Diplomacy and Commerce No.22

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May 2020 | ISSUE No. 22 | FREE COPY

HELP AT THE RIGHT MOMENT IS THE KEY

SOME THING THAT WE HAVE BEEN PLANNING, WE CANNOT DO

OUR GOAL WAS TO PROVIDE A FAST REACTION OF THE GOVERNMENT

Governor of the Croatian National Bank

Ambassador of the UK

Minister of Economy, Entrepreneurship and Crafts

BORIS VUJČIĆ

H.E. ANDREW DALGLEISH

DARKO HORVAT

Life in Croatia in the Era of Pandemic and Expectations After DESPITE EVERYTHING, ECC CONTINUES VOJKO OBERSNEL Mayor of Rijeka

EIB’S SUPPORT MEASURES FOR CROATIAN ECONOMY

FRIENDSHIP ABOVE ALL

ANTON KOVAČEV

Head of European Investment Bank (EIB) Office in Zagreb

H.E. DARIO MIHELIN

THE MARKET SETS THE RULES

Ambassador of the Republic of Croatia to the People’s Republic of China

LANA MIHALJINAC KNEŽEVIĆ Lana Mihaljinac Knežević

REAL CHANGES DID NOT TAKE PLACE DRAŽEN OREŠČANIN CEO, Glas poduzetnika

IRRESPONSIBLE SPENDING OF PUBLIC MONEY MLADEN NOVOSEL

President of the Alliance of Independent Unions of Croatia

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FOREWORD

Skeletons from the Closet

FOLLOW US TO STAY UPDATED

ROBERT ČOBAN Director

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BOBAN SPASOJEVIĆ

Executive director boban@diplomacy andcommerce.hr

bit tired of topics related to Covid19, we started paying attention to life after the pandemic. Aside from many things that are about to change and continue to apply as during the pandemic (for example, I continued biking to work, and I often have lunch in the peace of my own back yard instead of a restaurant) – so will the many bad and ugly things from the period before return as well.

These are led by nationalism, xenophobia, conspiracy theories (“migrants installing 5G equipment that’s spreading the virus)

A

ILIJA PETROVIĆ INDIGOCHILD

Art director indigochild.ilija@gmail.com

ALEKSANDAR KOSTIĆ

Designer designamites@gmail.com

ROBERT ČOBAN

Director Photos GETTY IMAGES TOMISLAV SMOLJANOVIĆ Translation GORANKA MILOŠEVIĆ

and similar things that confirm the alleged Einstein’s sentence that two things are infinite - the universe and human stupidity, and there is no proof of the first.

So, among so many such examples of “reverting to old habits”, here’s a real refreshment from the mouth (pen) of the President of the Republic of Croatia, Zoran Milanović, the man who knew how to unpleasantly surprise us with his rash and often offensive statements as the Prime Minister during the 2015 migrant crisis. Five years later, he grew to become a serious statesman

with style, and that’s why I think it’s important not to forget this reaction of his (to the map of “Great Hungary” that Victor Orban posted on his social network profiles): “Regarding the map/globe that shows hypertrophic Hungary, which is our neighbor and a friendly state in recent history, currently in a firm grip of chronic “map lovers”, here is my message of encouragement to Croatian schoolchildren before graduation: Croatia is a modern European state and nation. Our cabinets and archives have numerous history maps that show our Homeland to be much bigger than it is today. Cabinets of most European countries hide away similar contents. Don’t share them and post them on your profiles. They are not the least relevant or achievable today, and what’s even more important, they strongly irritate our neighbors. Just about the same as we are irritated by the “historic” maps that conveniently and predictably emerge from the pages of some “leaders” in our neighborhood like a dark fetish,” wrote the President of the Republic of Croatia Zoran Milanović.

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Help at the Right Moment is the Key The pandemic and the lockdown we implemented to cope with it have put the economy into a state of hibernation

BORIS VUJČIĆ Governor of the Croatian National Bank

he most important policy goal during the lockdown was to preserve the commercial fabric of the society, stated Boris Vujčić, Governor of the Croatian National Bank for Diplomacy&Commerce magazine.

T

Which measures has CNB specifically taken to mitigate the effects of the crisis caused by the Covid19 pandemic?

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THE CNB THUS SOLD A TOTAL OF EUR 2.6BN TO BANKS IN THE LAST TWO MONTHS, WITH THE LARGEST AMOUNTS SOLD IN LATE MARCH AND EARLY APRIL — In mid-March, following the onset of instability in international financial markets, the CNB started implementing measures to preserve the stability of the exchange rate of the kuna versus the euro. The CNB

thus sold a total of EUR 2.6bn to banks in the last two months, with the largest amounts sold in late March and early April, in order to meet the increased demand for foreign currency by companies and financial

institutions and to a smaller extent by citizens. As the precautionary domestic demand for foreign currency receded in mid-April, the exchange rate of the kuna strengthened somewhat against the euro.

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In parallel with carrying out foreign exchange interventions, the CNB was creating and releasing additional kuna liquidity in order to maintain favourable financing conditions for all sectors of the economy. Monetary policy cannot spur economic activity while businesses are closed in the lockdown and citizens are afraid to leave their homes due to fear of contagion. However, it is important to maintain favourable financing conditions to help businesses and citizens work through these adverse circumstances and make a quick recovery once the virus is under control and the economy starts getting back on track.

How do you think this will affect the Croatian economy and stability in general,

and what can we expect in the period ahead, how long do you estimate the crisis to last and what consequences will it cause? What are the potential traps and what should by no means be done to reduce the consequences?

— Unprecedented fiscal monetary and supervisory actions were taken in order to help businesses pay incoming bills even as they lost revenue. Now, with easing of the restrictions, we are moving into the next phase. Economy cannot be simply restarted at the simple push of a button. Recovery will most likely be only gradual and

spread over this and the next year even under rather optimistic scenario of no major second wave of epidemic. In addition to strengthening of the testing capacity of the health system in order to track and monitor the epidemic, take quick actions to keep down the number of new cases and take care of those who fall ill, it is now important to proceed cautiously with taking away exceptional support measures. If we proceed too quickly, we risk sending too many viable businesses into bankruptcy. However, if we move too slowly, the risk will mean burdening of the

society with excessive public debt and making the economy even more sclerotic. The key is to get the ordering right with removing exceptional fiscal measures first and maintaining easy financing conditions for some time. Finally, there is also the perennial issue of structural reforms such as reducing costs and improving efficiency of the state apparatus and making business environment more predictable and conducive for new companies. The likely expansion of the role of the government in the aftermath of the crisis is only making structural reforms more paramount.

UNPRECEDENTED FISCAL MONETARY AND SUPERVISORY ACTIONS WERE TAKEN IN ORDER TO HELP BUSINESSES PAY INCOMING BILLS EVEN AS THEY LOST REVENUE. NOW, WITH EASING OF THE RESTRICTIONS, WE ARE MOVING INTO THE NEXT PHASE

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Our Goal Was to Provide a Fast Reaction of the Government The fact is that the entire world today is faced with circumstances that nobody has encountered before

DARKO HORVAT Minister of Economy, Entrepreneurship and Crafts

n a situation like that, our Government’s goal was to react as fast as possible in Croatia, primarily in order to preserve jobs and secure liquidity for entrepreneurs through the measures we reached, stated Darko Hor-

I

the work and assets that will enable the companies to continue their business operations, regardless of the numerous cancellations of orders, the unavailability or lack of certain raw materials, and a general decline in demand.

ONE OF THE ASSISTANCE MEASURES IS CONNECTED TO THE ALLOCATION OF EXISTING AND STILL AVAILABLE EU FUNDS TO NEW FINANCIAL INSTRUMENTS IMPLEMENTED BY HAMAG-BICRO vat, Minister of Economy, Entrepreneurship and Crafts for Diplomacy&Commerce. Both are very connected, because in the period of economic recovery that is before us, we will need people who can carry out

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To what extent have the Government measures contributed so far to reducing the negative impact on the economy due to the pandemic caused by the COVID-19 virus? Will there be any addi-

tional measures?

— One of the most generous measures by which the Government stood firmly behind its entrepreneurs was the support for the preservation of jobs, which we additionally increased from HRK 3,250 to HRK 4,000, while simultaneously covering the costs of contributions to that amount.

According to the latest data, this measure has so far been used by approximately 84 thousand companies for about 485,000 workers, who have been paid more than HRK 1.5 billion. But this is just one of the many measures we are using to help our entrepreneurs and workers get through this entire period and prepare for what lies ahead, which is to catch up

on all the missed opportunities that have occurred due to economic inactivity. It was necessary primarily in order to preserve the most important things, which are the lives, health and safety of all our citizens, and according to all the data and figures we have, I can say that we have all done a great job together. I believe we can do the same to get back to those economic growth rates we had until a few months ago, just before the arrival of the coronavirus, in a year or two.

The government recently announced their estimates of economic developments in Croatia, according to which an almost 10 percent drop of GDP is expected. Where do

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you expect the most problems and how do you plan to resolve this?

— We always approach our forecasts very cautiously, and even a bit conservatively. It is a much better situation to be surprised by the results that are better than expected, than the other way around. For this reason, the Government's estimates took into account several important and key points when talking about Croatian GDP trends, which led us to a figure of 9.4 percent decline in 2020, but also to 6.1 percent growth in 2021. The forecasts from IMF, the European Commission, and now the EBRD show even some slightly more optimistic tendencies, but what is important is that they all show growth in the next year. This is the key to getting out of this whole situation, that is, the speed with which we will be able to recover from this shock, which primarily relates to health, which has consequently led to major economic problems. What I also consider to be important for Croatia is that all these estimates that we are talking about predict the growth of some of our largest trading partners, such as Germany and Austria. I think that this crisis has clearly shown us how interconnected all the economies of the world

are, and that in that sense no one can be an "island for itself".

The situation is similar when we talk about economic sectors as well, because the decline in activity in one sector, such as tourism, consequently leads to problems in the accompanying industries, from food to processing. We will recover in the same way. One sector will pull the other, and the premise of all this will be the continuation of investment.

In addition to preserving jobs, one of the priorities of the Government in this entire

EU funds to new financial instruments implemented by HAMAG-BICRO. These are very favourable loans for which we have already received over 5,000 applications, which means that the measure is appropriate, but I believe that it is clear to everyone that it is not infinite. The amount of these funds is limited, which is why we are currently looking for additional space or items from which we could make more funds available to entrepreneurs, all in a very active communication with all the Government departments.

ond wave of the epidemic, or at least another lockdown, will not occur. In this sense, we have continued to initiate and encourage all those investments that are possible at the moment, and we plan to continue to insist on this, while at the same time opening the economy even more.

Of course, we are aware that there is a certain fear that this situation will happen again in the fall or next year, but I also think that already today we are much more informed and experienced about the movement of this virus and

IT IS A MUCH BETTER SITUATION TO BE SURPRISED BY THE RESULTS THAT ARE BETTER THAN EXPECTED, THAN THE OTHER WAY AROUND period is the provision of liquidity for entrepreneurs.

What is the feedback and will you have enough funds for all the requests received?

— We are looking for all the possible ways to provide our entrepreneurs with additional liquidity that they need for regular operations and settlement of receivables from suppliers, as well as some other current liabilities. One of these measures is related to the allocation of existing and still available

Experts around the world are making various announcements about the future trends of this virus, from the claim that a second wave is expected in the fall, to the claim that there will be no second wave at all. Are we preparing for both scenarios and what if what everyone fears, a new lockdown, happens again?

— All of these estimates of GDP trends that we talked about earlier are based on the presumption that a sec-

how to combat it. These days, we are also hearing a number of encouraging news coming from scientific circles regarding the discovery of the vaccine we need in order to put an end to this pandemic. But the fact is that our reality and everyday life have completely changed in the past few months and that we will have to get used to such new circumstances and learn lessons from them that we will be able to use in a positive way in the future.

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EIB’s Support Measures for Croatian Economy The EIB is ready to provide EU member states, including Croatia, with the fastest possible way out of the crisis, while at the same time ensuring a better prepared EU economy for possible future challenges

ANTON KOVAČEV Head of European Investment Bank (EIB) Office in Zagreb

his fund will be an important support to our regular activities in the EU, and thus in Croatia – according to Anton Kovačev, Head of European Investment Bank (EIB) Office in Zagreb.

T

To what extent and in what way have the EIB operations in Croatia changed? Did you cancel any of the agreed projects and what are your plans for the new ones?

— The COVID-19 pandemic has a huge impact on people’s lives and their work across Europe, and in Croatia as well.

Such crisis requires a bold and fast response, one that is truly European. In that sense, the European Union has reached significant support measures worth EUR 540 billion, which were announced by the European Parliament and adopted

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by the European Council.

These EU measures are: support to the labour market, support to governments and support for the economy.

European Investment Bank will provide key support for implementation of measures from the third group, and we will support the economy, primarily SMEs.

what should not be done in order not to worsen the situation in the future?

— The EIB guarantee fund will have a calming effect on the markets. If this guarantee fund didn’t exist, we would be faced with a negative spiral of uncertainty, insolvency and financial instability, which would ultimately be several

pecially SMEs, remain liquid in the Member States so that they can survive despite the downturn caused by the crisis.

The EIB guarantee fund is focused on providing support to the economy with special emphasis on small and medium-size enterprises which are the backbone of Croatia’s economy. The Fund will enable EIB Group, in cooperation with commercial banks and national development institutions, to collect and invest up to EUR 200 billion, which is an integral part of EU measures in the amount of EUR 540 billion.

The guarantee fund will support different types of products provided by both parts of EIB Group – both the European Investment Bank and the European Investment Fund. Even though details are still being negotiated, this may include guarantees and counter-guarantees, the purchase of ASBs from banks and more. The goal is to provide banks with space for new loans to small and medium-size enterprises, capital investments and other forms of support.

Most funds will be available through financial intermediaries in all EU countries; this means either through commercial banks or national development institutions,

WE AND OUR PARTNERS WANT TO ENSURE THE FASTEST POSSIBLE EXIT OF EU, AND THUS OF CROATIA, FROM THIS CRISIS IN ORDER TO BECOME MORE RESILIENT TO SOME FUTURE CHALLENGES AS WELL These measures are an expression of European solidarity. They are a combination of mutually harmonized measures at Member State and EU level.

What are the challenges, and

times more expensive than our guarantee fund.

The EIB Group guarantee fund aims to respond to the economic turmoil caused by the COVID-19 pandemic and to ensure that companies, es-

such as HBOR in Croatia. Once the funds become available, companies will be able to apply to the partners participating in the program. This list will be made available on our website.

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Real Changes Did Not Take Place The second set of economic measures of the Government proved to be good, and a great number of micro, small and medium-size entrepreneurs used the minimum wage and income tax and contribution write-off measure to preserve the employees and work places tourist season and how much will the Government reduce public consumption in the next crisis period. These two factors will decide how much the public debt will increase.

There are three options – to increase from the current 73% to 85-90%, which the economy could finance through taxes once it’s recovered and reduce gradually. The second option is for the debt to be at the level of 100-110%, which would mean a long and difficult crisis and slow recovery.

Anything more than this leads us to state bankruptcy and the Greek scenario. That is why it is very important for the state to tame public consumption.

DRAŽEN OREŠČANIN CEO, Glas poduzetnika

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Where is the worst situation and what do you think, from an economic point of view, should not be done in any way?

nfortunately, even though this was an opportunity for permanent changes, they did not take place, and therefore we will see the actual results of the crisis only in the following months, says for Diplomacy&Commerce Dražen Oreščanin, CEO, Glas poduzetnika

U

What else are you requesting specifically, and was there any understanding for your requests? (you can mention everything you asked for, but still hasn’t found its way to the agenda, and why)

— Well, there was some understanding for our short-term demands, but unfortunately, our long-term demands that are focused on a radical change in the ways of running the state in the direction where

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we ask that the state supports work, that it reduces taxes, improves the judicial system, to introduce digitalization and become transparent – did not encounter a fertile ground.

The reason for this is that, this way, we would interfere with some undeserved rights that are very important to the politicians, and these rights

and rigged public tenders, and various other things that normal and honest people find repulsive. Of course, there is no doubt that what we are demanding is in the best interest of the Croatian society and the state, but those who brought the state to this condition are a very organized and strong adversary.

— Unfortunately, the situation is not good anywhere in Croatia, we can find several sectors that are globally competitive, regardless of the crisis, but aside from pharmaceutical and IT sectors, nothing else comes to mind. The industry and agriculture are destroyed, tourism is on its knees because of the crisis, our judiciary is the worst in the European Union. Our universities occasionally find themselves among the world’s top 1,000.

The only thing that can help is

RECOVERY OF CROATIA DEPENDS MAINLY ON TWO THINGS – THE REVENUE OF THIS YEAR’S TOURIST SEASON AND HOW MUCH WILL THE GOVERNMENT REDUCE PUBLIC CONSUMPTION IN THE NEXT CRISIS PERIOD include placement of party members in fictitious positions in ministries, agencies, state companies and local government, corruption tied to the spending of public funds

How the crisis affects future business and when do you expect a recovery?

— Recovery of Croatia depends mainly on two things – the revenue of this year’s

to remove the current political sets forever, to have honest, hardworking and capable people running this country in the future, and to make a total restart and Croatia 2.0.

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Irresponsible Spending of Public Money As much as 15% of total disbursements for 84,000 employers in March went to only 145 large companies (0.03% of the registered number) MLADEN NOVOSEL President of the Alliance of Independent Unions of Croatia

hen we consider the fact that both multinational companies making multimillion profits in Croatia and a micro employer who was closed by the Civil Protection Headquarters have equal right to support per employee, it is clear that this is not about support intended for the protection of Croatian workers, but a case of poor and irresponsible spending of public money - Mladen Novosel, President of the Alliance of Independent Unions of Croatia, stated this for our magazine.

provides for the possibility of unilateral reduction of rights and termination of collective agreements by the employer.

We made a clear stand against this then, and we will certainly not allow something like that to happen.

W

How do you comment on the measures of the Croatian Government, and to what extent did they help the employees and those you represent, or do they work in favour of the employers more?

— It is questionable to what extent has this measure managed to protect the jobs (the unions were initially informed that the support would be provided only on condition of retaining workers for 3 months after the expiration of support, which the final version of the measures did not provide), but it certainly did not protect their income, which is bad for the workers, but also for the entire economy

What are your estimates, are we to face a serious crisis or a fast recovery of the economy?

agreed salaries, and some did not even receive the amount of the subsidy.

What else are you asking for specifically, and did anyone show interest in your demands?

— We demanded that the benefits to workers whose employer was closed by the decision of the Headquarters be paid directly to the workers’ accounts, and that for workers who work for an employer who had a drop in turnover, the CES and the Tax Administration control that the full salary is paid. Also,

FURTHER MEASURES MUST BE AGREED IN A TRIPARTITE AGREEMENT, AS IS THE CASE IN ALL THE DEVELOPED COUNTRIES AND SOCIETIES WE ASPIRE TO due to declining purchase power and consumption. Namely, official projections from the Government show that at least 25% of employers who received subsidies did not pay full wages, which means that the measure actually stimulated wage cuts, both through pressure to sign various annexes and various violations of rights and abuse, of which we already informed both the CES and the public.

Due to these measures, many workers did not receive their

it is absurd that the amount of support has been increased so that the employer who pays minimum wage keeps the money for themselves. Therefore, we requested a temporary increase in minimum wage to HRK 4,000 (the amount of support for April and May), so that workers with lower wages could receive the full amount of support. However, it’s not just that nobody showed any interest in that, but on that occasion Minister Aladrović even

stated that this was a matter of supporting the employer and that the employer has the right to dispose of it as he wishes.

We also demanded the suspension of dividend and profit payments as a condition for the granting of aid. This proposal from our end was not accepted either, as was no request or comment in the process of designing the conditions for the use of this measure.

In your opinion, where is the worst situation and what should not be done from the union’s point of view?

— The situation is definitely the worst where the workers are not unionized and where they are 1-on-1 with the employer, without their representatives and professional assistance for navigation through issues of labour law and labour economics. I hope that we will move forward from this crisis towards a society that regulates its work relations as planned – through collective agreements and negotiations. Unfortunately, our Government has shown that it is interested in exactly the opposite direction, when, at the end of March, the draft Labour Law leaked to the public from the Ministry of Labour and Pension System. This draft law

— We will probably know the true extent of the crisis in the autumn, when the consequences of a truncated tourist season, at best, will become clearer. It is important to make smart moves in the coming period and adequately protect the workers so that there is no further outflow of labour force to countries that will recover sooner due to a healthier economic structure and better governance. The better measures would be, for example, to continue to preserve jobs according to the model of reducing working hours within which the state would co-finance the rest up to the amount of salary. This model proved to be very successful in overcoming the 2008 crisis in Germany and Austria, which is why in March this year most member states opted for this model, and not for the subsidy model, as Croatia did. Further measures must be agreed in a tripartite agreement, as is the case in all the developed countries and societies we aspire to.

Finally, it would be good if we saw this crisis as an opportunity to finally step away from the model of accidental growth based on tourism and services, and start encouraging domestic production and the development of industry for the 21st century, coupled with good education, science and innovation. In addition to encouraging private investments, this will require a significant increase in public investment.

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The Market Sets the Rules Short-term losses in turnover in March were around 30%. Activity in the property market is gradually increasing due to the stabilisation of the epidemiological situation, and we expect this to continue, unless significant changes to the economy occur in the mid-term LANA MIHALJINAC KNEŽEVIĆ Director of Zagreb West Real Estate Agency

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here will certainly be changes in the market, with the number of transactions falling and prices differentiating depending on the type of property and its location, with trends being affected by the epidemiological situation and the resulting economic situation, says Lana Mihaljinac Knežević, Director of Zagreb West Real Estate Agency.

T

The crisis caused by coronavirus impacted the entire world, and thus Croatia as well. All the branches of the economy are affected by it, and it seems that the Real Estate sector is among the more affected industries. How did the crisis affect your business, how have you organized yourself and can you give some estimates of the percentages and numbers of losses?

— When Croatia introduced a strict lockdown in mid-March, we ceased our operations in the field, as doing otherwise would have been against epidemiological guidelines. Although our industry wasn't banned from operating by the National Directorate for Civil Protection, most activities involve a lot of direct contact through

THE MARKET OVERHEATED, AND SEVERAL TRENDS INDICATED THE NEED FOR PRICE CORRECTIONS - DECREASED NUMBER OF TRANSACTIONS IN 2019 AND AN INCREASE IN THE DIFFERENCE BETWEEN ASKING AND TRANSACTIONAL PRICES valuations, viewings and negotiations. We worked from home, and remained available via phone and e-mail. The only activity we had was after the earthquake, and we assisted in the moving of persons whose properties were damaged, with minimal direct contact.

In the past few weeks, as the threat from COVID-19 has subsided, and the lockdown has eased, we are noting completions of postponed purchases

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initiated before the lockdown, and a slow increase in the number of new enquiries regarding purchases and renting, both from locals and ex-pats.

We carry out all the activities involving direct contact with clients adhering to epidemiological guidelines – maintaining the distance, doing as much as possible over the phone and via e-mail, wearing protection etc.

We will introduce 3-D virtual

tours to our ads, to be prepared for the potential re-appearance of the threat from Covid-19. Our team can fully function from home for any administrative activities. We will continue to behave responsibly in our personal and professional lives, avoiding unnecessary contacts and applying epidemiological guidelines.

When do you expect market recovery and how? Do

you expect a drastic drop in prices in terms of renting and in terms of sales?

— The market throughout Croatia was completely frozen from mid-March to the beginning of May, there were hardly any transactions, so there is no sample to base price changes on.

The market for sales was at its peak in Zagreb and major tourist centres on the coast at the beginning of 2020, while other parts of the country, e.g.

Lika and Slavonija, not experiencing any growth for years.

Highest price increases were noted in the mentioned parts of the country in 2019, with prices having been on the rise year-on-year since 2016, driven by several factors: accumu-

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move. Prices in such properties are stable, and no decreases are expected yet, especially because the vacancy rates have been very low for the past three years.

How do you adapt to new business conditions and what will you pay attention to?

— We will continue to monitor the epidemiological and economic situation and adjust costs and activities accordingly.

We will continue to invest in the development of our team, and maintain relationships with our existing client base.

We are focusing on business development.

Do you have a message for all those in need of real estate, who are looking for an

lated demand from the longterm, post 2008. economic and property market crisis, coupled with a lack of product due to decreased development and many properties being converted into rentals to tourists in central Zagreb and cities on the coast; stable economic situation and growth in GDP, disposable income and employment; increased returns from the tourism sector, which provided more disposable income; low interest rates on loans and savings; government subsidies for loans for firsttime buyers; the Croatians’ traditional approach of investing into property.

We expect further differentiation of prices and an impact on the number of transactions depending on the location, micro-location, property type and its quality, as well as the economic situation, especially that in the tourism sector which makes a significant contribution to Croatia’s GDP. Regarding the residential property rental market for expats, mainly employees of Embassies and international companies - it exists almost solely in Zagreb, where the Embassies and company HQs are located.

This niche has been stable for years, and will remain so, with no significant price drops in rents expected, especially in the most luxurious end of this niche, unless significant economic issues arise in Croatia and the emitting markets, and rental budgets become severely affected. Rents of smaller, aver-

WE EXPECT FURTHER DIFFERENTIATION OF PRICES AND AN IMPACT ON THE NUMBER OF TRANSACTIONS DEPENDING ON THE LOCATION, MICROLOCATION, PROPERTY TYPE AND ITS QUALITY age quality properties in central Zagreb and on the coast might fall, though not significantly, depending on the number of short-term lets which will be returned to the long-term rental market, which in turn will be affected by decreased demand from tourists.

The economic sector is opening and slowly recovering as well, how do you estimate things to develop on this matter when it comes to office space, whether for renting or for sale? What do you offer to your clients?

— Many offices in the centre of Zagreb were affected by the earthquake, so tenants had to move. Until the full extent of damages is ascertained, and it is repaired, there will be no price changes as there will be no transactions with such properties.

Landlords of commercial and office premises whose tenants were hit hard by the COVID-19 crisis reduced or postponed rents, and these will return to normal depending on the industry the tenant is in and when it will recover. No damage was sustained by modern office buildings, so tenants did not

adequate space?

— If you currently have a need, either for residential or investment purposes, such a need should be fulfilled, ensuring that the price of the product isn’t too high. It is advisable to consult a reputable real estate agency, which will be monitoring all the trends affecting the market. We expect price differentiation based on the type of product and its location, e.g. prices of flats in older buildings will have to be adjusted since they were too high on average, high-quality new builds will maintain their price.

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Friendship Above All Croatia and China continue to be in an upward trajectory and they are developing in a good direction H.E. DARIO MIHELIN Ambassador of the Republic of Croatia to the People’s Republic of China

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espite the crisis caused by the COVID-19 pandemic and the changes that followed in the fight against the virus, this policy will continue, as the Croatian Ambassador to China, H.E. Dario Mihelin, declared exclusively for Diplomacy& Commerce.

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How would you describe firsthand the manner in which China is battling the Corona virus?

— Since the beginning of the crisis caused by the spreading of COVID-19 until today, the situation in China is constantly changing. From the initial issues, and even a certain degree of inability to cope with the unexpected newly created situation – which even the Chinese authorities subsequently admitted – at the end of January, as the World Health Organization assessed, China started an ambitious, proactive and aggressive stage of isolat-

Festival, which otherwise represents the period when the Chinese travel the most, but also when all activities stop for a couple of weeks.

In those moments it was absolutely clear that China, and the entire world, is facing a new virus of which little is known and that the isolations are a specific opportunity to gain time, which proved to be accurate. Considering the Chinese system and its capabilities, it was possible to build temporary hospitals with a 1000 bed capacity in this country in two weeks, in order to isolate patients with COVID-19 from the others and thus prevent the super spreading of the disease, then they sent more than 30 thousand army doctors and medical staff to Hubei province to help their colleagues, the factories repurposed their production lines for 24-hour production of single-use masks almost overnight, they closed entire settle-

THOUSANDS OF PEOPLE WERE MOBILIZED TO PROTECT THE COMMUNITY – FROM THOSE MEASURING TEMPERATURES TO THOSE WHO DELIVERED FOOD ing entire cities and provinces and reducing social contact and virus transferring that way, all in order to contain the situation as soon as possible. We have to remind that all this coincided with the holiday of the Chinese New Year or the Chinese Spring

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ments, mass-produced tests and organized temperature measuring clinics where more than forty thousand people per clinic came during the worst days, in Beijing only. Today, almost nobody is visiting these clinics, most of them stopped

working. Thousands of people were mobilized to protect the community – from those measuring temperatures to those who delivered food. We saw Chinese collectivism at work, and it showed its best face in these moments. We also saw the solidarity of a large number of foreigners who stayed in China, despite the uncertainty in the first weeks of the illness outbreak.

Over the past month and a half, we witnessed the never before seen methods of fight against an epidemic that “stopped” the entire country. In moments when nobody could predict with certainty further development of the situation in China, a decision was made that isolation was the best way to prevent a dramatic spreading of the virus. This meant extension of holidays for schools and universities, closing of plants, restaurants, hotels, shopping centres, etc. It was an unprecedented move that required great discipline and cooperation from everyone.

Even Beijing looked like a ghost city in those first weeks, with but a few cars on city roads, an occasional lonely passer-by hurrying to buy food…

During that period, we grew accustomed to a new way of life in China, wearing masks, measuring of temperature, even despite the fact that the number of newly infected was in steady decline and it is ex-

pected that, at this pace and with these trends, the Chinese authorities will soon declare victory against the virus. The people started feeling safe and protected precisely when they saw that there was a strategy in the battle against the illness and its spreading, and that the methods in which this fight is carried out are being respected.

Yes, this means measuring of body temperature at every step and at the entrance of every commercial or residential building, restaurant or store, wearing masks, maximum two people sitting at a table in a restaurant, significantly slower pace of life in an otherwise extremely dynamic Beijing and China… Asian countries perceive the mask-wearing culture otherwise, and they give them certain security that, despite the global recommendation not to wear them, they did have a positive psychological effect here. Also, they are often worn when there are high levels of air pollution, which is not rare, especially in the winter.

But, precisely because of these measures, there was no panic, and no fear. All of us at the Embassy stayed in China together with our Chinese friends, and we remained cautious just like everyone else, respecting the rules and following the instructions we received. Indeed, despite this crisis, some of the Embassy staff returned from their vacation. I would say that this best confirms the solidarity with the entire Embassy team, our nationals in China and our Chinese hosts. Truly, a friend in need is a friend indeed.

However, I would say that it was very interesting to testify about the extent the technology today worked in favour of the battle against the infection, even though legitimate questions could be raised about her invasion of privacy and freedoms. For example, you could see the locations of newly infected on mobile apps almost in real time, and “plan” your movements based on that, the

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numbers of infected, those in critical condition, healed and deceased were monitored nonstop, and today, there are apps that monitor your movements and condition and determine who falls under which category when it comes to infection – green, yellow or red – by reading a QR code on your mobile phone, and this allows you to travel within China’s limits or enter some cities. A great sigh of relief came at a time when curves of the diseased and the healed crossed each other on the graphs, which meant a major turning point, psychologically as well. Even though life is not yet as it was less than two months ago, official figures and trends and the arrival of spring have a positive effect on the atmosphere in Beijing and all of China, and it seems that in fact the whole country cannot wait for all

with the local EU Delegation, in terms of actions towards the Chinese authorities, as well as joint efforts in repatriation of EU citizens, including four Croatian citizens, from the territory of the City of Wuhan and the Hubei Province. In our desire to express our solidarity with our Chinese friends, at the request of Chinese media, we recorded video messages where I conveyed the expressions of support of the Croatian state leadership and I expressed my belief that the fight against the virus will be ended successfully, and I complimented China’s reaction in controlling the spread of the disease.

Many of our citizens staying here found themselves outside China during the holidays, and considering the suspension of flights, they could not return as planned, so they opted for some alternatives, like pro-

THERE IS AN ENVIABLE DYNAMIC THAT WE HAVE IN BILATERAL COOPERATION, AND WE CERTAINLY INTEND TO CONTINUE WITH THESE POSITIVE TRENDS this to be behind us. This is also confirmed by President Xi's visit to the epicentre of the fight against the virus, the capital of Hubei Province, Wuhan.

We have to point out that Croatia’s Presidency of the Council of the European Union also means coordination of member-countries in the field of local consular cooperation, which particularly includes such crisis situations; therefore we were constantly active and engaged on this matter as well, in cooperation

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longed stay in their country or going to Croatia. At this moment, based on the information that is available to us, we can estimate that there are up to about one hundred of our citizens in China. What’s most important is that none of them have been infected so far, according to our knowledge. We hope it will remain that way!

What would you single out as the main trends that characterize life in China in economic and social terms?

— At the moment, it’s certainly

the end of fight against the virus and the start of recovery of the society and of the economy. China wants to get back on the track it took before the COVID-19 epidemic outbreak, when it was on the best path to achieve its key centennial goals in this year, to eradicate absolute poverty and to create a society of moderate wellbeing.

During his last few appearances, Chinese President Xi Jinping talked precisely about how China must return to the path of economic growth in order to try and diminish the damage caused by the paralysis of the society and economy due to the epidemic.

On a wider scale, it is the China that is appearing on the global scene with more and more determination and openness, aware of its economic strength and inevitable role in the international community, wishing to give its mark to the international order and to strengthen multilateralism. At this time, Beijing is the most wanted position for every diplomat.

How close are the relations between China and Croatia?

— Regarding our relations, it is enough to recall the words of the Premier of Chinese State Council Li Keqiang during his official visit to Croatia last year when, during the bilateral visit, he stated that our relations were in a "diamond period". This determinant, which doesn’t mean only that our relations are so brilliant and valuable, but also solid and stable - because that’s what diamonds are like - extends to

our political relations as well as to our overall social relations.

There is an enviable dynamic that we have in bilateral cooperation, and we certainly intend to continue with these positive trends. Our relations are based on as many as four tracks - of course, the bilateral one in which we have established partnership in general cooperation that will have its fifteenth anniversary this year, then the EU-China track which marks 45 years of diplomatic relations this year, then there’s the level of cooperation within the Belt and Road Initiative and finally at the level of 17+1 Cooperation which is also very comprehensive and ambitious.

Almost half a million Chinese tourists visited Croatia in 2019, and they are discovering our country as a pleasant, beautiful and hospitable country full of culture, natural beauty, a relaxed and quality way of life and gastronomic specialties, where they feel good and where they can see and experience a lot – in accordance with our slogan, “Full of Life”. In that sense, the Chinese will soon be able to discover the wealth of our offer on their market as well, since Croatian milk and dairy products are in the final production stage for export to the Chinese market, and they are already familiar with the quality of Croatian wines and truffles. The aim is to enable other products - tuna, honey, meat and our superior meat products - to follow them as soon as possible.

Last year was also the Year of Tourism and Culture between Croatia and China, so we recorded a series of extremely successful guest appearances of Chinese and Croatian artists. Chinese sportsmen – football and handball players – who are the foundation of our sports cooperation – are gaining experience and sports skills in Croatia, and we would especially like to point out the extremely dynamic decentralized cooperation, i.e. the joining of Croatian and Chinese cities and counties or provinces, which then continue to work intensively on their political, economic, cultural and tourist ties. Last year we connected the Osijek-Baranja County with Sichuan Province in China, talks were initiated

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about the partnership between Dubrovnik and Xi'an, Varaždin and Harbin, and Zagreb County with the Province of Hebei that surrounds Beijing just like the Zagreb County surrounds the City of Zagreb. This year we are also celebrating the 25th anniversary of friendship between Zagreb and Beijing, and 40th anniversary of friendship between Zagreb and Shanghai.

Croatia and China also have common summer police patrols, and this also proved to be an excellent concept because it speaks not only of excellent cooperation in terms of security, but also bestows additional trust in Chinese tourists who had the opportunity last year to meet “their” policemen in Plitvice Lakes, Zagreb, Zadar and Dubrovnik.

nomic importance of stronger integration of the Eurasian continent and the possible synergistic impact of linking the European Connectivity Strategy for Eurasia and this Initiative. In addition, Croatia's geographical position as the Mediterranean gateway to Central Europe, positions us as the closest entry point for Asian goods to the Central European market. Exactly such projects of using Croatian ports, not only Rijeka, but also Zadar and Plo;e, as well as their connection with modern railway connections with Central Europe, are being discussed with Chinese partners. Croatia

medieval European they know who connected China and Europe – Marco Polo, when we tell them that Croatia is the birthplace of a necktie, or that the second “biggest” wall, like the Chinese wall, is located at Pelješac. Croatia won the hearts of Chinese fans during the World Cup in Russia, when we were recognised not only for our red and white squares, but also as a courageous team that had strong support from the country’s President – which the Chinese appreciated very much – so we expect the positive trends to continue when the situation with the virus comes to an end.

often travel individually, they like sailing, the beaches, nights out, they enjoy gastronomy and exclusive offers.

In your opinion, how close and far the European and Chinese cultural concepts are, and where does Croatia see itself between these two influences?

— Croatia is part of the European cultural and civilizational circle, but as a maritime nation, it was often at the dividing line of events, turned towards meeting and accepting other cultures. I often point out during my appearances in China that Croatia owes its role to ad-

What made Croatia decide to entrust Chinese companies with the construction of the Pelješac Bridge and what will its completion mean for Croatia?

— This is a project that has strategic and symbolic significance for Croatia because it will connect the south of Croatia with the rest of the country. Its importance in terms of traffic and tourism is in the fact that it will enable smooth traffic to the far south. It is also the largest single project funded by the European Union. I would like to remind that a public tender was conducted for this project, where the offer of reputable Chinese company China Road and Bridge Corporation was the best, which is also reflected in the dynamics of the works.

As a pioneering project by a Chinese company in the European Union, it has received exceptional attention on both sides. When the Pelješac Bridge is completed, it will connect not only two parts of Croatia and the European Union, but also Croatia and China as a lasting sign of friendship and cooperation.

How much does the philosophy of the New Silk Road fit in with Croatian ambitions in political and economic field?

— Croatia is participating in the Belt and Road Initiative since the first meeting at the top, in Beijing in 2017, recognising the geostrategic and eco-

CHINA PRIDES ITSELF ON ITS FIVE MILLENNIA OF CIVILIZATION AND ALL ITS CONTRIBUTIONS TO THE DEVELOPMENT OF HUMANITY is one of the countries that connects the belt, the land part of the initiative, and the road, its maritime part.

To what extent were the Chinese able to discover Croatia and what kind of trends do you expect in the short term because of the virus, and in the long run?

— Croatia was recognised in China as a friendly, open, hospitable country full of diversities, cultural and natural beauty. The Chinese, as heirs of 5000 years old civilization, have a high regard for culture and tradition, and in that sense, we also offer an abundance of attractions they visit and discover. Our Chinese friends are often surprised when we tell them that Korčula is the birthplace of the most famous

The Chinese love to travel and discover the world increasingly more, and last year more than 150 million people travelled outside the China limits.

Even though they mainly visit their neighbouring countries still, they travel outside their neighbourhood more and more, towards Europe, where they discover new countries and old civilizations. We have been working devotedly for years on a project to introduce a direct flight between Croatia and China, and we believe that it will be implemented in the near future. Even though the Chinese travelled in groups in the past, and they avoided the sun and the sea, since they don’t have too much interest in such activities, trends are changing in this aspect as well, because younger passengers

vocating a stronger cooperation with China to its famed man from Korčula, Marco Polo, who began approaching these two cultural circles some centuries ago. China prides itself on its five millennia of civilization and all its contributions to the development of humanity. And we are witnessing that it does so today, leading the way in the development of modern technology, 5G, artificial intelligence, the Internet of Things ... No country can ignore China today. Croatia is a committed member of the European Union and the North Atlantic Alliance, living the values of these integrations and alliances, but also a supporter of cooperation with key global stakeholders, as reflected in the program of our Presidency of the Council of the European Union.

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Corona Crisis We have interviewed some of the officials from diplomatic and economic community to found out how embassies have organized their diplomatic activities during the state of emergency, as well as, how they spend their free time and what they will do first when the state of emergency is abolished a very fluid and unprecedented situation.

H. E. W. ROBERT KOHORST

How do you comment on the Government’s measures to help and save the economy?

Ambassador of the USA

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EVERYONE NEED TO WORK TOGETHER TO GET THROUGH THIS CRISIS How has the current situation affected the Embassy’s activities?

— Due to the current global pandemic, the U.S. Embassy is following the Croatian government’s guidelines regarding social distancing and many of us are teleworking, including

H. E. ANDREW DALGLEISH Ambassador of the UK

SOME THING THAT WE HAVE BEEN PLANNING, WE CANNOT DO How did you organise your diplomatic activities?

— When we heard the news of the restrictions put by the Croatian government, well, the first thing that we did was to be very clear to our staff, and our compatriots here in Croatia, that we have to follow these instructions. It is very important that we comply and we do all that we need to do, to support the Croatian government in all of their efforts to tackle this problem. That means that now in the Embassy we are all working at home, but we are working, we have daily meetings through IT technology, we have meetings sometimes

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myself. Therefore, we have curtailed all of our in person meetings, events and other activities for the time being. Like other organizations and businesses, we have moved many of our meetings to conference calls or video calls and continue to work. This is new for many of us but we continue to be patient and follow the guidelines. The Croatian government is handling the situation very well and I applaud their management of face-to-face virtually, but certainly we talk. We carry on the best service we can possibly provide in the circumstances, to British nationals here in Croatia, and in our engagement with the Croatian Government and the Croatian community.

Unfortunately that means that some thing that we have been planning, we cannot do, but that’s OK, we will do them other time. For instance, we have the Hay Festival, the great literature festival coming to Croatia, to introduce our Croatian friends to this fantastic event. We’ll do it later. That’s all right. We are in touch with many other embassies here in Zagreb, we are working together fantastically well with the Croatian authorities to deliver the right message that all our citizens are

— I think governments around the world are trying hard to help businesses and individuals get through the unprecedented disturbance to their normal operations caused by the pandemic.

You may have seen news of the economic measures undertaken in the United States which are unparalleled in scope. The initial efforts involve the government spending trillions of dollars. These are unfathomable amounts, but may be necessary to keep the economy going.

Here in Croatia, the government appears to be taking careful steps to save lives and avoid negative impacts to the economy whenever possible.

I understand that employers sought government support to keep half a million Croatians in their jobs since the beginning of the pandemic. Croatia has

more limited resources than the United States to support jobs and businesses, but the actions taken seem to be prudent and within the ability of the government to deliver. Of course, all of these actions are only the beginning. Everyone will need to make sacrifices and work together to get through this crisis.

I’ve spoken with many Croatian and U.S. companies over the last few weeks and have heard about creative solutions using technology and online communications to keep businesses going, even while maintaining social distance. Some of these companies are making generous donations to help schools transition to virtual learning and others are supporting the earthquake relief effort.

Many people are making incredible personal sacrifices to help others, to stay home, and to avoid contributing to the spread of this virus. The more we all comply with the government’s instruction to stay home, the faster the economy can get back to normal.

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behaving by the rules and we are doing everything we could to address the corona problem, because the corona problem is

the top priority for now. We’ll get through this but it’ll take time and it’ll take effort from everybody’s side.

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H. E. HAAKON BLANKENBORG Ambassador of Norway

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WE OPENED OUR NEW HONORARY CONSULATE IN SPLIT How did you organize your diplomatic activities?

— The Embassy remains open, but we are not receiving visitors. We are all working from home. One home office is event relocated to Norway, due the earthquake here in Zagreb.

We can be reached on our normal phone numbers and by e-mail, or on other digital platforms. You are all welcome to contact us. Anybody with an urgent need for assistance must ask for an appointment.

Our ambition is to comply with the Croatian instructions and support the Croatian government in their effort to tackle COVID-19 virus. At the same time we try to maintain as many of the functions of the Embassy as possible. International cooperation and international contact is no less important in the time of Corona, it is more important.

Only that we have to do it in a different way.

We had planned for a number of activities in the coming months. Unfortunately, we had to postpone the visit by His Majesty the King’s Guard on 25th of May. Now I hope we can enjoy His Majesty the King’s Guard from Norway and the Croatian Honour Guard Battalion and Army Orchestra next May. We managed to open our new honorary consulate in Split. Unfortunately with no reception and no guests. The consul, Marina Sare, had to unveil the Norwegian coat of arms on the office building herself. The celebration will come later.

How are you spending your private time during the pandemic?

— I am privileged. I have plenty of space. In my home office I do only what is job related. I have other rooms for the “private time”.

ANDREA DOKO JELUŠIĆ Director of AmCham Croatia

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I thought this would be the time for reading and watching films and documentaries, but no. So far, I have spent most of my “private time” on different audio or video platforms, talking with friends, in Croatia, in

Norway and in other countries.

Of course, I talk with my family in Norway every day.

Every now and then, I walk to my local shop and queue up.

It is nice to meet other people, even om proper distance.

and government speakers. AmCham is a club of companies that nurture corporate social responsibilities. Many of our members have been actively contributing to fight against Covid-19 through Medical Research & Development focused on vaccine or medicine for coronavirus, many have been donating their products & services to government or public institutions like firefighters or hospitals and many funds. An excellent example what private sector can do to help citizens in pandemic as well as earthquake in Zagreb.

those contributing more to the state budget in regular times and is protecting high value industries and jobs. This was direction that AmCham has been advocating for. Also, we miss “furlough leave” which Croatia used in war times, while other countries are successfully using to give relief to employers, while protecting jobs. Employers of workers who are forced to stay at home but are unable to work from home because of the nature of their jobs and therefore the obligations under their employment contract cannot be fulfilled, are currently in an unenviable position. In order to protect jobs in all business entities regardless of their sector of industry, we proposed the introduction furlough leave whereby employees are entitled to compensation paid from the Government budget (equal to unemployment benefit), but employers retain such workers in employment and “recall them to work” when the extraordinary situation ceases to exist, triggering reactivation of all employment rights and obligations. In front of the Government is potential cut of parafiscal fees and AmCham will contribute with its proposal.

How do you comment on the Government’s measures to help and save the economy?

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AMCHAM WILL CONTRIBUTE WITH ITS PROPOSALS How did you organize your business activities?

— In mid March all AmCham operations switched to home office. Transfer to videoconferencing was smooth with few days of quick learning of

advanced features of Microsoft Teams and Webex. All of our committees continued with their regular activities, while at the same time AmCham has prepared busy program of webinars where members are sharing their expertise. Our “in person” networking events have been switched to high level webinars with international

— High pressure situation showed that Croatian policies can be well structured and effective whether we talk about health protection or supporting the economy. Measures for job protections were processed timely which helped companies a lot. The fact that the Government chose fixed amount of support, simplified the procedures, and made the support scheme available on time. Still, many countries used support in percentage of worker’s salary which is fair to

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MOST IMPORTANTLY, HOW CAN THE GOVERNMENT SUPPORT COMPANIES TO STAY AFLOAT

STEFANIE ZISKA New Managing Director GermanCroatian Chamber of Commerce

How do you comment on the Government’s measures to help and save the economy?

— We welcome all efforts and measures that the Croatian government, the Ministry of Economy and further ministries have taken to date. We are very pleased that the decision-making processes have been accelerated as much as possible in the last few days.

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MR SAŠA MUMINOVIĆ PHD, President of SLO CRO Business Club

WE STILL DON’T KNOW THE EXTENT OF THE DAMAGE How did you organize your business activities?

— Coronavirus helped bring to the light of day all the weaknesses of the system, such as liberal capitalism, globalization, populism and human nature. On the other hand, true human qualities have also surfaced, such as sacrifice and capabilities in work and relations with others. This much will become clear: Our values that don’t have to be exclusively liberal and capitalistic. Maybe society needed this sobering up that nature sent us; the economy needed it. This will certainly result in rethinking on sustainability of business, supply chains, and work methods in general in the future.

AquafilSLO in Slovenia and AquafilCRO in Croatia continued production, although

ANDREA PERKOV secretary-general of Italian-Croatian Chamber of Commerce

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reduced in volume in March, with security measures in place since the end of February. We have been using experiences of our colleagues from the Aquafil group from China and Italy, and we communicated our experiences to our colleagues in the US. These as the features of multinational companies that proved to be a great asset in this pandemic. Unfortunately, we will have to stop industrial activities for several weeks as well in April and May. How do you comment on the Government’s measures to help and save the economy?

— Governments chose different ways to help the economy, but already the amount of money earmarked for this purpose clearly signals that the authorities take the problem seriously. We are monitoring several countries, and nobody is underestimating the problem. However, we still don’t

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know the extent of the damage.

All we can do is guess. Government measures are based on predictions and currently available data. It is possible that new packages of measures

will be adopted in the coming weeks. This is not long-term planning. We must not forget that people come first, but the preservation of the economy is immediately behind it.

IT’S A WORLDWIDE SITUATION

working mode, and mostly became an informative service to help the members to organize their work. There were many difficulties with the international transport and many other “hot” questions.

Not only the Chamber, but the entire System Italy in Croatia, is organized in common activities. Our meetings are online sessions, our activities are online, such a webinar, information services etc.

I would love to announce, and underline START THE FUTURE online worldwide event that will be held on 7 th April,

How did you organize your business activities?

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We also welcome the initiative of Prime Minister Plenković to set up a “crisis team” to help the current situation. However, we are also aware that all of the measures introduced so far are not enough for private industry. The most crucial point for private industry at the moment is to secure their liquidity. They are dealing with declining sales, while fixed costs remain the same.

So therefore it is most pertinent on how the government can support these businesses to stay afloat during the next couple of weeks or months.

— Due the pandemic situation of COVID 19, and the recent earthquake in Zagreb, it was very challenging to organize the business activities, but despite the difficulties The Italian Croatian chamber of commerce is active. We feel obliged to give our support to members, especially our Italian members, that are facing terrible health situation in Italy. Our office is in smart

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that is affronting the innovation and digital possibilities, exactly to face the current situation and to improve our future.

I use this possibility to invite all stakeholders, entrepreneurs, start-up companies, NGOs and all interested to participate in creating our future now! The participation is free of charge for all.

How do you comment on the Government’s measures to help and save the economy?

STATE OWNED COMPANIES SHOULD NOT BE PUT INTO A LESS FAVOURABLE POSITION

gear and delivery process is optimized in such way that the personal and social contact with our customers is reduced to minimum. Postal Offices working hours are shortened and number of concurrent customers is limited. The health of our workers, their loved ones and our customers is the top priority.

How did you organize your business activities?

— Croatian post is one of the key elements of Croatian society and economy, and it’s role is especially important in state of emergency during which the company serves as a backbone of our community.

We adjusted our business activities according to directives issued by national authorities, and we are continuing to do so. Our workers are equipped with protective

— This pandemic situation, as we all know will have the huge impact on world economy, and we all must do as much as possible to participate, to be solidarized, to preserve the working places. The first package of measures was not

enough, and we were witnesses of “revolution” from the entrepreneurs. Yesterday, fortunately, after big effort of real business community and other associations, we see a movement from Croatian Government. The announced package of measures could help firstly, to preserve working places and to help to companies that had

to quit with the activities. We are monitoring the situation, we are in continuous communication with our members, we gave our suggestions, and we will all see, the real impact of the measures. We hope that the crisis will not last for long term period, and we have to understand that it’s a situation that is worldwide.

IVAN ČULO Chairman of the Board of Croatian Post

How do you comment on the Government’s measures to help and save the economy?

— We support all measures which will save jobs. But measures must include everyone and state owned companies should not be put into a less favourable position.

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HOW DO YOU COMMENT ON THE GOVERNMENT’S MEASURES TO HELP AND SAVE THE ECONOMY? How did you organize your business activities?

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— Times of crisis are good times for crisis communications, so we at the agency are quite busy and work from home. Most of the meetings are via videoconferencing tools (I tried pretty much every platform so far), but still some in person when needed, usually on open air spaces. If inside with all measures taken. Work from home seems to be challenging to everybody if you are busy, since home obligations like distance schooling also take their toll on the time we have, so sometimes it is even harder than working from office. We’ll reconsider working from the office as soon as school starts, because earlier would be too challenging for colleagues with smaller kids.

In this spirit we have reduced our working hours per one per day, effectively we work four day now, though we are available all the time.

How do you comment on the Government’s measures to help and save the economy?

KREŠIMIR MACAN Communication Consultant and Manjgura Agency Owner

— Timely and appropriate for the first phase of the pandemic, now it is time to restart the economy swiftly. It will be the new normal after the pandemic and we have to get used to living with the coronavirus and with the coronavirus by our side. It will request a lot of changes in Croatian economy, primarily reduction of unnecessary costs and optimisation, primarily from the public sector, since private is already adjusting. Time for big reforms and changes like never before. Unique window of opportunities to be seized.

And new communications tools have enabled now movements to emerge – Udruga Glas Poduzetnika (Voice of Entrepreneurs Association) have not existed month ago and now have nearly 10.000 members and their voice is stong and should be heard.

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MILENA PRODANIĆ TIŠMA Director of the Bright Horizons British School in Zagreb

DANIJEL KOLETIĆ CEO of Apriori World

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and their teachers every day and take part in live lessons!

They have daily regular classes and even regular school breaks during which students have the opportunity to see their peers, talk and socialize with them.

The ZOOM app made it possible for students not to any lose classes, including P.E. as well!

During this period, the school also focuses its efforts to further develop students' ICT skills. Students learn how to use the Internet as a place where they can find various resources to completing tasks and carrying out various projects. They are learning how to use the many programs that will definitely benefit them as they embark on further education.

Even before this new situation, the school was using a variety of applications in its daily work to further enhance the classwork.

For example; the subject of mathematics is enhanced by the Mathletics application, the subject of music is enhanced by the Charanga program and so on. As for communication between the school and parents, one of the applications used is called Seesaw. It allows students to directly transfer their learning activities through an application to which parents have direct access. Also, for the purpose of communication, teachers use Google classroom.

HOW DID YOU ORGANIZE YOUR BUSINESS ACTIVITIES? How did you organize your business activities?

— Bright Horizons has focused its efforts to make the situation as painless as possible for its students, thus protecting not only the physical but also the mental health of the students.

Therefore, the school focused on consolidating the school community and maintaining regular contacts between the principal, the school counselor, the school psychologist, the teachers, the students, and the parents, even after the formal closure of the schools.

The greatest advantage during this period of isolation is, the day-to-day shared time that students spend online. Bright Horizons strive to simulate a regular school day as much as possible to maintain a sense of community. The entire process is planned and monitored, and students even have the possibility to have individual online consultations with their teachers, school counselor and/ or psychologist if they need additional support. In order to achieve this, the school has decided to use the application; ZOOM; in order to enable its students to meet each other

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EACH SUPPORT BRINGS SOME STABILITY How did you organize your business activities?

— Like most, we were caught by the COVID19 virus, which changed the way the communications industry operates. Unfortunately, many agencies are struggling to survive, and service users will change their way of doing business.

Our business is stable at the moment. We try to find the best solutions to maintain stability.

We work from home and office with reduced capacity as we generated more than 60% of our revenues from abroad, which has now stopped most of their activities.

How do you comment on the Government’s measures to help and save the economy?

— Each support brings some stability, but also hope. There is no ideal at this time of the global pandemic, but we should be grateful for the possibility that sometimes slow and interesting passing of the law in this case could nevertheless adapt to the situation and provide opportunities for support.

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Despite Everything, ECC Continues The year of European Capital of Europe in Rijeka was opened on February 1st with an allday program that included 70 events at 30 locations, where tens of thousands of people literally occupied the city ber of tourist arrivals in Rijeka.

Namely, in the first two months of 2020, Rijeka achieved an excellent tourist turnover of 37,943 overnight stays, which is an increase of 13% compared to the same period in 2019. Thus, Rijeka positioned itself on the high third place in terms of tourist traffic in family accommodation with 2,650 realized arrivals and took eighth place in the total tourist traffic in Croatia with 20,037 overnight stays. Also, at the beginning of February, the European Best Destinations organization added Rijeka to the list of top 10 European destinations to visit in 2020. I am sure that the reason for this is largely due to the fact that we are the European Capital of Culture.

VOJKO OBERSNEL Mayor of Rijeka

ijeka continues the implementation of the European Capital of Culture project, on a reduced scale and through activities that are possible considering the measures to protect against the coronavirus Vojko Obersnel, Mayor of Rijeka, stated for our magazine.

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— Call me biased, but I believe that most citizens of Rijeka will confirm that an incredible positive energy was felt throughout the city. Everything culminated with “Opera Industriale” – loud, powerful audio-visual spectacle that left no one indifferent. Rijeka really did seem like the epicentre of a tectonic

THERE WILL ALWAYS BE ROOM FOR QUESTIONS ABOUT WHETHER WE COULD HAVE DONE MORE OR FASTER, BUT WHEN WE DRAW THE LINE, I THINK THAT WE SUCCEEDED IN MAKING RIJEKA A MODERN, OPEN CITY AND A GOOD PLACE TO LIVE IN You said in your blog that the day when Rijeka was officially declared the 2020 European Capital of Culture turned into a day of tectonic disturbance. What actually happened to the city that day?

disturbance packed with good emotions. It was a great feeling and a confirmation that hard work and effort invested in the organization of the opening of Rijeka as the European Capital of Europe has paid off

entirely. The opening was the great celebration of the official start of European Capital of Europe. It is important to say that numerous ECC programs and activities took place even before the grand opening. In fact, some have been going on for two or three years now, and the citizens have accepted them well and joined in on these programs. The focus, however, is on 2020, where nearly 300 cultural programs with more than 600 individual events were to be held. Almost 350 partner organizations and artists from more than 55 countries in Europe and the world were involved in the organization of the program, and part of these programs was definitely strong enough, so to speak, that it could certainly attract tourists, that is, it should have been a reason for an even larger num-

Coronavirus changed everybody’s life, how do you see the planned activities and the implementation of plans and projects by the end of the year? To what extent will this affect the revenue, and in this regard, what is happening with the project Rijeka 2020, as the capital of culture?

— Unfortunately, less than a month after the opening, we faced a coronavirus pandemic that literally stopped all cultural events overnight. No one could have been prepared in any way for what happened to the whole world. It was impossible at that time to have any estimates of what would happen in terms of the epidemic because the situation was changing from day to day.

It was immediately clear, of course, that it will not be possible to implement the Rijeka European Capital of Culture program in the way it was planned for a number of reasons - from the inability of foreign artists to come to Rijeka, the ban on gatherings, ban on organiz-

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ing events for the public, to the drastic reduction of funds planned for the project in the state, county and city budgets.

Revenues - I'm talking only about the city budget – have been significantly reduced due to a series of measures to help entrepreneurs which were adopted due to the epidemic situation, but also due to the overall significant reduction in economic activity in the country. Specifically, as far as the budget of the City of Rijeka is concerned, comparing April 2019 with the same month this year, only because of the measures to help entrepreneurs affected by the corona crisis, budget revenues decreased by as much as HRK 30.2 million, or 36.4%. The true scale of the budget cuts that are yet to be demonstrated in some expenditures that are inevitable as well, such as the increased need of citizens for social programs, is still impossible to determine exactly.

Roughly, due to the coronavirus pandemic, Rijeka ECC was left without two-thirds of the planned funds. In such circumstances, the company Rijeka 2020, which manages the ECC project in Rijeka, was unfortunately forced to rearrange and reduce the program, but also to lay off more employees, with the desire and plan to return at least some of them to their jobs when the program continues after the easing of epidemiological measures.

Unfortunately, although the state has a number of measures to help the companies faced with difficulties due to the current crisis, they do not apply to companies founded by cities, municipalities, counties or the state, and Rijeka 2020 could not use them.

We have to point out that the ECC project consists of many cultural stakeholders of this city. First of all, city cultural institutions that immediately moved part of their activities and programs online to stay in touch with the audience, at least online. There are also many artists and organizers who, in conditions where it is hardly possible to be normal, have found a way to keep their audience and offer programs that are feasible. So, although on a much smaller scale than planned, the European Cap-

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ital of Culture program will still be implemented. What continues regardless of the pandemic is the completion of the Art Quarter. The ECC enabled a faster revitalization of industrial heritage, so the Children's House and the Museum of the City of Rijeka will soon be opened in the former factory, and next year the City Library of Rijeka, and the ship Galeb will be renovated. For these projects, the funds were

— First of all, the ship Galeb was declared a cultural heritage by the Ministry of Culture of the Republic of Croatia back in 2006, and the City of Rijeka became its owner in 2009. We estimated that the ship with such history has a great potential to become an extraordinary tourist and cultural attraction.

Just let me remind you that the ship was built in Italy as a merchant ship. Then it became a war ship, it was torpedoed,

ROUGHLY, DUE TO THE CORONAVIRUS PANDEMIC, RIJEKA ECC WAS LEFT WITHOUT TWO-THIRDS OF THE PLANNED FUNDS obtained from EU funds and they are coming without delay, and the City of Rijeka regularly pays its share in the projects so that the implementation of investments can continue smoothly. These cultural objects will remain a permanent legacy of the ECC project.

During the Rijeka carnival, you walked around dressed as Jovanka Broz, provoking the public even more after the renovation of Galeb, Tito’s ship used for diplomatic travels which was left neglected after the breakup of Yugoslavia. How is Rijeka dealing with the memories of the Marshall?

then the Germans took it over, and at the end of World War II it was sunk in the port of Rijeka.

Therefore, even if we set aside the fact that it was Tito’s floating residence on whose deck the non-aligned movement was initiated and where the world’s political and cultural elite of the time was a frequent guest, there were reasons to keep the Galeb in Rijeka and to use it as a unique museum at sea, which itself is a museum piece at the same time.

True, the Galeb was the subject of very strong discussions, especially at the Rijeka City Council, but in the end, it will also become a part of the Museum of the City of Rijeka,

as planned. After the completion of reconstruction and furnishing, the Galeb will have a permanent museum exhibit, occasional exhibitions, a cinema and creative workshops, all on its 5,565m². Aside from cultural purpose, the Galeb will also have a commercial purpose, so it will also include a hostel, restaurant bar and a souvenir shop.

Opinions about Tito are divided on the entire territory of former Yugoslavia, so Rijeka is no exception. However, nobody can dispute the fact that Partisans, anti-fascists, under the leadership of Josip Broz Tito, freed Rijeka from fascism and finally united the city that was divided by wall between two countries. Tito and the Partisans returned Rijeka to Croatia, within its internationally recognized borders today, the borders that the citizens of Rijeka got to know very well in the Homeland War, defending the sovereignty of their country.

I am pointing this out only because someone is constantly trying to impose some anti-Croatian orientation on us, which is simply against the grain.

And the fact that Jovanka and Tito, who appeared at the international processions of the Rijeka Carnival, provoked laughter and joy, proves that the citizens of Rijeka, at least most of us, embrace our past in a very healthy way, that our history doesn’t frighten or burden us.

Culture, art, the city became rich in various contents, will there be funds to maintain this pace and splendour in the years when Rijeka no longer serves as the capital of Europe?

— It is impossible to answer to this question at this moment.

Financial situation not only in Rijeka, but in Croatia and the entire world is not at all pink and we cannot know what is in store for us in the future.

However, I believe that even the very preparations for Rijeka – European Capital of Culture, have opened up possibilities for future development. First of all, thanks to this title, the neglected industrial heritage is being revitalized. The entire new Art Quarter is being completed in the renovated premises of the former Rikard Benčić factory, where the Mu-

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seum of Modern and Contemporary Art is already situated.

The so-called Palača šećerane (Sugar Factory Palace), one of the most beautiful baroque palaces in Croatia, will soon be occupied by the Rijeka City Museum. The unique Children's House, where programs and activities for children up to 12 years of age will take place, is also almost finished. The Rijeka City Library will also be located there. Alongside the Galeb ship, there are Exportdrva and RiHub premises that came to life just because of the ECOC. Furthermore, the University of Rijeka is launching new study programs that will strongly influence the future of Rijeka's culture. One such program is DeltaLab, a centre for urban transition, architecture and urbanism.

Before the start of the coronavirus pandemic, numerous educations of the citizens of Rijeka and the region through which numerous people have acquired knowledge, skills and experience in organizing cultural events, have been carried out. Thanks to the development of cultural diplomacy, which is an integral part of the European Capital of Culture project, Rijeka has been creating strategic international partnerships since winning the title. These are just some of the benefits we can take advantage of thanks almost exclusively to the title of European Capital of Culture. In short - the ECC project has brought and will continue to bring new knowledge and ideas to the entire culture of

Rijeka, to young people and students, the university community. Unfortunately, because of the pandemic, we will be deprived of part of the planned programs, but on the other hand, this abnormal situation has provoked a large number of creative ideas, new ways of communicating with the audience, new ways of using smart technologies. Just to be clear, this is absolutely no substitute for the ECC program that was meant to be. We can only try to preserve everything that should have remained a legacy after 2020. Personally, I think that the title of European Capital of Culture has opened up completely new opportunities for the development of the whole city and despite everything, despite the entire situation, and especially this economic one that the pandemic has left behind, I still think so.

At the opening of Rijeka 2020, there were a number of workers with grinders, and to what extent is Rijeka a city with strong industry today? What are your plans in this area?

— The entire Opera Industriale – the central event at the opening of Rijeka European Capital of Culture – was a great homage to industry, i.e. to the workers who built Rijeka. The city suffered the fate of numerous European industrial cities where the industry of the 19th and 20th century slowly disappeared. This transition happened to us during war in Croatia, and that made it

even more difficult. This is truly a gruelling process that we experienced, but we also survived it. I see the future of Rijeka in the industry of modern technologies, in the development of small and medium size enterprises. I see it as a city of knowledge.

With construction of road and railroad infrastructure, the Port of Rijeka will get a chance for a new momentum. I also believe that Rijeka’s shipbuilding

we have a clean sea of excellent quality and full beaches in the centre of Rijeka. We have renovated and restored life in the Old Town of Rijeka, the program of reconstruction of the facades of Rijeka buildings, mainly from the period of historicism and secession, has been on-going for 13 years, and through interventions in building construction we secured the first apartments for young families of Rijeka. We were the first or

TODAY WE HAVE A CLEAN SEA OF EXCELLENT QUALITY AND FULL BEACHES IN THE CENTRE OF RIJEKA industry will find its place on the global market again, after everything that happened with it, thanks to tradition, knowledge and quality.

You have a rich career and experience as Mayor. How much has Rijeka changed during your term, and what’s left that you personally would like to change first?

— It has changed quite a lot actually. A lot of sports facilities have been built and they operate at full capacity. Today, for example, it is difficult to imagine a time where there were no Kantrida Pools, Zamet Hall or the Campus of the University of Rijeka that emerged from the vision of Rijeka as a city of knowledge and young people.

We have completed several major investment cycles that have restored the municipal infrastructure necessary for the functioning of the city. Today

are among the first in Croatia to withdraw European funds, introduce new technologies, conduct computerization, as well as environmentally sustainable principles. Rijeka is also the most transparent Croatian city. From a city where tourism simply did not exist, today we have a city with one of the highest rates of tourism growth in the country. We invest in the excellence of our young fellow citizens, raise the rank of school standard, we were the first in Croatia to design and introduce Civic education that promotes solidarity, non-violence and tolerance in primary schools, which is an important, if not the most important element of what we call the Rijeka identity. The fact that we are a European Capital of Culture shows an important direction in which we want to move forward, respecting all that is our past.

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Next Normal for Communicators As the question of what would the post-pandemic world look like rises all over the media, the communicators too face a next normal in which the new four C's emerge

JAGODA POROPAT DARRER Business Communication Professional

ccording to United Nation Developing Program the coronavirus COVID-19 pandemic is the defining global health crisis of our time and the greatest challenge we have faced since World War Two. Since its emergence in Asia late last year, the virus has spread to every continent except Antarctica. As the world is slowly reopening its door to economy, it is fair to ask ourselves how this next normal will work.

Due to the lockdown, every event from March by now has been cancelled, and it happened to the world known communication festival in Croatia Dani komunikacije as well.

To recreate the feeling and to spread some new knowledge, the organizers came up with the idea to set up webinars. The one held by Marin Salzman, Senior Vice President, Global Communications for Philip Morris International – Strange days for communicators and the World tackled the next normal for communication industry. „We've come to expect the unexpected – and it's not all bad “, Salzman started her online presentation, and continues by quoting New York Gov. Andrew Cuomo, who isn't

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four new directions and definition to be added to the known ones to mark that way the new era: Compassion, Camaraderie, Civility, Community.

As the world faced the global lockdown social distancing became so social. Downloads of Houseparty video chat app increased from 24,795 on February 15 to 651,694 on March 25 according to Apptopia, and the market share of ZOOM Communications jumped by 130%.

Internet is now a window to

WE WANT TO KNOW BUSINESSES ARE DOING ALL THEY CAN TO PROTECT JOBS AND SALARIES DURING AND BEYOND THE CRISIS exactly known for being warm and fuzzy: „Be a little bit more sensitive, understand the stress, understand the fear, be a little bit more loving, a little bit more compassionate, a little bit more comforting, a little bit more cooperative...we are going to get through it, and we are going to get through it together.“ In the line with that advice, Salzman emphasized

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the world, new reality. As stated Salzman - media consumption is all consuming. Me personally found out that I am spending much more time on my cell phone then I was doing that before the pandemic. From 2.5 hours my online presence jumped to over six hours. „Netflix added 15MM subscribers in Q1 2020 – but warned investors the lockdown surge will likely mean a slowdown in organic

growth post-pandemic. And there's the rub: Once we've settled into our new normal will we see a precipitous drop? Communities are rallying around local businesses, and corporations are mobilizing to support workers and ease isolation. We are finding innovative ways to reach out. “, states Salzman. „Marketers need to be thinking about creative and personal ways to contribute.

For example, by supporting struggling businesses and the unemployed, lifting people's spirits and giving them hope, as well as offering opportunities to join community efforts and help those in need. We want to know businesses are doing all they can to protect jobs and salaries during and beyond the crisis. Innovate to support and help as LVMH did converting three of their perfume manufacturing facilities to make hand sanitizer long before others. There has been no better time for brands to step into the spotlight and show what they are made of – and how they're contributing to the greater good. Action over words, People over short-term

profits, Vision over self-interest. “, concludes Salzman.

According to one study (mckinsey.com), more than three billion people live in countries whose borders are now totally closed to nonresidents; 93 percent live in countries that have imposed new limits on entry, because of the coronavirus. Eventually, the tourists will come back and the borders will reopen, but it is certainly possible that the previous status quo will not return. In three areas in particular—digital commerce, telemedicine, and automation—the COVID-19 pandemic could prove to be a decisive turning point. However, given the general shortage of optimism at the moment, it may be good to consider a few encouraging possibilities.

One has to do with the human imperative to communicate.

In this sense, the death of distance continues to be very real, and very positive. Individuals, communities, businesses, and governments alike are all learning new ways to connect: almost everyone knows a story of the grandparent who finally learned to Zoom, Skype, or FaceTime (Harter, 2020).

Gallup researchers find the percentages that prefer continuing to work from home are highest in technology, insurance, arts, entertainment, media, finance and professional services. Those with lower preference to work from home in the future include education, retail, transportation and construction. One thing we know for sure: Gallup research reveals that the relationship between remote work and employee engagement is complex. Those with some remote work options have the highest employee engagement, while those with no remote option and those who work remotely 100% of the time have somewhat lower employee engagement (gallup.com).

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A1 CROATIA RANKS 12TH IN EUROPE IN MOBILE NETWORK QUALITY

National Statistical Office CROATIA’S NAUTICAL PORTS GENERATED HRK 918.5M IN INCOME IN 2019

In a survey conducted by the telecommunications magazine Connect, Croatia took 12th place among 28 European countries in mobile network operators and communications quality. According to the survey, the Netherlands is in the first place, with the best operators and communications, followed by North Macedonia and Austria. Switzerland is in the fourth place, followed by Slovakia, Finland, the Czech Republic, Sweden, Belgium, Denmark, and Hungary. Croatia is in the 12th place, followed by Serbia, Spain, Germany, and other countries. On the other hand, the best among the 94 mobile network operators in 28 European countries are firstranked Telia Sweden, followed by Vodafone Netherlands in the second place, and Swisscom Switzerland in the third.

In 2019, Croatia’s nautical ports generated HRK 918.5 million in income without VAT, up 7.2% on 2018, and HRK 652 million of that was generated by renting moorings, up 5.4%, the national statistical office says.The highest income was realised in Sibenik-Knin County (HRK 233 million), up 3.5% from 2018. By flag, the largest number of permanently moored vessels came from Croatia (44.1%), followed by Austria, Germany, Slovenia and Italy. The

largest number of vessels in transit came from Croatia (47.8%), Italy, Germany, Austria and Slovenia (4.1%), which makes up 85.2% of the total number of vessels in transit. This survey includes 167 nautical ports on the Croatian coast: 78 marinas, 75 anchorages, nine moorings and five boat storages. The total water surface area was 4.4 million m2 and there were 18,179 moorings.

Croatia Airlines RETURNING ZAGREB FLIGHTS TO AMSTERDAM AND FRANKFURT FROM 25 MAY

EBRD CROATIAN GDP TO CONTRACT 7% THIS YEAR

Croatia’s national flag carrier, Croatia Airlines, are bringing back daily flights from Zagreb to Amsterdam and adding another flight to Frankfurt from 25 May. Currently, Croatia Airlines operates only one

daily international flight – Zagreb-Frankfurt-Zagreb. The airline started resuming some of its air travel operations within Croatia on Monday with flights from Zagreb to Split and Dubrovnik, after a shutdown caused by the coronavirus epidemic. Since 11 May, Croatia Airlines’ flights Zagreb-Split-Zagreb and Zagreb-Dubrovnik-Zagreb have been operating twice a day, in the morning and in the evening. It is expected that additional domestic flights will be introduced.

National Statistical Office ANNUAL INFLATION IN CROATIA DROPS 0.2% IN APRIL

The Croatian economy will contract 7% this year due to the coronavirus pandemic, but a rapid recovery, with a growth rate of 6%, is expected in 2021, the European Bank for Reconstruction and Development (EBRD) says in its spring prospects. A key channel for disruption is tourism, the EBRD says, recalling that in mid-March, the government introduced a number of lockdown measures, with tough restrictions on travel and economic activity. “There was a drop of 75-80 percent in tourist arrivals in March year-on-year, with a similar drop expected in the second quarter and a decrease of about 30 percent in the third quarter, mitigated by the fact that Croatia is easily reachable by land from the tourists’ main countries of residence such as Germany, Austria, Slovenia, Hungary, and the Czech Republic,” the EBRD says.

In April 2020, consumer prices in Croatia dropped 0.2% on the year, which was their first annual decrease since the end of 2016, according to data from the national statistical office.The annual decrease was mostly due to lower transport prices, which dropped 9.5%, first and foremost because of a 20.1% drop in fuel prices.The second-largest annual decrease was recorded in energy prices in the category of housing, water, electricity, gas and other fuels (-1.5%) and the electricity, gas and other fuels subcategory (-3.4%). Month on month, prices in April 2020 also decreased by 0.2%, with the highest drops recorded in transport and housing prices, down 4.5% and 0.9% respectively.

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More than 20 Years of American Higher Education in Croatia We help our students become the best versions of themselves and easily compete in a global job market

DON HUDSPETH RIT Croatia, President and Dean

WEBSITE

IT Croatia is a global campus of a prominent American private university Rochester Institute of Technology (RIT) and has been providing top American higher education programs in Croatia for over 20 years. Established in 1997, this college remains the only institution for higher education in Croatia that grants 2 diplomas – the American diploma awarded by RIT and a Croatian diploma awarded by RIT Croatia.

RIT Croatia is a welcoming and dynamic community to more than 850 students. They attend classes in English, which is the official language of this college, and study in a vibrant international environment.

Furthermore, students receive the American education and diploma of the same quality like RIT’s students on other campuses in USA, China, Du-

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bai and Kosovo. Furthermore, their students have an opportunity to cooperate with their peers from other campuses, and spend a semester or two in Rochester or Dubai.

On their campuses in Dubrovnik and Zagreb, they offer the following American undergraduate (BSc) programs: - International Business (Zagreb) - Hospitality and Tourism Management (Dubrovnik) - Web and Mobile Computing / Information Technology (Dubrovnik, Zagreb)

another American MS program this Fall: Master of Science in Information Sciences and Technologies.

We are living in quite challenging times for all segments of society, including higher education. How have you at RIT Croatia adapted to working remotely and how will you prepare for the next academic year?

— We are witnessing disruptive changes that are occurring as a result of the COVID-19 pandemic and this has impacted

RIT HAS ALMOST 40 YEARS OF EXPERIENCE IN DISTANCE LEARNING In addition, RIT delivers its Master of Science in Service Leadership and Innovation program on Zagreb campus.

The college plans to launch yet

every industry, company and household in the world. In terms of education, this has accelerated digital transformation awaiting all businesses.

And I do not think it will slow down. Being a part of a truly global university, all of the campuses started preparing for online transition very early.

RIT has almost 40 years of experience in distance learning; the infrastructure and tools RIT Croatia uses to teach classes are laid out for both in-class and online teaching. In virtual classrooms, faculty combines synchronous activities (lectures through Zoom and Blue Jeans tools) and asynchronous activities through an online learning platform.

For us at RIT Croatia, the safety of our students, faculty and staff, and our all community has always been a priority number one. Since we transitioned online, we have been in daily contact with our students, to check how they have adjusted to the new situation and what their learning

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experience is. Nothing can replace the interaction with professors in the classroom, but they adapted well, just like we did. We finished our Spring semester in an online environment successfully, delivering classes to 165 sections from 73 different courses. Working in these challenging times rests on our collaboration with students, so the success outcome was a joint effort and we are grateful for it. We are now looking into possible future scenarios so we can properly prepare for the Fall. The future of education is now, and we are ready for it!

What are the advantages of studying at RIT Croatia?

— There are many things that differentiate us in relation to other education institutions.

One obvious is that we are a global campus of a 191-year old American university thus providing American higher education programs, but what stands out the most is our focus on career-development, developing practical knowledge and the cooperative education. RIT is internationally known for its career-oriented education. We offer our students motivating and challenging environment through various projects and interactive study. Our faculty encourages students to develop critical and analytical thinking, and to know how to deal with challenges and obstacles. Being a student-centric institution, we promote individual approach to all of our students. This is done from enrollment and admission to academic affairs to career advising throughout their studies.

Students make decisions with regards to their academic lives and career paths – we are here to help them all the way. With high quality career-oriented education and committed faculty and administration, we help our students become the best versions of themselves and easily compete in a global job market.

How did your students react to online classes delivery at RIT Croatia?

— Overall the response from the students was very positive.

They appreciated the efforts that the professors put in, in very short notice, to allow the

classes to be completed remotely. The outcomes exceeded everyone’s expectations, both ours and the students.

Many students found that they very much like the online platform for learning, while others found that they prefer the ‘live’ in-class model. I believe going forward it will be important to have both models available to the students.

Important part of education at RIT Croatia is the mandatory co-op experience (internships). How did you assist your students to make sure they complete all requirements and gain necessary work experience?

— This academic year, due to the situation caused by the COVID-19 pandemic, finding coop for our students will be much more challenging

internships so that students are not under pressure from the current situation in the world. Finally, we notice a more positive trend among employers when it comes to opening positions for professional internships - the situation is better today compared to March. We are always available to students and our Career Office will provide them with all the necessary support.

We are witnessing a huge impact this situation has on Croatian tourism. One of your programs at the Dubrovnik campus is focused on tourism and hospitality industry – why should future students consider this program?

— The tourism and hospitality industry will certainly be impacted this year by the COVID-19 pandemic, but the

ferrable so even if a student finishes our tourism and hospitality degree program, they are well prepared for entering other industries. This has been the case with our graduates in the past, and I don’t see this being any different going forward.

How did the situation caused

by COVID-19 pandemics impact the end of academic year, more specifically, how did it impact the graduating generation of students? Have they successfully finished final exams?

— All students were able to finish their studies on time as originally planned. Final exams and projects were all held virtually and it went very well. We have postponed our commencement ceremonies to Friday, November 6th, in Zagreb, and Saturday, November

INNOVATION, CRITICAL THINKING, AND CREATIVE THINKING, ARE ALL IMPORTANT PARTS OF OUR REGULAR STUDIES SO THAT STUDENTS ARE PREPARED FOR THEIR FUTURE WORK ENVIRONMENT compared to previous years.

Aware of the current situation in Croatia and in the world, we have adapted this year's internship program by introducing additional models such as projects with companies, academic research and entrepreneurial projects. We have introduced flexibility in terms of the duration and period of

industry will not end, and will recover. Certainly the safety measures and the way in which the industry operates will change. Innovation, critical thinking, and creative thinking, are all important parts of our regular studies so that students are prepared for their future work environment. Also, all of these ‘soft skills’ are very trans-

7th, in Dubrovnik. For students who are not able to attend the November ceremonies they will be given the option to join for the May, 2021, ceremonies. It is very important to us that our students, who have put in great efforts to complete their degree programs, are given the opportunity to properly celebrate their accomplishments.

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European Union Adopts the Zagreb Declaration at Virtual Summit The European Union adopted the Zagreb Declaration at a virtual summit on Wednesday reaffirming the membership prospects for six Western Balkan countries.

ecalling the 2000 Zagreb, the 2003 Thessaloniki and the 2018 Sofia Summits, the EU once again reaffirms its unequivocal support for the European perspective of the Western Balkans. The Western Balkans partners reiterated their commitment to the European perspective as their firm strategic choice. The credibility of this

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video link because a physical meeting was not possible due to the current coronavirus pandemic. The summit was conceived as the central event of the Croatian presidency of the Council of the European Union.

The document highlights “unity and solidarity” in combating the pandemic, for which the EU has prepared a € 3.3 billion package to support the

THE DECLARATION CALLS ON THE WESTERN BALKAN COUNTRIES TO RESPECT EUROPEAN VALUES AND THE RULES OF LAW commitment depends also on clear public communication and the implementation of the necessary reforms,” says the declaration, which is an important document for the future relationship between the EU and the six countries of Southeast Europe.

The summit was held via

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Western Balkans. It reaffirms the membership prospects for the six countries without actually mentioning the word “enlargement”.

The EU is also preparing a large economic and investment package for the region which will be unveiled at a later date because it is tied to negotia-

tions on the next seven-year EU budget.

The declaration calls on the Western Balkan countries to respect European values and the rules of law. It clearly states that the EU deserves greater acknowledgement for support in fighting the coronavirus outbreak than some other actors whose aid has received far greater attention in the region.

“The fact that this support and cooperation goes far beyond what any other partner has provided to the region deserves public acknowledgement. The EU also recognises the valuable support the Western Balkans have given during the pandemic to their immediate neighbours and towards the EU. “The EU and the Western Balkans partners share the objective of a peaceful, strong, stable and united Europe, underpinned by our historical, cultural and geographical ties

and by our mutual political, security and economic interests. The EU is determined to further intensify its engagement at all levels to support the region’s political, economic and social transformation and welcomes the pledge of the Western Balkans partners to uphold European values and principles and to carry out necessary reforms thoroughly and vigorously. Increased EU assistance will be linked to tangible progress in the rule of law and in socio-economic reforms, as well as on the Western Balkans partners’ adherence to EU values, rules and standards.” The declaration goes on to say that the EU fully supports the Western Balkans partners’ pledge to inclusive regional cooperation and strengthening good neighbourly relations, including with EU member states.

“Implementing bilateral agreements in good faith and with tangible results, including the Prespa Agreement with Greece and the Treaty on Good Neighbourly Relations with Bulgaria, remains important in this regard. Further and decisive efforts need to be devoted to reconciliation and regional stability, as well as to finding and implementing definitive, inclusive and binding solutions to partners’ bilateral disputes and issues rooted in the legacy of the past, in line with international law and established principles, including the Agreement on Succession Issues,” the document says.

The EU called on the Western Balkan partners “to progress towards full alignment with EU foreign policy positions, notably on issues where major common interests are at stake, and to act accordingly.”

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Digital Content as Tools for Branding Countries and a Tool for Public Diplomacy Achievement of countries’ international goals and their policies through public action proves to be an increasingly greater challenge. Numerous factors define this challenge

GORAN MILAKOVIĆ White Glove Digital

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iplomacy is traditionally a closed and generally sensitive area that must adapt to the “new”, predominantly digital media world. A media world that is more dynamic than it was before, a world of greater transparency and exposure, both a fragmented and globalized world. Therefore, the challenge is determined by the adjust-

D

fulfilled “state” goals through the country (nation) branding and public diplomacy also in interpolation with the private sector and vice versa. Such projects were based on cooperation with highly specialized communication business subjects, the media, clusters, NGOs and hybrid agencies. My personal continuous work, project management in my own

will identify it with the “classic” branding. However, the “country branding” practice consists of several disciplines, it is controversial and sometimes even politicized, and it differs from company branding. A similar claim was made

by Simon Anholt, the “father” od country branding and the designer of Nation Brand Index.

In simplified terms, he speaks

WITH THE DIVERSITY OF BRANDING, MARKETING, PROPAGANDA, COUNTRY (NATION) BRANDING AND PUBLIC DIPLOMACY, WE CAN FIND SIMILARITY IN THE UTILIZATION OF A COMMON REPERTOIRE OF TOOLS ON THE SAME GOALDEFINED PLATFORMS AND MEDIA. THIS IS PRIMARILY DIGITAL CONTENT ment factor. The other factor relevant for this article is the increased need for creating digital content. The projects mentioned in this article are inspiring examples of utilization of digital content as communication tools.

Throughout the history, we see successful projects that

agency – White Glove which produced several thousands of hours of video materials and somewhat less articles, largely determine the thoughts, theses and empirically describe the tools presented below.

The term “country (nation) branding” seems clear and familiar at first, most people

how country (nation) branding is not something you achieve only through campaigns and catchy slogans. He pays greater attention to benchmarks of culture, religion, regulation of the countries he wants to influence, and their social norms, values and positions.

In that sense, the sector of pub-

lic diplomacy is even more sensitive. For those who encounter this term for the first time, in general terms public diplomacy means the process of communication with foreign public in an attempt to inform and present national ideas, ideals, institutions, economy and culture, and fulfill national and political goals.

It is useful to point out that the term “public diplomacy” is a relatively new term (although we find its manifestation in the very beginnings of diplomacy). It was created in the 1960s with the intention of US foreign policy to replace the negatively perceived notion of propaganda (today, empirically and theoretically, propaganda and public diplomacy are not one and the same thing).

Video or film as a form of digital content is the most attractive form of content for the audience. Studies show that the audience perceives and consumes video content

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more actively than compared to other forms of content. We see a confirmation of these studies also through the increase of video content consumption on all the platforms, appearance of a large number of streaming services, and through greater interaction of the audience with video ads on digital platforms compared to image or text platforms.

Utilization of video content for the purpose of propaganda, public diplomacy or country branding is nothing new. An example that is incredible to many at first, but nonetheless interesting, is the cooperation between Great Britain and Hollywood, as part of partnership between the US and the UK. During and after World War II, it resulted in the production of themed feature films with the intention to represent the British agenda. Another common form is the documentary film. Perhaps one of the most famous examples is the documentary of New Zealand (This is New Zealand) from 1970, which, as they say, completely changed the image of this country in the world. Over the past ten or so years, shorter promotional films, especially for the digital media and platform, take on the form and content of a documentary film.

An example of this form is the promo video for Sri Lanka and an example of a documentary as a tool for public diplomacy is the documentary on diplomacy from the French Foreign Ministry, “Diplomats en action”.

Also, when it comes to production of video content, user-generated video content takes over increasingly greater

PAGE 32

space on digital platforms.

Video content is made also by “amateurs” – social network users, tourists, etc. – and such form of activation with planned and controlled management and strategy can be extremely beneficial.

Part of successful country branding is the classic spot advertising, i.e. marketing.

Almost every country in the world produces it, and one of the finer examples that every marketeer would say it meets all the features of successful advertising is the inspiring and creative series of spots: “Nature Wants You Back” for the promotion of Swiss tourism.

Very often, from the marketing point of view, we can recognize the already mentioned interpolation of private and public. We can recognize the elements of a wider country

of video formats that can be used to achieve goals, and the range of distribution channels is just as wide. A video requires greater resources than for other forms of content, but with new ways of distribution, and with “processing and recycling” it is possible to use one video material to make a series of quality “breadcrumbs” for different channels.

Text and graphic contents are the next relevant tools, and we can divide them into primary printed and digital ones. Of course, the origin of today’s tactics and application of these forms can be found throughout the history. By addressing the European population in letters published in the leading European media, President Abraham Lincoln thus fulfilled the desire and the goal that Europe maintains its

ONE GREAT ADVANTAGE OF DIGITAL MEDIA IS THE POSSIBLE PRODUCTION OF "OWN" MEDIA WITH INSIGNIFICANT RESOURCES branding strategy in advertising private sector brands. We can often see the principles of this action in the marketing of companies of national importance. We can recognize the principles in a production like this beautifully produced video for Scandinavian Airlines. The video places the entire Scandinavian region and its positive values in a context. The video’s role is to promote the company on the values of this region, thus directly promoting the region as well.

There is a wide repertoire

“neutral” status in the American Civil War. Generating content for the print media, with and in the print media is still extremely current despite the predictions of the "fall" of the print media.

Magazines and their content maintain a certain dose of sophistication and power. An example of this type of activation can be seen in the Modern Thailand Project, which started its own publication, i.e. a magazine, and for the second part of the campaign, they established cooperation

in production of content with a globally relevant lifestyle medium.

One great advantage of digital media is the possible production of "own" media with insignificant resources. "Own media" are most often blogs and other forms of e-services or applications. One of the better examples is the House of Switzerland website. On the site itself, we can identify the essential values, sectors and ideals that Switzerland wants to present. This conditioned the thematic division of content, where we see that a large part was produced in cooperation with the citizens and visitors.

An added value of own media is the fact that published content can play the role of a kind of communication "spark". What does this mean?

The possibility that one article or a series of articles becomes an extremely visible and influential element of wider communication strategy through a planned and technically and time-adjusted distribution on the social networks and other media. In this case, content fulfills two functions – interaction with the audience and visibility, i.e. transfer of the desired message.

The given examples show us the importance of digital content as a tool, and a greater part of its methods of distribution. For the most part, the examples relate to country branding. In the second part, we will deal with content for social networks in the context of public diplomacy and the adaptation of communication to "specific" new media.

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