PV International 279 by NEstar

CROATIAN BUSINESSES→ Social networks have become an unavoidable tool in the promotion and brand creation of today’s businesses PAGES 2-6

SUPPORTED BY THE CROATIAN CHAMBER OF ECONOMY

www.privredni.hr

INTERVIEW - GARI CAPPELLI, TOURISM MINISTER → Income growth is a reflection of the visitor structure PAGES 8-11

CROWDFUNDING→ last year the largest number of people participated in and invested into local campaigns PAGES 16-19

PVinternational C R O A T I A N

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F I N A N C E

M O N T H L Y

April 2018, Year XI, No 279

CROATIAN BUREAU OF STATISTICS

GDP at 2% as at end 2017 Throughout 2017 the economy recorded growth of 2.8%, slower than the 3.2% for 2016 and lower than anticipated by Ilijana Grgić

uring Q4 2017, the economy saw 2% growth at an annualised level, the lowest rate since Q2 2015, as a consequence of a mild slowing in personal consumption and of investment growth, according to preliminary GDP estimates provided by the Croatian Bureau of Statistics. “This is the 14th consecutive quarter of GDP growth, yet a slowing has been recorded compared with the previous quarter, when the economy strengthened by 3.3%; it is also the slowest growth since Q2 2015, of 1.9%”, noted the Director of the Croatian Bureau of Statistics, Marko Krištof. Throughout 2017, the economy saw growth of 2.8%, slower than the 3.2% seen

in 2016 and less than anticipated. According to seasonally adjusted data, during Q4 the GDP rose by 0.1% over the previous quarter, whilst when compared with Q4 2016, it rose by 2.2%.

SLOWER GROWTH COMPARED WITH EUROPEAN UNION The economy saw slower growth compared with the EU average quarter-onquarter, as during Q4 2017 the EU saw 0.6% growth. Also, Croatian GDP showed slower growth compared with the EU average of 2.6% at an annualised level. The largest positive contribution to GDP during Q4 2017 was an increase in household consumption expenditure of 3.4%

year-on-year, whereas during the previous quarter it was 3.7%. Domestic demand exerted a positive impact, as opposed to that from foreign demand, which was negative. Investment growth saw a sharp slowdown, to 1.7% year-on-year; during the previous quarter it was 3.4%. Exports of goods and services rose during Q4 2017 by 3.6% on an annualised level, with imports of goods and services up by 6%. Gross value added in Q4 2017 saw an increase of 1.3% in real terms in relation to the same quarter of the previous year. The greatest contribution to quarterly GDP growth in Q4 2017, was in wholesale and retail, and the largest decline of 5%, was seen in agricultural.

THE OVERALL CONTRIBUTION OF EXPORTS OF GOODS AND SERVICES TO GDP GROWTH WAS NEGATIVE

The overall contribution of exports of goods and services to GDP growth was negative The Croatian Chamber of Economy considers the slowing of GDP growth seen in 2017 as the result of a slowing in growth of gross investment, as well as in exports of services, and a higher than envisaged rise in imports. Furthermore, the opinion was expressed that

it was also due to the fact that other consumption components did not record higher levels of overall growth in order to maintain a higher growth rate. “Notwithstanding the fact that the increase in both domestic and foreign demand resulted in an increase in the

value of domestic production of goods and services, it also resulted in a large increase in the value of imports, with the overall contribution of exports of goods and services to GDP growth was negative”, as stated in the comment provided by the CCE.

TOPIC OF THE WEEK CROATIAN BUSINESSES RECOGNISE THE IMPORTAN

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CE OF SOCIAL NETWORKS

Immense potential when used properly Social networks have become an unavoidable tool in the promotion and brand creation of today’s businesses. The most frequently used social networks for product brands are Facebook and Instagram, with LinkedIn being used with greater frequency for employer branding and business promotion by Jozo Knez

acebook, Instagram, Twitter, LinkedIn, Google+ - the sequence could be continued. The number of social networks is increasing. They have radically changed communication methods between people, methods of informing and purchasing, as well as the ways in which large companies and businesses communicate with potential customers, clients and consumers. Social networks have become an essential tool in the

ACCORDING TO RESEARCH CONDUCTED BY EUROSTAT, THE PERCENTAGE OF CROATIAN COMPANIES USING AT LEAST ONE SOCIAL MEDIA IS 45% promotion and creation of brands of today’s businesses, primarily due to their availability, dynamism, as well as the opportunity to constantly communicate with potential clients. Their potential showed in 2017 when an outburst of fake news led to US presidential election victory for Donald Trump. Subsequently, “fake news” became a frequently used phrase and even social networks, primarily Facebook, aimed to express their reservations concerning this issue, stating that they were not responsible for published content. Since then, it has become a fact that elections are either won or lost through social networks. If social

networks can exert such a huge impact on elections, their potential is obvious concerning the promotion of a brand or a service. The power of the Internet and social networks has exceeded all expectations. They have high potential, if used properly.

CROATIA LAGGING BEHIND EU AVERAGE According to research recently conducted by Eurostat, the number of companies using social networks has been constantly increasing, which means that in 2017 almost every other company used this method of communication with clients, yet Croatian companies still lagged slightly behind the EU average. The report by Eurostat states that 2017 saw 47% of companies in the EU, those with at least 10 employees that participated in the research, used at least one of the various types of social media, which implies an increase of 17% over 2013. It is important to note that the most widespread form of such media are social networks, such as Facebook and LinkedIn, whose share at EU level stands at 45%. Blogs and microblogs, such as Twitter, are used by 14% of companies, whilst multimedia sharing sites, such as YouTube, are used by 16% of those questioned. Amongst EU member states, the lowest percentage of companies using social media was seen in Poland, (27%), followed by Latvia (30%) and Bulgaria (34%). On the other hand, according to the percentage of businesses active on social media, Malta is at the forefront (74%), with Denmark, Ireland and Holland each having 68%, according to Eurostat. The percentage of Croatian companies that use at least one social media is 45%, on par with Germany, whilst slightly above businesses in Italy (44%). “Notwithstanding the statistics that show that

Many companies are currently still unaware that their presence on Facebook, Instagram, YouTube or Twitter is not important as they ﬁnd it “convenient”.

It is important due to the fact that their users are also present there, which provides a direct opportunity for establishing interaction with them. Martina Gršković, 404 Agency

April 2018 | No 279 | PVinternational | 3

TOPIC OF THE WEEK Online presence of companies, 2017 (% businesses) Website

Social networks

Corporate Multimedia blogs or micro- content â&#x20AC;&#x201C; blogs sharing sites

EU-28 Austria Belgium Bulgaria Cyprus Czech Republic Denmark Estonia Finland France Greece Croatia Ireland Italy Latvia Lithuania Luxembourg Hungary Malta Holland Germany Poland Portugal Romania Slovakia Slovenia Spain Sweden UK

77 86 83 51 73 83 95 78 96 67 65 71 74 72 63 78 82 69 81 86 87 67 65 45 79 83 77 91 84

45 51 57 34 65 34 67 39 61 39 49 41 67 42 29 47 52 36 73 66 40 26 45 34 35 45 49 63 60

14 10 17 4 28 7 12 7 17 12 13 7 32 8 9 10 13 5 15 29 7 5 7 5 8 7 21 14 42

Iceland Norway Turkey

82 80 73

77 71 44

16 11 17

Tools for the exchange of knowledge based on Wikipedia

Websites and social networks

Using only one type of social network (*)

Using two or Using at more types least one of social type of social networks (*) network (*)

16 18 17 7 27 11 25 11 24 11 15 13 23 16 9 17 15 3 21 29 14 9 15 7 14 17 23 20 19

5 6 7 3 5 4 5 5 6 4 3 7 6 3 3 12 9 5 5 7 7 2 3 3 6 2 5 8 5

44 50 53 26 56 35 67 38 62 35 43 39 58 39 28 45 51 34 67 66 43 26 46 25 35 45 48 63 60

26 32 34 25 30 23 39 27 34 25 29 28 32 27 17 30 33 23 47 29 29 18 30 26 22 29 23 40 21

21 21 24 9 37 13 29 13 29 16 21 16 36 17 13 20 20 15 27 39 16 10 16 9 17 18 28 25 42

47 53 58 34 67 36 68 40 63 41 50 45 68 44 30 50 54 38 74 68 45 27 46 35 39 47 51 65 63

17 15 16

3 5 5

63 62 46

56 52 24

23 20 22

79 72 46

(*) the difference between the last column and the sum of the previous two columns is due to rounding up Source: Eurostat

Use of social networks by companies, 2017 (% businesses) 90% 80% 70% 60% 50% 40% 30% 20% 10%

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Turkey

Iceland

Norway

Latvia

Poland

Bulgaria

Romania

Czech Republic

Slovakia

Hungary

France

Estonia

Italy

Croatia

Germany

Slovenia

Portugal

Lithuania

Spain

Greece

Austria

Luxembourg

Source: Eurostat

Belgium

Finland

Cyprus

Sweden

Ireland

Holland

Denmark

Malta

Croatian companies are below the EU average concerning the use of social networks, I believe the situation has greatly improved. An awareness has been created that social network presence is currently imperative in communication, as well as a deep insight of user behaviour and habits. Social networks have never been a channel for one-way messaging as the focus has always been placed on two-way communication. Many companies are currently still unaware that a presence on Facebook, Instagram, YouTube or Twitter is not important since they ﬁnd it “convenient”. It is important due to the fact that their users are also present there, which provides direct opportunities for establishing interaction with them”, highlighted Martina Gršković of the 404 agency. Ana Marija Malić with Degordian, a digital marketing agency, shares her opinion: “From the aspect of a digital marketing agency, it appears that the number of companies using social networks on behalf of their company and for their brands has been increasing. The trend is positive, since businesses have realised that digital platforms and a social network presence is imperative for success and in order to reach the target group”, believes Ana Marija Malić.

FACEBOOK STILL AT THE FOREFRONT 41% of Croatian companies use social networks, of whom 7% use a blog or a microblog, with 13% using multimedia sharing sites. It is important to note that only one social media type is used by 28% of companies questioned, with the percentage of businesses using two or more types of such media reaches 16%. “The most frequently used social networks for product brands are Facebook and Instagram, with LinkedIn being frequently used for employer branding and business promotion. Unfortunately, there are currently still companies in Croatia who have not realised the benefits that can be gained through activity on social networks, nor are they aware of the crucial importance of investment into social media channels and that promotion on social media channels is currently imperative”, pointed out Ana Marija Malić. According to Eurostat, 84% of businesses in the EU use social media for image-building, as well as for promotion and product sales. Moreover, a further important reason for using social media stated by over 50% of companies interviewed, is knowing and understanding the opinions of their clients and customers and opportunities to respond to their inquiries. Concerning the issue of image, it is not sufficient to log in to a social network, post a profile picture and hope that things will happen

on their own. “If one is working to position oneself on social networks in a clever way, one needs to have a deep insight into one’s own business operations and be fully aware of one’s competitors, as well as focus on market requirements, digital trends and target users. Furthermore, one needs to develop a comprehensive social media strategy, which includes the selection of an optimal social media channel mix, methods of communication, types of content to be communicated, as well as establishing an advertising budget”, emphasised Ana Marija Malić. Depending on one’s expectations from communication on social networks, one needs to develop a strategy, a communication plan, establish the budget and avoid putting “one’s next door neighbour” in

SOCIAL NETWORKS HAVE NEVER BEEN A CHANNEL FOR ONEWAY MESSAGING, AS THE FOCUS HAS ALWAYS BEEN ON TWOWAY COMMUNICATION, EMPHASISED MARTINA GRŠKOVIĆ charge of managing the social network site. “Prior to the selection of a social network and prior to becoming involved in communication, one needs to strategically plan the communication, deﬁne content and select channels, in accordance with clearly deﬁned objectives, as

Unfortunately, there are currently still companies in Croatia that have not realised the beneﬁts that can be gained

through their activity on social networks, nor are they aware of the crucial importance of investment into social media channels and that promotion on social media channels is currently imperative. Ana Marija Malić, Degordian, digital agency

April 2018 | No 279 | PVinternational | 5

TOPIC OF THE WEEK egy with this social network, as unless they do so, their content will not be visible. The starting point of any communication on Facebook or on any other social network needs to be high quality and carefully devised content, paying attention on target audiences that it is primarily intended for. There are currently immense challenges, certainly more than there used to be, concerning the issue of conveying the crucial messages, as they need to be strategically designed into interesting and interactive content that will, above all, be advertised”, pointed out Martina Gršković.

THE RISE OF INSTAGRAM

Prior to the selection of a social network and prior to becoming involved in communication, one needs to strategically plan the communication, define content and select channels, in accordance with clearly defined objectives, as well as to ensure the specific budget that is required for this purpose. Marko Galić, Communications Laboratory

well as ensure the speciﬁc budget that is required for this purpose. It is important to point out the difference between companies that have strategically planned their communication on social networks and hence those that achieve excellent results through interaction with their users, and companies that are present on social networks and yet are using the channel spontaneously and without a clear plan, which eventually can have an adverse impact as a result of poor management issues, as it is highly evident. Special attention needs to be paid to the creation of content which needs to be harmonised with the umbrella communication strategy and simultaneously highly interesting, relevant at the local level and follow the continuously changing trends in order to attract the attention of the target group and the encourage the involvement of its members. In order to achieve all these aspects, one needs to provide and ensure the required resources and join social networks as a relevant media that requires time, budget and involvement of communication experts”, stressed Marko Galić with Communications Laboratory (Komunikacijski laboratorij). Since Facebook also needs to focus on its ﬁnances, it has been reducing the reach of unpaid posts. This causes concern amongst businesses and agencies, since in order for their post to reach the greatest possible number of users, they need to increase their investment into promotion. “Changes in the Facebook algorithm have lately been drastically reducing the organic reach of posts. Businesses need to instantly start working on a new communication strat-

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Irrespective of the fact that Facebook is still the most frequently used, Instagram has recently been on a rise in Croatia, and the number of users and those who enjoy the content posted to it has almost tripled over a period of one year. Viewing photographs is simpler and attracts an increasing number of people, which includes potential customers or clients, as well as other companies that have identiﬁed Instagram as suitable vehicle for their content. “Due to its attractive and “light” form, it arouses interest from companies that are able to design their content and messages in an excellent way in order to portray the company lifestyle, as well as its objectives, its mission, vision, products and services. Based on my experience with clients, I would hazard the

THE STARTING POINT OF ANY COMMUNICATION ON FACEBOOK OR ON ANY OTHER SOCIAL NETWORK NEEDS TO BE HIGH QUALITY CONTENT, NOTED GALIĆ opinion that currently both Facebook and Instagram regularly go hand in hand and are imperative as communication channels in different industries”, stated Martina Gršković. The Croatian market is on the right path and the trend of social network presence has become increasingly widespread. If this upward trend continues, Croatian companies may eventually reach the level where they are ﬁnally on a par with the EU, where they belong.

MEETINGS CONTRACT BETWEEN HRVATSKE ŠUME AND ODAŠILJAČI I VEZE

€2.7 million for fire safety video surveillance

rvatske šume and Odašiljači i veze signed a €2.7 million contract for video surveillance of forest fires and a radio communication line to be installed in operational centres of county fire departments in Zadar, Šibenik and Knin, Split and Dalmatia and Dubrovnik and Neretva. Hrvatske šume will also finance the operators of the video surveillance system, said Director of Hrvatske šume, Krunoslav Jakupčić. The system uses cameras in the visible part of the spectrum and near-infrared areas to assist spotting fires at night. During the day, the camera sees

what the human eye sees, but with optical increase of x32. The communication infrastructure of Odašiljači i veze covers almost the entirety of Croatia, and the Split Faculty of Electrical and Mechanical Engineering and Shipbuilding developed this smart fire safety video surveillance– hence our co-operation as a logical turn of events, said its Director, Mate Botica. Agricultural Minister, Tomislav Tolušić highlighted that last year’s forest fires resulted in enormous damage to four Dalmatian counties, and this year there will be €5.3 million in all-purpose funds for firefighting. (I.G.)

AUSTRALIAN-CROATIAN BUSINESS FORUM IN SYDNEY

Significant possibilities for increasing trade

he Australian-Croatian Forum, organised by the Croatia Chamber of Economy, was held on 12 March, in Sydney. Over 100 representatives of Australian companies and 20 representatives of Croatian companies participated. The meeting was opened by Croatian Ambassador to Australia, Damir Kušen, Executive Officer for the European Australian Business Council, Jason Collins, Executive Officer of the Australian Trade and Investment Commission, Iannis Patin and on behalf of the Croatian business delegation, the President of the CCE Zagreb, Zlatan Fröhlich. The Forum was the focus for discussing the realistic potential for increasing trade, particularly in terms of energy, the electrical and food industries and tourism, bearing in mind the

growing number of Australian tourists to Croatia. During the past year 210,000 Australian tourists visited Croatia. This business forum was also supported by the four Australian-Croatian economic chambers operating in Syd-

ney, Melbourne, Perth and Adelaide, the Embassy of Croatia in Canberra and the Consulate General of Croatia in Sydney. It is anticipated that the Free Trade Agreement between Australia and the European Union will contribute to the development of trade between Australia and Croatia. Around 200,000 Croatian emigrants live in Australia and they are another important link in the chain of intensifying economic, cultural and social relations of the two countries. The Croatian delegation was also welcomed in the Parliament of New South Wales and was present for the signing of the Co-operation Agreement between the towns of Osijek and Canada Bay. The visit ended in Brisbane where another business forum was held with economic representatives of Queensland. April 2018 | No 279 | PVinternational | 7

INTERVIEW GARI CAPPELLI, TOURISM MINISTER

Growth is the result of continuous investment into new offers and quality promotion of existing offers, as well as the strengthening of relations, promotional and development activities, and most importantly, good cooperation between the public and private sector in tourism by Jozo Vrdoljak

We are also working on establishing regional competence centres for hospitality and tourism which would offer expertise, prequalification and additional qualification. We have provided €42 million for between five and seven of these centres, which will be established across Croatia.

roatia is well-placed for another successful tourist season. It has grown accustomed to the growing number of arrivals, overnight stays and income, but Croatian tourism is facing bigger problems – the issue of workers. At the same time, there is great potential for the development of health tourism. This is why Tourism Minister, Gari Cappelli, mainly responded to questions on workforce and the potential development of health tourism. Naturally, he also presented his views on the past and forthcoming seasons.

 Could you briefly evaluate the results of the past tourist season? Last year was immensely successful for Croatian tourism in terms of tourist turnover, where we achieved record results (over 100 million overnight stays) and income. This growth is the result of continuous investment in new offers and quality promotion of existing offers, as well as the strengthening of relations, promotional and development activities, and most importantly, good co-operation between the public and private sector in tourism. Concerning the results, we anticipate around €11 billion in tourist income. It is important to mention that income growth is a reﬂection of changes in visitor structure who not only visit

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to enjoy sun and sea, but also our food, sport activities, and wellness. All this has been conﬁrmed by the latest research on visitors’ views and spending in Croatia.

VISITORS NOT ONLY VISIT US TO ENJOY SUN AND SEA, BUT ALSO OUR FOOD, SPORT ACTIVITIES, AND WELLNESS  What is the prognosis for the forthcoming season? So far, we have registered double-digit growth in tourist turnover. We also anticipate 5% to 7% growth on an annual level.  How would you assess this year’s Days of Work in Tourism? This year they were held much earlier, in January and early February. In addition to the shows held in Osijek, Zagreb and Split,

Foto by Robert Anić

INCOME GROWTH IS A REFLECTION OF THE VISITOR STRUCTURE

April 2018 | No 279 | PVinternational | 9

INTERVIEW

The primary goal is to form partnerships between crafts, small-size entrepreneurs, vocational schools, competent ministries and other stakeholders in order secure better system of professional education and training.

we also organised specialist shows in Vukovar and Bjelovar where experts and potential employers presented their advantages and conditions of work in the hospitality-tourism sector to students. As well as motivating all those in search of work, regardless of their experience in tourism, this is particularly important for promoting various jobs in tourism, and there are more of them since selective types of tourism are developing intensively.

 What are the long-term solutions for a lack of workforce? It is estimated there will be a demand for up to 15,000 new workers in the tourism-hospitality sector compared with last year. We will ﬁrstly look for workers in the local labour market, for example, through a prequaliﬁcation process in which 2,200 workers have already been included.

 What measures have you taken? As a backup measure, we secured 4,660 work permits for foreign workers. In addition, the Government has recently adopted measures for increasing employment as well as a decision on tax relief for entrepreneurs providing accommodation and hot meals for their staff. We have had positive reactions from entrepreneurs since they manage to save money, which they plan to invest in high-quality accommodation capacity for staff or use it to increase salaries or pay addition to salary.  Do you have any long-term projects for solving this problem? As well as securing quality working conditions in tourism which would guarantee long-term

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quality staff, we are also looking at establishing regional competence centres for hospitality and tourism which would offer expertise, prequaliﬁcation and additional qualiﬁcations. We have provided €42 million for between 5 and 7 of these centres, which will be established throughout Croatia.

CONCERNING THE PRESENT RESULTS, WE ANTICIPATE AROUND €11 BILLION IN TOURIST INCOME  What does the Memorandum On Understanding on establishing a partnership for apprenticeships in Croatia bring? This memorandum is an excellent sequel to the initiative on establishing regional competence centres for hospitality and tourism. The primary goal is to form partnerships between crafts, small-size entrepreneurs, vocational schools, competent ministries and other stakeholders in order secure a better system of professional education and training. Such partnerships enable us to strengthen and develop learning based on work as well as to promote entrepreneurial skills and thinking in younger generations – this will ultimately form a foundation for the further success of tourism in Croatia.

The investment potential, that is, health tourism projects, is around €300 million What is the level of investment we may anticipate in health tourism? Croatia has the potential for investment – projects related to health tourism – and it ranges around €300 million. Moreover, when observing income earned by health tourism, it could rapidly increase from the current €400 million to up to €1 billion in a short period of time. To secure the longterm sustainable development of health

 What will this year bring in terms of tourism legislation? We are preparing a series of measures with the aim of enabling more competitive and efficient business in tourism. We are also preparing an act on hospitality activity which will soon be ready for public consultation. Furthermore, for the past few months we have been working with representatives from the tourism sector on drafting an act on tourist communities and the promotion of Croatian tourism as well as an act on sojourn tax and on membership fees in tourist boards. We plan to ﬁnalise them during this year.

IT IS ESTIMATED THERE WILL BE A DEMAND FOR UP TO 15,000 MORE WORKERS IN THE TOURISM-HOSPITALITY SECTOR COMPARED WITH THE PAST YEAR  What will be new in the act on providing services in tourism? With the amendments to this act, we want to harmonise service provision in tourism and develop business activities as more efficient, transparent and simpler. The new act also includes harmonisation with the EU Directive on all inclusive arrangements and connected arrangements; it deﬁnes a decrease of administrative obstacles for the purpose of relieving entrepreneurs and decreasing the amount

tourism, the Ministry of Tourism initiated the project of establishing a department for health tourism which will implement development plans defined by the Action plan for the development of health tourism in co-operation with local administrations and other participants in the system. This will certainly be followed by the further promotion of health tourism, for which we have already secured funding.

of infringement penalties. Moreover, the act regulates tourist services in health tourism, conference tourism, services of active and adventure tourism, services in farms and hunting lands as well as service of tourist transfer.

 What will it bring to health tourism? What is the future of health tourism in Croatia? This area is very important for Croatian tourism, not only because it is available through the whole year, but also attracts visitors with greater spending power. The new act regulates the preconditions for much higher value of this product since we expanded the services usually offered in health tourism, and they include organising transport, tourist transfer and accommodation. Also, the circle of service providers is now expanded in health tourism. In addition to specialised hospitals and resorts, it offers those same services in other health institutions, companies for performing health activities and individual health workers with private practices. With the required amendments to the Act on healthcare and health insurance, within the competence of the Ministry of Health, scheduled for the ﬁrst part of this year, I am sure health tourism will reach its full potential and contribute to strengthening competitiveness of the Croatian tourism, especially continental.

Health tourism is a very important product for Croatian tourism, not only because it is available during the entire year, but also as it attracts visitors with higher spending power.

 What are Croatia’s advantages for developing health tourism? Croatia possesses many comparative advantages required for the faster development of health tourism, such as qualiﬁed staff and a good reputation regarding health services, competitive prices, accessibility from the larger home country markets, and general tourist attraction. April 2018 | No 279 | PVinternational | 11

MEETINGS CROATIAN-IRANIAN ECONOMIC FORUM

Co-operation between the two countries is improving Direct air communication, simpler visa system and payment operations between the two countries are required for better co-operation and greater trade by Krešimir Sočković

espite considerable problems burdening the business operations of Croatia and Iran, these two countries saw a considerable growth in trade last year. Total exchange of goods was $US5.4 million for the first ten months of 2017. During this period, exports to Iran totalled $US4.7 million, 53.5% up compared with the same period the year before. Imports totalled $US600,000, up 45%. There is room for growth, but what is lacking is direct air communications, a simpler visa system and payment operations between the two countries. These issues as well as the potential for Croatian-Iranian market co-operation (with a population of 82 million) were discussed at last week’s Croatian-Iranian Economic Forum which included discussions from over 70 representatives of Croatian and Iranian companies and institutions from agriculture, food industry, construction, petrochemical industry, medicine, health tourism, medical equipment, trade, IT, metal processing industry and mining. Bilateral relations between Croatia and Iran are friendly, and our mutual goal is to strengthen economic relations and exploit the potential through concrete economic solutions and projects, said Government Vice-President and Minister of Economy, Entrepreneurship and Crafts, Martina Dalić. Iran’s plan for renovating electro-energy, traffic and maritime infrastructure are a significant opportunity for Croatian companies. There is also potential in the food industry, especially for those Croatian companies which have halal certification, in the renovation of railway infrastructure,

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building, oil industry and energy, production of electrical energy, and there are signs of joint investment projects as well as performance in third markets, said Zarif. This year marked a turnaround in Croatian-Iranian relations, and this forum will establish the foundation for new business initiatives to the mutual beneﬁt of the two countries, said CCE

EXCHANGE OF GOOD BETWEEN CROATIA AND IRAN STOOD AT $US 5.4 MILLION DURING THE FIRST 10 MONTHS OF 2017 locomotive engines and carriages, shipbuilding, tourism, pharmaceuticals and other areas, Martina Dalić highlighted.

NEW BUSINESS INITIATIVES The third business meeting of Croatian and Iranian entrepreneurs indicates the importance of the 2016 political initiative and the visit of the Croatian President to Iran. This initiative is now showing its results, said Foreign Minister of Iran, Mohammad Javad Zarif. He also brought attention to the long co-operation tradition of Iranian and Croatian companies, which reached $1 billion at one point. The private sector recognised the potential for co-operation in the areas of ship-

President, Luka Burilović. We anticipate a substantially different balance in our exchange of goods which has not been at its highest so far. Croatian companies in Iran are currently working on important contracts and they compete for multimillion contracts in electrical energy and the metal industry. The sequence of these recent business gatherings has to yield results, Burilović highlighted. Vice-president of the Iranian Chamber of Trade, Industry, Mining and Agriculture, Masoud Khansari, added that Croatian-Iranian relations have always been positive, but the time has come to take new steps and further develop economic relations.

CROATIA-MALTESE BUSINESS FORUM

STRENGTHENING BILATERAL TRADE Together, we recognised initiatives focused on maritime issues which are especially important since tourism in both countries is a very important part of the economy, Kolinda Grabar Kitarović highlights bz Krešimir Sočković beneﬁt business, but will also strengthen our markets and investments”, MarieLouise Coleiro Preca assessed.

ECONOMIC CO-OPERATION IS NOT SATISFACTORY

roatian-Maltese trade totalled €67.6 million during the ﬁrst 11 months of the last year compared with the year before, when it was more than double this amount. Croatian exports to Malta were €63 million, mainly oil, yachts, corn and processed wood, and import lifting and digging machines, yachts and other vessels, medicine, instruments and measuring tools. The possibility of further development of mutual business co-operation was discussed at the Forum, organised by the Croatian Chamber of Economy and Trade Malta Agency.

ing a fund and workgroup for tourism at the EU level, which would simplify access to EU funds. “I therefore invite entrepreneurs to expand bilateral co-operation and perspective to all economic sectors and third country markets”, highlighted Croatian President, Kolinda Grabar Kitarović. She also stressed the potential of the ports of Rijeka and Ploče which could service Maltese exports to Europe. These meetings aim at creating opportunities for improving an already solid economic and political co-operation, Maltese President, Marie-Louise Coleiro Preca, added. “Malta is deeply dedicated

CROATIAN-MALTESE TRADE INCREASED BY 112% TO €67.6 MILLION IN 2017 Jointly recognised, initiatives focused on maritime issues which are especially important since tourism in both countries is a very important part of the economy. European tourism is encountering greater challenges, ranging from safety to economic, which is why Croatia initiated the idea of establish-

to preserving the relations between the two countries and I wish to see concrete results of this visit in the form of stronger mutual trade. Malta is a bridge connecting different cultures, and its geographic position is an opportunity to expand into new markets. Our co-operation will not only

“Despite excellent relations between Croatia and Malta, their economic cooperation has not been satisfactory for quite some time now”, CCE President Luka Burilović assessed. “Therefore, after a fall in trade in 2016, we are pleased with a 112% increase during the ﬁrst 11 months of last year. We also see potential in many other economic activities: construction, shipbuilding, tourism, transport, infrastructure, energy, IT, strategic partnerships and joint presentations on third markets”, noted Burilović. Our chambers share the ambition to continue building good relations, and this forum proves our dedication, opined Frank Farrugia, President of the Maltese Chamber for Trade, Entrepreneurship and Industry. “We wish to pave the way for a new development in our relations to the beneﬁt of both countries. I must commend the improved business climate in Croatia and the acceleration of bureaucratic procedures. The Maltese economy is open and dynamic and it can serve as a basis for expanding into the markets of Southern Africa”, Farrugia highlighted. A Co-operation agreement between the Croatian Chamber of Economy and the Maltese Chamber for Trade, Entrepreneurship and Industry was signed during the Forum. Business meetings were held with almost 80 representatives of Croatian and Maltese companies and institutions in the areas of construction, tourism, furniture industry, transport, energy, environmental protection and business consulting. April 2018 | No 279 | PVinternational | 13

CURRENT ISSUES CONFERENCE OF SOUTHEAST EUROPEAN WOMEN ENTR

Women need to step out of their comfort zone Female entrepreneurship has become extremely important both for the Croatian economy and that of Southeast Europe. Against a backdrop of a male-dominated world, female solidarity is imperative in order to achieve balanced leadership by Sanja Plješa

n International Women’s Day Zagreb, for the third time, hosted one of the largest business events bringing together women entrepreneurs – Conference of Southeast European Women Entrepreneurs. Over 600 participants, including those from Northern Slovenia and those from Southern Greece, all had a common goal - to show women entrepreneurs as a driving force of. The Conference was organised by Virtual Women’s Entrepreneurship Centre and the city of Zagreb and sponsored by the Croatian President, Kolinda Grabar Kitarović. The slogan was Successful Women Entrepreneurs – A Source of our Motivation or Business Frustration! In addition to panel discussions and lectures, the Conference also included an Entrepreneurship Fair during which visitors had the opportunity to see and test a

WOMEN NEED TO TAKE THE FIRST STEP IN ORDER TO ELIMINATE LONGTERM DISCRIMINATION, STRESSED SANELA DROPULIĆ

large number of products designed and made by women entrepreneurs. As was pointed out throughout the Conference, female entrepreneurship has become extremely important for the Croatian economy and for that of Southeast Europe. Against a backdrop of a male-dominated world, female solidarity is imperative in order to achieve balanced leadership. That is something that needs to be mutually ensured by women. Commenting on this concept, Sanela Dropulić, the organiser of the Conference of Southeast European Women Entrepreneurs, emphasised that equality between men and women is an issue that needs to be tackled now. “Women currently still earn considerably less compared with men, irrespective of the fact that they frequently work longer than men. Moreover, their career advancement also lags behind men and, in addition to their business projects, they also need to care for the family and children more frequently than men, who are normally not burdened by such problems”, noted Sanela Dropulić. She added that women need to make the ﬁrst step in order to eliminate this long-term discrimination. Women need to come out of their cocoons and step out of their comfort zone, showing that they are equal to men and in some cases even superior to them.

A new magazine Poslovna žena na (Business Woman)

SELF-CONFIDENCE AND BELIEF IN OWN PRODUCT

The magazine Poslovna žena (Business Woman), a new publication from Privredni vjesnik, was presenn ted at the Conference of Southeast European Women ć, Director Entrepreneurs. As was emphasised by Darko Buković, and Editor-in-Chief of Privredni vjesnik, behind the simple magazine title there is a large number of success stories of women entrepreneurs. “We have primarily focused on the work performed by these women, on their achievements, as well as their potential and prospects. It has to be highlighted that this is not yet another women’s magazine, as it is a magazine that will be read also by men in order to gain insights into different types of work and the ways in which work is performed by women across Croatian society”, stressed Buković.

There is ample space for female entrepreneurship. “In addition to external factors, we need to ask ourselves whether we are capable of keeping abreast with the success achieved by our colleagues, and whether we are really moving to be leaders”, stated Mirjana Čagalj, Vice President of the CCE and the incumbent President of CCE - Split County Chamber. She stressed that irrespective of the fact that women outnumber men in the population in Croatia, 2016 saw only 21.8% women as business owners. The percentage of women who are owners or partners in craft trades is just

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Foto by Franjo Maltar

REPRENEURS

over 33%, and only 20% of women currently perform managerial functions. “These ﬁgures point out that in Croatian entrepreneurship, primarily in business ownership, men are far more active. I believe there are ample opportunities for the development of female entrepreneurship”, stressed Mirjana Čagalj. Conference participants addressed a large number of issues and topics concerning women in entrepreneurship, such as leadership, reconciling professional and private and life, and family business operations. In addition, some women shared their entrepreneurial success stories. It was highlighted that women entrepreneurs need to have two fundamental characteristics in order to achieve business success - self-conﬁdence and a belief in their own product. “When women entrepreneurs are faced with a problem, they need to use all their strength and potential and proceed with their work. Growth and development in entrepreneurship are achieved through experience, learning, as well as courage”, emphasised Gordana Bauer, owner of the Zagreb-based agency Bauer-market research (Bauer-istraživanje

ARE WE CAPABLE OF KEEPING ABREAST WITH THE SUCCESS ACHIEVED BY OUR COLLEAGUES AND ARE WE REALLY MOVING TO BE THE LEADERS, INQUIRED MIRJANA ČAGALJ

The highest number of women entrepreneurs is in Bjelovar-Bilogora County and Zagreb According to data released by the Financial Agency (Fina), concerning the structure of entrepreneurship in Croatia, in accordance with gender criterion, the percentage of women entrepreneurs, that is, women business owners in Croatia, showed a slight increase during the period 2010 to 2016. In 2010 the percentage of women entrepreneurs was 17.3%, and by 2016 it had reached 21.8%. Concerning different counties, this percentage ranged between 17.9% and 24%, depending on the county. It is important to point out that the largest number of women entrepreneurs was seen in Bjelovar-Bilogora County, (24%) and in Zagreb, (23.2%).

tržišta). She added that marketing and promotion of one’s own product are imperative for sales success. Perhaps this is not right, Gordana Bauer added, yet form is at least as important as product content, if not even more important. The closing panel discussion entitled Successful Women Entrepreneurs – A Source of Our Motivation or Business Frustration was moderated by Darko Buković, Director and Editor-in-Chief of Privredni vjesnik. He asked panel participants about the motives that encouraged them to start their own businesses and the obstacles they encountered on their way. It is well-known that obstacles are actually challenges. Hence, Milena Tomić, owner of the Belgrade-based MT Komerc, highlighted the fact that there is a wide range of challenges to each start of a privately-owned business. “What prompted me to start a private business was not exigency. I was prompted by a belief that I was capable of succeeding. It appears that those taking over the business or inheriting it have an even higher degree of responsibility”, concluded Milena Tomić. April 2018 | No 279 | PVinternational | 15

TOPIC OF THE WEEK CROWDFUNDING

The importance of preparation and timing Last year saw the launch of the largest number of campaigns, most of them being successful. Nevertheless, I believe the most important thing is that last year the largest number of people participated in and invested into local campaigns, pointed out Hrvoje Hafner by Boris Odorčić

€2 2 million raised in Croatian campaigns in 2017

13.531 the number of backers of local campaigns in 2017

€4

Around million

has been raised thus far in C ti in Croatia i crowdfunding df di campaigns

roatia has seen a most successful year for crowdfunding. According to data provided by Crowdfunding. hr blog, which is aimed exclusively at crowdfunding, in 2017 Croatian campaigns raised €2 million. About €4 million has been raised so far in Croatia through crowdfunding campaigns. Crowdfunding is a method of raising funds to implement a project. It is an online platform on which investors, most frequently through donations, microfinance a start-up which they believe has a place in the market. The initiator of the campaign has a limited period of time to meet their specific financial objective. The most well-known international crowdfunding platforms are Kickstarter and Indiegogo. Last year, over half of the campaigns were launched in Zagreb, and only a small percentage were launched in other Croatian cities. The number of backers of local campaigns in 2017 has been the largest to date, reaching 13,531. Hrvoje Hafner, an expert in service platform development, micropayments and mobile telephony, as well as the author of research published in the Crowdfunding.hr blog, stated that last year was the most successful year for crowdfunding in Croatia concerning several segments. “The value of funds raised last year was almost on par with the overall value of funds raised during all previous years. Moreover, last year saw the launch of the largest number of campaigns, the majority of which were successful. Nevertheless, I believe

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the most important thing is that last year the highest number of people participated in and invested into local campaigns and it is important to note that their number almost doubled compared with the number of participants thus far. This huge value of funds raised was largely crowdfunding of proprietary interests

THE START OF 2018 IS PROMISING, AND THE POSITIVE TREND CONTINUES, POINTED OUT HAFNER whose campaigns managed to attract a smaller number of backers, yet the payments were for signiﬁcant amounts. Last year we had three such campaigns on the Funderbeam platform, which operates in Croatia in co-operation with the Zagreb Stock Exchange”, pointed out Hafner.

THREE KEY FACTORS He added that it would currently not be wise to forecast this year. “I can only state that the start of 2018 is promising and that the positive trend continues”, highlighted Hafner, adding that, concerning the number of inquiries and

April 2018 | No 279 | PVinternational | 17

TOPIC OF THE WEEK ing campaign depends on three key factors: preparation, preparation and preparation. “The preliminary preparation is linked with the rearrangement of the organisational structure of a company, both from an operational and ﬁnancial perspective, so that it becomes transparent and easily understandable for investors. This is followed by further preparation linked with the identiﬁcation of potential key or major investors who subsequently act as catalysts for other small-scale investors. Finally, there is the preparation of the relevant communication strategy to be used both with the public and other key factors of the campaign. In addition, I would like to emphasise that timing is another key success factor of a crowdfunding campaign”, explained Antoljak.

TOKEN TRADING

The advantage of Funderbeam compared with other crowdfunding platforms is that one can instantly trade tokens that one has purchased as an investor, or, in other words, invested in a speciﬁc company, which is highly similar and in accordance with the principles applied on Stock Exchanges Vedran Antoljak, Managing Partner, Sense Consulting

the interest shown by those involved in creative work, as well as by entrepreneurs and activists in Croatia, there is ample potential for large-scale campaigns that could achieve global success. The most successful crowdfunding campaign in Croatia last year was that launched by Sense Consulting, a Croatian business consulting company. Through a campaign on the Funderbeam platform, it managed to raise €660,000, and had 81 backers. Vedran Antoljak, Managing Partner in Sense Consulting, stated that the company’s decision regarding the recapitalisation through Funderbeam was due to the fact that the company had been planning further growth both in Croatia and in Southeast Europe, as well as the creation of a new portfolio of digital services for these markets. “Since Sense Consulting is a medium-sized company, our financing source was primarily in accordance with the “FFF principle”, or, in other words “Friends-FamilyFools” and through financial institutions, whilst our size was insufficient for an IPO. We had been aware of this before the company was founded 11 years ago, and so we prepared the company structure, the business method and financial transparency in such a way that allowed us to instantly and in a simple way launch a Funderbeam campaign”, explained Antoljak. He added that, because of being involved in business consulting, the company is provided with knowledge, skills and practical experience concerning recapitalisation. “Consequently, the process of preparation and implementation of a Funderbeam campaign was not a particular challenge for us”, noted Antoljak. According to the experiences of Sense Consulting, the success of a crowdfund-

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He believes that in Croatia there are a large number of small and medium-sized companies with significant potential, which can exploit the benefits of financing via crowdfunding in order to grow as well as business development. “Sense Consulting provides assistance in the preparation and implementation of crowdfunding campaigns, in the selling

LAST YEAR, OVER HALF THE CAMPAIGNS WERE LAUNCHED IN ZAGREB, WITH ONLY A SMALL PERCENTAGE LAUNCHED IN OTHER CROATIAN CITIES of a company or acquisition of other companies. Hence, on a daily basis we receive inquiries from companies involved in various fields that require our assistance”, he stated, stressing that the Funderbeam platform is an excellent choice for such promising companies. “We would certainly advise them to use it. The advantage of Funderbeam compared with other crowdfunding platforms is that one can instantly trade tokens that one has purchased as an investor, or, in other words, invested in a specific company, which is very similar, and in accordance with the principles applied on the Stock Exchange, noted Antoljak. Following Sense Consulting, ranking second of the top five was the publicly known campaign from the Institute for Youth De-

velopment and Innovation (IRIM) association within the project Croatian Makers. The association opted for the Indiegogo platform for the launch of a crowdfunding campaign entitled BBC micro:bit - STEM revolution. The specific objective of the campaign was the purchase and large-scale introduction of BBC micro:bit sets into Croatian schools and institutions. This is cutting-edge technology, a specific educational tool, developed by the BBC and Microsoft in co-operation with their partners, intended to provide children with the opportunity to quickly and simply enter the world of modern technologies and to become involved not only in STEM (Science, Technology, Engineering and Mathematics) fields, but also in design and arts. Hence, children develop their imagination through play and learn about robotics and programming, whilst acquiring other skills and knowledge necessary for them to fully participate in the 21st century society and economy. The campaign had 2,364 backers, the highest number in Croatia in 2017 and raised €231,700

ESTABLISHED RULES Aspida, a start-up, also opted for a Funderbeam campaign and raised €142,000. The campaign was backed by 88 investors, almost half of whom were foreign. By so doing the huge potential for global expansion of Aspida was recognised. The company currently already has 30 apps under its Izzy brand, a new digital marketing platform, with functions that enable users to use the keyboards of their mobile devices more effectively, as well as in a more entertaining and interactive way. Another brand by Aspida is TVizzy, which was launched in partnership with Hrvatski Telekom. This was the first app in the world that is involved with video notifications (they developed the possibility of viewing video notifications on a locked screen, which is a global innovation) and it provides the opportunity to watch highlights of matches played in Croatian First Football League. Marin Erceg, Director and founder of Aspida, stated that a crucial problem in Croatia is how to raise funds required either to implement good ideas and projects or for their market penetration. “There is a small number of large-scale investors, primarily those who are prepared to invest into something they consider risky. Hence, crowdfunding campaigns are frequently the only way to access capital, mainly because in this way risk is dispersed through a large number of small-scale investors. We have been successful in this and have managed to raise a high level of funds”, believes Erceg, pointing out the existence of

clearly established rules for such campaigns. “In general, there are two issues that need to be proved to investors. First, the idea or the product, which is vital and essential. Nevertheless, investors currently largely make investment decisions based on their opinion of the team. Consequently, convincing them that a team of experts is behind an idea or a product is imperative, as well as showing them that the team has absolute faith in their own work and its members have the required knowledge and experience that can surely guarantee success. Moreover, one needs to present ﬁgures, aiming to show the prospects for a return of investment”, he stressed.

TALENT POOL According to Erceg, there are good projects in Croatia that could appear on the market mainly as a result of crowdfunding. “Croatia has been constantly showing itself to be a pool of young talent that needs backing. Crowdfunding is the most appropriate method for them to raise the first, and perhaps the only, funds that can be raised at a specific point in order to start and opt for any path – the implementation of the new idea or further development of an existing one”, he emphasised. The Croatian start-up CircuitMess with its video games console, MAKERbuino also had great success in a crowdfunding campaign implemented in 2017. Through a campaign on Kickstarter, MAKERbuino raised €80,500, exceeding its predefined goal tenfold. The campaign had 1,574 backers. The video games console comes in kit form and needs to be assembled, following the instructions provided on the Internet, a process intended to develop a passion for programming, electronics and technology amongst users. The Zagreb-based Julius Film, a film production company, which through its launch of

There is a small number of large-scale investors, primarily those who are prepared to invest into something they consider risky. Hence, crowdfunding campaigns are frequently the only way to access capital. Marin Erceg, Director and founder of Aspida

THE SUCCESS OF A CROWDFUNDING CAMPAIGN DEPENDS ON THREE CRUCIAL FACTORS: PREPARATION, PREPARATION AND PREPARATION, STRESSED ANTOLJAK a campaign entitled Slice of Life on Kickstarter, managed to raise €65,250. The campaign was backed by 1,403 investors. Slice of Life is a ﬁlm that pays tribute to Sci-Fi ﬁlms dating back to 1980’s, primarily to the cult movie Blade Runner, using real models, amongst other things. April 2018 | No 279 | PVinternational | 19

WORLD FINANCE PSD2 CONFERENCE –CROATIA AND OPEN BANKING

THE ARRIVAL OF T OPEN BANKING O PSD2 lays the foundations for a unique system of financial transactions and is certainly one of the promoters of the use of digital technology in finance in Europe, stated Adrović, pointing out that data protection and confidentiality are crucial, as well as safe data storage and information processing by Ilijana Grgić

he Payment Services Directive 2 or PSD2 entered into force at the beginning of 2018 in EU member states. It may be concluded that this is an updated version of the Directive from 2009, intended to upgrade existing regulations by introducing new and innovative services through new service providers, whilst working to enable more effective consumer protection for online purchases. One of the vital changes resulting from PSD2, is the fact that banks will be obliged to provide licensed payment service providers with data about their clients’ accounts through Application Programming Interface, or API. A PSD2 Conference – Is open

banking coming (also) to Croatia? jointly organised by the Croatian Chamber of Economy and the Croatian Banking Association, has recently been held in Zagreb in order to advise the public about innovations resulting from the Directive. “PSD2 lays the foundations for a unique system of financial transactions and is certainly one of the promoters of the use of digital technology in finance in Europe. This can already be felt in Croatia concerning the quality and modernisation of services, where in the implementation of new digital solutions, primarily in m-banking, a large number of local banks are already co-operating with domestic FinTech companies and keeping abreast of Western European trends”, stated Zdenko Adrović, Director of the Croatian Banking Association, pointing out that the data protection and confidentiality is crucial, as well as safe data storage and information processing. Irrespective of the fact that PSD2 entered into force at the beginning of this year, the regulatory technical standards about technical potential concerning the access to PSP bank accounts will enter into force only in September 2019 and the enforcement of the Directive will have implications for all businesses in Europe that are involved in payment transactions.

NEW REGULATORY RULES

IN ADDITION TO REGULATING PAYMENT SERVICES, THE DIRECTIVE IS INTENDED TO ENCOURAGE INNOVATION AND COMPETITIVENESS, STRESSED BARBAROŠA 20 | PVinternational | April 2018 | No 279

“The Directive introduces three major new services: licences for third party providers, the introduction of new, strict client authorisation rules, whilst the third huge impact is linked with credit institutions that will face reduced revenue and increased costs. Banks can actually opt for two scenarios: the ﬁrst is defensive and includes compliance with minimal standards and minimal changes, whilst the second

is offensive in which they will play an innovative role and encourage the building of a new financial ecosystem”, concluded the Director of the Sector for Financial Institutions, Business Information and Economic Analyses of the CCE, Zvonimir Savić, adding that this is an ideal period for business operations development, both for the banks and IT companies. “Is open banking coming to Croatia? Yes, it is, since Croatia is an EU member state and the law is the law”, was the brief answer concerning the major issue addressed by the Conference given by the Chair of the Payment Systems Committee of the European Banking Federation, Gijs Boudewijn. “The objectives of the new Directive are to strengthen the competitiveness of banks, increase the safety of services, as well as to facilitate innovation in this sector and provide client protection. Banks have thus far avoided providing data to third parties, yet against the backdrop of new rules, they need to find a balance between safety and the development of new, simpler services for users”, noted Boudewijn. The new Directive also introduces new regulations and rules, and the Deputy-Governor of the Croatian National Bank, Neven Barbaroša, highlighted the fact that, in addition to regulating payment services, the Directive is intended to encourage innovation and competitiveness. “The new Directive is expected to contribute towards the further development of digitisation in banking, whilst complying with specific standards, primarily safety standards. New payment services will be developing against the backdrop of the development of instant payment. Hence, data access will be standardised for third parties through a unique Application Programming Interface and certainly, on user approval. In addition, higher safety requirements will be introduced for all electronic payment transactions, as well as for all payment service providers”, stated Barbaroša, pointing out that Croatia will gain insight into the future of banking following the mandatory liberalisation of payment transactions that will be implemented in September 2019.

MORE EFFECTIVE CONSUMER PROTECTION It is important to highlight a highly interesting panel discussion entitled What Kind of Open Banking Are We About to See in Croatia. During the discussion, special focus was placed on the research conducted by PwC Croatia, the Croatian Banking Association and the CCE which showed that 44% of Croats are prepared to execute payment transactions through licenced companies other than banks, whilst 37% opted for the response that read “probably not, but it depends on the of-

fer”. In addition, 19% would certainly continue executing payment transactions in the same way as they have done thus far. The President of the Alliance of Consumer Organisations, Dijana Kladar, believes that Croatian consumers frequently do not pay sufficient attention to safety and hence transaction fees may play a vital role in the selection of the payment service provider. “Consumers are afraid of misuse of credit cards in the digital world, yet I believe they will still opt for the payment service providers whose services are more affordable. Consequently, we need to inform consumers about the beneﬁts and shortcomings using simple language, and we need to do it jointly, through co-operation with consumer organisations, banks and other payment service providers”, believes Dijana Kladar. Darko Buković, Editor-in-Chief of Privredni vjesnik and panel discussion moderator, also expressed his agreement concerning the issue of the importance and requirement for more effective and simpler communications. Speaking from the perspective of FinTech companies, Dejan Miklavčić, Executive Director of Monri Payments, pointed out that these companies, currently, do not consider themselves as competitors to banks. “Irrespective of the fact that the PSD2 Directive is a logical

Zdenko Adrović

Gijs Boudewijn

TRANSACTION FEES MAY PLAY A VITAL ROLE IN THE SELECTION OF THE PAYMENT SERVICE PROVIDER, BELIEVES DIJANA KLADAR sequence of events, I do not believe that local FinTech companies will become market leaders in the forthcoming future. I expect us to initially provide our services in co-operation with banks”, emphasised Miklavčić. Tomislav Sessa, Head of Business Development at Trilix, stressing that through the services provided by the company they will be competing with credit card companies. During the presentation of the research entitled Waiting Until the Last Minute delivered by Marco Folcia with PwC Italy, it was highlighted that banks need to consider this EU Directive as an opportunity, since the open banking concept provides new opportunities and sources of income compared with the traditional range of banking services. It has to be pointed out that according to research conducted by PwC, 71% of banks believe that this Directive will provide them with new income streams. April 2018 | No 279 | PVinternational | 21

STORY FOR A REASON CRAFTER’S BREWERY

WHAT’S COOKING The craft scene is very much alive, but unfortunately the majority of the local producers do not meet modern technological production standards, which results in unequal product quality, Andrej Andrlić highlights by Jozo Knez Although they produce beer for the palate of wide masses, they also have something to offer for the most demanding customers.

DEDICATED TO SUPREME QUALITY

I am convinced the market has enough room for further development of small-size breweries, especially the producers who will want to place their products only in their region or their town based on the German model. Andrej Andrlić, Director of Crafter’s

he culture of drinking beer and the craft scene is developing and it now includes new fans of local beer. Crafter’s Brewery has been active east of Zagreb, in Dugo Selo, since 20016. We opened the brewery in the summer of 2016, symbolically on the 500th anniversary of Reinheitsgebot, famous German act on the purity of beer. The brewery was established with the goal of producing various high-quality craft beers with stress on their drinkability and competitive prices compared with many other craft breweries. All of the recipes are designed by our master brewer Silvije Boroša Sergo, the most awarded Croatian crafter with medals from local and foreign competitions, says Crafter’s manager Andrej Andrlić. Special attention was paid to the drinkability of all beer being produced, that is, ease of drinking since the majority of their beer contains less than 5% alcohol. We are currently producing six regular beer styles which cover different ﬂavours so we also offer classic lager we have become accustomed to in the central European tradition, for example Czech Republic and Germany, as well as different ale beers based on the English and American tradition (ipa, stout and similar styles), Andrlić explains.

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All names of the beers are in English since we are aiming at urban young customers, but also tourists who want to taste ﬁne Croatian craft beer. We also offer Escape English ipa, Hopper Session ipa, Glider pilsner, Swing American red ale, Pumpker pumpkin ale, Chimney oatmeal stout, Spirit scotch ale, Switch and Saint which is produced in limited quantities, especially on Saint Patrick’s Day. We also have an occasional seasonal type of beer, Andrlić adds. It is not easy to stand out from the competition, unless you know exactly what you are doing and what you want to achieve with your beer. Above all, we are dedicated to achieving supreme quality which is obvious in the technological segment of our production where we

WE ARE CURRENTLY PRODUCING SIX REGULAR BEER STYLES WHICH COVER DIFFERENT FLAVOURS, ANDRLIĆ SAYS

FURTHER MARKET CONQUERING Small beer producers have the benefit of favourable conditions since small breweries receive state subsidies in the form of low duties on alcohol which is not the case with bigsize industrial producers. However, there is a catch. The biggest problem is the red-tape and its slow pace when it comes to issuing all sorts of types of licences, says the Director of Crafter’s. Notwithstanding, despite this slow pace and personal funding of the entire project, Crafter’s manage to succeed. We financed the entire project with personal means which allows us greater flexibility, and we also ap-

THE BANKS ARE SLOW TO RECOGNISE AND STIMULATE THE POTENTIAL OF START-UP PROJECTS, DIRECTOR OF CRAFTER’S HIGHLIGHTS plied for EU funds. The banks are slow to recognise and stimulate the potential of start-up projects, in this case investing in local production – but this is only our experience, he highlights. Crafter’s currently employs six people, but they hope to hire more. Concerning the workforce, it is difficult for them to find workers with specific knowledge in beer production. However, with mentorship programmes and education of younger assistants in production these problems can be solved, says Andrlić. Things are looking good now for Crafter’s and their plans prove it. Our plan is to continue conquering the market and reach our end users through retail and hospitality channels as well as to continue developing our products’ excellence. Our plans also include developing our recipes and yeast as well as improving and optimising our production processes, he concludes. April 2018 | No 279 | PVinternational | 23

Foto: Marko Čižmešinkin

use state-of-the-art machines for producing and packaging, both in crates and bottles. We are different since our beers are drinkable and with moderate alcohol share, which is rarely the case with craft beer. Moreover, our offer is rich. Andrlić also highlights Croatia has great potential for developing the craft scene. The craft scene is quite lively and the environment is motivating, but the majority of the local producers do not meet modern technological production standards, which results in unequal product quality. We do hope things will change for the better since we have great potential in an already commercialised smallsize beer production and constantly growing community of home brewers, some of which will deﬁnitely venture into commercial operations. I am convinced the market has enough room for further development of small-size breweries, especially the producers who will want to place their products only in their region or their town based on the German model. By shortening the way to the end user it is possible to decrease the effect of technological ﬂaws which limit the beer’s duration and damage its quality – in my opinion this should direction should be taken by many small breweries. Actually, broader distribution requires far bigger investments in technological processes and the bottling machines, which could be a great problem for many beginners, Andrlić says.

Foto by Marko Čižmešinkin

IN DUGO SELO?

HRWWWATSKA THE ADVENTURE OF ECO – WASTE DISPOSAL GAME

SERIOUS ISSUES THROU Players learn about the waste cycle, proper sorting, recycling, the importance of environmental protection and individual responsibility for all waste producers, Sonja Hlebar highlights by Jozo Knez people raise their awareness on the environment from a young age, Hlebar points out.

GAME IN SCHOOLS

The feedback mainly concerns their lack of patience to ﬁnish the game and we also receive various questions and suggestions of what the game should include. We also ask teachers and professional services in schools to advise us on how to make the game more acceptable at a pedagogical level Sonja Hlebar, entrepreneur

f we wish to reach young people and instil in them the value of eco-friendly behaviours and sustainable development, we need to approach them in a language they understand. This has been achieved by Sonja Hlebar, an entrepreneur from Koprivnica, who is the innovator behind Adventure of Eco videogame. This is an educational game with the aim of informing young people on the issues of ecology, responsible behaviours towards the environment we live in, and waste sorting. Since we have been active in the ﬁeld of training for many years with the Croatian Association for Sustainable Development, I realised that people need be educated on sustainable development from their early years and through all levels of education, says Sonja Hlebar. With this mind, the idea for educating young people through a game was born. In this game they are taught about waste disposal in a relaxed way. Since the issues of ecology, recycling and sustainable development are constantly present and will be even more talked about in their future, I believe this game will help young

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The game is primarily intended for young people between 7 and 15. The idea is to use the game in school as part of civil education, in class or similar as a supporting tool for teachers. Of course, before implementing the game into the curriculum, the videogame will ﬁrst be presented to the market for the videogame population of all ages and for all those who want to learn more about ecology, Sonja Hlebar says. The goal of the game is to inﬂuence the way of thinking and behaviour of players in the real world, in our case, everyday waste producers. They will learn about waste cycle, proper sorting, recycling, the importance of environmental protection and individual responsibility for all waste producers. Through contemporary and relaxing assignments, children will save the planet from a ‘waste monster’ and familiarise themselves with all the processes in waste management, Sonja Hlebar explains. This project will contribute to solving the challenges of waste pollution by raising awareness of each individual, educating and creating healthy habits and responsible future generations. The game was made in co-operation with Codebox, made up of Lead Artist Ivan Ivanović and game developers Filip Stojić and Martin Kolarić.

VENTURE INTO THE GLOBAL MARKET The game is currently in its demo version and should see the light of day by the end of the

BETA VERSION IS FINANCED BY THE INVENTOR BUT THERE ARE PLANS FOR APPLYING FOR EU FUNDS

CURRENT ISSUES

UGH A GAME SPLIT SHIPBUILDING INDUSTRY

Dams for Venice completed Brodosplit delivered 63 dams (each of 300 tonnes), a contract valued at over €75 million by Jozo Vrdoljak

year. We are working a lot on customer development. We tested individual phases on a target group, students of elementary schools. The feedback mainly concerns their lack of patience to ﬁnish the game and we also receive various questions and suggestions of what the game should include. We also ask teachers and professional services in schools to advise us on how to make the game more acceptable at a pedagogical level, Sonja Hlebar highlights. The Beta version is ﬁnanced by the inventor, and there are plans for applying for EU funds. The Adventure of Eco is intended for the global market. We are also in a phase of arranging its implementation in other countries and their education systems, but this is still in its early phase, Sonja Hlebar concludes.

he barge for transporting special cargo from Split Shipbuilding Industry has just delivered its final cargo of steel dams for saving Venice from tidal damage. Brodosplit delivered 63 dams with a weight of around 300 tonnes; the contract was valued at over €75 million and includes 20,000 tonnes of steel and other anti-corrosion works, final furnishing and transport. Brodsplit are very proud of this contract since they won it in a global tender, against fierce international competition from shipbuilders and steel producers. This will put Brodosplit on the list of companies which participated in one of the biggest construction projects in the history of Italy, and which contributed to saving Venice from serious problems caused by flooding. The project of saving Venice from flooding is MOSE – it is an integrated safety system consisting of rows of mobile gates to four channels leading to the Venice lagoon when

the tide exceeds a level of 110 centimetres and up to a maximum of 194 centimetres. The inlets in question are Lido Tre Porti, Malamocco, Chioggia and Lido San Nicolò. The project involved setting up a total of 78 dams with life span of around 100 years. The dams are constructed as special tanks filled with air. When filled with water they lie on the seabed and when filled with air they lift up to the surface closing the gates to the lagoon. When the tide drops, the gates are filled with water again and return to the sea bottom. This vast project resulted in hiring other Croatian institutions and companies, for example the Faculty of Mechanical Engineering and Naval Architecture in Zagreb where the material was tested, and Gumiimpex from Varaždin, which manufactured many demanding segments such as rubber bumpers which take the entire weight of the dam, lowering them to their horizontal position with the energy they absorb.

April 2018 | No 279 | PVinternational | 25

TEKSTIL LIO

The largest Croatian pillow Tekstil Lio from Osijek has recently manufactured the largest pillow in Croatia. The pillow’s dimensions are 237x300 centimetres and it weighs 30 kilograms. It is made of cotton and stuffed with silicon balls. This unusual undertaking has the aim of bringing the public’s attention to the production potential of the Croatian textile industry, as well as the importance of good, healthy sleep since the right type of

ial for an undisturbed and pillow is crucial p. It will be exhibited in the peaceful sleep. Lio discount store in Osijek, and those d llook k at iit until il interested may enter and Easter. The pillow will then be given to the Nevičica nursery in Osijek. Tekstil Lio is a Croatian producer of pillows, bed covers and linen, with a long tradition and history dating back to 1901. With constant innovation, the company managed to preserve its quality and holds

the Croatian Quality label. Lio has been l d as the h most sucselected cessful company in Osijek and Baranja in 2005 in the category of small trade companies and received the Golden Kuna Award. In addition to households, Lio supplies a great number of hotels and apartments. Each of their products is made with carefully selected materials.

STANIĆ BEVERAGES CROATIA

Expansion into the South African market

The ‘Juicy’ brand presented itself to the United Arab Emirates for the second time at one of the largest and most influential food shows – Gulfood – which covers 5,000 brands globally. The ‘Juicy’ brand has been present on the market of the United Arab Emirates 26 | PVinternational | April 2018 | No 279

since 2015, and two years after entering the new market their sales increased 3.5 times. Total exports of Stanić Beverages in the MENA region, increased nine times compared with 2016. In addition to the increased juice sales on these markets, Stanić Beverages Croatia is expand-

ing its exports into Bahrein, Yemen and Egypt. Exports are an important issue in the sales strategy of Stanić Beverages. “For two years we have been working intensively on strengthening our position in the MENA region, and I am proud to say we are responsible for the strengthening of the image of other Croatian companies in general in terms of top product quality and high business ethics. In order for a product to become a brand on a new market, it is important to brand the country of the product’s origin. This is why the support of state institutions and economic associations is crucial for successful marketing of Croatian companies in the Middle East”, said Svjetlan Stanić, CEO and owner of Stanić Beverages Croatia, on his return from Dubai. The fact that ‘Juicy’ is on the shelves of the two biggest retail chains in the United Arab Emirates: Carrefour and Union Koop, conﬁrms its position as an important brand on the market.

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