Stella Ronner Grubačić, Dutch Ambassador to Croatia Be imaginative, willing to do business, collect data and profits will come
Cluster development Bad historical experience with co-operatives and lack of trust represent huge obstacles to cluster development
INTERVIEW PAGES 2-3
UN TENDERING PAGES 4-5
Roland Berger Restructured companies are more competitive with economic recovery expected in 2013 FINANCE PAGE 8 2010
Croatian Business & Finance Weekly Established in 1953 Monday / 10th October / 2011 Year IV / No 0169 www.privredni.hr
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pvinternational pv international C R O A T I A N
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ASSETS OF CROATIAN COMPANIES IN SERBIA
Agreed return postponed until spring Whilst often stated that Croatian companies may lose assets in Serbia the actuality is they might lose property but gain shares Drago Živković he argument over property of Croatian companies in Serbia has been ongoing for several years and has now come to another ‘final’
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companies have the right to submit a request for the settlement of shares until March 31, 2012. If agreement is reached, it should be submitted to the Serbian Ministry of Economy by June 30, 2012. However, if
Of course, most of the interested Croatian companies would rather choose property than shares deadline. However, according to past experience, it might not be the finale. On the last day of September, the eighth version of the provision of the Serbian government on the protection of assets of companies with central offices in ex-Yugoslavia came into force. Each of the past changes, as well as the latest, merely extended the deadline for the application of the provision, whereas the legal mechanism it introduces remained the same. Through shares of Croatian companies with assets in Serbia during the splitting of Yugoslavia, new companies were established. Now, Croatian
it is not reached, the Serbian Agency for Privatisation will evaluate the share of a specific Croatian company in a Serbian enterprise. International agreement Whilst often stated that Croatian companies may lose assets in Serbia the actuality is they might lose property but gain shares. It would be more accurate to say they will lose their property if no agreement is reached with its successors. Rather, they would obtain shares in the Serbian companies according to an evaluation of the Agency for Privatisation. Ac-
cording to the provision, after the privatisation of these Serbian companies, the money for the shares of Croatian companies will be retained in a special account from which they will be able to collect debts. Of course, most of the interested Croatian companies would rather choose property than shares. According to unofficial data, around twenty Croatian companies have succeeded in doing so, whereas others are claiming assets whose value is estimated at €800 million.
On the other hand, Serbian companies in Croatia are claiming assets worth €1.8 billion, according to the Direction for the Assets of Serbia. However, since Serbia does not have accurate data, Croatia finds such
estimates exaggerated. It is difficult to expect a final solution without an international agreement that would specify the provisions of the G Annex of the Succession Agreement. If such an agreement is not reached within the next six months, it may be expected that the Serbian government will extend the deadlines yet again.
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Privredni vjesnik Year IV No 0168
Damir Vitez, Board President, Čateks
Croatian production harmed by import lobby
ateks and Varteks have signed a strategic alliance agreement for joint representation on local and foreign markets. The motive was commercial; a productive alliance and job preservation. The companies are not competitors, as Varteks product range consists primarily of pure wool and wool mixes, whilst Čateks offers a cotton product range. Consequently, the alliance of these two complementary companies will ensure a more competitive market range, particularly in terms of public procurement and exports. The Croatian textile industry is faced with competitors behaving in an anti-competitive manner, created by a trade lobby having affordable textile imports. Such importers often claim to be textile producers, without having production facilities nor employing textile engineers and other necessary staff. In addition, there is frequently no information on the country of
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IMPRESSUM: Privredni vjesnik Kačićeva 9 10000 Zagreb +385 1 5600020 uprava@privredni.hr www.privredni-vjesnik.hr/ subscription
origin or the producer on customs declarations, which misleads consumers. Since 2005 Čateks has invested over €2.97 million in production capacity modernisation, illustrating the existence and advancement of the primary textile industry in Croatia. Nevertheless, there is a far more serious problem with competition on the local market, where we cannot be on par with the import lobby in spite of our quality and 137 years of tradition, as its primary goal is its own profit, rather than job preservation and the development of the Croatian textile industry. In addition, our products are eco-friendly and meet stringent environmental standards of control, having obtained all the necessary permits from the authorised ministries and institutions. We use certified and eco-friendly materials and raw materials from reputable producers (companies from EU countries), and meet-
Importers often claim to be textile producers ing EU standards. Consequently, the products are more expensive, due to their indisputable quality and consumer safety, as opposed to affordable textiles of unknown origin or product structure. It has to be emphasised that we are the sole producer of special purpose and technical clothing and multilayered laminated materials in the region, due to our investment in new equipment. There are only a few companies in Europe with a similar product range, facing anti-competitive behaviour from the Far East.
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EXECUTIVE EDITORS Andrea Marić maric@privredni.hr Vesna Antonić antonic@privredni.hr
INTERNATIONAL OPERATIONS Ray Fletcher fletcher@privredni.hr
( 30%
Dutch revenue from trade
STELLA RONNER GRUBAČIĆ, DUTCH AMBASSA
Invitation
Be imaginative, willing to do business, collect all nec Igor Vukić he seminar How to do business with the Netherlands will be held on 11th November 2011 in Zagreb. Dutch and Croatian company representatives will have the opportunity to exchange information on and experiences from their business relationships thus far, in the Croatian Chamber of Economy. Companies venturing to into both markets for the first time will have the opportunity to find a plethora of useful information on ways of doing business in both Holland and in Croatia. Privredni vjesnik talked with Stella Ronner Grubačić, Dutch Ambassador to Croatia. The Dutch Embassy and the Croatian Chamber of Economy are co-organisers of the seminar. Privredni vjesnik asked the Ambassador to assess the current business relationship between the two countries.
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“I would like to point out that Holland is the fifth largest exporter and the second largest importer globally with about 30% of our revenue originating from trade. The Dutch are aware of their trading skills and demonstrate them throughout the world. It is part
of our tradition. Nevertheless, currently Croatia contributes just 0.3% to total Dutch imports and this certainly needs to increase. The value of imports from Croatia is $170 million, with the value of imported Dutch goods to Croatia
The Dutch economy is very open. Be imaginative, willing to do business, collect the necessary information and profits will certainly be satisfactory standing at $429 million. We believe there is ample potential for augmenting trade in goods and for decreasing the current incongruity in the value of both imports and exports. Consequently, we are inviting Croatian companies to enter our market. What economic sectors should Croatian companies target? Croatian companies can trade in many goods, as long as they achieve a satisfactory quality to price ratio. We particularly welcome creative and innovative products. Croatian companies
Trade between Croatia and Holland Trade between Croatia and Holland is slowly recovering following the recession in 2009. It reached its peak of $715 million in 2008. Croatian exports stood at $178 million, whilst imports were $536 million. Subsequently, 2010 saw a trading value of $597 million, which was $30 million up over 2009. During the first six months of
2011 the figure stood at $272 million: Croatian exports were $89 million, whilst Dutch exports were $189 million. Major Croatian exports during the first six months of 2011 were antibiotics ($11 million) followed by footwear, electric transformers, passenger ships and cruisers, household furniture and similar.
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% imports from Croatia to Holland
ADOR TO CROATIA
to trade
cessary information and profits will certainly be satisfactory sumers and other European consumers via Dutch traders and commodity markets. Do not expect foreign customers to tell you what to produce. You must find the appropriate way of promoting your products in foreign trade circles. The Dutch Embassy can provide assistance in penetrating the market. Our staff in the Economic Relations Department will provide all the basic information on doing business in Holland. I believe you can get useful information also in the Croatian Embassy in The Hague. In addition, the Chambers of Economy of both countries can provide valuable business information. We advise Dutch companies on public tenders in Croatia and we believe Croatian institutions do the same for the tenders in Holland. Participation in public procurement tenders is also a satisfactory manner of penetrating the Dutch market.
need to promote quality, they need to be aware who to address and how to initiate trading activities. The forthcoming business forum will provide several answers to such questions. The Dutch economy is very open. Be imaginative, willing to do business, collect the necessary information and profits will certainly be satisfactory. Significant results can be achieved in sectors where co-operation has already been achieved, such as petrochemicals, machinery and agricultural products. There is ample poten-
tial for co-operation in renewable energy equipment. There is also the potential for co-operation in virtually all economic areas. What is the best way to penetrate the Dutch market? When you have a quality product at an acceptable price, things move fast. There are several institutions, agencies and internet addresses that assist in identifying an appropriate market niche. There is an example of a Croatian company producing exotic fruits. It found its way to Dutch con-
Do fairs held in your country provide a good vehicle for market penetration? We live in a time of electronic communications. Nevertheless, we cannot exclude the benefits of direct contact, meetings and negotiations, strengthening business confidence. Dutch companies are pleased to participate in business meetings and forums with foreign company representatives, in order to be introduced and to initiate business co-operation. Such occasions require a satisfactory knowledge of English. It is important to strengthen contacts and ensure companies are informed on with whom they will negotiate, as well as ensuring these people are authorised to conclude contracts.
What privileges and incentives can companies get if they set up a branch office in Holland? There are tax exemptions; yet we believe that the largest number of companies who enter the Dutch market do so primarily due to the excellent business climate and developed business infrastructure. Our air and sea ports, such as Rotterdam, attract large numbers of business people who consider Holland as a distribution centre for their products throughout Europe. Administrative procedures are simple. All these factors should be considered as incentives to business sector. Is there huge potential for cooperation between Croatian and Dutch companies in third markets? There is huge potential in free entrepreneurship. Some Croatian companies co-operating in the shipbuilding sector are currently already well known. Both countries have a long tradition and deep expertise in this sector. Croatia designs drafts for the ships we produce and which are sold throughout the world. This provides the foundation for further co-operation. Connecting companies and people with information and expertise for the development of joint business activities will be the next challenge. I believe our seminar will provide a significant opportunity to discuss it. In addition, Croatian EU accession will significantly promote co-operation with Dutch companies, particularly in simplifying administrative procedures. Nevertheless, there will be fierce competition.
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Privredni vjesnik Year IV No 0169
( €4.37 million ( 46 cluster subsidies for clusters in 2011
initiatives subsidised by the Ministry of Economy
Cluster development
Specialised regional clusters are a key to the European market Bad historical experience with co-operatives and lack of trust represent huge obstacles to cluster development Drago Živković he Croatian word for cluster is grozd. However, this word did not catch on, but it precisely defines the way companies, suppliers or business service providers connect in certain branches of the economy. Clusters are extremely important for the local, regional and national economy. Therefore, their action is supported through various programmes via the Ministry of Economy, and in February 2011 the project for supporting the development of clusters started to be implemented. It is subsidised with €2.4 million from the IPA fund. The projects are managed by Irish and British consultants. The leader of the team, Barry Condron, says that according to EU criteria a ‘real’ cluster must include not only entrepreneurs, but education facilities and local government, intertwined in a socalled triple coil. In ex-socialist countries, as well as Croatia, bad historical experiences with co-operatives present a huge obstacle for the development of clusters. A further problem is the lack of trust, since entrepreneurs often think they have to reveal their business secrets if they join a cluster. Clusters are usually established in production activities, but also in service activities, where the best example is the ICT clusters, few of which are present in Croatia.
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Export tool For the Ministry of Economy clusters are an important export tool. They increase competition and help solve the problems of fragmented production, says Sanja Rendić-Miočević, director
of the Administration for Economic Diplomacy, Exports and Investment. Hence, why for the past three years the Ministry has been implementing a series of subsidising measures and activities for preparing the clusters for exports and fairs. In the last two years a sum of €9.58 million was allocated for the financing of 107 joint participations at fairs, and two cluster representative offices have been opened abroad. A sum of €4.37 million has been secured for 2011, with around €2.3 million having already been spent. In addition to increasing exports, clusters may also boost employment and innovation as well as increase interregional co-operation, points out Zdenka Mesić, head of the department for clusters and co-operatives in the Ministry of Economy. At an EU level, clusters are now oriented towards
innovation and networking, and the same approach is also recommended to the Croatian clusters. Since 2005, the Ministry has supported 46 cluster initiatives, for which a total of €4.31 million of non-refundable funds has already been spent. The Danube region The plan of the Ministry of Economy is to increase non-refundable funding for co-financing of clusters and then distribute them throughout Croatia. For now this has not gone according to plan in two counties, in Lika and Senj, and in Dubrovnik and Neretva, which have failed to show interest in supporting clusters. This does not mean there are no clusters in these counties, since the Ministry knows that some clusters do not apply for their tenders since in reality
there are twice as many clusters than the Ministry subsidises. Some Croatian clusters went a step further, associating with cross-border clusters, for example, in timber, in car clusters of the SEE and the Ecorural-NET cluster. The Development Strategy of the Danube region is a great opportunity for Croatia. It includes 14 countries, one of which is Croatia. Even though only two eastern Croatian counties fall within the Danube region, anyone can apply for the projects under this strategy. The Adriatic Strategy for the EU development is currently being prepared, and according to the first draft Croatia should be the moving force. Structural EU funds have already been opened for clusters in the areas of health tourism, renewable resources and health foods.
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INTERMODAL TRANSPORT
Rail and vessel transport are the future Croatia should invest in railways and harbours as much as it has invested in motorways over the last ten years Drago Živković ntermodal transport as the future of the transport sector has been often discussed and is mentioned as a priority in EU White paper on transport published in March 2011. Intermodal transport may be defined as the integration of multiple methods of transport. It is the sole transport sector that witnessed growth during the current recession. Consequently, its share of total freight transport has grown to 15% and it is projected to reach 25% by 2015. Intermodal Promotion Centre Danube-Adriatic (IPC) has been actively promoting intermodal transport in Croatia for seven years and it has recently issued a publication on the topic. The publication also includes concrete project proposals. There are some 15 proposed projects and some of them are currently well-known (such as Vukovar,
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Ploče or Rijeka Port modernisation, or Danube-Sava channel construction). In addition, there is a proposal for the construction of Pragersko-Krapina railroad, the revitalisation of the Una railway and the construction of a rail tunnel through Učka. In compliance with EU plans, 30% of road cargo transport should be transferred to inland waterways and railways by 2030, and 50% by 2050. Subsequently Croatia should invest in railways and ports as much as it has invested in motorways over the last ten years or perhaps even more. Rijeka lacking space According to Dubravko Radošević from the Institute of Economics, the optimum sources of finance are European Investment Bank affordable loans as opposed to EU structural funds supported by many. Cargo Centre Zagreb, functioning as an inland harbour
PBZ
to the port of Rijeka, is currently the most viable. Specifically, if the international agreement concluded last year on the forthcoming pan-European corridor XI (from Sweden via Poland and Czech Republic to Croatia and Greece) is implemented, containerised cargo transport in Rijeka could soar from the current 150,000 containers to 7.5 million. The construction of new terminals is imperative, yet in Rijeka there is insufficient room. Consequently, railway transport of most freight to Zagreb appears to be the optimum
solution. According to Tomislav Josip Mlinarić, the study of intermodal passenger transport for five cities (Zagreb, Split, Rijeka, Osijek and Varaždin), carried out by the Faculty of Transport and Traffic Engineering, highlights the necessity of at least 44 new train-sets. Nevertheless, it is currently not certain how costeffective it will be for Croatian Railways (HŽ), as the state pays a mere €0.02 per passenger per kilometre, which is wholly unprofitable according to EU criteria.
CNB
Stagnating salaries in 2012 Bank deposits at €30 billion ccording to the latest data provided by the Croatian National Bank (CNB), bank deposits (savings and term kuna deposits and foreign deposits) totalled €30 billion, some 2.1% more up in relation to the end of July. This result was contributed to by the growth of kuna and foreign savings, term and cash deposits. Furthermore, the growth of foreign deposits (€0.35 billion) contributed most to growth on a monthly level, which is partly a seasonal characteristic and a consequence of foreign currency inflows from tourism. At the end of August, savings and term foreign deposits reached €19.7 billion, 2.3% higher year-on-year. However, com-
A ccording to data provided by the Central Bureau for Statistics, nett salary per employee in companies averaged €729 during the first seven months of this year. This is nominally 1.9% more over 2010, whereas the real value is 0.3% lower. According to Ana Lokin, PBZ analyst, these movements are in line with their latest forecasts, according to which the nett salary in 2011 might be 0.3% lower in real value, and 2.5% higher with a correction from the crisis tax effect. In their forecast for next year, PBZ analysts warn that the labour market is sluggish, especially in Croatia, which reacts
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to economic movements with certain time lag (around two quarters are calculated). “Since 2011 is a year of low GDP growth, insufficient to generate jobs, and 2012 will result in a slightly higher growth rate, we believe that only in the last quarter of 2012 will the beginning of any recovery in the labour market be seen, excluding seasonal effects. In such conditions it is unlikely that nominal growth of salaries will exceed the rise in prices, and we are anticipating higher inflation than this year. This means we are faced with a year of stagnation and a slight real drop in salaries”, concludes Ana Lokin. (V.A.)
pared with the end of 2010, foreign deposits still indicate a negative trend (minus €0.24 billion or -1.2%). On the other hand, savings and term kuna deposits show growth. However, they remain below the precrisis level due to the continuous decrease through 2009 and 2010. At the end of August these deposits stood at €5.35 billion, up 13.8%. Private deposits stood at €19.55 billion at the end of August, 3.1% more compared with the end of 2010. Corporate deposits decreased by 4.7% in relation to 2010, and stood at €3.88 billion. (V.A./RBA)
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Privredni vjesnik Year IV No 0169
CROATIAN FOREIGN CURRENCY MARKET Currency
AUD CAD JPY CHF GBP USD EUR Source: HNB
EUR
Kuna exchange mid-rate
7.52
5,470530 5,377563 7,287484 6,061712 8,672005 5,587089 7,499550
USD
5.68
4.10.
5.10.
6.10.
7.10.
6.18
7.51
5.66
6.15
7.50
5.64
6.12
7.49
5.62
6.09
7.48
5.60
6.06
7.47 3.10.
WEEK OCTOBER 8, 2011
CHF
5.58 3.10.
4.10.
5.10.
6.10.
7.10.
6.03 3.10.
4.10.
5.10.
6.10.
7.10.
::: news
ROLAND BERGER
Introduction to financial literacy The Croatian Insurance Office has supported a government decision to allocate the task of proposing a draft national strategic framework for consumer financial literacy to the Ministry of Finance. Financial education is to provide insight indispensable to the general public in making crucial decisions impacting themselves and their families. Consequently, the general public needs to develop their insight into financial products and terms, deepen their awareness of risks and potential and make decisions as to the choice of financial services tailored to meet their needs.
EXITING THE CRISIS IN TWO YEARS
Entrepreneurial profit doubled According to data provided by Fina, entrepreneurial gross profits stood at €2.5 billion during the first six months this year, a remarkable 105.5% up over the same period last year, when gross profits stood at €1.22 billion. Total income increased 8.1%, and expenditure was 4.8% up. Hypo in excess of 400,000 clients Hypo-Alpe-Adria Bank has recorded over €1.5 billion in personal deposits for the first time, exceeding 400,000 clients. The bank recorded €1.52 billion deposits during the first nine months this year, achieving a 9% growth of €128 million. In addition, the bank attracted 9,000 new clients in 2011, which is a monthly growth of 1,000 clients. The personal banking sector also recorded growth of €80.4 million in new local currency deposits or 12.5% during the first nine months of this year. Over 19,000 new accounts were opened and 13,750 new credit cards were issued.
Restructured Croatian companies at the end of the crisis are more competitive with economic recovery expected in 2013 he financial performance in terms of liquidity has exceeded last year’s results for a considerable number of Croatian companies. Most of them are opting to use their own capital rather than bank loans in financing expansion, due to a more rational use of internal resources. According to the latest study by Roland Berger on trends in restructuring which has been carried out globally seven consecutive times and six in Croatia, slashing costs and focusing on core activities are still the crucial measures in tackling the crisis, the exit to which should come to Croatia only in 2013. The research covered 50 small and medium-sized companies from 8 industrial branches, with the goal of finding managerial viewpoints on the long-term competitiveness of their companies after the crisis and how they are planning to improve during the recovery, with particular emphasis on financing. Restructuring programmes implemented during the crisis, such as cost reduction and business model adaptation, created new business opportunities and, subsequently, 44% of managers perceive their company as competitive. The research indicated that most companies do not rate the importance of risk management, such as unstable raw material prices and exchange rate differences. Croatian companies focus on improvement
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of effectiveness by simplifying operational IT processes and optimising logistics and supply chains. Continuous liquidity increase an imperative Whilst West European companies cut employee costs during the crisis with flexible working hours, Croatian companies more frequently resorted to variable remuneration, part-time employment and outsourcing. “According to the results of the survey, 73% of managers have improved their companies’ competitiveness by continuous restructuring. This result might appear encouraging, yet it also indicates the problem of unfocused restructuring. Companies continuously reduce business costs without changing their business model, which is unsustainable in the long term”, pointed out Vladimir Preveden,
Roland Berger Zagreb Office Executive Director. “Croatian companies must move forward, increasing their liquidity by freeing up cash-flow to the maximum for operation and growth through focused restructuring measures, implementing a long-term financing strategy and alternative financing models, as merely optimising work capital will not suffice. All efforts to improve the competitiveness will remain futile, unless companies focus on the customer with innovative products and through differentiation”, noted Dejana Dojčinović Drilo, senior consultant at Roland Berger Zagreb Office. “Companies must focus on structural measures, rationalisation and simplifying business processes instead of mere cost reduction, since innovative business models are the best way to enhance company competitiveness”, he concluded.
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GRANUM G, ZAGREB
PORTAL ČUVARKUĆA.HR, ZAGREB
The story of two grains The rôle is to help employees to become accomplished and successful individuals
For carefree childhood The portal assembles experts, companies, associations, institutions and individuals offering users important information for a safe and healthy childhood hroughout childhood, most of us were surrounded by sage sayings and thoughts or stories with a message. Since granum in Latin means grain, people first think of the saying grain by grain, a loaf of bread, but they forget about the saying you reap what you sow. As managers and advisers as well as professional trainers, the owners of the company Granum G acquired broad experience on the processes, tools, channels, approaches and skills on which they advise. They say they live by the two sayings mentioned above.
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Granum G can significantly improve the chances of success They established Granum G convinced that the employees are the foundation of any organisation, whether they are a team or individuals. They achieve results and goals, communicate with the public, create, promote and sell products. They are the organisation. Ines Vranješ Radovanović says their rôle is to help employees to become accomplished, successful and satisfied individuals who use all their know-how, alone or as a team, meeting the criteria of the organisation and accepting the
market surroundings. If relations between manager and employees are developed in a company, but the sales of products or services are not doing well, the weakest link is that the company ignores systematic marketing and communication, says Vranješ Radovanović. How to market a product It is not easy to turn products and services into a success, which is why, in over 50% of cases, companies fail in that respect. Granum G can significantly improve the likelihood of success, according to the owners. They say their work involves creating marketing strategies, evaluation of market potential, drafting a marketing plan and the implementation of supervision management of products and brands, segmentation and positioning or making decisions regarding business development of an existing and new portfolio. It does not matter if you call it communication, PR, internal and external communication or crisis communication – you cannot survive on the market without it. Someone on the outside always has a clearer view of the communication strategy, media relations, how to establish an effective system of internal communication or approach to crisis and event management. (P.V.)
ecently, the internet portal čuvarkuća.hr was opened to the general public. As the portal’s founder and co-owner, Nina Išek Međugorac, says the portal is the result of co-operation between communication experts and the programme support of the company Web.burza who provided the platform. The portal has been active for several months now and is primarily intended for parents, but also companies that are able to connect directly with portal users. Nina Išek Međugorac came up with the idea during her Masters degree studies and later her PhD research. She noticed that many younger parents, are constantly searching for safe and verifiable information online that can help them solve many doubts they might have.
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Recommendations graded With the idea of a responsible, positive and informed approach to parenthood, čuvarkuća.hr attracts experts, companies, associations and other important institutions and individuals, offering information that is important for the safe and healthy development of children. More precisely, each partner informs parents on new programmes, products and practises based on scientifically proven facts and experience. She added that the portal is a positive response to the communication
situation in Croatia, from the idea, design, innovation, creativity, positivity and enthusiasm to state-of-the art technology. By registering, parents are provided with personal guidance through parenthood, a user page that offers information and projects in
By registering, parents receive personal guidance through parenthood the areas of health, nutrition, free time, law, finance, lifestyle, care through all important development stages, from pregnancy to school. Each recommendation on the portal is graded, and users are able to see the reasoning behind a certain grade, which helps them make an informed decision. The portal has dedicated this year to the promotion of nonviolent communication. In cooperation with our partners we wish to raise public awareness of the increasingly present “violent communication” that starts during the first days of a child’s life, and we wish to present programmes that might provide parents with useful tools for creating a quality foundation for a non-violent society, starting from the home, concluded Nina Išek Međugorac. (J.F.)
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Privredni vjesnik Year IV No 0169
START OF THE ACOST PROJECT
Faster, stronger, higher An achieved 5% growth by small family hotels will probably cover the difference resulting from higher expenses Jozo Vrdoljak he Association of Small Family hotels was founded primarily as a regional association. Since 2004, when the National Association of Small Family Hotels was created, it has encompassed 120 permanent and 50 associated members in only three years. The Association currently has 204 members. Its goal is to offer support to members, creating identifiable products, improving the levels of service and quality in facilities, ensuring better business conditions, financing, procurement and sales, increasing interest in family and small hotels and accelerating the repositioning of the entire Croatian tourism sector. Although the tourism season is still ongoing, and it is known that many small hotels work throughout the year, participants at the assembly of small family hotels, held recently in Trilj, are convinced that it is already possible to state that growth from 2010 continued in 2011.
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Included in brochures “It is possible to say that certain destinations and certain colleagues had slightly better growth, and others slightly poorer. However, this season might end with an average growth of around 5% over 2010
which was also a successful year. This growth could cover the difference resulting from higher expenses”, points out Šime Klarić, president of the National Association of Small and Family Hotels. According to him, several valuable results have been achieved by the youngest Croatian tourism association, and it is also worth mentioning that large foreign tour operators included them in their brochures. The association has never distanced itself from its main goal - staff training. Significant results have also been achieved in the modernisation of hotels, and lobbying. There were several credit lines intended for owners of small hotels. The largest contribution to Croatian tourism is the raising the level of quality in catering and accommodation to an envious level. State Secretary at the Ministry of Tourism, Branko Grgić, thinks that the forthcoming Development Strategy for Croatian Tourism is a great opportunity for small and family hotels to protect their interest in the long-terms sense, especially through the use of various EU funds. European projects The Association already has experience in using EU funds. In 2009, it started successful co-operation with the Informest
Agency with a project Piccoli grandi alberghi (small big hotels), which led to even closer co-operation with the agency and the Italian government. Furthermore, on 3rd October 2011, representatives of small hotel owners assembled in Trilj, marking the start of a new project Azioni coordinate di sviluppo turistico (Co-ordinated Actions for Tourist Development) in co-operation with the same agency and the Trentino School of Management. The project is fully financed by the Italian government to the amount of €317,000. The goal of the project is to strengthen the Croatian
tourism sector in terms of operations and planning. A series of seminars will provide training for the movers of Croatian tourism policy, responsible for tourism planning and strategic territorial development and participants will be able to exchange experiences and good practices developed in the Italian region of Trentino. Hotel owners and managers will go through practical training for web marketing, and Italian entrepreneurs interested in direct investment will also participate, says Elisa Sfiligoi, project manager of the Informest Agency.
centre will extend to 24,000 m2, of which 11,000m2 will be openplan shopping area. Bricostore is one of the leading European chains with house and garden products range. It has been in the Croatian market since 2004, when the first shopping centre was opened in Kaštel Sučurac, followed by a store in Pula.
producers to submit their opinions, proposals or commentaries on New UN Food Standards for Products by 20th October 2011. The Ministry of Defence has published a presentation on their web pages on how to do business with the UN, as well as links to the UN Procurement Division and information on new standards for food supplied to the UN peace keeping missions.
::: news Agrokor expansion in Macedonia Agrokor has recently opened a new storage and distribution centre in Strumica, valued at over €15 million, which will store and distribute over 60,000 tonnes of fruit and vegetables. The centre covers 13,000 m2 and employs over 250 staff. Products will be sold mainly into EU member countries
and to the Russian Federation. Ivica Todorić, Agrokor Board President expressed his gratitude to the Macedonian authorities for their assistance and invited other investors to enter the Macedonian market. Bricostore centre in Zagreb The French chain Bricostore has commenced the construction of its shopping centre in Sesvete industrial zone on the east side of Zagreb. Total investment value stands at over €25.27 million and the shopping centre will employ 11 staff. The projected opening is in spring 2012. The shopping
UN in need of food products The UN Procurement Division has invited Croatian producers of food of animal origin to become involved in the supply of products to UN peace keeping missions. They have invited all food