Saturday, 15 January 2022

EC Tells Government: No Deadline Extension for Spending on Reconstruction

January the 15th, 2022 - The European Commission (EC) has told the Croatian Government that there will categorically be no deadline extension for spending on reconstruction projects for post-earthquake procedures.

As Index vijesti writes, the European Commission has refused to extend the deadline for the Republic of Croatia to use the funds from the Solidarity Fund and added that there is no consideration whatsoever being given to the proposed deadline extension of eighteen months to use the funds from the day the money was paid to the country, Jutarnji list unofficially reported.

Another Croatian publication, Telegram, has since published accurate quotations from a letter from the European Commission sent to the Croatian Government. It is clear from the letter that Croatia cannot receive a deadline extension for the spending of a massive 5.1 billion kuna from the Solidarity Fund.

"It was clarified that the EU Solidarity Fund Regulation doesn't provide for an extension of eighteen months for its implementation, and my colleagues explained that the costs of the first damage as a result of the original event (Zagreb earthquake) back in March 2020 are acceptable. Given its limited amount and timeframe, the EU Solidarity Fund should be used for emergency rehabilitation, while other means are more appropriate for significant and long-term reconstruction,'' reads the European Commission's letter signed by Sofia Alves of the Directorate-General for Regional and Urban Policy of the EC.

This means that the Republic of Croatia will need to return part of the amount totalling 5.1 billion kuna because it will not be able to spend it until June the 17th, when the deadline is set.

Croatia will have to finance these projects contracted so far from other EU sources

The European Commission also requested that the Croatian Government's decision to establish special departments within the Ministry of Construction and Physical Planning, which were established exclusively for work on the Fund, be sent.

Special services within the Ministry were established only in December last year, one entire year after initially receiving the funds. They also noted that the funds of the Solidarity Fund are intended for emergency operations after damages, while the funds of other funds can be used for other projects.

On December the 27th, Prime Minister Andrej Plenkovic said he hoped that the European Commission would accept Croatia's argument for a deadline extension. It seems that there will be none of that, which means that the country will have to finance the projects agreed so far from other EU sources, which means less money for development projects.

Plenkovic's ministers: Nobody sought postponement

Plenkovic's ministers, Obuljen Korzinek, Bozinovic and Horvat all claimed that no one had actually asked the European Commission for a deadline extension, nor that this letter published by Telegram (linked above) was rejected.

"These are incorrect allegations, the merits of the letter were to confirm what was discussed at the meeting, and the implementation of the projects financed from the Fund was discussed, as was the method of reporting. The letter reads the follow-up of our technical meeting with the EC during December and at which we agreed on the dynamics of further work. The aim of the letter was to confirm what was agreed at the meeting,'' claimed Obuljen Korzinek.

For more, check out our politics section.

Sunday, 28 November 2021

Could Croatian Term Prosek Finally be Protected by European Commission?

November the 28th, 2021 - Could the Croatian term Prosek finally be protected by the European Commission (EC) and put an end to the dispute between Croatia and neighbouring Italy?

As Morski writes, On Friday, November the 26th, 2021, State Secretary Tugomir Majdak, in the presence of Member of the European Parliament Tonino Picula, participated in a panel entitled "Croatian quality on the European table - the protection of the traditional term Prosek".

The event brought together Prosek producers, oenologists and legal experts to discuss the course of protection, Croatian and Italian arguments and the problems of producers, and a day later, on November the 27th, from 10:00 to 16:00 on Petar Preradovic Square, a public blind tasting of Prosek and Prosecco was planned, with the shooting of a promotional video about the important and undoubted differences between these two wines, all with the tasting and sale of Prosek made by Croatian producers.

Back in 2013, the Ministry of Agriculture submitted a request to the European Commission for the protection of the traditional Croatian term Prosek, and this year, the European Commission closed the application review process and approved it as well-founded and justified, with an expected objection from an Italian organisation.

In order to advocate for successful protection of the Croatian term Prosek at the European level and in order to promote this Croatian wine, a panel was organised at which State Secretary Tugomir Majdak stated:

''I'm satisfied with the development of events in the process of the protection of this wine, which is extremely important for all of us in historical, tourist and gastro-oenological terms. I'd like to remind you that relatively recently, we successfully resolved another wine dispute, which was both legally and technically extremely demanding, and then our producers from Istria were given the opportunity to continue marketing the wine "Teran".

In the same way, the Republic of Croatia now has an answer related to Prosek and that's the only way in which our approach can be based in this case because we really have all the professional, historical and legal arguments for its protection. Croatian producers certainly have a legitimate right and expectation to have their products protected, which have all been produced in the traditional way and with full access to the market as their European counterparts have.

Today, Croatia has 31 products with their names registered in the EU with protected designation of origin or protected geographical indication, and is proud of seventeen protected wine designations of origin, six geographical indications on strong alcoholic beverages and one geographical indication of aromatised wine products.

For more, check out Made in Croatia.

Saturday, 13 November 2021

Brussels Expects Enviable Croatian GDP Growth, Though Risks Remain

November the 13th, 2021 - Croatian GDP growth has been a topic on the lips of many ever since the coronavirus pandemic struck and caused untold and unprecedented negative trends on a global scale. Predictions and expectations have been shared by many and have been varied, but Brussels has some encouraging expectations indeed, with only two EU member states ahead of Croatia in this regard.

As Ana Blaskovic/Poslovni Dnevnik writes, the European Commission's (EC) recent forecasts for economic developments for the Republic of Croatia have brought growth expectations closer to most local expectations. Brussels expects 8.1 percent Croatian GDP growth this year (their expectation previously stood at 5.6 percent), which is close to the Croatian National Bank's expectations of 8.5 percent, but still more cautious than the Croatian Government's 9 percent. This prediction, if it materialises, would also make Croatian GDP growth the third fastest in the entire bloc.

The European Commission's autumn forecasts generally predict a faster pace of recovery from the coronavirus crisis than the spring one did, after all, corrections leaning towards higher percentages as the year draws to a close were also given by numerous Croatian experts. The European leader with the highest GDP in 2021 will be Ireland with a projected 14.6 percent, followed by Estonia with 9 percent.

The ranking next year, of course if there is no correction, could look even better with growth of 5.6 percent, just behind Malta. "The recovery of the Croatian economy continued in 2021, mostly thanks to strong private consumption and better-than-expected results in the tourism sector. Favourable economic trends have spilled over into the labour market, which is experiencing strong employment dynamics,'' they said from the EC. A good outlook for the economy is expected in the next two years, and essentially, there are no major surprises in Brussels' latest autumn forecasts.

The engine of growth remains domestic demand driven by a good labour market situation. During the coronavirus crisis, the accumulated savings and the growth of consumer lending will give their momentum to the economic momentum. A positive contribution will also come from the direction of public spending, but its momentum will slow down due to the targeting of the deficit and public debt within the introduction of the euro in Croatia at the beginning of 2023, if all goes as planned.

Investment momentum should accelerate on the wings of European Union money as part of the National Recovery and Resilience Plan in addition to the regular EU budget and as payments from the Earthquake Solidarity Fund begin to be paid out. The European Commission expects that over time, these funds will encourage additional private investment in Croatia, which will further facilitate favourable financing conditions.

Finally, NPOO reforms (on which future generous payments depend) should support business confidence, according to the EC.

Exports are an item of GDP that should grow in line with the improving situation in major trading partners. After this year's surprising jump in the export of services, primarily tourism, the continuation of solid trends is expected, the preconditions for which are favourable conditions in emitting markets and the final total normalisation of travel.

Although the Croatian economy is projected to grow strongly in terms of exports of goods, its import dependence will result in a gradual deterioration of the trade balance, a picture that essentially reflects the vulnerabilities and competitive weaknesses of the domestic economy. Finally, an unavoidable factor in the uncertainty of these forecasts is the low vaccination rate of only 44.9 percent of all residents of Croatia. Such figures "could lead to tougher measures to combat the pandemic and delay in post-earthquake recovery."

Positive ''risks'' are Croatia's possible entry into the Schengen area and the Eurozone. Inflation is expected to accelerate due to rising energy and food prices, reaching 2.2 percent this year, after which it should then gradually stabilise. The budget deficit should drop down to 4.1 percent of GDP in 2021, and to 2.9 percent next year, and a downward trajectory is also projected for public debt; from 82.3 percent this year to 79.2 percent next year. Employment should return to pre-crisis levels this year, and the unemployment rate should drop to a record low of 5.8 percent in 2023.

For more information on Croatian GDP growth and much more, check out our politics section.