Friday, 18 June 2021

Peljesac Peninsula Oyster and Mussel Production Facing Disaster

18 June, 2021 – Mali Ston on the Peljesac Peninsula is famous for its top quality oysters and mussels. But, recent drop in sales is threatening the livelihood of local producers and the Peljesac Peninsula oyster and mussel production as a whole.

The Peljesac Peninsula in Dubrovnik-Neretva Country is without a doubt one of the most beautiful parts in all of Croatia. Wine production and the cultivation of oysters and mussels have given it a well-earned international reputation. Traditions that span centuries, beautiful scenery and amazing historical towns and villages have turned Peljesac into one of the most favourite destinations for foreigners and locals alike.

It comes as no surprise that most of the yearly revenue of local shellfish farms comes from tourists travelling to Peljesac or restaurants around Croatia selling Peljesac Peninsula oysters and mussels. They're produced in cycles and are mainly sold fresh. So, any drop in sales usually means an un-recoverable loss. In 2020 there was an enormous drop in sales for Peljesac. This was the effect of COVID-19 related travel restrictions and the closing of restaurants.

Dangerous numbers

Slobodna Dalmacija released a report on the current state of oyster and mussel farming in Mali Ston with some alarming numbers to consider. Local aquaculture farmers are currently down 80% in revenue when compared to 2019. After a disastrous 2020, this number is very serious indeed. Along with this crisis, they are apparently facing problems with illegal oyster farms and illegal selling. According to a few interviewed producers, much of what is being sold doesn't even actually get recorded for tax purposes and this creates additional problems for those who are choosing to work above board and legally.

The President of a local association of shellfish producers, Marija Radic, denies there are illegal farms in operation in and around Peljesac. She also stated that instances of selling Peljesac Peninsula oysters and mussels without proper invoices is less common than some of the local producers might claim. However, she did confirm the numbers of around 80% in terms of the drop in sales are sadly correct. The only thing that can save the majority of Peljesac Peninsula oyster and mussel farmers is the return of tourism and restaurant consumption. The local market is simply too small and unable to alleviate such a dramatic drop in sales.

Do your part in helping out local businesses by visiting gorgeous Peljesac for a food, wine and beach trip. Here’s some of the best beaches on the peninsula and here you can find the locations of top local wineries.

For more, follow our dedicated business section.

Saturday, 29 May 2021

Tobacco Industry with Net Profit of HRK 81.9m in 2019

ZAGREB, 29 May 2021 - Businesses in the Croatian tobacco industry posted the net profit of 81.9 million kuna in 2019, a rise by 72.5% compared to 2018, according to the data provided by the Financial Agency (Fina).

In 2019, only the three entreprenuers -- TDR, Hvatski Duhani and Tvornica duhana Udbian -- were registered in this business activity in 2019.

They had 902 people on their payrolls.

The total revenues in the tobacco industry were HRK 1.1 billion, and for instance in 2017, they totalled 1.4 billion while in 2003 and 2004 they reached more than 2.6 billion.

The number of workers in this sector fell from 1,106 in 2002 to 720 in 2010, while in 2019 there were 902 employees.

The average monthly salary per employee in this sector rose 64.6% from HRK 6,566 in 2002 to HRK 10,809 in 2019.

The average monthly salary in this sector in 2019 was by 85.9% higher than the Croatian average.

In terms of the total revenues, the best performer in 2019 was the TDR company with 715 employees and HRK 871.4 million in revenue.

(€1 = HRK 7.5)

Saturday, 15 May 2021

World Bank Approves €200m Loan to Help Enterprises in Croatia

ZAGREB, 15 May 2021 - The World Bank Board of Directors on Friday approved a loan to the Croatian Bank for Reconstruction and Development (HBOR) in the amount of €200 million for the HEAL Croatia Project (Helping Enterprises Access Liquidity in Croatia), the World Bank said on Saturday.

The loan will provide liquidity and financial restructuring to firms that have been hit by the COVID-19 pandemic and by the two devastating earthquakes of 2020.

"The approval of this Project is very important as it provides support to companies affected by the crisis caused by COVID-19 pandemic, thus ensuring the preservation of jobs and providing an incentive for economic recovery. The additional benefit is that it will attract commercial banks to finance the private sector and facilitate financing from other international financial and contribute to increasing the operational efficiency of HBOR. It is important to emphasize that the World Bank provides this Project under very favorable conditions," said Finance Minister Zdravko Marić.

To mitigate the multiple effects of the pandemic, the Project will support firms focused on export, both small and medium enterprises (firms employing fewer than 250 people) and mid-caps firms (employing from 250 to 3,000 people).

The Project will increase access to finance for firms from less developed regions of Croatia, women-owned or managed firms, and young enterprises (operating less than five years). The Project will also support HBOR’s continued development through improved business processes, strengthens sustainability and climate change resilience, and use of EU funds.

"Favorable terms and conditions granted by the World Bank will provide us an additional source of finance for further favorable loans to our entrepreneurs. In addition, the World Bank, as the leader in the field of environmental and social management, will support HBOR in enhancing its own Environmental and Social Management System. This will be important as HBOR's activities in the coming period will be particularly committed to building more capacity for supporting sustainable projects and inclusive growth," said HBOR Management Board president Tamara Perko.

The HEAL Croatia project complements two other World Bank crisis operations approved last year, the Croatia Crisis Response and Recovery Program and Earthquake Recovery and Public Health Preparedness Project - worth together $500 million, to help mitigate the effects of the economic shock, advance recovery, facilitate earthquake reconstruction and strengthen national systems for public health preparedness for pandemic outbreaks.

"The HEAL Croatia project will contribute to a resilient, inclusive and sustainable recovery of Croatia, which has been hard hit by the global pandemic, the economic recession, and the devastating earthquakes of March and December 2020," said Elisabetta Capannelli, the World Bank Country Manager for Croatia.

"We expect the HEAL project to help preserve jobs and support household livelihoods through direct support to approximately 150 firms employing around 25,000 people. It will also help firms led by women, young firms and firms that operate in less developed regions to address issues related to longer-term access to financing," she added.

In the past 27 years, the World Bank has supported more than 50 projects in Croatia worth almost $5 billion, produced numerous studies, and provided technical assistance to help strengthen institutions and support the design of policies and strategies.

For more, follow our business section.

Monday, 4 May 2020

Relaxing Restrictions Leads to Increased Turnover in Retail and Hospitality

ZAGREB, May 4, 2020 - The first wave of relaxing epidemiological restrictions since April 27 has led to an increased turnover in the retail and hospitality sectors compared to the week before, but annual figures are significantly lower, according to data from the Tax Administration.

Comparing the week from April 27 to May 3 with the week from April 20 to 26, the number of fiscal receipts in all activities increased by 3% while their overall amount increased by 6%.

A total of 22.1 million receipts were issued in all activities from April 27 to May 3, with a total value of HRK 2.3 billion.

The number of receipts issued in retail increased by 4% and their value rose by 8%.

Activities of providing accommodation and serving food increased by 6% on the week with regard to the number of receipts issued, the Tax Administration said.

The first wave of relaxing restrictions to contain the spread of the coronavirus epidemic took effect at the start of last week, allowing the retail sector, except for stores in shopping centres, to reopen.

As of Monday May 4, other activities such as hairdressers, barbers, pedicurists and the like were also allowed to reopen their businesses.

In the period from April 27 to May 3 there was a decrease of 49% in the number of receipts issued year on year and a decrease of 33% in value.

Since the outbreak of the coronavirus crisis in Croatia, from February 24 to May 3 the number of fiscal receipts issued decreased by 38%, with a 24% drop in value y-o-y.

This year 265.5 million receipts were issued in that period with a value of HRK 24.9 billion, whereas last year there were 425.5 million receipts issued with a value of HRK 32.6 billion.

More economic news can be found in the Business section.

Sunday, 3 May 2020

Three Associations, GLAS Against Non-Working Sundays

ZAGREB, May 3, 2020 - The associations -- a Croatian association of agricultural producers, a national association of cafe and restaurant owners and the Voice of Entrepreneurs -- said in their joint press release that ban on Sunday trading would reduce revenues of retailers, small farmers and cafe owners.

The press release issued on Sunday recalls that those businesses have already been hit hard by the corona crisis, and ban on Sunday trading would be additional shock. They ask for regulation of the work on Sunday rather than ban.

Tihomir Jaić of the Croatian association of agricultural producers said that family farms that sell their produce on the farmers' markets would suffer from that ban on Sunday shopping.

Vedran Jakominić of the above-mentioned association of cafe and restaurant owners said that the ban on Sunday trading was an act of encroaching on the economic and human freedoms, although cafes and restaurants could be nominally open on Sundays.

He said that due to the ban on Sunday work of shopping centres, cafes and restaurants placed in those facilities would not be allowed to work, too.

The Opposition party GLAS on Sunday reiterated its position that the ban on trading on Sunday was only in the interest of the election campaigning of the ruling HDZ party led by Prime Minister Andrej Plenković, while this measure would be to the detriment of small businesses.

Small retail owners and agricultural producers cannot endure that ban now when they do business in restrictive conditions due to the epidemiological situation, sad GLAS.

The temporary ban on Sunday trading has been recommended as an epidemiological measure to curb the COVID-19 spread.

More economy news can be found in the Business section.

Friday, 1 May 2020

INA Unions Want Government to Give up Dividend

ZAGREB, May 1, 2020 - The three biggest trade unions in the INA oil group have asked Prime Minister Andrej Plenković to get INA owners - the government and the Hungarian oil company MOL - to give up the payment of the dividend for 2019.

The also urged the government to consider the possibility of including INA and its companies in a set of measures aimed at preserving jobs.

"The financial reports clearly show the gravity of the consequences of the economic crisis and its effects on the INA Group, jeopardising more than 9,000 jobs," one of the unions said in a press release.

Another union said that the proposal to cover INA with the government measures that already benefited 84,000 employers was reasonable.

The unions demand the preservation of jobs, investments and economic activity.

 The INA Group generated HRK 3.95 billion from sales in the first quarter of 2020, which was down by 7% in comparison to the corresponding period of 2019, this leading oil and gas company stated on Thursday.

Furthermore, the company's financial statement shows that INA had a net loss of HRK 798 million in Q1 2020 as against a profit in the same period in 2019.

"Operations of INA, d.d. in Q1 2020 have witnessed unprecedented market dynamics, particularly at the end of the quarter. The outbreak of the COVID-19 pandemic coupled with the disagreement within OPEC+ have led to a parallel supply and demand shock on global oil markets leading to a massive drop in oil & gas prices," reads a press release on INA's web site.

Additionally, INA experienced a cyber-attack which created operational challenges but core operations and market supply were not interrupted and the business continuity was ensured, said INA.

INA, d.d. revenues recorded a 6% decrease in line with the mentioned market conditions while the reported result turned negative and amounted HRK 531 million, primarily due to inventory revaluation driven by external environment.

"Exploration and Production EBITDA excluding special items decreased by 22% to HRK 419 million mainly caused by 11% lower realized hydrocarbon price and the natural decline in hydrocarbon production, primarily Croatian natural gas volumes."

Refining and Marketing including Consumer Services and Retail EBITDA excluding special items, hit by external drivers, was negative in the amount of HRK (978) million. Consumer Services sale quantities were only down by 4% in Q1, as the biggest drop in demand occurred at the end of the reporting period.

CAPEX was significantly lower in Q1 2020 compared to Q1 2019 due to the high base effect, as a major turnaround in the Rijeka refinery in 2019 boosted investments last year, INA said in the statement.

More news about INA can be found in the Business section.

Tuesday, 28 April 2020

Atlantic Grupa Reports Higher Profit Despite Coronavirus Restrictions

ZAGREB, April 28, 2020 - Atlantic Grupa generated a 10.6% increase in profit in the first quarter of 2020 compared with the same period in 2019 despite restrictions to stem the spread of the coronavirus epidemic, the food and distribution company says in its financial statement.

The company's profit increased to HRK 89.3 million, and sales revenue rose by 12.2% to HRK 1.28 billion. Earnings before interest and taxes (EBIT) reached HRK 121.3 million, an increase of 15.4% compared with the the first quarter of 2019.

CEO Emil Tedeschi said they believe the stable financial position, the historically best results in 2019, the unquestionable commitment of the company's employees and the strength of its brands will help them weather this crisis with minimal negative consequences.

The company noted that it has become involved in the fight against the coronavirus crisis in all regional markets in which it operates, donating HRK 28 million to healthcare institutions and local crisis management teams.

More business news can be found in the dedicated section.

Friday, 17 April 2020

HUP Calls for Taxation of Cross-Border E-Commerce

ZAGREB, April 17, 2020 - The Croatian Employers Association (HUP) has sent a proposal to the Finance Ministry to start taxing, in line with the relevant EU directive, cross-border online commerce and use the tax revenue to help the Croatian commercial sector, where, it says, more than 300,000 jobs are at risk directly or indirectly.

HUP claims that the growth on e-commerce during the current coronavirus pandemic has put domestic retailers in an unequal position in relation to foreign online retailers because a vast majority of them use a Croatian internet domain and create a false impression among Croatian buyers that they are buying in a Croatian store.

The bills do not show the amount of VAT, which means that VAT is actually paid in some other country, HUP says, calling for strict control and collection of taxes on cross-border shipments.

"Fair and transparent taxation of online trade is, just as the taxation of 'classic' trade, an opportunity for the state to earn more than a billion kuna from e-commerce tax alone. The biggest internet stores are registered in tax havens like Romania, the Czech Republic or Cyprus and it is solely due to omissions by our tax authority that they do not pay VAT in Croatia, which has one of the highest VAT rates in Europe," said Denis Čupić of HUP.

He proposed that revenue from e-commerce taxation be used to set up a fund to help in the recovery of the domestic retail sector, which, he says, is on the brink of bankruptcy due to restrictions imposed due to the coronavirus epidemic.

Čupić also calls for investigating cases of abuse in the customs-free shipment of parcels of small value to Croatia, noting that that way global e-giants place goods of higher value on the Croatian market, avoiding local taxes which are paid by everyone else in the national retail sector.

More business news can be found in the dedicated section.

Friday, 10 April 2020

Jet Set Social Distancing: Croatian Chartered Plane Turned Back in France

April 10, 2020 — A Croatian businessman wanted to treat friends to a holiday in France’s Côte d’Azur, chartering a private jet from London last Saturday then pulling the tried and true practice of “calling connections” to get around a ban on travel. Pandemics, travel restrictions and social distancing rules be damned. French police greeted the group with a resounding “non”, cut short their holiday and sent the group back to the United Kingdom, according to the Guardian.

The nixed vacation comes just as Croatia’s own restrictions on movement and social isolation policy incrementally unravel. Various reports claim cafes and other shops operate around the country in clandestine fashion, religious ceremonies are green-lit despite epidemiological dangers, and even the bureaucracy meant to restrict movement creates loopholes for itself.

Seven men, ages 40-50, and three women, ages 23-25, took the charter flight to Marseille-Provence airport, with three helicopters waiting to fly them to a luxury villa in Cannes. A Croatian businessman who works in finance and real estate chartered the flight, the paper reported. The group was made up of several nationalities, including German, Romanian and French.

Authorities forbade the plane’s arrival while it was still in the sky, but the pilot landed anyway. The group then took nearly four hours to leave.

“They tried to make use of their connections and made a few phone calls,” a source in the police told BFMTV. 

“They were coming for a holiday in Cannes and three helicopters were waiting on the tarmac,” a border police spokesperson told Agence France-Presse. “We notified them they were not allowed to enter the national territory and they left four hours later.”

The helicopters were sent away and fined for ignoring lockdown rules, which banned all non-essential travel since March 17.

The Croatian businessman might have taken a cue from his homeland, where good figures have created a sense of security and an increasingly-lax attitude after weeks of successfully “flattening the curve” through strict isolation measures and limits on travel.

The decision to re-open Zagreb’s open-air market in Dolac drew crowds for the first time since an earthquake sent residents rushing out onto the streets. The government-sanctioned travel system, which uses “e-passes” to allow citizens to travel across municipal borders has become a leaky dam. And authorities let a Catholic Church tradition be an exception to requests everyone stay at home despite the Easter holiday weekend.

Friday, 10 April 2020

HBOR Says Loans Worth More Than 13.5 Billion Kuna Available to Real Sector

ZAGREB, April 10, 2020 - The European Commission on Thursday approved a second Croatian scheme for support to the economic sector in the context of the coronavirus pandemic, and the total credit potential of the two schemes is €1.8 billion (more than HRK 13.5 billion), intended for the real sector.

The schemes were approved on the basis of the Temporary Framework for State Aid Measures, adopted by the European Commission on March 19 and amended on April 3, the Croatian Bank for Reconstruction and Development (HBOR) said in a statement.

The first scheme, totalling €790 million (HRK 6 billion) and approved by the EC a few days ago, secures credit potential for exporters' liquidity in the form of insurance policies.

In cooperation with the Finance Ministry, a few days ago the HBOR put forward a second scheme, intended for small, medium and big enterprises affected by the coronavirus crisis and in need of working capital.

Under the scheme, the HBOR will provide favourable loans, with interest subsidised by the state. The total credit potential of subsidised loans is estimated at one billion euros.

More business news can be found in the dedicated section.

Page 1 of 54

Search