Wednesday, 11 January 2023

Lidl Croatia Explain Why the Same Products are Cheaper in Slovenia

January 11, 2023 - Since the euro was introduced as the official currency in Croatia, there has been a series of price comparisons of products in Croatia and other countries, especially Slovenia. Lidl Croatia explained to Večernji why the prices are different. They point out that the formation of prices in a country is influenced by numerous factors, from the amount of the VAT rate, excise duties, and product analysis costs to logistics costs and the like.

Index compared Lidl prices in Slovenia and Croatia in detail.

"In the case of comparing prices in Slovenian and Croatian Lidl, the VAT rate on food in Slovenia is 9.5 percent, while in Croatia, the rate is 5 percent for some products (bread, fresh meat, and fish, eggs, fruits, and vegetables, edible fats and oils, baby food, pads, and tampons, which make up about 10% of our total assortment), and the rest is 25 percent," they state, as reported on Index.

"Regarding the comparative account from both Lidls, which was published in several Croatian media, 8 out of 10 products from the said account from the Slovenian Lidl have a tax rate of 9.5 percent, and in Croatia, 25 percent. This is a difference of 15.5 percentage points. Furthermore, Croatia pays a return fee on PET packaging of 0.07 euros, which is reflected on products such as mineral water and juices," states Lidl.

Fuel price

They further note that gasoline and diesel are cheaper in Slovenia, which makes a difference in the logistics costs for the delivery of goods. At the same time, they note that Croatia is geographically significantly larger than Slovenia. "It is demanding in terms of transportation due to the specific geographical shape, and the logistics also include islands, which is an additional challenge," they state in the press release.

"Some of the factors that led to global disturbances are the prices of raw materials, the availability of goods, the rise in logistics prices, the rise in electricity and gas prices and general costs such as maintenance, the impact of the war in Ukraine and, consequently, high inflation. The retail prices of certain products rose in line with the growth of purchase prices and other factors that influenced movements in global markets, " they state.

"We would like to emphasize here that we did not blindly transfer the increase in the input prices of our suppliers to our customers but corrected the prices with extreme care and concern, precisely so that we would not allow our customers to feel the full weight of the inflationary pressure that appeared," it is further stated in Lidl Croatia's explanation.

They also claim that Lidl Croatia did not increase prices during the switch to the euro.

"Prices of products from Lidl's regular range have been converted from kuna to euros according to the rules of mathematical rounding (without unjustified price increases) in favor of the customer. Also, to confirm a transparent relationship with customers, Lidl has joined the Code of Ethics, which determines how business entities act for a reliable and transparent introduction of the euro to create trust and a safe environment for consumers. Within the scope of the inspections so far, no unjustified price increases have been found in Lidl Croatia," they said.

For more, make sure to check out our dedicated Lifestyle section.

Tuesday, 10 January 2023

Euro Croatia Price Increase: Politician Kreso Beljak Shopping Across Border

January the 10th, 2023 - Croatian politician Kreso Beljak, who has been the President of the Croatian Peasant Party since back in 2016, has openly admitted to crossing the Slovenian border to do his shopping since the euro Croatia price increase issue has become so apparent.

As Poslovni Dnevnik writes, while appearing as a recent guest of N1 studio, the President of the Croatian Peasant Party, Kreso Beljak, commented on the situation that is currently on everyone's lips - the very obvious euro Croatia price increase. Beljak says that he isn't surprised by any of these price increases: "Prices of items are determined by the market, and I'm not surprised that prices have risen. Obviously, the demand is like that. It's a simple rule of the market economy - the higher the demand for something is, the higher the price for it will be,"

That said, he made no effort to hide the fact that he thinks that the difference in prices between Croatia and neighbouring Slovenia is no less than shameful: "Personally, it doesn't matter to me or the people in Samobor if we go to Zagreb or Slovenia to do our shopping. In Slovenia, instead of 100 euros, I spent 70. My wife was on the phone to be back in Samobor comparing the prices. It's shameful,'' Beljak stated.

However, and rather surprisingly, Beljak doesn't really blame Plenkovic for this situation. "This situation is unsustainable, but to blame politics for it in the 21st century in a market economy, well... that's what we wanted in the 90s. We wanted the market to determine the price, not for the state to conduct it all. I do blame Plenković for another situation, though, he tries to get involved with things that politics shouldn't be involving itself with. The political spectrum should be dealing with the growth of salaries, pensions, tax relief, the reduction of levies and so forth. Plenkovic and HDZ do none of this. And that's another reason why our purchasing power is weak."

"If someone wants to buy something - that's a matter of the market. The market forms the prices, not the state. The state is there to ensure a higher salary, to make so people are able to buy more in such cases. The state needs to reduce the taxes and levies so that net wages rise, and as such, peoples' purchasing power."

When asked about blacklists for companies taking advantage of the euro Croatia price increase trend, Beljak explained: "Now it can be seen that certain omissions have been made. I think the intention was good in regard to giving people a period of two weeks, which now turns out to have complicated the situation even more. The euro should have been introduced on January the 1st, 2023, and kuna should have immediately been made so it exchanged for euros in banks for a period of one year."

"In general, I'm talking about a system that doesn't work, about an HDZ that doesn't work. It's hard to expect that such a party that simply doesn't care about people in the slightest would even think of doing anything to help or protect them. Plenkovic is now busy rubbing his hands together, and so is his finance minister, because every euro Croatia price increase is an increase in VAT and a bigger payment into the state budget,'' Beljak concluded, noting that HDZ wants more money for ''uhljebs''.

For more, make sure to check out our news section.

Monday, 9 January 2023

Euro Croatia: Reasons Why Same Products are Cheaper in Slovenia

January 9, 2023 - Euro Croatia: although their wages are twice or three times higher than the Croatian average, the Germans, the French, and even the neighbour Slovenians spend 30, and for some products, up to 40 percent less money than Croatians for a variety of grocery items.

Slobodan Školnik, an expert on retail prices, comments on the reasons why: "Because our weak economy has to bear the heavy burden of an inefficient public sector and the state, which is too expensive for an economy at this stage of development, and all of this must be incorporated into prices and the lower standard of citizens."

If we take 450 grams of coffee as an example, we will pay 2 euros and 30 cents more in the same retail chain in Croatia. Croatia will be more expensive with cheese, where the difference is one euro and 72 cents. Eggs are 90 cents cheaper for our neigbours, ajvar 86 cents, and pasta is 56 cents cheaper. We would pay 11 euros and 75 cents for these five items in Slovenia and more than 18 euros in Croatia. This is a difference of almost six and a half euros for only five products, write Danas.hr / Poslovni.

Lower tax burdens

"It depends on supply chains, it depends on importers, distributors, who do their calculations; I don't think it's a problem with traders," says Ivica Katavić, president of the HGK Trade Association.

Many factors influence the differences in price, and cheaper shopping in Slovenia is primarily due to lower VAT.

"Slovenia has a lower tax burden on most products of daily consumption, the basic VAT rate is lower than in Croatia, especially food products rates, they are 9.5 percent, so significantly lower than in Croatia.", says Damir Novotny, an economic analyst.

An aggravating factor is that Croatia has almost completely neglected the processing industry and is dependent on imports, which further increases the price of food and high logistics costs.

"This means it is easier to supply the Slovenian market than the Croatian market. There are significant differences in prices between, say, Osijek and Dubrovnik - in some places, it will be three times more expensive due to logistics costs," adds Novotny.

So, going to the grocery store for basic groceries seems more and more like a luxury game.

"Some follow, some don't. Some make a mistake and set a price that is too high and then have to correct it, but sooner or later, the market solves everything where there is competition, and in Croatia, there is fierce competition", adds Školnik.

The problem could be that, at least for now, none of the retailers are announcing lower prices, but quite the opposite – a new wave of price increases.

For more, make sure to check out our dedicated Lifestyle section.

Saturday, 7 January 2023

Euro Croatia: Initial Phase of Transition is Progressing Well, States EC

January 7, 2023 - Euro Croatia: almost a week after Croatia's entry into the euro area, the transition to the euro is progressing well in the initial phase, according to a survey by the European Commission (EC), the executive body of the EU, which assesses this event as an important turning point for Croatia, the euro area and the entire union.

As 24Sata writes, they report that the majority of cash payments (51%) in euros in stores were made on January 5.

"In the majority of transactions, as many as 93%, the change was returned to consumers exclusively in euros, 35% of the surveyed Croatian citizens stated that they only carry euro banknotes, and 36% of them only euro coins", according to a survey carried out by the EC representative office in Croatia.

According to the Eurobarometer survey, on January 5, six percent of the 199 respondents had Croatian kunas in their wallets, five percent mostly kunas, 19 mostly euros, 35 had only euros, 27 percent had half kunas and half euros, and eight percent had no banknotes.

The withdrawal of kuna banknotes and coins from circulation began in December 2022, and by December 31, 55% of kuna banknotes and a third of kuna coins had already been withdrawn from circulation.

The EC states that the Croatian retail sector copes well with the transition process and the parallel use of two currencies.

"No major problems with waiting in lines or problems with the cash registers were reported. Conversion at ATMs also takes place smoothly, with 70% of all ATMs in Croatia already distributing euro banknotes from the first hour of the new year. The commission pointed out that the number and scope of withdrawals remained at levels comparable to those before the transition to the euro".

The commission stated that it will continue to monitor Croatia's transition to the euro and will continue to measure the experience of Croatian citizens in connection with the transition to the European currency in the coming weeks.

For more, make sure to check out our dedicated Lifestyle section.

Thursday, 5 January 2023

Euro Croatia: The Saga Continues, Government Tackling Price Increases

January 5, 2023 - Euro Croatia tackling dirty play - at today's session, the government adopted a conclusion calling on everyone, from retailers to restaurateurs and craftsmen, to return their prices to the level before the conversion to the euro. Prime Minister Andrej Plenković pointed out that such price increases represent dirty play and profiteering.

"We warned there would be a negligible price increase; it was like that elsewhere. But what we are witnessing is something else. This is unjustified, pure profiteering, dirty play, and we will strongly oppose it with the Government's measures in the coming period," the PM said, as reported by 24Sata.

He called on all competent institutions to expose unfair practices from the State Inspectorate and Tax and Customs Administration.

"We will do that, and when I say measures so that there are no dilemmas, I also mean subsidies and other taxes. The government will not sit back and watch this without a reaction, and everyone who thinks that in this situation they can cast a shadow from an extremely positive and useful thing with their irresponsible business policy or harm the strategic success of the state, the government, society and all of us, they will not succeed", he said.

The Prime Minister called on all business entities to distance themselves from those who unjustifiably raised prices.

"With the conclusion of the Government, everyone is invited to immediately revise the prices to those before January 1, 2023, at the end of December. All departments are tasked to strengthen supervision, the Ministry of Economy to take all measures to collect complete and accurate information on price monitoring, the Ministry of Agriculture to collect food and product prices", said Plenković.

He stated that the purpose of the euro is not for someone in a crisis to get rich unjustifiably at the expense of citizens.

"We will not welcome any phenomena that lead to an increase in inflation, but we will sanction and fight against it with all mechanisms to protect consumers and ensure fair business practices," he stressed.

"In this period, all authorities will contribute to uncovering unfair practices. The state inspectorate, and the tax and customs administration, will be given a specific task to act as soon as they see irregularities - said the prime minister and called on everyone to revise the prices and return them to what they were at the end of December - he added.

Minister Davor Filipović presented the Government's measures against price increases.

"All business entities, including credit institutions and other financial service providers, and all those who have raised prices against the law are obliged to revise the retail prices of their goods and services and that they be determined by the price level as of 31 December", said Filipović.

"The inspectorate, tax, customs, ministries, CNB... are tasked to implement increased supervision of entities within their jurisdiction without delay", he said, adding that the Ministry of Economy will monitor prices and offer price comparisons at various entities.

He called on the Ministry of Agriculture to immediately collect the prices of agricultural products.

Chief State Inspector Andrija Mikulić was also present at the Government session and reported that they had intensified monitoring of received consumer complaints. In terms of dual pricing, before introducing the euro, inspectors found 1,744 violations of the law from September to the end of 2022. From January 2 to 4, the inspection was carried out by more than 200 inspections in trade and service industries.

"Bearing that business entities freely set the price, inspections have begun based on the applications received. From January 2 to 4, the inspection carried out over 200 inspections in the area of retail trade, including bakeries and service industries. These were mainly hairdressing services, body care, and maintenance services. According to the first results, an increase in prices was determined. In the shops, a price increase of 3 to 19 percent was recorded for chocolate, baked products, beer, coffee, and chocolate... We will determine if this is unjustified. If this is established, misdemeanor measures will be taken", said Mikulić.

"Most submissions concerned bakeries, hairdressers, and body care services, where price increases have been confirmed. In the shops, some subjects raised prices from 3 to 19 percent for chocolate, bakery products, beer, butter, sour cream, toilet paper, coffee, and other items. If they determine that it was unjustified, in accordance with the law on consumer protection, they will be prohibited from engaging in unfair practices and will be subject to misdemeanor measures. In service activities, the price increase there, unfortunately, ranges from 10 to even 80 percent", said Mikulić.

In the last two days, out of 306 inspections, 96 violations were found, which is 31 percent, and the inspections continue.

For more, make sure to check out our dedicated Lifestyle section.

Tuesday, 3 January 2023

Euro Croatia is Here, and You Guessed It - Much More Expensive

January 3, 2023 - Euro Croatia is here. It is its third day. And Croatian citizens have started complaining about massive price increases. Social networks are full of various examples of price increases after the introduction of the euro, whether it is for shops, various services such as hair salons, or parking fees.

As Index writes, what most of the complaints have in common is the rounding up. So, for example, if something cost HRK 13, it is possible that someone "rounded" it to two euros, which is significantly more expensive.

A group was opened on Reddit yesterday, where hundreds of people write about price increases and give examples. "Men's haircut at a local hairdresser cost HRK 60. I came a couple of days ago. He said he would round up to 10 euros to make it easier for both of us," wrote one user. "Coffee with milk in the cafe where I've been going all my life jumped from 12 to 15 kunas," wrote another.

Index received photos from shops by users claiming that the same things cost significantly less just two days ago. Index is currently working on verifying those allegations.

>> If you suspect an unjustified increase in the price of a product or service, contact them at This email address is being protected from spambots. You need JavaScript enabled to view it.

Prime minister's meeting yesterday

Yesterday afternoon, Prime Minister Andrej Plenković convened a meeting with competent ministers and inspection authorities.

As the Prime Minister stated in a message published on Twitter, he held a meeting with competent ministers and representatives of the Tax Administration, Customs Administration, and the State Inspectorate related to further activities to protect consumers from unjustified price increases.

"The introduction of the euro is not a reason to increase the prices of goods and services," said Plenković.

Filipović called an urgent meeting. 

At Plenković's meeting with the ministers and the heads of the Tax Administration, Customs Administration and the State Inspectorate, it was agreed that Economy Minister Davor Filipović would invite representatives of retail chains to the meeting.

The meeting, unofficially confirmed to Index by a source close to the government, should be held today.

"The consumer must not be in a worse position than they would have been if the euro had not been introduced."

What is considered an unjustified price increase that caused Plenković to react? Here is what is written on the official government website Euro. hr.

"According to the principle of consumer protection, it follows that the consumer must not be in a less favourable financial position than he would have been if the euro had not been introduced. As in all other situations, in the period of dual pricing, it is necessary to correctly and accurately apply the rules of conversion and rounding, which means that the price must be correctly calculated and stated, i.e. the informative calculation in the currency that was or will be official must accurately reflect the price charged to the consumer and must not be rounded up or down.

The ratio of expressed prices in kuna and euro must correspond to a mathematical operation, i.e., the rules of conversion and rounding by applying a fixed conversion rate in its full numerical amount."

"The mere introduction of the euro must not be and is not a justified reason for increasing product prices."

The page states that this means explicitly that from the beginning of the period of mandatory dual pricing until the day of the introduction of the euro, for the purpose of informing consumers, the price charged in kuna must be recalculated and displayed in euros, with the correct application of the fixed conversion rate and the rules for recalculation and rounding.

The key principle of the introduction of the euro is consumer protection, and the consumer must not be in a financially less favourable position than he would have been if the euro had not been introduced. The mere introduction of the euro must not be and is not a justified reason for increasing product prices," the EURO HR website concludes.

Knežević: People complain the most about coffee price increases

Index asked the president of the Consumer Protection Association, Ana Knežević, what information she had about price rounding and the resulting price increases.

"We have concrete information; people are calling and complaining. The highest price increases are around coffee. We received a report that in one place coffee is two kuna more expensive because of this rounding of prices," Knežević told us.

"This happened in all the countries that entered the eurozone; we saw it in Slovenia, Austria, Italy... We warned that Croatia would not be an exception. In the mentioned countries, too, coffee prices changed the most. In our country, we now see that there were price increases in bakeries as well".

For more, make sure to check out our dedicated Lifestyle section.

Sunday, 1 January 2023

New Croatian Currency Now in Effect with First Euros Withdrawn

January 1, 2023 - Croatia officially became the 20th member of the eurozone, a monetary union member of the European Union (EU), making the Croatian currency and the only legal tender the euro, the second most important world currency.

As Index writes, on the first day of the New Year, Croatia became the 20th member of the euro area, and the euro became the official Croatian currency and legal tender in Croatia. The previous eurozone expansion took place in 2015 when Lithuania became a member.

Minister of Finance Marko Primorac and CNB Governor Boris Vujčić met in front of CNB. Minister Marko Primorac commented on the introduction of the euro.

"Croatia has joined the circle of the most developed countries in the world. This was by no means an easy process. It took a long time; a number of people made significant efforts," he said. "The euro will provide us with some security in these turbulent times," he said and added that the euro will enable further growth and development.

"Over 95 percent of ATMs are stocked with euros; now the transition process is underway. So we can relax and enjoy ourselves," said Primorac.

"Kuna is going down in history; it served us well."

Then Boris Vujčić took the floor.

"I am thrilled because this year we finished the project that we started five years ago. We created the Eurostrategy then, and I must say that it did not always look like we would be in the Eurozone on January 1, 2023. This is a record timeline; it could not have been faster," he said.

"Croatia is the 20th country that uses the second most important currency in the world," said Vujčić and listed the advantages of the euro. "It is not a magic wand that will solve many of our problems, but it will help us be a richer country," Vujčić said.

"Kuna is going down in history," Vujčić said. "The kuna served us very well. It was stable since we introduced the kuna, we had low inflation, it will go down in history with pride, we will only remember it for the good," he said.

After that, at a nearby ATM, Minister Primorac withdrew the first euros from the ATM.

For more, make sure to check out our dedicated Lifestyle section.

Tuesday, 20 December 2022

Euro Croatia: What to Expect During the Dual Circulation Period

December 20, 2022 - Euro Croatia: from the 1st of January 2023, the official currency in Croatia will be the euro. From January 1 to 14, 2023, there will be a dual circulation period, where kuna and euros can be used for cash payments.

As SiB / Net.hr write, on January 1, Croatia will enter the eurozone, and the euro will become the official currency. Although preparations for the euro are already in full swing, Croatian citizens will be able to pay with kuna even after the New Year. From January 1 to January 14, 2023, there will be a dual circulation period, where kuna and euros can be used for cash payments.

In the dual circulation period, citizens still have to pay attention to certain things. For example, a merchant or payee is not obliged to accept more than 50 kuna coins in one transaction. The payee is obliged to apply the regulations on preventing money laundering and terrorist financing, which refer to the limit of the amount that can be paid in cash.

The change will be returned in euros, but it is possible to do so in kuna. The Law on the Introduction of the Euro provides that as an exemption from the application of the dual circulation rule if the business entity is not objectively able to return the rest of the amount in euro cash. In that case, they can return the remaining amount in kuna or kuna and euros.

As stated on the euro.hr page, which contains all the information related to the changeover to the euro; the dual circulation period starts on January 1, 2023, at 00:00 and ends on January 14, 2023, at 24:00.

CNB recommends citizens use debit cards as much as possible in transactions in the first days of 2023. "Furthermore, to facilitate cash transactions in the first days after the introduction of the euro, from the beginning of December 2022, citizens will be able to obtain starting packages of euro coins, which will enable them to pay in the new currency from the first day of 2023. With the same goal, In the first months of 2023, ATMs will have to be stocked mainly with euro banknotes of smaller denominations (of 10 and 20 euros)," according to the euro.hr website.

For more, make sure to check out our dedicated News section.

Thursday, 15 December 2022

Euro in Croatia: Changes on ATMs Effective From Today

December 15, 2022 - Croatia, one of the countries with the most widely developed ATM network, is gradually adapting to a new currency due to the introduction of the euro on the first day of the next year. The arrival of the euro in Croatia is affecting the ways in which cash will be available in the transition period.

As N1 writes, ATMs of commercial banks are the most important channel for the supply of cash in kuna in the Republic of Croatia and will also be the key channel for the supply of citizens with euro banknotes.

They should be adapted so that from January 1, 2023, they pay out exclusively in euros, while banks are obliged to ensure adequate availability of the Croatian kuna covering all of the ATM network until December 31, 2022.

ATMs are being gradually temporarily shut down during December and early January to allow the banks to adjust their ATM network for euro withdrawals by January 15, 2023.

In order for this adjustment process not to negatively affect the availability of cash in kuna in the period until the end of December 2022 or the availability of euro notes after January 1, 2023, in the period from December 15, 2022, to January 15, 2023, a few changes will be introduced to the ATM network in Croatia. The banks will temporarily abolish fees for cash withdrawal transactions with debit cards at ATMs outside the ATM network of a particular bank (at ATMs of other banks) in the Republic of Croatia.

Thus, from December 15 to 31, the Croatian kuna can be withdrawn free of charge at any ATM in Croatia, while from January 1 to 15, euros will be available for withdrawal from ATMs free of charge as well.

Considering the density of the network of ATMs in Croatia, it should provide citizens with a high degree of availability of cash in Croatian kuna until December 31, 2022, and cash in euros after the first day of the new year 2023.

The Croatian Bank Association has published an interactive map of all available ATMs during this period.

For more, make sure to check out our dedicated Lifestyle section.

Tuesday, 13 December 2022

Euro Croatia: How to Pay Utility Bills in Croatian Kuna in January 2023

December 13, 2022 - Euro Croatia: from the 1st of January 2023, the official currency in Croatia will be the euro. In the first two weeks of next year, Croatian citizens will be able to pay their bills in kuna, regardless of whether they are issued in kuna or euros.

As Poslovni reports, as soon as we enter the New Year, the official currency in Croatia becomes the euro, which means that payments should be made in euros, but citizens are given a deadline for adjustment in the first two weeks of 2023, during which they can still pay in kuna. The change, however, will be in euros during this transition period. Card payment is recommended as much as possible.

From January 15, the euro will be the only accepted currency, and the kuna will definitely be out of circulation. Regarding the payment of utilities, for example, the Croatian Banking Association states that the currency specified on the invoices should be used to pay.

"Utility bills for December will be issued in January 2023 and will be in euros. For all payment slips that citizens have received in advance and on which the amount of payment is in kuna, and will be paid after the introduction of the euro, the bank is obliged to make the payment in euro in the amount corresponding to the amount of kuna specified on the payment order. The bank will act in this way until July 1 next year," HUB told Novi list.

The Financial Agency (Fina) confirmed yesterday that the above applies to Fina as well.

"After January 1 and until June 30, 2023, Fina will receive orders issued in kuna and will execute them in euros, with the application of the conversion rate. Also, during the dual circulation period, i.e. in the first two weeks of January 2023, citizens can pay orders in kuna, regardless of whether they are issued in kuna or euros," explains Fina.

According to this, it turns out that the criterion is the moment in which the citizens decide to pay: if they pay by January 14, that can be done using the Croatian kuna, and if it's after that, regardless of when the bill was issued and in which currency, it must be in euros. If the citizens do not have euros, they can exchange kuna for euros in several ways. As far as the conversion of kuna into euros is concerned, in Croatia, the bank association points out that throughout 2023, banks, Fina and Croatian Post will exchange up to 100 kuna notes and 100 kuna coins per transaction at the counters for free, to all citizens at the same exchange rate.

For more, make sure to check out our dedicated Lifestyle section.

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