation Centre and Court of Honour. I am convinced that we will set the foundations in 2018 for elevating the country’s growth potential, solving the issues it depends on in the long run. Having this in mind, the Chamber turned completely to its membership with the intention of becoming the key decision co-creator in the economy, entrepreneurship, exports and investing, since politics have to take the voice of the economy into consideration, Luka Burilović concluded.
The goal is to enable entrepreneurs to expand their business through exports. We have to build an image of a country at a global level and brand our quality products abroad, Burilović highlighted. Luka Burilović
PROFESSIONAL EDUCATION REPRESENTS 70% OF HIGH SCHOOL PROGRAMMES SO IT IS WORRYING THAT IT RANKS LOW ON A LIST OF PRIORITIES, CCE PRESIDENT WARNS January 2018 | No 276 | PVinternational | 7
INTERVIEW MATIJA FOJS, DIRECTOR, HOĆU KNJIGU! – BOOKSTORE FRANC
OUR GOAL IS TO BE THE BEST, NOT THE BIGGEST We can finally focus on what was actually our primary goal – to bring people back into bookstores and make them feel at home. It will be a great challenge to launch our web shop, which is scheduled quite soon by Ilijana Grgić grgic@privredni.hr
We believe the symbiosis of bookstores and publishing present in Croatia today is not natural and we are glad that Hoću knjigu! is exclusively a bookstore franchise – an alternative and something new and fresh on the Croatian reading scene.
T
he Croatian bookstore market has just received a new member. Its main goal is to revive the culture of reading and making books and reading fun and entertaining. Hoću knjigu! is a new bookstore franchise. Its approach to books and selling them is somewhat of a venture in this complex market. Besides being state-of theart and offering readers a wide variety of quality titles, Hoću knjigu! bookstores offer advice from expert sellers with far-reaching knowledge of literature, said Director of Hoću knjigu! Matija Fojs. What inspired you to take over six bookstores of the now defunct bookstore franchise Algoritam? Zvonko and Jurica Ćubrić, my business partners and friends, have worked with paper related work and partly with publishing. Their father sold his ownership share to Fokus, the largest supplier of office materials, and the Čubrić family decided to invest some of the profits into launching the Hoću knjigu! bookstore chain. We decided to do this so we could prove that bookstores can be legitimate work; that it is possible to pay one’s obligations on time and make some profit at the end of the day. One of our main goals is to modernise the reading experience in Croatia since we are convinced that books and visits to a bookstore and libraries are still one of the main sources of entertainment in the world.
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What will be the focus of your future activities? We began working only a few months ago. Our primary focus was to reopen bookstores so that people who had worked in them would not be out of job for too long. Actually, we are ex-
WE ARE CONVINCED THAT BOOKS AND VISITS TO THE BOOKSTORES AND LIBRARIES ARE STILL ONE OF THE MAIN SOURCES OF ENTERTAINMENT IN THE WORLD tremely happy that after consulting with bookstore managers we kept the majority of the staff with great experience in selling books. Furthermore, we were able to offer better conditions than their previous employer. Considering we have recently opened our last bookstore so far – Megastore – in the
HISE
January 2018 | No 276 | PVinternational | 9
INTERVIEW looking for. The latest titles, a place to read and trained staff who will help an interested person navigate a sea of books – these are a minimum of what today’s bookstore should offer. There are also other activities, such as an interesting interior design and fun workshops or launching events. These are the things that will attract people who are maybe not keen readers. This is the segment we are working on with great care.
WE WANT TO MAKE PEOPLE AWARE WE ARE HERE AND LET THEM KNOW THEY CAN FIND ANYTHING THEY WANT HERE AND HAVE FUN AT THE SAME TIME
What we want to achieve is that our customers not only enter our bookstore to buy a book, but to enjoy the atmosphere the bookstore will offer and in which the customers will find what they are looking for.
heart of Zagreb, we can finally focus on what was actually our primary goal – to bring people back into bookstores and make them feel at home. It will be a great challenge to launch our web shop, which is scheduled soon. The web shop should be the most advanced online store, both in Croatia and regionally. Will you be involved in publishing or just sales? The fact we are not publishers makes our job easier, since we do not have to stack our shelves with not so attractive titles but which we published. This is our biggest advantage compared with the competition since we, as sellers, exclusively meet the needs of our customers. We believe the symbiosis of bookstores and publishing present in Croatia today is not natural and we are glad that Hoću knjigu! is exclusively a bookstore franchise – an alternative and something new and fresh on the Croatian reading scene. What should a modern bookstore have? Wh Books Bookstores we dream about and which we will create c finally have long existed globally. The situation si is different in Croatia. What we want tto achieve is that our customers not only enter our bookstore to buy a book, but to enjoy the th ambiance the bookstore will offer and in which wh customers will find what they are
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Can we say that the Croatian business scene has started to show progress, for example, paying obligations on time? Timely payments should never be an exception, but a rule. We know that each business can be hit by an unforeseen scenario, which can delay payment. However, to avoid your obligations for months, even years; to avoid paying your suppliers, translators and employees – this should have been possible only in the Sci-Fi novels found in our bookstores. Unfortunately, this was the reality for many bookstores and publishing houses in the world. We hope we have generated a positive trend, since we pay our obligations on time, and we hope others will follow in our steps, which will make our co-operation more honest, healthier and successful. Do Croatians read and what genres do they prefer? Even though the media often describe Croatians as a people who do not read, or they read one to two books a year, we think this is not quite true. We think that book accessibility is a much bigger concern. Croatia is a small player on the world scene, and some popular foreign titles arrive much later than they should. If we could change that, we believe reading trends would change for the better. Also, the real situation is not as bad as shown in statistics. Regarding the genres, Croatian readers keep up with global trends so they read mainly romance novels, crime novels and popular psychology.
BRODOSPLIT
Would you reveal some of your future plans? As already mentioned, now that we have dealt with the main part (to open all bookstores that we had planned), we now want to focus on the organisation – or as we like to say – we want to introduce the ‘coolness’ factor into our bookstores. We have slowly started working on it so you can find in our Megastore an elevator inspired by the Tardis from Dr. Who. You can also find the largest offer of film and literature memorabilia in Croatia. We pay special attention to working with the Ministry of Magic, an association that will bring joy to children every month with magical workshops. Furthermore, Amaterapeuti, an acoustic band, helps people forget their daily problems with their music in the middle of the week. Our ideas are limitless, we only need the time to achieve them. It is important to mention our main goal is to be the best, not the biggest. We want to make people aware we are here and let them know they can find everything they want here and have fun at the same time. Which three books would you recommend to business people and why? I would recommend What Would Google Do by Jeff Jarvis – since it deals with the most important aspects in the business world. Also, Cen-
CROATIAN READERS READ MAINLY ROMANCE NOVELS, CRIME NOVELS AND POPULAR PSYCHOLOGY tury of War: Anglo-America Oil Policy and New World Order by F. W. Engdahl, since it will teach you the strategy and the dark side of market domination. The third book is Diamonds, Gold and War: The Making of South Africa by Martin Meredith, since it shows what people are capable of doing and where it can lead us. Do you have a special book and why is it special? There are two books which impressed me, that is, changed my relationship with books – Catcher in the Rye and The Great Gatsby. These are the first books that really caught my interest and brought me into the magical world of books. Before these books, I mainly struggled with reading comprehensive literature in school and though of reading as a punishment.
Polar expedition cruise vessels These are high value-added products, stressed Debeljak
T
he Split-based Brodosplit shipyard has recently held the keel laying ceremony for Hull 484. It is a polar expedition cruise vessel for Polar Expeditions Inc. “This is the first vessel in the class LR PC6 cruisers to be manufactured globally. We are thus entering a new and a more positive niche market. We have followed this path since inception and the building of this vessel is confirmation that we are moving in the right direction. The polar expedition cruising market is a growing niche market and we have already received a substantial number of orders and are hoping for more similar contracts in the forthcoming future. These are high value-added products”, pointed out Tomislav Debeljak, President of the Management Board of Brodosplit. Debeljak was not prepared to reveal the cost of this vessel, yet he stated that Brodosplit will be operating profitably “We are currently operating against the backdrop of such circumstances that, irrespective of the signing of a good contract, one needs to continuously focus on all expenditure incurred during building. We have already completed a large number of sec-
tions and so on its launch the vessel will be extremely well-equipped and prepared for delivery by the contracted deadline. The vessel will be available for the first cruise passengers in the Arctic season of March 2019”, noted Debeljak. It has to be noted that this will be the first polar expedition cruise vessel built globally in the class LR PC6, meeting the latest and highest requirements of Lloyd Register for Polar Class 6 vessels. The vessel will be 107.6 meters long, with a beam of 17.6 meters and it will reach a speed of 15 knots, powered by two engines with a total output of 4,260 kW. It will accommodate 196 passengers in 85 cabins. The design and all technical solutions were provided by Brodosplit shipbuilding designers who have yet again confirmed their key role concerning the high profile of Brodosplit on the list of technical competencies and shipbuilding competitiveness. Frane Matulić, Project Manager, stated that this vessel is highly demanding concerning the construction aspect. “We have encountered a large number of problems, since this is an ice class vessel, yet we have succeeded in successfully solving them all during vessel design”, emphasised Matulić. (J.V.)
January 2018 | No 276 | PVinternational | 11
CROATIAN NATIONAL BANK CONFERENCE
THE ADVANTAGES OF INTRODUCING THE EURO OUTWEIGH THE COSTS Croatia is a small, open and a highly Euro-ised country, with substantial financial and commercial connections with Eurozone countries. In addition, the greatest benefit to introducing the Euro Croatia can expect, is the elimination of exchange rate risk, according to Vujčić by Ilijana Grgić grgic@ privredni.hr
If a modern country is able to manage its own financial resources, it is a powerful tool, and the question arises as to why a small country would join a large currency area in which it would not have any decisionmaking role. Drago Jakovčević, Professor at the Faculty of Economics
A
n analysis of the economic costs and benefits to introducing the Euro has shown that Croatia would see significant long-term benefits, even more so compared with those for some countries who have already adopted the Euro. According to our estimates, costs will be low concerning the intensity and of a one-off basis. This is due to the fact that Croatia is a small, open and a highly Euro-ised country, with substantial financial and commercial connections with Eurozone countries. In addition, the greatest benefit that Croatia can expect is the elimination of exchange rate risk, so emphasised the Governor of the Croatian National Bank, Boris Vujčić, during the opening of the Conference organised by the Croatian National Bank, entitled Benefits and Costs of the Introduction of the Euro: from a Croatian Perspective and the Experience of Other Countries. The Strategy for the Adoption of the Euro as the official currency, developed by the Croatian National Bank jointly with the Croatian government, states amongst other aspects that the introduction of the Euro will strengthen any protection capacity in the event of economic tur turmoil, since Croatia will gain access to the Eu European Stability Mechanism, which is inten tended to provide assistance to countries faced wi with financial difficulties. Moreover, as stated in the Strategy, the introduction of the Euro will re reduce risks of financial and macroeconomic sta stability and favourably affect financing conditio tions, which is intended to accelerate growth an and strengthen economic resilience, with saving ings both for the general public and businesses du due to the elimination of currency exchange op operations and payment charges for crossbo border Euro payments. In addition, a positive im impact on investment may be anticipated.
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“This is primarily due to the fact that Croatia is a small, open and a highly Euro-ised country, with substantial financial and commercial connections with Eurozone countries. It is important to highlight that the greatest benefit from the introduction of the Euro is the elimination of exchange rate risk”, noted the Governor Vujčić.
THE EUROPEAN COMMISSION AND THE INTERNATIONAL MONETARY FUND HAVE ISSUED WARNINGS CONCERNING THE WORSENING OF THE CROATIAN STRUCTURAL DEFICIT, WARNED MARUŠKA VIZEK POLITICAL DECISION TO ADOPT THE EURO HAS ALREADY BEEN MADE Concerning the issue of joining the Euro, the Director of the Institute of Economics, Maruška Vizek, emphasised that Croatia could certainly enter the Exchange Rate Mechanism. Nevertheless, it is uncertain whether she can withstand the five-year pace of reduction of the difference between current and public debt and the maximum debt ceiling, in order to join the Eurozone.
“The European Commission and the International Monetary Fund have issued warnings concerning the worsening of a Croatian structural deficit. My opinion is that we will not be able to adopt the Euro; this is based on historical experiences, since we have never been sufficiently capable of a constant reduction of public debt for five years”, stated Maruška Vizek, pointing out that in 2018 Croatia will be faced with an increase in technical expenditure by the government. Drago Jakovčević, Professor at the Faculty of Economics, stressed that the political decision on the adoption of the Euro has already been made, which is actually the greatest weakness in terms of public debate and its development. “Sovereignty in modern societies, in addition to a flag, a coat of arms, a national anthem, the police and the military, comprise also of a country’s own currency. I believe that the issue of a national currency is an issue that concerns all generations, or the most important issue that Croatia will face in the 21st century. If a modern state can manage its own financial resources, it is a powerful tool and the question arises of why a small country would join a large currency bloc in which it would not be a decision-maker”, noted Jakovčević, stating that in his opinion the Croatian National Bank has never promoted savings in local currency. Had it done so at 2% or 3% higher yields on savings, bank assets would currently, after 25 years, be in the local currency, which would have significantly reduced any exchange rate risk.
JOINING THE EURO AREA AT AN UNDEFINED DATE “We would not like to commit to any timescale at this point. We need to complete what we have started and I am referring to a high quality and informative public debate. We are simultaneously aware of all the tasks that need to be performed in order to be able to
gain access to the Exchange Rate Mechanism at some stage. After that, matters will certainly accelerate”, pointed out the Minister of Finance, Zdravko Marić, adding that Croatia currently meets practically all convergence criteria agreed upon in the Maastricht Treaty. According to the performed analyses, the impact of adopting the Euro is primarily positive. Nevertheless, depending on specific features of individual national economies, the ratio of benefits to potential costs shows differences amongst various states, pointed out the Slovak Finance Minister, Peter Kažimir, presenting the experiences of his own country. Furthermore, he stressed that after joining the Eurozone in 2009, Slovakia has seen an additional 10% GDP growth. “The benefits to adopting the Euro are significant, ranging from a rise in exports, the acceleration of the convergence process, huge savings in transaction costs, as well as the importance of the strengthening of the role in decision-making. The Euro is a part of the success story of my country and after having joined the Euro, we saw an increase in public support for the Euro, which in 2009 was rarely the case. Both public and political consensus are fundamental for adoption, since the Euro cannot be introduced within an election cycle. It cannot be achieved within a government mandate. This process needs to be started within one government mandate and completed within the following one. Consequently, a political consensus concerning this issue is imperative”, noted Kažimir. In addition, he highlighted the major importance of the process of explanation to and the persuasion of the general public concerning the issue of adoption, stating that they currently all belong to a club established against the backdrop of the idea of solidarity, amongst other things, also with the countries such as Greek and Spain.
BOTH PUBLIC AND POLITICAL CONSENSUS ARE FUNDAMENTAL FOR THE ADOPTION OF THE EURO, EMPHASISED KAŽIMIR
January 2018 | No 276 | PVinternational | 13
STORY WITH A REASON 60 YEARS OF ILIRIJA
CREATOR OF TOURIST DEVELOPMENT AND ECONOMIC GENERATOR Ilirija has become one of the three top tourist companies in the Zadar region and one of the top 15 tourist companies of special interest for the development of Croatian tourism in general, Ražnjević highlights by Jozo Vrdoljak
tourist companies of the Zadar region and it is one of the top 15 tourist companies of special interest for the development of Croatian tourism, Ilirija’s CEO Goran Ražnjević highlights.
WIDE VARIETY OF ECONOMIC ACTIVITIES
I
lirija from Biograd marked its 60th anniversary last year. This is a tourist company which combines five promotional areas: hotels, sailing, camping, destination management company Ilirija Travel and the real-estate segment City Galleria in Zadar, a business-trade centre. As a tourist company, which has been the leader and creator of the tourist programme since its establishment 60 years ago, but also the generator of a full range of economic activities in Biograd na Moru and its Riviera, Ilirija has grown into a state-of-the-art tourist company. It has also become one of three top
TEN YEARS AGO ILIRIJA WAS A TOURIST COMPANY WITH HOTELS, SAILING AND CAMPING AS ITS CORE BUSINESS 14 | PVinternational | January 2018 | No 276
The new millennium was marked by privatisation, and the company’s focus on creating a tourist programme for the 21st century. From the end of 1999 to date, the company has expanded its capacity and improved its offers with special focus on prolonging the tourist season, that is, development of business which lasts throughout the entire year through complementary and integrated forms of tourism. Ten years ago, Ilirija operated in two destinations: Biograd na Moru and Sv. Filip i Jakov. Today, it is in three destinations with a significant presence in Zadar as the region’s economic and administrative centre. Ten years ago, Ilirija was exclusively a tourist company, with core business in three segments: hotels, sailing and camping. The current business system includes a large variety of economic activities whose business operations are realised through five aspects created as a result of expanding the tourism segment to destination management and real-estate. From only one hotel in 1957, today there are now four new hotels, united under one brand, Ilirija Resort with a capacity of over 450 rooms and 1,000 beds, mainly in four-star hotels. The nautical sector of Ilirija encompasses Kornati Marina and Kornati Hotel Port, situated in front of the Ilirija Hotel and Kornati Hotel. It has a total of 805 berths for short-stay and contracted annual berthing. It can accept and equip over 2,000 vessels and over 150 vessels in transit. Kornati Marina and Kornati Hotel Port defined Biograd na Moru as the city of sailing visited by 60,000 nautical tourists a year.
ILIRIJA’S SHARES ON THE STOCK EXCHANGE
Created foundation for promoting corporate, institutional and public character Since 2003, Ilirija’s shares have been quoted on the Zagreb Stock Exchange and since 2015 they have been quoted on its leading quotation Official Market, where there are 28 stocks listed. After two successfully completed additional capitalisations (2015 and 2016) and the buy-in by qualified institutional investors, the foundation for strengthening Ilirija’s corporate, institutional and public character was created. All this will contribute to their further development in all sectors, Ražnjević says. Ilirija is the first tourist company in Croatia which
received Indeks DOP for socially responsible business for 2011 and 2012, for medium-sized companies, awarded by the Croatian Chamber of Economy in co-operation with the Croatia Business Council for Sustainable Development. As a socially responsible company we signed the Diversity Charter, a document signed by business organisations which obliges them to implement diversity and non-discriminatory policies within their business systems, and which is actively supported by the European Commission, Ražnjević points out.
THE MILLENNIUM WAS MARKED BY PRIVATISATION AND THE CREATION OF A TOURISM PROGRAMME FOR THE 21ST CENTURY There are few people who can say they are pioneers or creators of something. To be the first among creators and founders of nautical tourism in Croatia, is Ilirija’s privilege. In fact, 19 years ago Ilirija enriched the destination’s nautical potential by organising a boat show which has developed into a wellknown local, and also in-
ternational, tourist and economic event the Biograd Boat Show, Ražnjević says.
NEW PROGRAMMES OFFERED Ilirija is the owner of the Park Soline camp which caters for over 35,000 guests a year. The camp’s capacity is 3,400 per day and over 1,130 equipped and modern sites and camping spots. By offering additional services which add value to the existing tourist offer, a highquality, integrated and comprehensive tourist product has been created. This is a new area managed by Ilirija Travel destination management company. The core and the implementation of special programmes and products includes personal additional capacities consisting of Nada, the event ship in Zadar, Villa Primorje and agro-tourism through the opening of the first diverse hotel in the direct hinterland of Biograd na Moru, Ražnjević highlights.
19 years ago, Ilirija enriched the destination’s nautical value by organising a boat fair which has developed into a well-known local, but also international, tourist and economic event the Biograd Boat Show Goran Ražnjević, Ilirija’s CEO
January 2018 | No 276 | PVinternational | 15
TOURISM GLOBAL TOURISM LOCATIONS FOR THE FUTURE 2017/2018
TH
CROATIA – 7 DESTINATIO FOR INVESTING IN TOURIS
In 2018, €940 million will be invested in the tourism sector compared with €817 m
T It is anticipated that tourism investment will increase 15% in 2018 in relation to 2017 and almost 40% compared with 2016. These announcements show Croatia is attractive both as a tourist and investment destination. Gari Cappelli, Tourism Minister
he first edition of the Global Tourism Locations of the Future 2017/2018, for the FDI Magazine of the Financial Times ranks Croatia as the 7th country in the world for its potential for tourism investment. Of 43 top world tourist destinations, Croatia also received the Editor’s Choice Award as one of the countries where the greatest progress has been made in the promoting of tourism infrastructure, accommodation, initiatives for tourism development, investing in hotels and the cruising aspect of nautical tourism. Furthermore, in terms of special types of tourism, Croatia was highlighted as a destination for film tourism. Croatia, as a tourist destination, is making progress year by year. We are particularly pleased with the continuous work on innovation and investing. Actually, it is anticipated that tourism investment will increase 15% in 2018 in relation to 2017 and almost 40% compared with 2016. In addition to being an attractive tourism and investment destination, Tourism Minister, Gari Cappelli, highlighted he was very proud that Croatia had received recognition of being the 7th country in the world for investing in tourism. Also, the Ministry of Tourism prepared a survey on tourism investment for this year. The survey includes all counties and tourism companies, and it consists of data received by the Ministry by the end of November 2017. According to this data, €940 million will be invested in Croatian tourism in 2018; of which around €628 million will be invested by companies in their tourism projects and the public sector (counties, towns and municipalities) will invest over €311 million. The announced investment projects of the private sector include hotels, camps, sailing, and accommodation facilities. Investment by the public sector include visitor centres, beaches and promenades. Based on this survey, investment in 2017 totalled €817 million and €676 million in 2016.
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LARGEST INVESTMENTS In 2018, it is anticipated that one of the largest tourism investments for the past several years will start with the construction and renovation of Hotel Belvedere in Dubrovnik, with a total value over €120 million, and the investment project of the Arqaam Capital Bank and hotel company Four Seasons Hotels and Resorts in Brizenica Bay on the Island of Hvar, worth around €0.13 billion. In 2018 Maistra expects to complete and open its five-star Hotel Park in Rovinj worth €72 million. A large number of investment projects are planned in Istria where the Valamar company in the Girandella Resort in Rabac will invest in the construction of the Maro Hotel and the renovation of existing facilities in the Valamar Argosy in Dubrovnik and Valamar Pinia Suites in Poreč. This year Plava laguna will start with the reconstruction of the hotel and tourist complex Laguna Park in Poreč. The company Istraturist Umag announced the renovation of the Hotela
MINISTRY OF TOURISM TO SUBSIDISE STUDENTS
ON GLOBALLY SM
million in 2017
by Jozo Vrdoljak
Quality workers are the foundation of tourism development 423 students will be subsidies during the academic year 2017/2018
Sol Umag and AC Stella Maris camp. Moreover, numerous investments were announced for the continental part of Croatia, including the construction of Ivanov dom, reconstruc-
OF THE 43 TOP WORLD TOURIST DESTINATIONS, CROATIA RECEIVED THE EDITOR’S CHOICE AWARD tion of Arcadia’s annexe and the Swiss villa in conjunction with the special hospital for medical rehabilitation Daruvarske toplice. These accommodation facilities will be categorised as four-star. Also, Hotel Panorama in Prelog will be renovated and the hotel will become a four-star hotel and increase its accommodation capacity.
B
ased on the Programme for subsidising hospitality and tourism HR (Stipendije 2017), during the academic year 2017/2018 the Ministry of Tourism will finance 423 students of future hospitality-tourism as well as other related vocations. This is a significant increase, since the Ministry subsidised 229 students the year before. The Ministry of Tourism will allocate €0.29 million for this programme. In fact, the Ministry has been implementing this programme since 2008, and since then it has subsidised over 900 students. As was confirmed by the Ministry, the scholarships are allocated in co-operation with companies, hotels, camps, tourist agencies, and county craft chambers so that each participant participates with 50% of the funding, that is, the Ministry with 50% and companies with 50%. Gari Cappelli, Minister of Tourism, said that quality workers are the foundation of the future development of Croatian tourism since this is an area where people are crucial for success. We are actively working on increasing the appeal of tourism related jobs through these scholarships, all with the aim of raising the quality of the staff in hospitality and tourism as well as overall tourism of Croatia, Cappelli said. He also added that this programme motivates the education of the students of vocational schools and connects them with future employers even during their education. (S. P.) January 2018 | No 276 | PVinternational | 17
TOURISM HISTORION – AN ECO-HOTEL EXPERIENCE
AN ASTRONOMICAL JOURNE
Through a combination of historical elements and modern technology I was worki Croatian cultural heritage, explained Kovač by Goran Gazdek
P
alković, a wood processing company from near Pitomača, in co-operation with the Pannonian Wood Competence Centre, the first support institution of this type in Croatia, has developed an eco-hotel model room from Slavonian oak in a period of only seven months. It is a product that bears the Croatian Creation label. The product has been enhanced by Croatian design, an innovative approach, as well as the implementation of cultural heritage elements, eco-friendly principles and the application of advanced technology in both design and manufacturing. The project was implemented by co-financing through the Ministry of Agriculture. Its value was €20,000, through a small value grant scheme intended for the encouragement of the development of wood processing and furniture manufacturing in Croatia in 2017. The company has so far been oriented towards the manufacturing of panel furniture. Subsequently a decision was made to develop an entirely new concept and identify a new market. “I was working to design a room from solid wood that would make visitors feel comfortable. It would be a room in the upper price bracket, manufactured by a well-known brand and of well-known origin, intended for four and five-star hotels”, noted Željko Palković, the company owner.
RESPECTING TRADITION The room was designed by the licensed architect Krunoslav Kovač, a winner of multiple awards, who has co-operated with Palković
SEVEN SYMBOLS SHOWN ON THE ORION POT CAN ALSO BE FOUND ON INDIVIDUAL FURNITURE ITEMS AND ON ACCOMPANYING ITEMS on several projects. The motif of the entire concept is based on the implementation of cultural heritage elements – stylised symbols on the pot named Orion, which is, according to some interpretations, the oldest European cal18 | PVinternational | January 2018 | No 276
endar, dating back to 2,600 B.C. The pot was unearthed at an archaeological site in Vinkovci in 1978. “Seven symbols shown on the pot can also be found on individual furniture items and on the accompanying items which provide a comprehensive overview of Croatian history. Carpets were manufactured based on my drafts, as were vases, pots, pictures and lighting. Through a combination of historical elements and modern technology I was working to convey the message that the total concept of a model room is based on Croatian cultural heritage”, explained Kovač. “One of the objectives for the design of Historion hotel furniture was respect for Croatian
EY INSIDE THE HOTEL ROOM ng to convey a message that the entire concept of a model room is based on
THE MOTIF OF THE ENTIRE CONCEPT IS BASED ON THE IMPLEMENTATION OF CULTURAL HERITAGE ELEMENTS A HIGHER VALUE-ADDED PRODUCT
tradition and raising awareness of its value. The project highlights Croatian cultural heritage, which we re-designed and offered on the international market. We approached hotel furniture design with respect, since we integrated into it the culture of a nation, as well as its way of thinking and its history. The exceptional graphic design of the Vučedol Calendar symbols inspired us to attempt to integrate them into furniture items through contemporary design and using available technology. Wood patterns through a broad range of warm overtones revive the wood in a specific way and through technology they clearly show the skill of their manufacturers”, stressed Kovač.
The art historian, Mihaela Kulej, emphasised the fact that the Historion project basically brings together the artistic and heritage expressions of the Vučedol culture, without departing from furniture functionality. “It attracts attention through simple lines and unimposing design, provides content, arouses interest in the part of history that has marked our region and tells a fascinating story. The opportunity to identify this abstract symbolism shown in the contemporary design expression, as well as to discover its significant character and gain insight into the symbolism of each sign, enables one to meet Orion, the Pleiades, Cassiopeia, the Swan, the Twins and Pisces in an hotel room or take an astronomical journey from pre-history to date. Design is applied art and Krunoslav Kovač applied and modernised a part of artistic expression of the Vučedol culture through Historion”, pointed out Mihaela Kulej. Sources at the Pannonian Wood Competence Centre are delighted with the project implementation. “Development of higher valueadded wood products is the basic purpose and objective of the Centre and its operations. Our task was to provide support to the entrepreneur in tackling any challenges, ranging from idea development to product commercialisation. Through the networking of knowledge, skills, an innovative approach and marketing in development and manufacturing of the Hisas torion hotel room, our specific objective was uto boost competitiveness of furniture manueir facturers through the improvement of their ić, market positioning”, explained Ivana Filipović, Director of the Centre. as According to Palković, his company has els the capacity to equip around a dozen hotels ed yearly. The room has already been presented lit at several exhibitions held in Virovitica, Split de and Zagreb. Presentation at specialised trade en fairs both locally and internationally has been planned for the forthcoming future.
I was working to design a room from solid wood that would make visitors feel comfortable. It would be a room in the upper price bracket, manufactured by a well-known brand and of well-known origin, intended for four and five-star hotels. Željko Palković, the owner of Palković
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DIGITAL&TECH CONFERENCE
WE SHOULD CREATE A One of the key goals is to define, describe and assess the Croatia IT industry. The second goal is to open to our companies export markets; the third goals is to eliminate administrative barriers and the fourth is to speed up the digitalisation process, Barišić highlighted by Boris Odorčić we want to be an active partner in the public sector, state administration in their digitalisation and using money from EU funds, Barišić pointed out.
EXPORTS BECOMING A STRONGER COMPONENT
W 2.5 5 billion
€
total revenue of Croatian IT industry in 2016
over
25,000 people employed in the ICT industry
almost
80%
of the ICT industry located in Zagreb
e are absolutely sure we have to create a unique brand for the Croatian ICT industry and as such we could approach European and world markets since, in addition to successful projects in the private sector, there are good examples in Estonia, Finland and Canada, but also nearer to home, in Hungary and Romania. These are countries we can learn from. It is necessary to create a personal brand or rather a strategy for the industry for the future, Vice-President of the IT Association with the CCE Plamenko Barišić stressed at the Digital&Tech conference recently held in Zagreb. The goal of the conference was to review how the IT industry, society and the state intermix, and to present the experience of other EU countries, as well as how digitalisation can increase economic competitiveness. Barišić highlighted that one of the goals of the IT Association was to define, describe and assess this industry in Croatia; our second goals is to direct our companies to exports and new markets. The third goal is to eliminate administrative barriers and the fourth is to speed up the digitalisation process for the rest of the industry, which is the key precondition for their survival and future competitiveness. Finally,
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In order to provide the CCE with in-depth insight to the Croatia IT industry, OmniaConsult and Tvornica istraživanja conducted research on this sector over the period 2008-2016. Total revenue of the Croatian IT industry was €2.5 billion in 2016, Director of OmniaConsult Boris Žitnik said. Revenue stagnated between 2009 and 2012 (or grew at a slow pace). High growth was recorded in 2013, 2014 and 2015. In 2017, regrettably, we anticipate moderate growth or stagnation, he said. He also added that exports are becoming a stronger component as a generator of total revenue. In total revenue from the IT industry exports have a 28% share. Thus, of each €13, €4 is generated by exports. This is a huge achievement, Žitnik says. It is especially interesting that almost 80% of the ICT industry, which employs over 25,000 people, is in Zagreb (€2.01 billion).
TODAY, EXPORTS ACCOUNT FOR A 28% SHARE IN TOTAL REVENUE BY THE IT INDUSTRY, ŽITNIK SAYS Dalibor Subotičanec, Manager of Tvornice istraživanja, points out that over 80% of the managers of IT companies would like to know what they could do to have more satisfied and loyal workers. They also want to know what types of IT technologies are used by other companies so they could adjust their products. Two panel discussions were also held at the conference; IT Industry Generators and Soci-
A CROATIA ICT BRAND ety, Economy and State in the Digital Era. On the first panel, Goran Mrvoš, Director of Infosit, said that digitalisation is in its full swing in tourism. Staff are equipped and connected; marketing is automated – and all this will continue growing. The analytics and data gathered during work are extremely important for increasing sales in the future. We are working mainly on business solutions, but lately our clients have started coming in with business problems we need to analyse ourselves and find a solution to them, since they do not have personal IT staff. Without business solution present IT companies cannot be competitive, but we need to change the existing contracting models. Clients do not know what they want so they demand solution testing and participation of IT companies in risk division when implementing new projects. We need to create solutions to the problems jointly with our clients, but we should have the right to be wrong. We should be more efficient and reduce the risk of failure, Barišić highlighted. In his lecture Making Digital Transformation Work, Nicolas Ivandić, who worked on the project at the German Ministry of Economy with the aim of digitalising Germany’s key industrial branches, evaluated that a strategy does not mean much without the necessary corporate culture. An important advantage to the economy is lost without direct contact with the buyer. That is why in Germany we insist on technology’s closer contact with clients. They need to be included in the creation processes of new products and services. All companies know that digitalisation is important, but no one has a developed plan for its implementation since they do not understand how it benefits them, Ivandić said.
NO DIGITALISATION WITHOUT INTERNATIONALISATION In his lecture Going International, Matthias Grabner presented the experience from the initiative of the Austrian Government and Chamber of Economy which help their companies with internationalisation. There is no digitalisation without internationalisation. Our economy mainly depends on exports, which is why internationalisation is vital to us, Grabner said. The Austrian IT sector is worth €21.2 billion. It employs over 100,000 workers and over 8% of revenue is spent on research and
Boris Žitnik
Plamenko Barišić
development. Secretary to the IT Association, Emil Perić, spoke about the digital innovation hub and presented it as the next evolutionary step of organisations for supporting the devel-
OUR MARKET IS ALREADY SATURATED WITH SOME PRODUCTS AND OPPORTUNITIES WILL BE SOUGHT ABROAD, PERIĆ EXPLAINS opment of the IT industry and economic digitalisation. A hub in one place offers access to competencies, consulting, infrastructure, networking and market intelligence. Our plan is clear – the first step is to assess the industry to see its capacity and who needs help. The second step is networking to avoid fragmentation and to have resources in one place. The third step we will focus on is specialisation, and fourth to connect IT with the industry to implement digital transformation. Finally, there is internationalisation – our market is already saturated with some products and opportunities will be sought abroad, Perić explained. The EU plans to invest €500 million in this initiative by 2020, and the IT Association plans to participate. January 2018 | No 276 | PVinternational | 21
ADVENT IN ZAGREB
THE BEST IN EUROPE AGAIN Zagreb Christmas market has outperformed Christmas markets in Vienna, Budapest and Strasbourg, according to votes cast by visitors to the tourism portal European Best Destinations by Sanja PljeĹĄa
T
he Christmas sounds of bells and the scent of gingerbread cookies, mulled wine, cinnamon and cloves have attracted both local and international tourists to the Christmas Market in Zagreb once again. Its most beautiful edition thus far has ensured it assumed the title of European Best Christmas Market for the third consecutive year. According to the results of an online survey conducted by European Best Destinations portal, of a total of 200,516 votes cast by visitors to that tourism portal, 38,830 voted for the Zagreb-based Christmas market. The Christmas market in Zagreb received the highest number of votes from American tourists (72.45%), followed by Russian tourists (24.81%). Dutch tourists also showed their delight with it, and 77.82% of Norwegian tourists also voted for the Christmas market in Zagreb. They were followed by Greek tourist; German tourists preferred the Zagreb-based Christmas market over those in Nuremberg, Cologne and Rothenburg. Croats primarily voted for Zagreb, which was not surprising. They also gave a large number of votes to Vienna, Budapest and Prague. European Best Destinations portal highlighted the
A TOTAL OF 24 CITIES PARTICIPATED IN THE COMPETITION FOR THE EUROPEAN BEST CHRISTMAS MARKET, WHILST PORTAL VISITORS FROM 131 COUNTRIES PARTICIPATED IN THE VOTING fact that had Croats not voted for Zagreb, the Christmas market in Zagreb would have won anyway, having received a sufficient number of votes to outperform second-placed Colmar in France, which received slightly over 24,000 votes from portal visitors. It was followed by Vienna on 16,300 votes, Budapest on 16,100 and Strasbourg with 12,000 votes. It is important to note that a total of 24 cities
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participated in the competition for the European Best Christmas Market, which saw the participation of portal visitors from 131 countries. The Christmas market in Zagreb retain the title through 2018, during which it is entitled to use the award logo. Moreover, European Best Destinations portal will be providing news, photographs and video material from the Zagreb Tourist Board.