Friday, 17 July 2020

HGK to Cull Staff by 30%

ZAGREB, July 17, 2020 - The Croatian Chamber of Commerce (HGK) said on Friday it was continuing its business reorganisation which includes downsizing staff by 30 percent.

"Due to the digitisation of internal processes and the fall in revenue caused by the coronavirus pandemic means, HGK is embarking on the next stage of reorganisation which means reducing the number of employees by 30 percent," HGK said in a press release.

HGK recalled that since Luka Burilovic took the HGK's helm the focus has been on reorganising business and improving efficiency to cater to the members' needs.

"Digital transformation, which we started two years ago, started not only with the Digital Chamber as a final product but also with the digitisation of internal processes which imply reducing the number of employees. Notably, digital transformation was one of the preconditions to rationalise and reorganise the Chamber which we planned to implement gradually, however no one could have foreseen the corona crisis," Burilovic said.

He underscored that like everyone else they had to adjust overnight to the new reality which is being felt the most by Croatian enterprises and consequently by all of Croatian society.

"As a result we have decided to embark on the next phase of reorganising the HGK which, unfortunately means reducing the number of employees by 30 percent. It's never easy to decide to lay anyone off but that is inevitable," said Burilovic.

HGKL currently has slightly over 500 employees. 

Sunday, 14 June 2020

Croatian Chamber of Commerce Seeks Lifting of Construction Ban in Summer

As Novac writes on the 11th of June, 2020, the Croatian Chamber of Commerce (HGK) has asked the Ministry of Construction and Physical Planning to send a recommendation to the local self-government unit on lifting the ban on construction works during the summer.

"We sent the request on behalf of construction companies whose working conditions were significantly hampered by the coronavirus crisis. During the pandemic, the Croatian Chamber of Commerce managed to prevent construction sites from closing and to open shops for construction materials and equipment as soon as possible, which preserved activity and jobs in this industry. The complete cessation of all earthworks and construction works would make it difficult to recover and realise the scheduled works, which would cause additional financial damage and consequently lead to the dismissal of a large number of workers,'' said Mirjana Cagalj, vice president of the Croatian Chamber of Commerce for construction, transport and communications.

According to the current Construction Act, cities and municipalities can make decisions on banning works, but the Construction and Utilities Sector of the Croatian Chamber of Commerce says that exceptional conditions have been met due to the coronavirus pandemic and that the necessary approvals and consents of local authorities must allow activities within this sector to continue.

"Lifting the ban would significantly help the construction sector and its related branches, and at the same time, it wouldn't seriously endanger the tourist season, which will be somewhat more modest due to objective reasons," explained Cagalj.

On behalf of the construction companies located in Split-Dalmatia County, the Croatian Chamber of Commerce also sent a letter to the Mayor of Split, Andra Krstulovic Opara, requesting that earthworks and construction works be allowed in the city throughout the summer (from June the 15th to September the 15th).

Opara supported the proposal and invited all interested investors and contractors to send their requests for the continuation of construction work during the summer months so that he could submit them to the City Council for discussion.

"At this moment in time, I consider it extremely important that the investments that can start the economy the most quickly are enabled and encouraged, so, I'm going to recommend a positive solution to all of the received requests to the Council," Opara said.

For more, follow our business segment.

Thursday, 11 June 2020

HGK Launches Platform for Virtual Meetings Between Business People

ZAGREB, June 11, 2020 - With the support of the Enterprise Europe Network, the Croatian Chamber of Commerce has launched "Go global - Go virtual", a project aimed at expediting the recovery of the domestic economy after the COVID-19 crisis, the HGK said on Thursday.

It concerns the organization of online B2B meetings for Croatian companies with foreign partners on markets in which Croatian business people, according to a survey, are most interested - Slovenia, Russia, Austria, Germany, the Czech Republic, Slovakia, Poland, and Hungary.

The first virtual meetings will be organized with business people from Slovenia, Ivan Barbaric of the HGK said. Croatian companies may apply for them by June 19 and the meetings with Slovenians will take place on July 2.

Monday, 8 June 2020

HGK: 2019 One Of Best Years For Investment Funds

ZAGREB, June 8, 2020 - Last year was one of the best years for investment funds with the value of their assets exceeding HRK 26 billion and this year despite the obvious fall due to the COVID-19 pandemic. the sector has been significantly maturing, it was said at the Top of the Funds award ceremony on Monday.

President of the association of companies for the management of investment funds within the Croatian Chamber of Commerce, (HGK) Hrvoje Krstulovic underlined that 2019 was one of the best years for investment funds and capital market with Undertaking for Collective Investment in Transferable Securities (UCITS) funds increasing by 18.5% to HRK 22.5 billion and a jump in alternative investment funds of 14.5%  to HRK 4.2 billion.

Those two figures, combined together, give the number of HRK 26.8 billion which is almost equal to the value of assets at the end of 2007, said Krstulovic.

Despite the crisis in 2020, 95% of physical entities retained their investments in funds, he explained and the decrease that has been recorded mostly relates to institutional investors, he said.

He underlined that a significant maturity has occurred in the entire sector from clients, to sales processes and on to regulators.

The strongest effect of the coronavirus epidemic was recorded in March when the value of assets of investment funds fell by 30% however in April an increase of 1.4% was recorded and the total value of UCITS funds at the end of April amounted to HRK 15.9 billion.

Top of the Funds awards in five categories

The Top of the Funds awards for the best management of investment funds in 2019 was conferred to Intercapital Bond for the best equity open-end investment fund (UCITS) while the best mixed open-end investment fund award went to Allianz Portfolio. The best open-ended investment fund was awarded to PBZ Equity while the particular open-ended investment fund award went to Intercapital Income Plus.

There are currently 23 companies managing investment funds in Croatia.

Saturday, 6 June 2020

HGK: Croatia Meeting Conditions For Entry To Euro Area As Planned

ZAGREB, June 6, 2020 - Findings of the ECB's assessment showing that all the major commercial banks in Croatia have met capital adequacy requirements and passed stress tests means that Croatia is a step closer to the European Exchange Rate Mechanism (ERM II), the Croatian Chamber of Commerce (HGK) said on Friday.

Therefore we can expect the country to join the euro area in 2023, as planned, the HGK says in a press release after the Croatian National Bank (HNB) stated that the comprehensive assessment conducted by the European Central Bank showed that the five leading banks in Croatia are well-capitalized and resilient to shocks.

Zagrebacka banka (ZABA), Privredna banka Zagreb (PBZ), Erste & Steiermaerkische Bank, OTP banka Hrvatska and Hrvatska Postanska Banka (HPB), which were covered by the comprehensive assessment conducted by the ECB, do not face any capital shortfalls as they did not fall below the relevant thresholds used in the asset quality review (AQR ) and the stress test, the Croatian central bank reported earlier on Friday.

The findings are also the confirmation of the stability and good quality of the Croatian banking system, the chamber underlines in its comment.

This is also an act of recognition of our members from the banking system and of the whole economy, says the HGK.

The chamber reiterates some of the advantages of the membership of the euro area such as the access to funding through the European Stability Mechanism, the fact that the HNB would no longer have to maintain the stability of the kuna, and the consequent higher credit ratings for the country.

Banks covered by ECB assessment make up four-fifths of total banks' assets in Croatia 

The five banks that fared well in the ECB comprehensive assessment make up 79% of the total assets of the banking system, the HGK notes.

Croatia sent its letter of intent to join the Exchange Rate Mechanism (ERM II) to the ECB on 4 July 2019.

The finance ministers of the euro area's 19 member states and Denmark, the president of the European Central Bank (ECB) and a representative of the Danish central bank's governor discussed the letter at a meeting in Brussels, after which the finance ministers issued on 9 July 2019 a statement in which they "welcome the intention of the Croatian authorities to put in place the necessary elements for a successful entry into ERM II."

The euro area statement said then that the ECB could complete its assessment of Croatia's compliance with the commitments outlined in the letter of intent in about a year's time.

In case of a positive assessment, a decision would be made on Croatia's ERM II participation, a sort of euro waiting area where it should spend at least two years, which means Croatia could introduce the euro in 2023 at the earliest.

Croatia would simultaneously join ERM II and the Banking Union.

Sunday, 31 May 2020

HGK Calls For aid To Winemakers Hit By Coronavirus Crisis

ZAGREB, May 31, 2020 - The Croatian Chamber of Commerce (HGK) has called on the Agriculture Ministry to amend the so-called wine envelope in order to help the viticulture and winemaking sector by allocating most of the HRK 43 million grants to be used to distill surplus wine and thus reduce unsold stock.

The HGK said last Thursday that the crisis caused by the coronavirus had strongly impacted the sector of viticulture and winemaking, too.

A survey conducted by the Chamber's Association of Wine Producers has shown that there are problems with the sale of about 50% to 60% of wine stock, and it is expected that sales will go down by up to 80% in the first six months.

"The Chamber has proposed that the biggest part of the HRK 43 million grants be allocated to reduce the unsold stock by distilling surplus wine," said the vice-president of the HGK Agriculture and Tourism Sector, Dragan Kovacevic.

He also noted that the proposal entailed favourable loans for winemakers through the Croatian Bank for Reconstruction and Development (HBOR) and the Croatian Agency for SMEs, Innovations, and Investments (HAMAG-BICRO), with good insurance instruments and interest rates, a five-year maturity and one-year grace period.

The HGK says that the reduced consumption, the unsold stock which has reached its highest level since 2009, additional import duties on European wines in the USA, which is the EU's main market, and the pandemic have all significantly destabilised the wine market in the EU, including Croatia's market.

Currently, wine stocks are accumulating, notably, with bigger wine producers, which also leads to a lack of storage capacity, the HGK said.

Wednesday, 6 May 2020

HGK: Five Years for Trade Sector to Recover

ZAGREB, May 6, 2020 - It will take five years for the Croatian trade sector to recover from the impact of the crisis caused by the coronavirus epidemic, the Croatian Chamber of Commerce (HGK) said on Wednesday.

"The public must be aware that the trade sector has borne a heavy burden on its shoulders, without increasing margins or prices, which helped all the citizens in this crisis," the HGK vice-president for trade, Josip Zaher, said at a meeting of the HGK's trade association.

Zaher said that retail trade had dropped by 25% in April.

The association's president Ivica Katavić said: "We've been through two difficult months. There have been problems in business, including inspections, shorter business hours and limited entry into the shops. But we managed to keep our heads above water."

Katavić said that the restrictions that had done the greatest damage were shortened shop opening hours and e-passes allowing travel. "With the lifting of these restrictions, the situation has improved considerably. The situation was most difficult at the start of April, but considering the circumstances we must be satisfied. We are also satisfied with our communication with the HGK, who were at our service," he added.

The CEO of the Konzum retail chain, Slavko Ledić, said that the sharpest declines had been recorded in large stores. "The key move was to extend opening hours, it was even more important than Sunday trading. The most important thing for us was to have opening hours extended and that we could pay wages," Ledić said.

The CEO of textile distributor Tekstilpromet, Hrvoje Šimić, drew attention to problems faced by the non-food trade sector, which has 90,000 employees.

"Over a period of 50 days our turnover was zero, while at the same time banks showed no sympathy. Some of the shopping centres also did not prove to be good business partners to Croatian traders because, for example, they sent their invoices for May already in mid-April," Šimić said.

More economic news can be found in the Business section.

Monday, 4 May 2020

Croatian Chamber of Commerce Seeking to Relax Measures for Driving Schools

Croatia has gradually begun to loosen up its formerly stringent anti-epidemic measures, and the Croatian Chamber of Commerce (HGK) is seeking more freedoms for driving schools and international drivers.

As Novac writes on the 4th of May, 2020, the Croatian Chamber of Commerce has asked the National Civil Protection Headquarters to relax some of the measures applicable to drivers in international road freight transport, as well as others which will provide better grounding for the start of driving school operations on May the 11th, 2020.

At the request of the members of the Road Freight Association, the Croatian Chamber of Commerce has proposed that quarantine and home/self-isolation measures for international drivers be carried out under the same conditions as drivers in domestic transport.

''According to the current regulations, a driver must not leave their house or their assigned accommodation where they're self-isolating, except in the case of a call from their employer for transport. On their return from a foreign country, they then begin a new cycle of self-isolation, and changing the driving and staying-at-home cycles in this regime can take up to a month, in some cases it takes even longer.

As the drivers operating under this regime don't have symptoms of illness, the Croatian Chamber of Commerce believes that they should be allowed to go to the store and pharmacy as needed and have a limited stay outside of their homes just like other people do,'' said the Croatian Chamber of Commerce's Vice President for Construction, Transport and Communications, Mirjana Cagalj.

The Association of Driving Schools of the Croatian Chamber of Commerce has also proposed that the measures for them be relaxed in order to enable the continued running of driving lessons from May the 11th onwards, with the application of horizontal and specific protection measures. They believe that with the education of staff and strict adherence to health regulations, both theory and practical teaching can be held smoothly, and they have been given specific suggestions on how to implement it by the National Cvil Protection Headquarters.

Make sure to follow our dedicated section for more on coronavirus in Croatia.

Monday, 27 April 2020

Croatian Chamber of Commerce: Croatia Must Rely Less on Imports

As Novac writes on the 26th of April, 2020, one of the lessons during this pandemic that Croatia needs to learn is certainly that it needs to rely more on indigenous resources and reduce its dependence on imports, and this includes the production of energy from renewable energy sources, which is constantly and strongly growing, the Croatian Chamber of Commerce (HGK) has stated.

The coronavirus pandemic, on the one hand, has shown what the planet can look like with reduced pollution, and on the other, it has shed light on all of the vulnerabilities of the system and the need to change our behaviour.

"Most EU member states support the initiative to put the European Green Plan at the very heart of the post-pandemic economic recovery, because the world can only make economic, environmental and social progress if we clearly and firmly commit to clean and renewable energy. We need to strategically make sure that we're developing the resources we already have, thus enhancing the competitiveness of the economy,'' said Ivo Covic, President of the Croatian Chamber of Commerce's Renewable Energy Community, which has been advocating for the development of this energy sector for fifteen years now, with its main focus on establishing a regulatory framework for renewable energy.

April the 26th marked World Renewable Energy Day, it commemorated the tragic Chernobyl nuclear catastrophe and the necessity to continue research and apply renewable energy as much as possible.

Croatian legislation is awaiting significant changes this year in regard to the energy sector. In addition to the European Green Plan, which brings with it major changes and the implementation of new technological and systematic solutions throughout the entire European Union, a law on amendments to the Energy Efficiency Act is expected in Croatia by the end of the year, which will further strengthen efforts to reduce dependence on energy imports.

The Law on the electricity market is planned for the end of this year, and the Croatian Government is planning to submit a new law in September to Parliament on renewable energy sources and high efficiency cogeneration.

"With regard to the new energy development strategy, as well as the objectives of the European Green Plan, Croatia has a great challenge ahead of it to achieve the set goals by the end of 2030, so the adoption of regulations and laws is of enormous importance. Now is an opportunity to prepare the local economy, but also citizens, to be involved as much as possible in the preparation and construction of new projects,'' said the Croatian Chamber of Commerce's Energy and Environmental Sector Director, Marija Šćulac Domac, noting that by increasing the use of renewable energy sources, not only will Croatia contribute to reducing greenhouse gas emissions and protecting the environment, but it will also help the local economy and job creation within the sector.

The International Renewable Energy Agency predicts that the number of jobs in the renewable energy sector will increase to 42 million over the next thirty years.

Follow our business and Total Eco Croatia pages for more.

Thursday, 23 April 2020

HUP and HGK Welcome Decision to Relax Coronavirus Measures

ZAGREB, April 23, 2020 - The Croatian Employers' Association (HUP) on Thursday welcomed the government's plan to relax restrictions imposed due to the coronavirus outbreak, saying that clear guidelines were needed from epidemiologists and that solutions should be devised to boost the economy.

"Today's decision by the government provides a clear direction for intensifying business activities and for a return to work as a precondition for generating revenues and providing funds for workers' wages," the HUP said in a statement.

HUP director-general Davor Majetić appealed for clear and unequivocal instructions on safe work procedures to be given to employers as soon as possible.

"Businesses need precise instructions so that they can do all that is necessary to be able to operate in new conditions and in accordance with guidelines from epidemiologists," Majetić said, adding that this would enable resumption of business activity without a threat of penalties and business closures over unclear interpretations of guidelines.

"We think it is important that together with the government we ensure that the required measures are applicable and practicable," Majetić said.

He also mentioned the need to create conditions and solutions that would boost the economy next year. Citing conservative estimates according to which 300,000 people would be out of work by the end of the year, Majetić said: "That's why solutions need to be urgently devised to provide a stronger boost to the economy."

The HUP proposed nine measures to revive the economy: maintain liquidity for businesses, carry out an urgent analysis of parafiscal levies to reduce the highest ones at least for a specific period of time, reorganise public administration and the territorial structure of the country, digitise government services, reform labour legislation, resume public procurement procedures, increase private sector investment, improve cooperation between local businesses and local government, ensure that VAT is charged on settlement, and increase self-sufficiency in food and medicines.

The Croatian Chamber of Commerce (HGK) also welcomed the government's decision to gradually relax the measures imposed over the coronavirus epidemic, saying that this would slowly bring the economy back to life.

"We need to be very careful because everything we have done can quickly go down the drain. I believe that with responsible behaviour we can show that the economy and public health can go hand in hand," HGK president Luka Burilović said.

The HGK said it was pleased that its proposal had been accepted and that all retail shops would reopen as of Monday, but added that shopping malls should have been allowed to reopen too. It also mentioned the acceptance of its suggestion that public transport be restored so that workers could travel to work.

Burilović said that the government should consider allowing all hospitality businesses to resume work under strict conditions as of May 11 so that they would not have to lay off people. "Their reopening could save at least a bit of the tourist season, although we are aware that (the tourism industry) will take a long time to recover," he said.

More economy news can be found in the Business section.

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