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Euromonitor International’s Croatia Business Dynamics Country Briefing focuses on the nation that became the newest European Union (EU) member in July 2013. Since joining the EU, Croatia has received significant funding from the European Commission (EC), enabling the government to carry out major restructuring that is crucial to enhance the country’s business landscape. Red tape, difficulty in getting credit (mainly for small businesses) and rigidity in the labour market are some of the challenges the country faces. Along with continued funding and infrastructure improvements, long-term steadfast reforms are needed for Croatia’s doing business environment to match peer levels.
After four prolonged years of sluggish economic growth over 2009-2014, Croatia has set itself on a new path of business reforms since July 2014 that have helped the country jump 45 notches, to rank 43 rd globally in World Bank’s Ease of Doing Business Index 2017. In the 2014 and 2015 timeframe, the Croatian government lowered the minimum capital constraints for businesses, reduced notary fees and made paying taxes efficient by launching an electronic system for social security contributions. In 2016, an electronic system was set up to deal with public sales of portable assets, making enforcement of contracts easier. However, despite all of these the country’s ease of doing ranking slightly deteriorated in 2017, owing to an increase in notary fees, the launch of a radio and television fee and the abolition of the discount offered to new companies on the Chamber of Economy fee. In order to keep up the progress, Croatia needs continued steadfast reforms, especially in reducing the costs associated with dealing with construction permits, to be implemented resolutely to help the country’s doing business environment to match peer levels.