74% of German investors would do business and invest again in Croatia

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June 12, 2021 – This might come as a huge surprise to many who are used to reading about Croatia’s problems attracting and even retaining foreign investment, but it seems German investors’ impression of Croatia is falling. has improved considerably in recent times. Many would choose to invest in Croatia again.

As Poslovni Dnevnik / Marija Brnic writes, as noted above, the perception of Croatia in the eyes of German investors has improved dramatically – unlike two years ago, when almost half of them were absolutely certain they would not decide to invest again in Croatia. According to the latest research by the German-Croatian Chamber of Industry (AHK), almost three-quarters (74%) would now choose to invest in Croatia.

However, the improvement over previous years (last year the traditional survey was not conducted due to the pandemic), still lags behind the ratings of other German businessmen. Central and Eastern European countries surveyed, in which up to 85% of German investors responded very positively.

The improvement in business and investment valuation is also noticeable in other countries, where two years ago 79% of German business leaders were willing to potentially risk an investment (54% in the Republic of Croatia ). In terms of the quality of the location for investments, Croatia is still in 8th place among the 16 countries observed, with Estonia, the Czech Republic, Poland and neighboring Slovenia in the lead.

According to Thomas Sichl, chairman of the board of directors of AHK, these results on the feelings of German investors towards Croatia are better than expected, and what is particularly significant in the context of the AHK survey is the ‘assessment of the current situation and the resumption of business in conditions disrupted by the current coronavirus pandemic.

It is quite true that there are no major changes in business expectations from the 2019 survey in Croatia or other countries – 50% expect the situation to remain unchanged compared to the previous year, and 43% that it will be better, with just 7% expecting it to be less favorable.

But about a third of German companies surveyed said they had already reached pre-pandemic levels, while 12% expected to return to then levels by the end of this year, and 38% said it would not be realistic in their case before 2022, 14% expect a recovery only in 2023 and 2% do not expect a recovery at all.

This year’s AHK Standard Annual Survey also included the question of government measures to help businesses mitigate the effects of lockdowns and pandemic-induced disruption on their operations.

The biggest weaknesses of Croatian investment and business case are generally dominated by corruption, sheer non-transparency of public procurement procedures and legal insecurity in the AHK survey, which is always the case, and the greatest advantages are membership of the EU, a quality skilled workforce and the level of productivity.

However, AHK representatives also point to the potential that could result from Croatia’s entry into Schengen and the euro area. They say that in their opinion Croatia is making good progress in both areas.

Another positive point of this survey, the share of companies that rate the current economic situation as negative has fallen compared to 2019 from 61% to 49%, and overall companies are much more optimistic about their own economic situation. compared to how they both felt years ago.

Then 27% rated their business situation as good, and now 44% of them give it this rating. Looking at around 20 aspects of doing business in Croatia, AHK respondents give an average score of 3.29, which is better than 3.55 compared to 2019, since one was the best and five were the worst.

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