Monday, 11 April 2022

Croatia Sees 19.3% Drop in Job Seekers in March

11 April 2022 - A total of 125,604 unemployed persons were registered with the Croatian Employment Service (HZZ) at the end of March 2022, down by 3.7% from the previous month and by 19.3% from March 2021.

March was the second month in a row to see a decline in the number of unemployed persons on a monthly level. There were 4,849 fewer of them compared with February. Compared with March 2021, their number decreased by 29,984.

Daily figures indicate that the number of unemployed persons will continue to fall in April as well. On Monday, 122,139 job seekers were registered with the HZZ, which is 3,465 fewer than at the end of March, and 23,702 vacancies were advertised.

In March, 13,181 job seeker signed up with the HZZ, 0.3% fewer than in March last year.

Monday, 28 March 2022

Eurostat: Croatia Catches Up with Latvia on GDP Per Capita

28 March 2022 - In 2021, Luxembourg and Ireland recorded the highest levels of GDP per capita expressed in purchasing power standards, while Croatia overtook Slovakia and ranked alongside Latvia, according to Eurostat's flash estimate. 

Luxembourg's GDP per capita was 177% above the EU average, while Ireland's was 121% above.

The high GDP per capita in Luxembourg is partly due to the country's large share of cross-border workers in total employment. While contributing to GDP, these workers are not taken into consideration as part of the resident population which is used to calculate GDP per capita, Eurostat said.

The high level of GDP per capita in Ireland can be partly explained by the presence of large multinational companies holding intellectual property. The associated contract manufacturing with these assets contributes to GDP, while a large part of the income earned from this production is returned to the companies’ ultimate owners abroad, Eurostat noted.

Luxembourg and Ireland were followed by Denmark (33% above), the Netherlands (32% above), Sweden (23% above) and Belgium (22% above).

In contrast, Croatia (30% below the EU average), Slovakia (32% below), Greece (35% below) and Bulgaria (45% below) registered the lowest GDP per capita, Eurostat said.

Croatia had made an improvement since 2020, when its GDP per capita was 36% below the EU average, and caught up with Latvia, which was 29% below the EU average in 2021.

France (4% above) and Malta (2% below) were closest to the EU average.

Monday, 28 February 2022

Adris Group Posts Net Profit of HRK 403M

28 February, 2022 - Adris Group generated a net profit of HRK 403 million in 2021, up from 44.6 million in 2020, with revenues growing by 20% to HRK 5.73 billion, the tourism and insurance group reported on Monday.

Sales revenue increased by 23% from 2020 to HRK 5.3 billion, while earnings before interest, taxes, depreciation and amortisation (EBITDA) reached HRK 1.02 billion, down 5% from the pre-pandemic 2019.

Adris said that all companies operating within the group had undertaken business transformation programmes, including digitalisation, to increase their operational excellence and gain a competitive edge.

Strategically, the present crisis has confirmed that Adris has a well-balanced portfolio. The HRK 400 million of its investment in 2021 and preparations for a number of new projects show that the continuity of development has been maintained even in times of high business uncertainty, the group said.

The group's tourism segment posted a sales revenue of HRK 1.36 billion, accounting for 78% of the revenue generated in the record-breaking 2019.

Croatia's leading insurer Croatia Osiguranje earned a consolidated net profit of HRK 363 million, an increase of 11%. Its total gross written premium increased by 5% to HRK 2.8 billion, while consolidated gross written premium, including regional branch offices, amounted to HRK 3.4 billion, increasing by 6% from 2020.

Cromaris, specialised in production and processing of high quality Mediterranean fish, saw a 14% rise in EBIDTA which reached HRK 67 million, and its net profit skyrocketed 40% to HRK 13 million.

Business: For more, check out our business section.

Friday, 25 February 2022

Croatia's GDP Soars by Record-High 10.4% in 2021

ZAGREB, 25 Feb 2022 - The Croatian economy increased strongly in Q4 2021, continuing to recover from the COVID crisis for the third quarter in a row, registering a record-high 10.4% increase in 2021.

The Croatian Bureau of Statistics today released the first estimate of GDP growth in Q4 2021 at 9.7% on the year.

Due to the COVID crisis, GDP fell 8% in 2020.

In Q2 2021, GDP saw a record-high growth of 16% and in Q3 it increased 15.8% year on year.

The strong Q4 growth was the result of year-on-year growth of all GDP components.

Household consumption went up 7.7%.

Exports soared 31.7%, the export of goods by 24.7% and that of services by 49.1%, while imports went up 16.4%, the import of goods by 15% and that of services by 23.8%.

Gross investment in fixed capital increased 0.8%, less than in Q3 2021, when the increase was 7.6%.

Government spending was up 14%.

According to seasonally adjusted data, GDP in Q4 2021 was up 9.9% year on year but down 0.1% quarter on quarter.

The year-on-year growth of Croatia's GDP in Q4 2021 was higher than the EU average which, according to Eurostat's seasonally adjusted data, was up 4.8% year on year and 0.4% quarter on quarter.

Monday, 21 February 2022

ZSE Indices Slightly Increase

ZAGREB, 21 Feb (Hina) - The main Zagreb Stock Exchange (ZSE) indices went up slightly on Monday, with the Crobex increasing by 0.21% to 2,125 points and the Crobex10 by 0.34% to 1,293 points.

Regular turnover amounted  to HRK 5.3 million, which was about HRK 1.3 million less than on Friday.

No stock crossed the million kuna mark in turnover.

The most traded stock was that of the Valamar Riviera hotel company, which turned over HRK 801,000 and closed at HRK 33.9 per share, down 0.29%.

The Petrokemija fertiliser company said that due to a lack of quorum, the General Meeting scheduled for today, in which shareholders would have voted on delisting from the ZSE, had been cancelled. A new General Meeting with the same agenda will be held on 28 February. This stock was not traded today.

A total of 39 stocks traded today, with 18 gaining and 17 losing in price, while four were stable.

(€1 = HRK 7.530873)

Wednesday, 2 February 2022

RBA Analysts Say 2021 Growth Projection of 9% Subject to Positive Risks

ZAGREB, 2 Feb 2022 - Raiffeisenbank Austria (RBA) analysts estimate that Croatia's economy grew by 9.2% in 2021, a projection that is subject to positive risks. With regards 2022, they are sticking to their GDP growth estimate of 4.4%, according to the bank's quarterly report RBAnalize published on Wednesday.

In early November 2021, RBA analysts had expected a GDP growth rate of 7% in 2021. However, in late November official statistics showed that GDP in Q3 2021 had risen 15.8% compared to the same period in 2020, revising their initial estimate and forecasting that economy in 2021 could grow by more than 9%.

"We also expect the last quarter to bring solid economic activity growth that would be closer to the first three quarters, when the economy grew at a rate of 10.6%. In any case, real economic activity in 2021 managed to exceed the level of 2019, thus bridging the negative domestic product gap," the latest publication says.

RBA analysts expect GDP to grow by 4.4% in 2022.

"The year 2022 should see the continuation of solid growth rates, albeit markedly lower due to the effect of the base period," the analysts say.

This year's growth is expected to be spurred by investments, supported primarily by ample funding under the National Recovery and Resilience Plan, but RBA analysts warn that "disruptions to supply chains and growing costs continue to pose a certain risk, causing increased uncertainty, thus posing a risk to investment activity, notably in the private sector."

For more, check out our business section.

Thursday, 11 February 2021

EC Expects Croatia's Economy to Rebound by 5.3% in 2021, 4.6% in 2022

ZAGREB, 11 February, 2021 - Croatia's Gross Domestic Product is estimated to have contracted by 8.9% in 2020, while it is expected to rise at a rate of 5.3% in 2021 and 4.6% in 2022, the European Commission says in its latest Winter 2021 Economic Forecast, published on Thursday.

The economy's contraction in 2020 "is mainly attributable to the impact of the COVID-19 pandemic on service exports, particularly tourism, which suffered greatly due to the fall in demand for air travel and the imposition of travel restrictions in many countries."

Croatia's private consumption also fell, reflecting the accumulation of involuntary and precautionary savings.

Following a better-than-expected third quarter, the country's GDP is estimated to have contracted again towards the end of the year as pandemic suppression measures were reintroduced in December.

This contraction is lower than the previous projections of -9.6%, as stated by the EC in its Autumn Economic Forecast. However, the latest forecasts about the rise in 2021 are smaller in comparison to the previously projected recovery at a rate of 5.7%, while the projected growth for 2022 has been revised upward from 3.7% to 4.6%.

"Real GDP is forecast to bounce back by 5.3% in 2021, as domestic demand should rebound once pandemic containment measures are phased out and more people are vaccinated.," the EC says.

"Pent-up demand, coupled with a gradual recovery in the labour market, is expected to boost private consumption. Investment should rebound on the back of the already strong dynamics in the construction sector, supported by rebuilding efforts following the strong earthquakes in the Banija region and Zagreb.

"A gradual pick up in longer-term investment projects, is also expected. The recovery in external demand, however, is expected to be uneven. Goods exports are expected to increase strongly on the back of the improved global outlook but services exports are projected to remain subdued in both 2021 and 2022 compared to their 2019 levels.

"This is mainly because the recovery in the travel and hospitality sectors are likely to take several years. This forecast does not include any measures expected to be funded under the Recovery and Resilience Facility, posing an upside risk to the growth projections.

"HICP inflation rate dropped to 0% in 2020 on the back of a strong decline in energy prices, while core inflation remained broadly stable at around 1%. As the effect of last year’s fall in oil prices dissipates, inflation is expected to pick up slightly in 2021 but should remain subdued throughout the forecast horizon (1.2% in 2021 and 1.5% in 2022)," reads the Croatia section of the EC Winter Economic Forecast.

Croatia ranks 3rd in terms of expected rise in 2021, fourth in terms of fall in 2020

For the sake of comparison, Spain is expected to have the most robust recovery in 2021, at  a rate of 5.6%, France follows (5.5%), and Croatia ranks third among the 27 EU member-states.

When it comes to the economic downturn in 2020, Spain again tops the ranking (-11%), Greece is  the runner-up (-10%), and Malta ranks third (-9%), while Croatia comes as fourth with a negative growth rate of 8.9%.

Thursday, 30 April 2020

GDP to Shrink by 9.4% in 2020, Rebound by 6.1% in 2021

ZAGREB, April 30, 2020 - The government forecasts that this year Gross Domestic Product (GDP) will fall by 9.4% while in 2021, recovery is expected at a rate of 6.1%.

The government session on Thursday discussed the 2020 National Reform Programme and the Croatia's Convergence Programme for 2020 and 2021.

The convergence programme projects the contraction of the national economy by 9.4% in 2020 while in 2021 the government expects a recovery and growth rate of 6.1%.

Opening the cabinet meeting on Thursday, Prime Minister Andrej Plenković said that with reference to economic policies the National Reform Programme rests on three existing objectives that the government had set at the outset of its term.

That is sustainable growth and development, connecting education with the labour market and the sustainability of public finances.

Under a baseline scenario, the main adverse impact on the domestic, and global economy will be of a short-term nature.

It is expected that the general government budget will record a deficit of 6.8% of GDP or HRK 24.8 billion in 2020 while in 2021 the general government budget deficit is expected to be reduced to 2.4% of GDP, he said.

The public debt to GDP ratio in 2020 is expected to grow by 13.5 percentage points compared to 2019 and will amount to 86.7% of GDP, mostly due to increased needs for borrowing as a consequence of the negative fiscal effects caused by the coronavirus pandemic.

In 2021, subsequent to reducing the general government budget deficit to 2.4% of GDP and strong economic growth it is expected that the public debt to GDP ratio will fall to 83.2% of GDP, which is a drop of 3.5 percentage points compared to 2020.

Consumer prices are expected to drop mildly in 2020 by 0.3% year on year.

The government is counting on job-keeping measures to buffer the shock on the unemployment rate and that the fall in the number of people employed will drop by 3.3% in all of 2020, and the average surveyed unemployment rate in 2020 will amount to 9.5% and 9% in 2021.

As far as fiscal trends are concerned, direct aid from the budget is estimated at HRK 14.9 billion which includes deferments on taxation and contributions, writing-off direct taxes and contributions, deferring profit tax for 2019, job-keeping incentives and the procurement of medical protective equipment in the fight against COVID-19.

An additional HRK 15 billion has been secured for favourable loans for entrepreneurs under schemes provided by the development bank HBOR and and the HAMAG BICRO agency, as well as HRK 17 billion for a moratorium on loans.

More news about GDP growth can be found in the Business section.

Tuesday, 14 April 2020

IMF Expects Croatia's GDP to Shrink by 9% in 2020

ZAGREB, April 14, 2020 - In 2020 Croatia's economy will contract by nine percent, the most in the group of emerging European economies, shows the latest global economic forecast of the International Monetary Fund (IMF), published on Tuesday.

The coronavirus pandemic has been strongly impacting economic activity, shows the latest forecast, reflecting the consequences of quarantine and other stringent measures with which governments around the globe have been trying to fight the new, highly contagious virus.

According to the latest IMF forecast, Croatia's GDP will drop by 9% this year. For the sake of comparison, last autumn, before the outbreak of the epidemic, the IMF forecast a growth rate of 2.7% for Croatia's economy in 2020.

In 2021 recovery is expected, with an estimated growth rate of 4.9%.

The international lender has also revised the growth rate for 2019 to 2.9%, down by 0.1 percentage point.

The IMF expects a significant increase in unemployment this year, to 11.5%, as against the autumn forecast of an unemployment rate of 8%.

In 2019 unemployment was at 7.8%, whereby the October 2019 forecast has been revised down by 1.2%.

In 2021 unemployment is expected to drop again, to 8%.

The IMF also forecasts a deficit in the current account, expressed as a share in GDP of 4% in 2020, whereas in its autumn forecast it predicted a surplus of one percent.

A deficit in the current account of 1.5% is forecast also for 2021.

The forecast about consumer price growth in 2020 has been revised up by 0.1 percentage point, to 1.3%. In 2021 prices are expected to grow at an almost unchanged rate of 1.2%.

In 2019, according to the IMF's estimates, prices grew by 0.8%, a downward revision of the autumn forecast by 0.2 percentage points.

According to the latest forecast, the surplus in 2019 was 2.9%, which is 1.2 percentage points higher than forecast in October 2019.

The latest IMF estimates show that this year Croatia's economy is expected to drop the most in the group of emerging European economies, which also encompasses Russia, Turkey, Poland, Romania, Ukraine, Hungary, Belarus, Bulgaria and Serbia.

The IMF estimates that those economies will drop by 5.2% on average this year, as against a 2.5% growth, forecast in the autumn of 2019.

In 2021, strong recovery is expected, with an estimated growth rate of 4.2%.

Last year, the emerging economies grew by 2.1% on average, 0.3 pp more than forecast by the IMF in October 2019.

A more pronounced drop in economic activity is expected this year in Ukraine and Belarus, of 7.7% and 6% respectively. The two countries are followed by Russia, with an estimated drop of 5.5%, and Turkey and Romania, each with a decline of 5%.

Poland's economy is expected to contract by 4.6% and Bulgaria's by 4% while economic activity in Hungary and Serbia is expected to contract the least, by 3.1% and 3% respectively.

More economic news can be found in the Business section.

Friday, 20 March 2020

RBA: GDP to Drop 5% This Year

ZAGREB, March 20, 2020 - Croatia will face a steep fall in GDP this year, of almost 5% on the year, while seasonality in tourism demand and weak industry will make recovery slower in comparison with other countries, Raiffeisenbank Austria analysts have said.

The current situation and coronavirus spread will have a significant impact on the Croatian economy, especially due to its strong dependence on tourism, according to a special publication, "Covid-19", published by RBA on Friday.

It is already quite certain that there will be no preseason, and the impact of the epidemic on the peak tourist season is expected to increase. The consequence will be a fall in overnight stays and loss of tourism revenue, RBA said.

The bank's analysts reiterate that at least a fifth of overnight stays and tourism revenue in Croatia can be matched to Q2, while the main tourist season, which falls in Q3, accounts for 70% of overnight stays and revenue.

Among the sectors at risk, RBA analysts include the service sector, especially transport and all other services that depend on tourism: accommodation, food and beverage services, recreation and entertainment and travel services. They add that the manufacturing industry - chemical, paper, textile, lumber etc. - will most certainly experience a decrease in supply and demand since the main Croatian export markets are EU countries, especially Italy and Germany, so a slump in goods export is inevitable in Q2.

More economy news can be found in the Business section.

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