Interview: Radwan Joukhadar

I wish Vukovar were as it

was, says owner of Medical
Intertrade and a new factory
Yasenka in Vukovar

Textile industry
The scientific community
and the textile industry are
developing new special fibres,
creating new markets

Croatian innovators
At the MTE fair in Malaysia,
10 Croatian innovation exhibits
received a total of 11
awards

PAGES 2-3

PAGES 4-5

PAGE 8
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2012

Croatian Business & Finance Monthly

Established in 1953
Monday / 2nd March / 2015
Year VIII / No 0245
www.privredni.hr

S U P P O R T E D

B Y

T H E

pvinternational
pv
international
C R O A T I A N

C H A M B E R

O F

E C O N O M Y

IMPORTS/EXPORTS FOR THE FIRST 11 MONTHS OF 2014

Exports to EU grew, to
Cefta even more
Exports to EU countries grew at a level of 11.9%, reaching 5.96 billion, but to Cefta by
12.2%, to 1.88 billion
Igor Vuki
roatian exports last year
totalled 9.35 billion during the first 11 months.
In relation to the same period of
2013, they increased 9.3%, according to data provided by the
Central Bureau for Statistics. In
addition to exports to the EU,
those to Cefta grew at an even
higher rate. Whilst exports to EU
countries grew by 11.9%, reaching 5.96 billion, those to Cefta
increased 12.2%, to 1.88 billion.
Total aggregate export growth
rate is high even within Europe.
According to available data for
the first 10 months, Croatia saw
the highest export growth rate
year-on-year, and only a few
transitional EU members (Poland, the Czech Republic, Romania and Slovenia) were near,
with export growth rates between
6% and 7%. EU accession has
enabled an easier approach to the
EU market, but it also increased
the trade originating from other
countries, which significantly increased the value of exports during the first half of the year, and
which was used for comparison
with the pre-accession period.
Certain analysts warn that in ad-

This year exports will slow and imports accelerate

The export of goods showed a relatively high increase during the
previous year, where the growth rate during the first ten months
was the highest in EU countries. Such a movement was influenced
by Croatian EU accession, that is, an easier approach to the market
and increased trade of goods from other countries, Director of the
CCE Sector for Financial Institutions, Business Information and Economic Analyses, Zvonimir Savi, evaluated. For 2015, we anticipate
the value of exports will slow in relation to 2014, whilst imports could continue their moderate growth, Savi suggested.
dition to other factors, the transit
of goods from other EU countries through Croatian ports and
border crossings also contributed to nominal export growth.
The second half of the year was
marked by a fall in the price of

crude oil and oil derivatives globally. This had a strong impact on
trading movements, considering
the significant export share of oil
derivatives in total exports and a
significant import of crude oil in
total imports.

Reduced deficit
During the first 11 months of
2014, imports totalled 15.68
billion, an increase of 4.7%.
Due to higher export growth,
the trade deficit decreased 1.4%
year-on-year. The highest export growth was seen in clothing, electricity, machines and
appliances, whilst the export of
ships, computers and waste materials saw the highest decrease.
Exports to other countries decreased 3% if we exclude EU
and Cefta countries. The largest was seen with the Marshall
Islands, where four ships were
exported in 2013.
Analysts at the Croatian Chamber of Economy highlight that in
terms of imports, the import of
oil derivatives showed the largest
increase. This is a consequence
of decreased local production,

Export growth rate is

high even within Europe
clothing, food products and vehicles, which are mainly related to
EU accession (high import level
of used motor vehicles). The import of crude oil decreased the
most due to decreased production
in local refineries.

Privredni vjesnik
Year VIII No 245

IDEX ABU DHABI ARMED FORCES AND DEFENCE EXHIBITION

AND FAIR

Filling orders for

the military

( 394 staff

employed by Medical Intertrade

dee iin
nC
Croatia
roatia

INTERVIEW: RADWAN JOUKHADAR, OWNER O

I spent 12 w
Vukovar and

The factory in Vukovar is a gift to my city and its people so I

Croatian student, now Master of Science in Medical Biochem
Svetozar Sarkanjac
he Association of
Producers of Equipment for Special
Purposes at the Croatian
Chamber of Economy
has participated for the
third time at the leading
international fair of armed forces
and defence industry International Defence Exhibition and
Conference IDEX 2015, recently
held in Abu Dhabi. IDEX is the
only international exhibition of
weapons and military equipment held in the Middle East and
Northern Africa every two years.
It represents innovative technology for the military industry and
defence by sea and air. The fair is
a unique platform for the establishment and the strengthening

The company estanBusch has received an

order for over 100,000
combat helmets
of relationships with government
departments, companies and the
armed forces both throughout the
region and globally, and is held
under the auspices of the President of the United Arab Emirates
and the Commander-in-Chief of
their armed forces. The companies estan-Busch and Agencija
Alan exhibited their products at
the joint stand organised by the
Croatian Chamber of Economy.
They presented the programme
by HS - product (weapons) and
INKOP military boots, whilst the
company DOK-ING showed its

any were baffled last

year when a pharmaceutical factory opened
in Vukovar. Unfortunately, only
few entrepreneurs opt for production in Croatia. This is even
rarer in the eastern part of the
country, especially Vukovar
one of five municipalities in exYugoslavia in terms of industrial
development. Moreover, the investor was born in the historical,
but now destroyed Syrian city
of Aleppo. Radwan Joukhadar
studied in Croatia and is now
Master of Science in Medical
Biochemistry. This man, with
joint Croatian and Syrian nationality, explained his move very
simply during the opening of his
factory: The factory in Vukovar
is a gift to my city and its people
so I could contribute to its progress and development, hoping
it will become the centre it was
before the war.

M
products at a
special exhibition space. estanBusch received an
order for over 100,000 combat
helmets, which has filled its
production capacity for the year
with orders placed by clients
from the UAE, Turkey, as well as
from Bangladesh and the African
market.
Tajana Kesi api, Director
of the Sector for Industry at the
Croatian Chamber of Economy,
pointed out the fact that estanBusch is currently the largest European (and the highest quality)
combat helmet producer. Moreover, several meetings were held
with other Croatian exhibitors
and many companies who did
not exhibit their products, such
as Varteks, ateks, PMT, Kapko, eir and Auto Safir visited
it, since they were interested in
the latest products in the military
and defence sector and were also
aiming to visit former clients.
The Croatian exhibitors were
visited by Mohammed bin Zayed
Al Nahyan, Crown Prince of Abu
Dhabi and a delegation of the
Croatian Ministry of Defence
headed by the Defence Minister,
Ante Kotromanovi. Over 2,800
exhibitors from 59 countries
exhibited at this years exhibition covering 12 exhibition halls
over an area of 133,000 m2, with
80,000 visitors. (K.S.)

You are a successful medicine

and medical equipment trader
who has been developing the
family company Medical Intertrade for the past 25 years, with
an annual income of over 0.19
billion. Why did you open a factory for producing medicines?
I am a dispensing chemist primarily this is what I wanted to
become since I was a child. This
is why I came to study pharmacy
in Croatia. Considering the legal
and financial possibilities at the
beginning of my business career,
I established my first private
wholesale of medicines and med-

ical products in Croatia. Later I

established a medical institution
Ljekarne Joukhadar, which now
consists of 35 dispensing chemists. With our present production
we achieve fully vertical integration, from factory and wholesale
to retail we provide stability of
the entire system and offer full
support to our business partners.
The companys Head Office
is near Zagreb. Why did you
open the factory in Vukovar
and how did you name it?
I spent 12 wonderful years in
Vukovar. My wife, a doctor
of dental medicine, was
born in Vukovar. We
both started working
in the former Medical Centre in Vukovar. We would
never have left
Vukovar had the
war had not happen. The factory
in Vukovar is my
humble contribution to this city,
its people and
soldiers who represent the symbol
Croatia. The decision was guided
strictly by heart,
since it would be
much easier to open
a factory near Zagreb
for manufacturing and
staff reasons. The factory
was named for my wife,
Jasenka.
What do you produce, and
what is your capacity?

www.privredni.hr
Business & Finance Weekly

( 176 employed ( 10.5 million

in Ljekarne Joukhadar

invested in Yasenka factory

F MEDICAL INTERTRADE AND A NEW PHARMACEUTICAL FACTORY YASENKA IN VUKOVAR

wonderful years in
d I wish it were as it was

could contribute to its progress and development, hoping it will become a centre it was before the war, says former
mistry Radwan Joukhadar. He named the factory after his beloved wife Jasenka.
Production consists of three departments: the production of
solids (capsules and tablets); production of semi-solids (creams,
ointments and gels) we can produce up to 15,000 metal or plastic
containers of various
sizes in one shift;
and lastly, the
department for
the production
of liquids (solutions and syrups) we can
produce 10,000
150 ml bottles
in one shift.
When
the

second shift starts, the capacity

will increase. Since all our production equipment was produced
by the best global producers, and
was installed and certified according to standards of pharmaceutical production, we can sell
our products on any market.

problems we have are related to

the economic situation of a given
country.

You invested 10.5 million in

the factory. When do you plan
to repay the invested money?
Everything I have, I owe to hard
work and the investment in quality (know-how, services, business
processes and equipment). One
cannot achieve his goal overnight
if you are guided by these principles, but one can achieve a longterm and stable business as well
as positive results. If we succeed
in completing our plans, the investment should see a return in
five to seven years.

I came to Croatia to
study. With my wife, I fell
in love with this beautiful
country and its hardworking people

What is your competition in

Croatia?
There are many pharmaceutical
companies in Croatia. For example Pliva, Belupo, Jadran galenski laboratorij, Genera, FarmaS,
Farmal
Who are your best customers
in Croatia?
Mainly chemists or hospitals and
health centres.
Do you have companies outside
Croatia?
In 2002, I established a wholesale medicines and medical products called Medical Intertrade in
Sarajevo, and another in Ljubljana in 2003. Both daughter companies operate well. The only

Tell us about your entrepreneurial story. How did you develop your company?

Medical Intertrade started operating on 1st August 1990, in

Vukovar with three employees.
The year after, I had to shut down
since the war erupted. I stayed
in Vukovar at the request of Dr.
Juraj Njavro, and worked as a
dispensing chemist in Borovo for
as long as the circumstances allowed me to do so. Actually, in
one period I was the manager of
a chemist whilst living in Vukovar. When it was no longer
possible to survive in Vukovar,
I transferred to Zagreb, and in
1992 I started a wholesale trade
in a leased building. Our successful development, an increased
number of suppliers and buyers,
allowed us to buy a new business
premises near Zagreb in 1998.
At the beginning, wholesale concerned mainly humane drugs;
medical, diet and cosmetic products, and over time, we expanded
into diagnostic, dental and veterinary products as well as medical
equipment. A larger market and
the desire to provide better sup-

plies enabled us to open business

units in Osijek in 1998 and in Solin in 2003 as well as wholesale
units in Sarajevo and Ljubljana.
In 2008, the business unit in Osijek was transferred into newly
built premises in Vukovar where
the factory has recently started
its work. Medical Intertrade in
Croatia currently employs 394
workers chemists. Ljekarne
Joukhadar has 176 employees,
and Yasenka 15.
You are modest, you do not like
media exposure and you are
known as an extremely socially
aware employer. What is your
business and life philosophy?
I firmly believe if you do good,
you receive good. Furthermore,
it makes me happy to make other
people happy. I believe my employees are key factors of my
success, and only motivated and
satisfied employees can contribute to the companys long-term
success.
You came from Syria to study
in Croatia and raised your family. Did your plans and wishes
come true?
Everything I ever wanted came
true when I opened the factory,
but I still have plenty of plans.
Firstly, I would like to return the
investment as quickly as possible
and expand the business beyond
the region. I do not have any regrets. I came to study in Croatia,
but my plan was to return home
after graduating. However, with
my wife, I fell in love with this
beautiful country and its hardworking and kind people.

4
In 2014 we began a large number of projects arising from the development of new

Privredni vjesnik
Year VIII No 245

materials. This year we will focus on these functional applications in the area of our
civil product range.
Stjepan Pezo, CEO of Galeb

Textile industry

FUTURE MATERIA

The scientific community and the textile industry are developing new special fibres, functional materials and the int
textiles. The increasing demand for functional textiles provides opportunities for a resumed development of a segme
pointed out Sandra Bischof
Ilijana Grgi
alue-added textile products are currently being
used in our daily lives.
The Croatian textile industry
currently produces antimicrobial socks or comfortable cotton
suits that do not wrinkle. Digital
fashion combines clothing items
with electronic devices for the
purposes of warming, protection,
treatment or merely for the purposes of new fashion aesthetics.
Functional textiles, which originate from a combination of actual
production and new technologies
in order to meet the demand for
textile products used in atypical
conditions, has been of crucial
importance. Functional textiles
are multifunctional; Croatian
textile companies such as Varteks, ateks or Jadran Stocking
Factory are becoming increasingly aware of the importance
of development of such textile
items. Consequently, the Omibased company, Galeb, has
been producing a broad range
of functional underwear with diverse features. Galeb underwear
is made from new materials. In
addition, it is resistant to temperatures up to 600oC and it is intended primarily for military, law
enforcement and fire fighters. Its
additional role is to provide protection to those wearing it and
make sure they remain uninjured
in situations of extreme heat.
In 2014 we began a large number of projects arising from the
development of new materials.
This year we will focus on these
functional applications in the area
of our civil product range, stated
Stjepan Pezo, CEO of Galeb. The

development of new functional

textile materials in Galeb resulted from its co-operation with the
Faculty of Textile Technology.
Modernity for tradition
The scientific community and
the textile industry are providing
new developments in the area of
special fibres, functional materials and the integration of microelectronic components into smart
textiles, as well as advanced
manufacturing technologies, including computer technology
development and the creation of
prototypes. A growing demand
for high value added functional
textiles provides opportunities
for the resumed development
of part of the traditional textile
and clothing production. This
contributes greatly to the modernisation of the manufacturing
industry, emphasised Sandra
Bischof, Dean at the Faculty of
Textile Technology. She also
pointed out that functional
textile materials, clothing,
footwear and equipment
need to be considered as a
fundamental area of development in Croatia, as well
as in the European Union,
since they provide ample
opportunities of application
in diverse sectors ranging
from the defence industry,
wood processing and automotive industry.
A European textile industry which can ensure
reliable and confidential
procurement of military
products is of strategic interest for the security of the
EU, as well as for the creation
of a European technological and

industrial defence base, stressed

Sandra Bischof.
A wide range of scientific
achievements has been integrated
into functional materials, clothing, footwear and equipment that
make them high valueadded products generating significantly higher revenue.
Revenue is clearly
a fundamental issue for the textile
industry in both
Croatia and the European Union whilst
aiming for competitiveness
a n d

sustainable growth at a global

level.
The fact that technical textiles
are the fastest growing area of
the textile industry globally has
to be stressed. This is the result
of its huge range of uses, from
medicine, industrial biotechnology and nanotechnology to transport and
civil engineering.
Technical materials
The Croatian textile industry develops a range
of special purpose technical materials. The Varteks
Group
developed
functional
materia l s
and

www.privredni.hr
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5
CONSTRUCTION INDUSTRY IN CROATIA 2015-2030

No alternative to
green building

ALS

egration of microelectronic components into smart

ent of traditional textile and clothing production,
clothing items to meet the specific requirements of niche markets.
These materials are fire resistant
fabrics of extreme resilience, as
well as being water repellent.
These clothing items are intended to meet the requirements of
clients such as fire fighters, petrochemical industry workers and
law enforcement agencies who,
against a backdrop of specific
operational situations, need additional protection.
ateks also engaged in the development of a sophisticated polyurethane membrane whose principal feature is excellent transpiration - the evaporation of sweat
and moisture, with simultaneous
imperviousness to rain and wind.
A water repellent, breathable
textile technical material is created through laminating the membrane to a textile surface. In addition, there is the company Kroko
International who is engaged in
the development of functional
rucksacks and vests of a modular military style. New materials
were used also in the creation
of functional military boots that
are waterproof, slip- and steamresistant, with anti-shock insoles,
microbicides and technical protection; they were developed
by the companies INKOP diz
Poznanovec and the akovecbased Jelen Professional.
Employers value science
Josip Pelin, President of the
Competitiveness Cluster of Textile Industry emphasised that employers value highly and accept
the opinion of the scientific community, yet the real value of these
products shows primarily in their
commercial value on the market.

We need to enhance the competitiveness of our economy and

need to form clusters. It has to be
stressed that we need primarily to
focus on our competitiveness on
the domestic market, as if we are
not competitive here, the same
will apply globally, stressed Pelin, who pointed out that Croatian
economic development can be
based on textiles, as this sector
is one of the most active areas of
the processing industry.
Croatian companies are slowly
entering the world of new technologies and materials and their
pace depends on their ability to
group and connect, as well as
on co-operation with scientific
institutions and the quantity of
invested funding.
Nanotechnology to reate
millions of jobs
The financing of research in
the field of nanotechnology at
a global level doubles annually.
Nanotechnology permeates a
vast number of fields, ranging
from electronics, robotics and
new medicines to textiles and
is aiming to create a material of
specific features through manipulation at the level of atoms and
molecules. The European Union
has dedicated special attention
to research and innovation in
nanotechnology, as it is striving
to rank amongst the leaders in
this area. By 2020, nanotechnology will be integrated with most
technologies and applications,
impacting significantly on the
quality of life. Market value estimates, which include nanotechnology, stand around 2 trillion
by 2020, in addition to the creation of 2 to 6 million new jobs.

The future of the Croatian construction industry is not based

on the construction of new hotels, endless kilometres of new
motorway or new buildings,
but in the reconstruction and
renovation of existing hotels,
motorways and buildings.
This can be achieved only by using new materials, technologies
and adopting new values, pointed
out Anka Mrak Tarita, Minister
of Construction and Spatial Planning at the recently held Zagrebbased 7th Better Building Brunch.
Speaking about the tradition of
local construction, she primarily
emphasised the fact that Croatian
civil engineers have always had
a reputation for being excellent
and committed workers, global-

ly. She also mentioned the guidelines stated in the National Strategy on Energy Efficiency, implying that a limitation on the number of certified buildings needs to
be imposed if Croatia is to keep
abreast of global practices.
Urban transformation is an
imperative for this country and
Green Certificates need to be
included in Energy Performance
Certification, since there is no
alternative to green building,
highlighted Anka Mrak Tarita.
Green building will result in a
vast array of new occupations
in the construction industry and
hence secondary school programmes need to be adapted accordingly. She mentioned four
Energy Efficiency Programmes
that are already being implemented: family housing, multipurpose residential buildings,
commercial buildings and public
purpose buildings. The meeting was organised by the Croatia Green Building Council and
sponsored by the Ministry of
Construction. (S.P.)

THIRD HAMAG-BICRO ENTREPRENEURSHIP FORUM

Funding for innovation

The Croatian Agency for
SMEs, Innovation and Investment (HAMAG) recently organised the 3rd Entrepreneurship Forum HAMAG-BICRO,
where new tenders for innovation programmes were presented with a total value of 4.8
million.
The programmes are RAZUM
programmes (Development of
Knowledge-Based Companies)
and an IRCRO programme comprising of co-operation between
an industrial company and a research institution.
The funding for the programme
has been provided under the second project of technological development of the Ministry of Science, Education and Sport (STP
II) through a loan granted by the
World Bank. Co-financing of research and development projects
under the RAZUM programme
valued at 3 million is planned,

whilst the value of the funding

under the ICRO programme is
1.8 million.
This year we have entered a
period of allocation of substantial financial resources and support for entrepreneurship where,
for innovation and technologies
from 2014 to 2020, we plan to
provide 0.18 billion, stressed
Gordan Maras, Minister of Entrepreneurship and Crafts.
The first tender for innovative
entrepreneurs, worth around
29.9 million, will be invited
over the forthcoming months.,
stated Maras. (K.S.)

Privredni vjesnik
Year VIII No 245

( 72.24% of entrepreneurs believe

that conditions for investment and business will be on a par with last year

Business sentiment edition and Gorazd Niki award presented, a roundtable discuss

The time of catchphrase

time for concrete measu

417 entrepreneurs questioned in the survey conducted by Privredni vjesnik do not expect any radically positive meas
in the fact that the majority of entrepreneurs 67.52% - believe that economic growth will be approximate with 201
Igor Vuki
eljko Lovrinevi is the
winner of Gorazd Niki
award for the best business analyst in 2014. The award
is presented by Privredni vjesnik
based on a survey conducted
amongst owners and managers
of leading Croatian companies.
It was recently presented at the
Croatian Chamber of Economy,
during the presentation of the
new edition of Business Sentiment 2015, a traditional publication by Privredni vjesnik that anticipates future trends. A roundtable discussion was held on
the messages conveyed by the
Business Sentiment: The time of
catchphrases is over, now is the
time for concrete measures for
exiting the crisis.
417 entrepreneurs questioned in
the survey conducted by Privredni vjesnik expect no radically
positive measures. This is a year
of elections when significant reform measures do not normally
occur, certainly not measures
which may negatively affect the
status of specific social groups.
Darko Bukovi, Editor-in-chief
of Privredni vjesnik, pointed out
that those questioned rated the
general economic condition with
grades ranging from the worst
(grading 1) to the best (grading
5), with an average grading of
2.16.
The highest proportion of business people (67.52%) believe
that economic growth in 2015
will approximate with 2014,
while almost an equal number

(15.06%) believe it will see only

slight growth or even drop slightly (15.26%).
Almost two thirds of business
people (73.24%) believe that investment conditions and business
in 2015 will remain unchanged
over4. Opinions on the priorities
for managing exit strategies are
divided. Nevertheless, several
have been pointed out, such as
more affordable entrepreneurial
lending, a substantial reduction
in state administration, lower
taxation and contributions, restrictions to the duration of court
proceedings upon bankruptcy,
tackling illiquidity and the action
of foreign direct investment.
Small businesses most
pessimistic
According to Bukovi, small
businesses are the most pessimistic, yet throughout the sectors, here are companies who are

confident in seeing results on par

with 2014. That is the case also
among companies in construction. Around 32% of civil engineers expect to see an improvement, 33% anticipate results
identical to 2014, with around
27% anticipating a continued de-

crease in business activities.

Significant changes are not expected concerning taxation and
contributions. Around 67.54%
of those questioned believe they
will remain unchanged compared with 2014. More optimism
has been expressed by business
people concerning the impact
of the crisis on the operation of
their businesses in 2015. Thus,
45.84% believe they will be adequately prepared for and successful in tackling the impact of
the crisis, 27% generally believe
they will be successful concerning that issue, whilst 20.84%
stated they would attempt to

tackle the impact of the crisis.

According to the survey, one
third of respondents believe that
their businesses will tackle the
crisis through an expansion of
their product range, one third announced a decrease in production
costs, whereas one third will resort to re-organisation.
Luka Burilovi, President of the
Croatian Chamber of Economy,
is also optimistic. During the
roundtable discussion organised
during the presentation, he pointed out that, irrespective of years
of recession, there are still resilient business people who continue providing solutions against

www.privredni.hr
Business & Finance Weekly

( 67.54% of those surveyed

do not expect any alterations in taxation and contributions

sion held by Privredni vjesnik

es is over, now is the

ures for exiting the crisis

sures. This is a year of elections when significant reform measures do not normally occur. Pessimism is reflected also
14. Significant changes are not expected concerning taxation and contributions.
No substantial positive changes

Economic populism needs to be avoided

The Gorazd Niki award for economic analyst of the year was presented for the fifth time.
Ljubo Juri, a triple laureate, has been declared the best over
the first five years. Juri entered the short list this year, in addition to Damir Novotny, Zdeslav anti, Guste Santini and eljko
Lovrinevi. None anticipates any significant changes this year.
The weather will greatly impact on the entire situation, as it significantly affects tourism and harvests which are fundamental, stated Juri. Santini added: Always the same people, the
same stories, the same expectations. 2015 will be identical as
last year.
Damir Novotny stated that Croatia has seen no substantial
growth during the last three decades. Consequently, the reforms
need to be comprehensive and challenging, yet it is highly unlikely they will be implemented. Zdeslav anti anticipates just
0.2% growth, which will not improve the current situation on the
labour market. Nevertheless, prices will see a slight increase,
which will prevent dangerous deflation. Affordable funding via
the European Central Bank will provide a breathing of a year or
two, which needs to be exploited to implement reforms, believes anti.

eljko Lovrinevi, the economist of the year, warned the government, as well as the general public, of the fact that populist solutions to meet the requirements of specific social groups
need to be avoided at all costs. The current situation is serious,
the results of the Croatian economy are weak, whilst cheap populism and temporary solutions are likely to cause chaos with
unforeseeable consequences. Export results that we continuously point out are in fact fictitious: half the growth or perhaps even
more, has been achieved through goods in transit following Croatian EU accession. The real growth actually stands at barely 4% to
5%, as opposed to 9% stated in statistical data. Should irresponsible conduct and adverse business climate continue, foreign capital might start leaving Croatia aiming to find more favourable circumstances and homes.
Lovrinevi pointed out that the private sector has managed to
adapt to the crisis, as opposed to the state and the public sector.
Consequently, it is high time to implement reforms to halt the situation that has led to a substantial brain drain during which the
public debt has reached 13 billion and the standard of living of
those opting to remain in Croatia has reduced by 10%, highlighted
Lovrinevi.

a backdrop of adverse business

conditions. He stated that he
would be even more optimistic
if Croatia had a concept of longterm economic development to
rapidly boost the business climate, with the government and
the Croatian Parliament accepting their responsibility more courageously.
Burilovi highlighted the fact
that hasty legislative amendments need to be stopped, since
entrepreneurs require a stable
and predictable legal framework.
EU funding absorption has been
unsatisfactory thus far, the forthcoming elections are postponing

reforms, and against such unstable circumstances a large number

of investors are unwilling to take
any risk. Foreign capital is often

According to
Minister Gri, public
administration causes
severe problems to
both businesses and
government ministers
compared with bashful animals,
such as hares. In my opinion, domestic capital is very similar and

can be compared with squirrels,

pointed out Burilovi.
Gri: Surpluses higher
than deficits
Branko Gri, Vice-President of
the government, emphasised the
transition from a rent-seeking
economy, from import and trade
towards export and production,
which is somewhat insignificant
at this point, albeit certainly an
important step forward seen on
the domestic market. Integration
with the EU greatly aids the operation of domestic companies
globally. Against a backdrop
of the general conditions on the

domestic market, surpluses are

higher than deficits. This year
will see a continuation of positive trends in exports due to Croatian EU membership. Moreover, companies which have been
given a new opportunity through
pre-bankruptcy settlement agreements will also substantially contribute to growth, stated Gri.
Gri stressed that the government will provide incentives to
the economy through available
instruments in compliance with
EU regulations. Nevertheless,
it will not interfere in monetary
policy or that of the Croatian National Bank.

Privredni vjesnik
Year VIII No 245

( 11 awards

at MTE in Malaysia won by 10 Croatian innovations

CROATIAN INNOVATORS SUCCESS AAT THE MALAYSIAN FAIR

And now going global

At the MTE fair in Malaysia, 10 Croatian innovation exhibits received a total of 11 awards,
and several companies signed contracts of co-operation and delivery of their products to Malaysiaa
Sanja Pljea
roatian innovators have
achieved yet another significant success at the
recently held innovations fair
of Southeast Asia 14th MTE
Malaysia Technology EXPO in
Kuala Lumpur. 10 Croatian innovative exhibits won a total of
11 awards, whilst several Croatian companies signed contracts
of co-operation and delivery of
their products to Malaysia. The
Zagreb-based company Citus received a gold medal. Citus is a
Microsoft partner and is involved
in consultancy, design, development and introduction of mobile
and cloud IT solutions based on
Microsoft technology. Three Citus employees are Microsoft Most
Valuable Professional titleholders for Office 365, virtualisation
(Hyper-V) and web application
development. Citus has received
over 40 international awards
thus far, as well as several gold
medals for innovations in ICT in
the US, Russia, Korea, Taiwan,
Malaysia and Croatia. It has recently received a gold medal for
their product C@N eMotion, a
software module that recognises
facial expression, as well as for
the www.ConferenceAtNet.com
web site, which is an online mobile solution, for the management
and organisation of workshops,
conferences, and for the product C@N Motion, an innovative
multimedia system managed by
hand or body movement.

Gold, silver and bronze

Tomislav Bronzin, owner of
Citus, pointed out that the companys products are available
globally. Slovenia, Bosnia and
Herzegovina, Israel, America, as
well as Arabian and Asian coun-

tries are just a few of the markets

we have penetrated and where
our products are sold. Instead of
thinking locally, we think globally, as technological developments have abolished all borders;
the world has transformed into a
global stage with 24 hours a day
accessibility, as well as equal
opportunities for success, emphasised Bronzin. Since the company and its operations, products
and services are primarily focused on innovations, it is of vital
importance to be present at exhibitions that provide opportunities
for co-operation with investors,
as well as potential partners who
will work on distribution in a
country or region. Participation
at fairs and exhibitions is additionally helped when we appear
with a group of innovators or
entrepreneurs supported by the
Zagreb Innovators Alliance, the
Croatian Chamber of Economy,
the Ministry of Economy and the
Ministry of Entrepreneurship and
Crafts. Our partners are primarily the leading companies in the
areas covered by our products,

such as marketing, conferences,

business process management,
health status assessment and IT,
stated Bronzin. In addition to the
gold medal from the exhibition in
Malaysia, Bronzin and his team
returned to Zagreb with several
new contracts amongst which it
is important to highlight co-operation with the University of Malaya. This agreement will enable
them to deliver the first 10 software packages of C@N Motion
to the Malaysian market following the successfully implemented
pilot project.
Business plus academic
In addition to the company Citus,
another Zagreb-based company
Live Good - achieved a significant success. Its founder, Anita
Bui, will be one of the leading
researchers in a tripartite project,
whose results will be incorporated into the Croatian product
BodyRecog-Fitness Asia. It is an
excellent example of connection
and co-operation between business and the academic communities, which was the objective of

the exhibition in
Malaysia. MTE
this year covered a large number
of innovators and innovations
from Malaysia and the countries
of Southeast Asia and Europe.
The most successful Croatian
exhibitor innovator was Rosa
Ferenevi from the company
Marinalab Opus, who received
Best Award for the innovation
Acidosalus baby. The Best Award
is given for one of the ten most
successful exhibits at the MTE
exhibition. Antun Drvar received
a silver medal for his ionisation
technology, for the lowering of
the point of fossil fuel flow to
0oC without the use of chemicals.
Moreover, the company Supernova received a silver medal for
an innovation for dyeing hair
samples in one or more colours
at a single application. Additionally, the company Herbafarm-

The company Citus won

a gold medal at MTE
previously having been
awarded for a software
module that enables
facial recognition
Magnolija won a silver medal
for its innovation Herbafertil, as
did the innovation InfraredART
by Nada iljak and the company
CEI Mikroelektronika for the innovation of intelligent clothing
with thermal insulation features.
A bronze medal was awarded
to the young innovators Jakov
Soldi and Josip Horvat for the
innovation Magreg, the company
Priroda lijei (Nature cures) for
its innovative cosmetics Nikel
and Marinalab Opus for its innovation Toothpaste 3-in-1.

www.privredni.hr
Business & Finance Weekly

( 252,442 people
employed through HZZ last year

EU PROGRAMME FOR CROATIA: DEVELOPMENT OF SOCIAL NETWORKS IN HZZ

Welcome to cyber world

The goal of the project is to improve the quality and efficiency of HZZ services through social networks and
other internet tools
Sanja Pljea
uring the eight months of
the project Development
of social networks in the
Croatian Employment Agency
(HZZ), 1.1 million individual
consultations were held and
14,000 unemployed people participated in training workshops,
focusing on how the individual
can present him or herself to employees, said Tatjana Dali, Dep-

Consultations and
workshops were some of
the activities that took
place in conjunction
with the Twinning Light
Project worth 240,000
uty Minister of Labour and Pension System, at last weeks presentation of the project. Consultations and workshops were some
of the activities that took place
in conjunction with the Twinning
Light Project worth 240,000,
funded by the European Social

Fund from the EU programme.

The goal of the project was to
improve the quality and efficiency of HZZ services through
social networks and other internet tools. This project motivated
the process of offering information and specialised services to
the unemployed, promoting opportunities for employment and
training and supporting communication with clients through
social networks.
Social networks connect
people
Tatjana Dali noted that 252,442
people found work last year

through HZZ (which did not

happen in the past 11 years),
of whom 107,000 were under
30 years old with 89,000 being
employed without measures for
subsidising self-employment. As
an additional positive activity of
this project, Deputy Minister of
Public Administration, Leda Lepri, mentioned the introduction
of e-Uprava (e-Administration)
policies through the project
e-Graanin (e-Citizen) which
includes all services realised in
the real world of the management-client relations. She also
added that the drafting of the
strategy e-Hrvatska (e-Croatia)

2020 is in its preparatory phase,

and this strategy should clear all
doubts regarding business activities. It still happens that a client
cannot do everything through
e-business, which forces him
to come personally to the relevant institution. Concerning the
project Development of social
networks in HZZ, the Director
of HZZ, Ankica Paun Jarallah,
highlighted the project reached
its goal of integrating social networks in the business activities
of the institution. She added we
are all a part of the cyber world
we must not run away from, and
state institutions have to adapt
and offer information to clients
through the internet or social
networks. Social networks are a
tool for connecting people since
they are a part of the digital revolution.
The precondition of business
behaviour is that the channels in
the social networks slowly enter
companies, but they are mostly
used by IT companies, which is
logical. Gradually, all companies will use them, Ankica Paun
Jarallah concluded.

EU FUNDED PROJECTS SHORT-LISTED

The list reduced from 77 to 25 proposals

The Croatian list of 77 projects,
to be funded by the Juncker
Fund, has been reduced to 25
proposals. After the meeting
of Government Vice-President,
Branko Gri, and Vice-President of the European Commission, Jyrki Katainen, in February,
it was published that the European Fund for Strategic Investment would focus on subsidising
private or public-private partnerships, and not on investment

projects that are primarily public.

The Croatian short-list is valued
at around 9 billion, of which
projects worth 2.2 billion could

be realised over the course of the

next three years, Government
Vice-President Gri said.
The present list mainly includes
projects to be realised through
public-private
partnerships.
The point is to mobilise private
money, which is why the focus
is on private investment, Katainen said. The Fund will finance
projects, not governments. This
means everyone has a chance;
each sustainable project, even if

high risk, has a chance to receive

funding, the EC Vice-President
concluded. Gri announced the
Government would call on private investors to express their
interest in participating in this
initiative. The Government and
the Croatian State would provide
support in communicating with
the European Commission and
the European Investment Bank
in realising these projects, Gri
said. (I.V.)

10

Privredni vjesnik
Year
VIII
245
Yeea
Y
eaarr V
IIIII N
No
o2
45

( 13 billion ( 60 football elds

total ITER project

the ITER construction site area

Fusion power

A drop of sun on Earth

One of the biggest scientific experiments in the world was designed to obtain self-burning fusion plasma for
the first time in history. Owing to the Ruer Bokovi Institute, Croatian scientists are a part of the research
consortium EUROfusion, encompassing 27 countries around the ITER construction project
Boris Odori
cientists from the Croatian Fusion Research Unit
(CRU) participate in one
of the biggest projects of today
the project of obtaining cleaner
and constant energy from nuclear fusion. Owing to the Ruer
Bokovi Institute, Croatian scientists are part of the research
consortium EUROfusion, covering 27 countries around the project for constructing the International Thermonuclear Experimental Reactor (ITER), which
will allow the testing of a series
of technologies required for operating a fusion power plant.
To achieve these goals, scientists globally were provided with
850 million for the period 20142018, of which almost half will
be provided through the Horizon
2020 programme. The sum of

This is tremendous
recognition for our
scientists, co-ordinator
of the Croatian Fusion
Research Unit Toni
Tadi observes
nearly 0.4 million has already
been allocated to Croatian scientists for a period of five years
as pointed out during the visit
of EUROfusion programme Director, Tony Donne, at the Ruer
Bokovi Institute (IRB).
This is tremendous recognition
for our scientists. The funds from
the Horizon 2020 are allocated
through extremely competitive
tenders. To win a project in conjunction with this programme

means the EU recognises your

work as competitive science,
which can be compared with the
work of other scientific institutions from countries with far
more generous funds for science
and research, such as Germany,
France or Great Britain, noted
co-ordinator of the Croatian Fusion Research Unit and member
of the EURATOM (European
Atomic Energy Community)
Scientific Technical Committee
(STC) Toni Tadi.
Significant undertaking
Croatian scientists from the
Ruer Bokovi Institute, Institute of Physics and the Faculty
of Mechanical Engineering and
Naval Architecture (FESB), are
participating in five work packages of the fusion programme,
based on which IRB will assess

the retention of fusion fuel in the

walls of fusion reactors with the
help of ion beams; the origin of
dust particles inside the fusion
reactor (tokomak), and the construction of the chamber for the
radiation of fusion materials with
two ion beams, one of only four
in the EU.
FESB scientists will be dealing
with the mathematical modelling
of magnetic fields and plasma
in the fusion reactors and colleagues from IFS will work on
the development of a laser machine for damage control of the
tokomak walls.
The Institute of Physics and
IRB together participate in the
EU training programme, under
which 300 students from all EU
countries write their theses related to the field of physics. To create solar energy on Earth is a sub-

stantial undertaking. Everything

relating to ITER is enormous.
This biggest fusion reactor will
be built in Cadarache in France,
over an area equal to 60 football
fields, and around 2.5 million
metres3 of earth has been dug
out to create room for the ITER
tokomak and accompanying facilities, Donne explained.
One of the largest scientific experiments in the world has been
designed to obtain self-burning
fusion plasma for the first time in
history, literally a drop of Sun on
Earth. The entire project is worth
13 billion and scientists from 34
countries participate in it. Each
research laboratory has its task.
We are seriously counting on
Croatian scientists, which are
confirmed by their participation
in the joint Horizon programme,
Donne concluded.

www.privredni.hr
Business & Finance Weekly

11

( over 80 countries ( 6 people

use Agrivi agri-tech system

currently
tl employed
l d by Agrivi

INTERVIEW: MATIJA ULJ, CEO OF AGRIVI

Agrivi used by farmers in

80 countries
Until recently Croatia was known in the world mainly for its athletes or Dubrovnik, but today the word of
successful start-ups has started to spread, says Matija ulj whose Agrivi System won first prize at the World
Startup Competition in Seoul
How hard is it to find investors
for start-up projects?
Extremely hard in Croatia, since
only a small number of people are
motivated to invest in start-up projects. Therefore, they cannot invest in every good project. Moreover, we do not have venture capital
funds that invest in ICT start-ups.
Therefore, almost all projects have
to turn to foreign investors for
funds, especially when it concerns
bigger investment projects.

Boris Odori
roatian Agrivi, an agritech start-up system, is
a system for agricultural
production management that
helps farmers secure production
productivity and profitability.
The system is currently used by
farmers in over 80 countries, and
the number of users is increasing
monthly. Preparations for ex-

We can offer west

European quality at a
lower price than western
countries
panding into the markets of Great
Britain, France, Italy, Poland and
Russia are in progress, and they
have already started with the announcement of partnership with a
distributor in Nigeria. The Board
and development head office,
which started work in 2013, is in
the Croatian town of Kutina. Agrivi currently employs six people
and several part-time staff. At
the World Startup Competition,
held in November in Seoul, Korea, Agrivi won first prize and
$50,000. Matija ulj, CEO of
Agrivi, says that there is a market
for software development is his
field of expertise. Since he has
been active in the ICT industry
since the beginning of his career,
it was only natural to proceed in
the same direction. ulj highlights this is an industry of high
added value which offers many
challenges, but also potential.

Is it difficult to compete on the

global software market?
The global market is full of various products, and it is difficult to
stand out, let alone get attention
from potential customers. Until
you have enough references to
give credibility, western markets will prefer products from
more developed markets. When
you have references, the story
changes as they give your product credibility and you become
an equal, that is, the entire story
comes down to product and service quality.
In your opinion, is the Croatian
market of ICT product and
services developed?
Our ICT market is developing
intensively. Until recently, only
a small number of companies
offered such products. Most of

them offered services of solution development, but now there

are more companies offering ICT
products they deliver internationally. I believe we have great potential and that the ICT industry
has to become one of Croatias
strategic determinants.
What advice would you give
your colleagues who wish to
develop software for the global
market?
It is difficult to give general advice since each industry and
niche is different, and a secret
recipe does not exist. However,
it is crucial to identify your pilot
market and focus on it. In some
cases, Croatia can be an ideal pilot-market, but if you cannot acquire enough references, I would
recommend choosing another
market as a starting point.

To what extent is the ICT sector

important for the economic development of any country?
The fact that start-ups created over
50% of jobs in the USA during
the past decade proves their importance. The ICT sector is one of
the most crucial sectors in shortterm, mid-term and definitely
long-term. Moreover, the rising
success of Croatian start-ups is a
positive promotion of Croatia. Until recently, Croatia was known in
the world mainly for its athletes or
Dubrovnik, but today the word of
our successful start-ups has started
to spread.
What can Croatia offer Europe
and the world in this industry?
Croatia has a good ratio of labour/
price, quality and location. We can
offer western European quality at
a lower price than western countries. We are also close to these
markets, so it is not a problem to
travel for meetings with customers, which they appreciate. Most
of our ICT companies know very
well how to use this leverage, even
this part could be communicated
strategically, at state level.

12
::: news
Varteks revenue and
exports increase

Privredni vjesnik
Year VIII No 245

( 75 S3 employees
in Switzerland, Spain and the USA

( 80 km

S3 shuttle laun

SWISS SPACE SYSTEM CROATIA

Varteks Group generated 27.9
million revenue in 2014, of which
26.8 million was sales, 17% up
in relation to 2013. Exports at
12.2 million were 8% up compared with 2013. Concerning
costs, expenditure dropped by
61%. All key operating features
in 2014 showed positive trends,
yet the implementation of financial restructuring, given its partial progress thus far, will more
significantly affect operational
effectiveness only in 2015.
Holcim increases
operational effectiveness
The company Holcim Croatia
bettered its operational effectiveness by 4.5 million and implemented the first aspect of its plan
entitled 2015 Plus. In addition
to business results shown in 2014
by Holcim employees, the importance of the start of construction
projects and a 65,000 increase
in the salary pool have been particularly highlighted.
Ezpada takes over the
Zagreb-based Proenergy

SPACE TECHNOLOGY

A Swiss company specialising in space technologies has opened an affiliate in Croatia. T

and after 2020 start the assembly and launch of commercial space satellites
Kreimir Sokovi
he Swiss company Swiss
Space Systems - S3 confirmed it would open an
affiliate in Croatia. The Croatian
affiliate could play an important
role in the business activities of
their holding on a global level,
since it would be focused on the
completion of suborbital shuttles
for launching satellites into orbit.
It would also offer commercial
space launching services.
The first activities of the Croatian Swiss Space Systems affiliate will relate to ZeroG flights
simulating weightlessness
starting from next year. For the
next phase (launching satellites,
suborbital commercial flights),
they anticipate support from
Croatia to construct a spaceport
at Udbina which seems to be
the best location. The spaceport
itself could be based on the concept of the S3 spaceport in Swit-

The Croatian affiliate of

Swiss Space Systems
should play an important
role in global business
activities
zerland, which is already under
construction. Udbina, however,
is a small municipality in Lika,

known for its extremely beautiful nature and the Plitvika jezera
National Park.
Invitation to the European
Space Agency
Former President of Croatia, Ivo
Josipovi supported this project,
and the General Director of Swiss
Space Systems Croatia, Slaan
Zovko, says that all countries inside the European Space Agency

GAMMA BAGS - THE FASHION ACCESSORY FOR BUSINESS WOMEN

The Croatian Competition Agency (AZTN) has approved the
takeover by Ezpada AG, with its
headquarters in Switzerland, thus
becoming the majority shareholder in Proenergy Zagreb. In
addition to the takeover, Ezpada
also took over the ownershiprelated companies Proenergyja in
Serbia, Bosnia and Herzegovina
and Macedonia. Ezpada operates
as an umbrella company of the
Ezpada Group that is involved in
trading electricity in Switzerland,
Germany, the Czech Republic,
Turkey, Croatia, Romania, Macedonia, Serbia and Bosnia and
Herzegovina. The core activity
of Proenergy is electricity supply, as well as trade in electricity
and gas.

High fashion and high tec

A combination of high technology and high fashion has resulted in a fashion accessory t
desire a bag equipped with mobile phone and tablet chargers, powered by sunlight
t might seem a difficult challenge to combine high fashion and high technology, but
this young businesswoman, with
experience in fashion and with
a sense of high technology, designed the ideal fashion accessory for businesswomen.
How often does your phone
battery die at crucial moments
and places where it was impossible to recharge? This was the
problem that served as the starting point for Mirta Udovii. I
worked in fashion and computer

programming, and graduated in

fashion design. This allowed me
to combine two things in which
I am experienced fashion and
electronic accessories, Mirta
Udovii says.
The result of this work is an innovative bag equipped with a
battery and charger, which can
be charged in a conventional way
(electrical socket) and with solar
panels attached externally. Each
bag is also equipped with a battery charge indicator. Total capacity of the battery is 5,000 mA

and it can charge a mobile phone

multiple times. Future products
will have a battery of even larger
capacity. The bag also has something that many women would
find useful LED internal lighting.
Ready for the world
The process from idea itself to
finished product was not easy.
Three years passed from my initial idea until the finished product, but we finally reached our
goal and the product is here now,

www.privredni.hr
Business & Finance Weekly

high

nches the construction

13
::: news

( 700 km high

small satellites sent into Earth orbit

FROM LIKA

The company wishes to construct a spaceport at Udbina,

Swiss Space Systems

Swiss Space Systems has expanded its business and employs
75 people in Switzerland, Spain and the USA. They are currently
working on the research-development phase of multi-use, flexible and safe systems for launching small satellites, based on
the Airbus cargo plane and suborbital shuttle SOAR. The SOAR
shuttle, developed by S3, will launch at a height of 80 kilometres,
the upper construction that will deliver small satellites into Earth
orbit up to 700 kilometres. After delivering the satellite, the third
component of the delivery system combusts in the atmosphere
and does not remain in orbit as waste.
wish to strengthen and develop
space activities. I am inviting
institutions to take all necessary
steps so that Croatia could also
join this institution. Swiss Space
Systems Croatia will act as accelerator that will guide Croatia
towards achieving this goal, and
our space research centre will
generate immense strategic value
inside the country, notes General Director Slaan Zovko.

chnology

that any businesswoman would

Mirta Udovii highlighted.
She already has experience in
selling conventional fashion accessories, and her new and innovative bag is approaching its moment of entering the market, first
locally and then globally.
Everything is almost ready for
launch. This month we are preparing the first line of bags,
and our plan is to launch new
lines every few months, Mirta
Udovii says. She also added
there are similar products in
the world, but the combination

S3 Croatia announced their co-operation with Croatian universities

and research centres on various
research and training activities
as well as the testing of airspace
technologies for small satellites.
Croatias important role
This co-operation will also benefit Swiss Space Systems and
Croatia, says the founder and
CEO, Pascal Jaussi. S3 wishes
of this type of high-tech and
high-fashion still does not exist.
There are solar bags of larger
dimensions, like backpacks, intended for explorers and those
who travel in places where they
are not able to use other energy
sources. However, a product for a business woman,
student or anyone in an
urban environment has
not existed until now,
Mirta Udovii says.
The
production
of the bags is still
manual; they are

Everything is nearly
ready for the market.
This month we have
been preparing our
first line of bags,
Mirta Udovii says.

to develop long-lasting partner

relationships, and the relation
with Croatia is certainly a good
example. Swiss Space Systems
Croatia will play an important
role in all main aspects of the S3
programme ZeroG flights, development and production of the
upper component for launching
satellites, as well as research and
training activities, Jaussi highlighted.
manufactured in Croatia, but
it is likely that production will
move to the east when it starts
to expand. As this young innovator and designer said, the bags
will cost between 65 and 455,
depending on the size, design,
materials and capacity. However, what is important for
future customers is that the
bags are already available online in the MBS
Store in Zagreb or at

www.gammabags.
com. If you have

problems with a
low
battery
on your cell
phone, tablet
or mobile computer then Gamma solar bag will
be extremely useful. (K.S.)

Innovative services
development programme
The Science and Technology
Park of the University of Rijeka has created a Development
programme of innovative services based on existing products
PROTOS, which will enable
entrepreneurs to focus their business operations on services arising from products through training and mentorship. The programme consists of three modules: development workshops,
the development of services, and
the preparation of the company
for the commercialisation and the
sales of the service.
Marine experimental centre
for biodiversity
A structural project entitled Marine experimental centre for biodiversity MORExpo is being
conducted by the Rovinj-based
Marine Exploration Centre of
the Ruer Bokovi Institute
and the Croatian Academy of
Sciences and Arts (HAZU). The
project is valued at 16 million
and has recently been included
in the infrastructure project list
of the Ministry of Science Education and Sports (MZOS) for
the European Regional Development Fund, for the period 2014 to
2020. The joint structural project
between the Ruer Bokovi Institute and the Croatian Academy
of Sciences and Arts will enable
the establishment of a modern
centre equipped with high technology and programmes, as well
as a new research vessel.
Park Hotel opening in Pula
6.5 million has been invested
in the Park Hotel owned by the
Pula-based tourist company Arenaturist. Following comprehensive reconstruction, the hotel will
be renamed Park Plaza Arena
Pula - and will receive its first
visitors by the end of May 2015.
The Arenaturist investment cycle
began in 2011 with the reconstruction of the Histria Hotel and
continued with investment in the
tourist resort Punta Verudela and
the hotels Medulin, Palma and
Belvedere in Medulin, following
which all the reconstructed facilities were branded Park Plaza.
The Park Plaza Hotel Group portfolio comprises 16 hotels including the artotel brand. Park Plaza
Arena Hotel will be the 22nd Park
Plaza hotel.

14

Privredni vjesnik
Year VIII No 245

( over 500 participants

showing huge interest in Croatian wines

ANNUAL WINE TASTING VINA CROATIA VINA MOSAICA NEW YORK 2015

New York showing huge interest

in Croatian wines
Annual wine tasting is the theme of the The promotion of the Croatian wines in the USA, co-financed
through the European Agricultural Guarantee Fund and the State Budget
State Budget of Croatia and the
National Assistance Programme
for the Wine Industry 2014-2018.
The specific objective is to enhance the recognition of Croatian wines on the US market and
substantially increase exports in
terms of both quantity and value.

he annual tasting of Croatian wines, as well as two

Masterclass tastings, were
held on 24th February 2015 in the
New York-based Astor Center,
organised by the Association
of Winemakers at the Croatian
Chamber of Economy. Croatian
winemakers presented four Croatian wine regions and the best
wines with several international
medals produced by the Croatian
wineries such as Agrolaguna,
Badel 1862, Benmosche Fam-

Such events are a unique

opportunity to present
Croatian wines to a
demanding and immense
American market
ily Vineyards, Bibich, Degrassi,
Feravino, Gali, Grgi Vina, Korak, Korta Katarina, Kozlovi,

Krauthaker, Lagradi, Markus,

Matoevi, Milo, Pp Orahovica,
Rizman, Rota vina, Saints Hills,
Stina Vino, Suha Punta, Vinogradi Volarevi, Zigante and Zlatan
Otok.
Annual wine tasting is the theme
of the The promotion of the
Croatian wines to the USA, was
co-financed through European
Agricultural Guarantee Fund, the

Good opportunities
Over 500 participants wine
experts, media representatives,
distributors, hotel owners and
tour operators, registered for the
event, which shows the wide
interest in Croatian wines. Mrs
Christy Canterbury, MW was in
charge of masterclass tastings.
Croatian winemakers established
and strengthened a large number
of contacts with potential buyers,
which will certainly encourage
exports.
The promotion of Croatian wines
is the principal aim of the comprehensive brand strategy of the

Association of Winemakers entitled Vina Croatia Vina Mosaica. This unique visual identity
of all the activities in the project
has been defined through graphic
solutions of the strategy comprising a logo for Croatian wines and
four logos from the four Croatian
wine regions Slavonia and the
Croatian Danube Basin, Croatian
Uplands, Istria and Kvarner and
Dalmatia.
Similar events provide a unique
opportunity to present Croatian wines and introduce them
to a substantial and demanding
American market. I am aware of
a large number of challenges, as
well as immense opportunities
for Croatian winemakers with
a product of unique quality and
recognition, emphasised Ivica
Matoevi, Vice-President of
the Executive Board of the Winemakers Association, speaking at
the annual wine tasting.

Super Market Trade Show in Tokyo

Croatian wines in the Far East

We optimistically believe that a new order of Croatian wines for the Japanese market will be placed in the not
too distant future
The order placed by the Japanese client Fuji Trading at the
recently held Tokyo-based fair
Super Market Trade Show,
where several Croatian selected wines were presented,
clearly shows that the quality of Croatian wines has been
recognised in the Far East. The
first contact with this Japanese
client was established in September 2014, near Zadar, where,
in addition to locally produced
wines, Belje wines were also

presented. Nevertheless, Frankovka wine produced by PP Orahovica aroused specific interest.

As stated by Kraljevski vinogradi sources, whose winemakers visited the Japanese fair, half
of Croatian wines presented at
the fair were sold instantly. We
optimistically believe that a new
order of Croatian wines for the
Japanese market will be placed
in the not too distant future. We
are prepared for a product range
expansion with high quality and

top quality wines, stressed Josip Toki, Director of Business

Unit for Fruit-Growing and Viticulture PP Orahovica. It is im-

portant to highlight that, as it is

not easy to compete with the top
quality wines from France, Italy,
Spain, California and Chile.
Super Market Trade Show was
visited by almost 85,000 business people retail centre owners, as well as owners of stores,
restaurants and hotels. It has to
be stressed that, in addition to
Croatian wine sales in China and
Japan, wine makers are expecting
the sale of Croatian wines also to
South Korea soon. (S.S.)

www.privredni.hr
Business & Finance Weekly

15

( 1,713,355 members ( 8.9 billion

off mandatory pension ffunds in January 2015

total nett assets

Mandatory pension funds

Croatia between
Luxemburg and Finland
According to global pension statistics, Croatian pension funds produced a real annual return of 3.09%
between 2002 and 2013, which is better than German, Swiss, Belgian and Italian pension funds
highlighted, adding that the pension system, which relies exclusively on the Pillar 1, cannot
be sustainable long-term. This
means that the Pillar II in Croatia
is very important for the sustainability of the pension system,
timac said.
It is important to mention that
according to the models that
consider all relevant parameters,
the present 75% of contributions
paid to Pillar I result in 54.14%
of total pension, and 25% of
contributions paid to the Pillar II
result in 45.86% of total pension
income.

Boris Odori
andatory pension funds
(PBZ/Croatia
osiguranje, Erste Plavi,
Raiffeisen OMF and AZ fund) in
Croatia had 1,713,355 members
at the end of January with total
net assets of almost 8.9 billion.

Mandatory pension
funds earnings stood
at 2.7 billion at the
beginning of 2015
Despite the general belief that
the Croatian pension system does
not achieve desirable results, it is
positioned near the top in terms
of produced real return amongst
other European countries.
Profit for members
According to the global pension
statistics of the Organisation for
Economic Co-operation and Development (OECD Global Pension Statistics), since the beginning of their work in 2002 until
2013, Croatian pension funds
produced an average real annual
return (real being deducted from
average by the inflation rate) of
3.09% (it totalled 3.75% by the
end of 2014). This result is better than the average real return of
German (2.56%), Swiss (2.34%),
Belgian (2.9%) and Italian
(1.62%) pension funds. On this
list, on which Croatia ranks six,
between Luxemburg (3.63%) and
Finland (2.93%), there are Polish
pension funds with average real
annual return of 4.24%.
President of the Association
for the Management of Pen-

UMFO
At the first presentation of this independent, non-party, non-profit
professional association, it was highlighted that UMFO was established on the initiative of mandatory and voluntary pension companies. The goals of the association are to promote and represent
the interests of mandatory and voluntary pension companies and
their members, raise awareness on the importance of pension
funds, and impart general information on the pension system and
its long-term sustainability, UMFO Director Dijana Bojeta Markoja highlighted.
sion Fund and Pension Insurance Companies (UMFO) and
Board President of PBZ Croatia
Osiguranje Mandatory Pension
Funds Dubravko timac, highlighted at the presentation of the
Association that mandatory pension funds produced an average
return of 11.36% during 2014.
In other words, the funds earned
over 1.50 for each 13 invested.
During the past three years, average return was 9.32%. Now, af-

ter almost 13 years of work, the

mandatory pension systems produced an average annual return
of 6.06%, timac said.
With this level of return, mandatory pension funds managed
to produce by 2015 a total of
2.7 billion in new value, that is,
profit for members. The average
member from 2002 has 7,135
on his account, and deposited
5,365. Therefore, his current
profit equates to 1,770, timac

Satisfied and not satisfied

Furthermore, results of the survey, conducted by the Ipsos
puls Agency covering 1100 participants in mid-2014, show that
30.7% of people believe that the
contributions for Pillar I should
reduce, and those for Pillar II
should increase. Therefore, both
experts and public feel that the
state of Pillar I is extremely critical with uncertain stability and
future, UMFO Director, Dijana

Bojeta Markoja, pointed

out. She also added that almost 40% of the survey participants are both satisfied
and dissatisfied with the pension system.

The survey showed that the public, especially the young and
middle aged, are not focused
on planning their living condition after retirement. Therefore,
29.9% of the survey participants
think about their retirement period only occasionally, and 24.1%
never think about it, whereas
13.2% think about very often,

Dijana Bojeta
pointed out.

Markoja

16

Privredni vjesnik
Year VIII No 245

( 347,093 nautical charter tourists

in Croatia in 2014

CHARTER TOURISM

A problem in sight: supply

exceeding demand
In 2014, Croatian ports saw the arrival of 3,305 charter vessels and recorded 61,085 charterers arriving. The
645 active charter companies registered in Croatia showed revenue of at least 0.17 billion
Sanja Pljea
ver the last several years,
Croatia has been identified as one of the best
yacht and charter destinations
in the Mediterranean, confirmed
by statistical data according to
which the charter business has
seen annual growth rates through
all segments. According to data
presented by the Ministry of
Maritime Affairs, Transport and
Infrastructure, 2014 saw the arrival of 347,093 charter tourists to Croatia who recorded 2.4
million overnight stays and over
60,000 charterers. Simultaneously, in 2014 Croatian ports registered 3,305 active charter vessels and 61,085 charterers. There
are currently 645 active charter
companies in Croatia that generated revenue of at least 0.17 billion. Irrespective of the fact that
growth is not substantial in terms
of demand as it stands at around
2%, taking into account adverse
weather conditions and the fact
that Greek tourism has seen a
recovery, I believe that charter
companies here can consider

2014 successful, pointed out

Branimir Maer from the Tourism Sector at the Croatian Chamber of Economy. He warned of an
anomaly recurring for 10 years
that can create insurmountable
problems for the charter business
in Croatia that supply exceeds
demand.
A charter destination
This is not a major issue during
the peak tourist season when the
demand for charter vessels is at its
height, yet during pre-season and
post-season an increasing number of charter vessels remains in

port. In view of increasing operating costs, high investment and

competition, Maer also warned
that, should this trend continue,
it is uncertain how much longer
charter companies will be able to
operate profitably. A large number of charter companies have
already made substantial investment in marketing and sales, in
addition to normal quality upgrading. Nevertheless, without
vigorous assistance provided
by the state and competent institutions, a significant growth
in demand cannot be expected.
Consequently, charter companies

A Croatian product that conquered the world MMKSystems software

for booking equips 1,400 agencies and 200 companies
The Zagreb-based company MMKSystems
has been operating for 13 years, and its
principal product is software for online booking intended for charter companies and
agencies, the so-called booking manager
system. This is used by 200 charter companies and 1,400 charter agencies globally.
As pointed out by Martina Babi, Director of
Marketing and Sales at MMKSystems, irrespective of the fact that at its start-up, its clients were exclusively Croatian charter com-

panies, currently over 50% are non-Croatian

clients. MMKSystems organises workshops for charter companies and agencies as it
did at the recently held Opatija-based charter fair. Martina Babi pointed out the fact
that during each fair at which the company
presents its product, it is customary to sign
co-operation contracts with new clients who
will be using its software. She added that
the software is currently used by almost all
charter companies and agencies in Croatia.

anticipate a robust, organised and

planned promotion of Croatia as
a nautical destination at the national level, stressed Maer.
One of the steps towards more
effective promotion is certainly a
recently held specialised nautical
fair - International Charter Expo
2015 - ICE in Opatija which covered over 130 charter agencies
from 25 countries, as well as over
200 local and foreign suppliers of
equipment and service providers,
all playing a vital role in chartering.
Tino Prosenik, Director of Charter Expo 2015 ICE fair, emphasised the fact that the first
two fairs were organised solely
for Croatian charter companies,
whilst the recently held, Opatijabased fair, encompassed companies globally, which shows the
strength and the rle of Croatia as
a charter destination. He stressed
that over the last several years
there has been increasing interest
in larger vessels, with four or five
cabins, as well as in catamarans.
As a result, charter companies
are adapting their fleets to client
requirements.