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CMC Ironworks Sisak State-of-the-art machinery worth US$65 million has started operation increasing output

Spring sowing was expected to be highly successful Due to a long period of rain in May and early June harvesting will be a problem

Davor UĹžbinec, Manager, LA Log There are currently 3,500 registered hauliers in Croatia managing around 10,000 transport vehicles

HEAVY INDUSTRY

AGRICULTURE

INTERVIEW

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Croatian Business & Finance Weekly Established in 1953 Monday / 7th June / 2010 Year III / No 0112 www.privredni.hr

S U P P O R T E D

B Y

T H E

pvinternational pv international C R O A T I A N

C H A M B E R

O F

E C O N O M Y

CROATIAN EU ACCESSION NEGOTIATIONS

PREPARATIONS TO START AT THE END OF JUNE

As the opening point at the Intergovernmental Conference to be held at the end of June, Coreper foresees a range of negotiating standpoints which will finally open the remaining negotiating Chapters Lada Stipić-Niseteo

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he majority of the general public is mostly unaware of the seriousness of the tasks related to EU accession. The process of adaptation is mostly facilitated by a narrow circle of professionals whose task is to complete the changes as scheduled. Discussions on the delayed harmonisation of medicine-related faculties with EU propositions, especially in the area of defining mutual qualifications, slow the whole negotiation process in the same manner as the notorious aspect of the judiciary. However, it is often forgotten that the problems of the Croatian educational system are to be solved locally whereas co-operation with The Hague Tribunal will be significantly influenced by general impressions. After a short quiet period, which followed the Easter holiday, the EU Council has initiated the negotiation process again. The Working Group, in charge of preparing the accession agreement draft, exchange ideas on regular basis. Some of the requirements include settling the Croatian-Slovenian border dispute as well as a promise that

Croatia, unlike Slovenia, will not block future accession processes without good reason. The preparations are conducted in a somewhat slow manner as each decision is reached by consensus. The border dispute caused a halt which lasted almost the whole year, and it cannot be ruled out that any other country would not block negotiations for any reason. As the opening point at the Intergovernmental Conference which will be held at the end of June, Coreper (The Permanent Representatives Committee) foresees a document whose content is formally to be confirmed at the Council session, without discussion. It contains a range of negotiating standpoints which will finally open the remaining negotiation Chapters. Numerous Chapters to be closed However, numerous Chapters are expected to be closed. Croatia has

submitted documents which, according to Zagreb, fulfil all the prerequisites related to Public Procurement (the European Commission has already sent its opinion to the Council members). Both the Chapters on Food Safety, Veterinary and Phytosanitary Policy as well as Transport Policy are to be closed in the near future. As three measures related to Taxation have been accepted by the

European Commission, this Chapter is also expected to be closed quite soon. Financial Control, requiring additional constitutional changes, is ready to be finalised. The European Commission is currently preparing the mutual proposition which is to open Competition Policy (additional efforts related to shipyards are expected), making this particular Chapter the last to be opened. In addition, EU Council is finalising the Chapter on the Judiciary. The only remaining Chapter, relating to Foreign, Security and Defence Policy, is currently blocked by Slovenia. 18 of the 33 Chapters have been already closed. A further 11 are currently being finalised, whereas the remaining 2 are currently under discussion by the EU Council Working Group, which is in charge of widening EU membership.


2 VIEWPOINT

Privredni vjesnik Year III No 0112

IVANA PUHELEK, WINE EXPERT AND WINE QUEEN, ZAGREBAČKA COUNTY 2010

The future of Croatian wine industry lies in local varietals

CMC IRONWORKS SISAK

INVESTMENT GENERATES PROFIT

Wine makers should offer such wines which are rare, traditional and typical of their region vana Puhelek believes that Croatia is one of the rare countries having so many different local varietals to draw upon. Croatian wine makers currently grow and cultivate some 130 different traditional varietals. Kraljevina, locally known as “The Queen of Prigorje”, is a traditional Croatian varietal, which has been cultivated in the area of Prigorje for centuries. It was the leading varietal of the Northern Croatian region until the 1980’s and as a wine very popular on the Zagreb market. As a result of changing trends in wine drinking, its popularity declined and was replaced by world renowned varietals. Despite having been neglected for years, its revival began as a project to create a county wine brand. The project was supported by Zagrebačka county and many wine experts who understood the necessity of preserving Kraljevina. The Association of Kraljevina Zelina Manufacturers currently cultivates this varietal in the Prigorje region. Its 33 members own approximately 100,000 grapevines, although not all own the certificate of geographical origin. The sub-region of PrigorjeBilogora, with its barren land, provides sufficient resources for wine-growing and wine production and has a long tradition of wine-production. Kraljevina adapted easily to the Prigorje climate, showing results of exceptional quality. The increased

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IMPRESSUM: Privredni vjesnik Kačićeva 9 10000 Zagreb +385 1 5600020 uprava@privredni.hr www.privredni-vjesnik.hr/ subscription

State-of-the-art machinery, worth US$65 million has started operation allowing the plant is to produce 450,000 tonnes of steel Igor Vukić interest in Kraljevina cultivation, as one of the most popular varietals in North-Western Croatian, as well as the lack of selected wine grapes, have drawn more attention to the need for clone selection. The next step includes the production of clone seedlings, absolutely necessary for the creation of a more up to date production of this valuable and quality varietal. Hence, the winemakers, who produce Kraljevina varietal and its branded wines, Zagrebačka county, the town of Sveti Ivan Zelina and experts from the Faculty of Agriculture started the project of Kraljevina clone selection in 2003 to ensure the permanent preservation and exploitation of this local varietal even after Croatia enters the EU. Wine makers should offer their rare, traditional and regionally typical wines which should be unified with the local gastronomy in the best way possible.

FOR PUBLISHER Nikola Baučić +385 1 4846661 uprava@privredni.hr

IMC MANAGER Dea Olup +385 1 5600028 olup@privredni.hr

EDITOR IN CHIEF Darko Buković +385 1 5600003 bukovic@privredni.hr

TRANSLATION Tr@duco traduco@zg.t-com.hr

EXECUTIVE EDITORS Andrea Marić maric@privredni.hr Vesna Antonić antonic@privredni.hr

COUNSELLOR, INTERNATIONAL OPERATIONS, LANGUAGE EDITOR Ray Fletcher fletcher@privredni.hr

aško Vela, Chairman of CMC Ironworks Sisak board, pointed out at the opening of the new plant that the manufacturing area is spotlessly clean. The totally new building was constructed next to the old plant and includes a US$10 million purifier which can remove 1 million m3 of dust per hour. However, the new purifier is one part of an investment into the ironworks worth US$65 million, which also includes a new electric arc furnace. Construction took almost one year and the foundry became fully operational recently. While Vela drew attention to the silence and clean air, the new furnace is already operating at full capacity. In the past, the foundry area was utter chaos; highly dangerous sparks flew everywhere, indescribable noise levels and dust coating everything. Now, the entire plant is operated by engineers and technicians from a sound-proofed control room. The software has been developed by Exor from Zagreb and the whole production process in Sisak is monitored in the CMC headquarters in Texas via a computer link.

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New technology more than welcome Privredni vjesnik had the opportunity of meeting some of the work-force with 25 years of

service behind them. The general opinion was that they are more than happy with the new machinery, which ensures jobs both for them and another 980 employees, enabling them to apply their skills and knowledge. Whilst preparing glowing hot steel ducts, it was explained that the huge melting vats are stacked one on the top of the other, thereby increasing productivity. “Regardless of the state-ofthe-art machinery, manufacturing processes have not changed greatly; our experience has ensured the smooth flow of production from the new line, which reduces waste considerably”, was the opinion. Productivity in the new foundry is six or seven times greater. As the old factory produced about 70,000 tonnes of steel, the new one is expected to produce around 450,000 tonnes. Some of the manufactured steel will be used in the production of seamless pipes whilst the remainder will be sold on the open market. Year-on-year revenue has so far amounted to some US$100 million and is expected to reach US$350 million. With appropriate cost controls, the plant will soon become cost-effective. This will be the zenith of more than US$200 million of investment channelled into the plant since 2007, when it was taken over by the American CMC company. The new factory is the most substantial American investment into Croatia and its productivity.


www.privredni.hr Business & Finance Weekly

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( 57 litres of rain per m2 in one day

( 130,000 hectares of crops sown

SPRING SOWING WAS EXPECTED TO BE HIGHLY SUCCESSFUL

Slavonia to produce large amounts of corn Due to an unprecedentedly long period of rain in May and early June harvesting spring and autumn crops may be disastrous

Svetozar Sarkanjac s a result of a month-long autumnal drought, sowing in the continental area of Croatia was over a significantly smaller area than had been foreseen. Spring sowing was expected to be more successful, particularly in the Osječko-baranjska county, known as one of the most “agricultural” Croatian regions. According to Ernest Nad, head of the Agriculture, Food Industry and Forestry Department at CCE Osijek County Chamber, this spring a total of 130,000 hectares have been sown with crops in this county. The data, available to the Chamber, show that the most sown crop was corn (65% of total surface area), followed by soyabeans (10.8%), sugar-beet (9%) and sunflower (less than 8%) foreseen for spring harvesting. Notwithstanding the many problems and farmer protests prior

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to sowing, it was completed as planned. “In these hard times, farmers are the first to face the consequences of the financial crisis. Such a situation caused an escalation of existing problems. However, as the government and relevant Ministries implemented appropriate decisions and all interested parties reached mutual agreement, the spring sowing was completed as planned. Commercial banks and larger manufacturing and production systems offered their help by approving loans for spring sowing and providing aid possibilities to farmers and family estates, such as the financing of seed, protective agents and fertilizers”, emphasises Ernest Nad. Potential problems Due to the current weather conditions particularly an unprecedented long period of rain in May

and early June, it is hard to foresee harvest results both for spring and autumn plantings. “Market surpluses are expected to cause problems. Crop purchases will depend on the current situation throughout the region as a whole. For example, if neighbouring countries place larger amounts of wheat or corn on the market, it will have a negative effect both on purchasing dynamics and prices. Lower prices are expected as commodity exchanges foresee lower prices for agricultural products which could remain at a similar level until 2013”, adds Nad. The current situation requires appropriate changes in the law relating to the regulation of collection. Since January 1, 2010, farmers are liable to taxation. According to Ernest Nad, it is impossible for an invoice for delivered wheat is issued in July and paid in March or June next

year. Therefore, greater financial discipline should be regulated through corresponding acts. Slavonia flooded Global market trends as well as recent rain and cold weather will certainly reflect on Croatian farmers. “More than 125 litres of rain fell in Osječko-baranjska county in the period May 14 to May 18. Such a quantity is astounding. Even cultivated soil could not soak up such large quantities. In addition, early June saw further rainfall with June 1 measuring 57 litres of rain per m2, covering agricultural areas, roads, farm buildings and houses. Such irregular weather will influence both crop quantity and quality negatively. Therefore, certain concessions related to economic policy should be obtained in order to stabilise the current situation”, says Nad.


4 INTERVIEW

Privredni vjesnik Year III No 0112

( LA log was founded 20 years ago and today employs 165 staff

DAVOR UŽBINEC, MANAGER, LA LOG

A fragmented market is our major problem There are currently 3,500 registered hauliers in Croatia managing around 10,000 transport vehicles. Small Croatian hauliers do not face a bright future in the EU unless they join forces Krešimir Sočković A Log is the largest Croatian haulier as well as one of the leading transport companies in the region. Founded 20 years ago, today it employs 165 staff and has refrigerator-lorries, tanker-lorries, articulated lorries with trailers as well as normal covered lorries at its disposal. In the first half of 2009, Ralu logistika changed from its original name to LA Log, as it has joined the Lactalis Group. It provides transport services to Croatian, Italian, German and Austrian markets as well as in Benelux and the countries of former Yugoslavia. Davor Užbinec, LA Log manager, comments on their

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business activities as well as on the current conditions for hauliers. €1.5 million have recently been invested in the company. How were these funds utilised? The final €1.5 million investment cycle is now complete; this was started in 2008 and overall now stands at €3.15 million. These funds have been used to improve and expand our transport fleet as well as to introduce and apply new technology, such as satellite tracking of vehicles. How would you describe your transport fleet and which services can you provide to your clients? The company currently man-

ages 90 vehicles, of which 35 are absolutely new. When the number of individual vehicles is considered, LA Log is the largest Croatian haulier. The average life-span of our transport vehicles is 3.5 years. We are equipped for the transportation of any type of goods but specialise in the transport of goods under controlled temperature, which is known as “cold chain”. We have 55 refrigerator-lorries, 7 tanker-lorries, articulated lorries with trailers as well as normal covered lorries at our disposal. LA Log provides Web-Eye satellite tracking of vehicles. How has this improved your services? Web-Eye satellite tracking of vehicles has been introduced only recently. LA Log is currently the only Croatian haulier providing such a service for their clients. Web-Eye is rather useful both for carriers, as it optimises efficiency and reduces costs, but also for clients as it provides a completely new service. It enables us to monitor vehicles on the Internet in real-time. Clients can therefore monitor their goods and efficiently manage their business activities. How would you describe the competition on the local and foreign markets? In comparison with the fragmented Croatian market, the competition in the international and especially the EU market can be considered as rather fierce. There are currently 3,500 registered

Can we compete with EU haulers? As part of the Lactalis Group, LA Log has open access to European roads. How can Croatian transport companies be competitive in such a market? Even LA Log, with 90 vehicles, is considered to be a small company in the European context. However, we can compete with EU companies with quality service and reasonable prices. I believe last year proved to be rather successful for LA Log. hauliers in Croatia managing around 10,000 vehicles. If companies with 30 or more vehicles are excluded, most of those remaining manage on average only two vehicles. This can be considered as the most significant problem of Croatian transport services. Small Croatian hauliers do not face a bright future in the EU unless they join forces, either through clusters or in the form of partnerships with larger companies. Despite the global financial crises, LA Log still manages to make a profit. Both transportation services as well as retail show a 15% decrease on the local market. LA Log management detected negative trends in Croatian economy on time and has therefore offered its services to the EU market. We have applied for several tenders and managed to compete with major European haulers. Several important contracts have compensated for our losses locally.


www.privredni.hr Business & Finance Weekly

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THE FORUM OF ADRIATIC-IONIAN CHAMBERS OF ECONOMY

Adriatic-Ionian macro region to be formed If companies from the region are to be competitive globally governments must encourage small and medium entrepreneurs as well as innovation Jozo Vrdoljak he 10th Forum of the Adriatic-Ionian Chambers of Economy, supported by the European Parliament, was recently held in Ancona Italy, attended by more than 300 representatives from the six countries in the Adriatic-Ionian basin as well representatives from various European institutions. Some 50 companies and institutions from all Croatian Adriatic counties were appointed as members of the Croatian delegation. The most important decisions from the conference stressed the mutual co-operation of various institutions with the aim of forming an Adriatic-Ionian macro region and encourage small and mediumsized entrepreneurship as well as innovation, which will enhance the competitiveness of regional companies on the global market. Jadranka Radovanić, the Forum Chairwoman, Alessandro Grafini, Secretary General of the

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Adriatic-Ionian Initiative, Emilio D’Alessio, Secretary General of The Forum of Adriatic and Ionian Cities and Towns as well as Marco Pacetti, President of Uniadrion (network of Adriatic and Ionian universities) welcomed the concept of an Adriatic-Ionian macro region and stressed the importance of mutual institutional co-operation in reaching this goal. Björn Grönholm, Secretary General of the Union of Baltic Cities, offered help and shared his personal experiences related to the creation of the Baltic macro region.

CCE AND TRADE AND INVESTMENT PROMOTION AGENCY (APIU) OPEN THE DOOR TO CHINA

Export policy The fair in the Chinese town of Ningbo, which will be held from June 8 to 11, will provide an excellent opportunity for 45 Croatian companies to seek international deals, find partners and enter a market increasingly interested in purchasing international goods. With the support of Croatian Chamber of Economy, Trade and Investment Promotion Agency and the Ministry of Economy, Labour and Entrepreneurship, 24 stands will introduce Croatian companies, mostly manufacturing food products. The Chinese Government supported their invitation to Croatian companies by providing 18 stands free of charge, with 6 additional stands being rented. “By combining funds and knowledge, we will provide an excellent opportunity for our companies to contact cus-

tomers and partners in the booming Chinese market”, says Milica Martulaš Rakuša, managing director of the Trade Department at CCE at the promotion of this event recently. “This is considered to be the largest introduction of Croatian companies outside the European market in the last few years”, adds Sani Ljubunčić, the head of AIPU. Together with Podravka, Badel 1862, Kutjevo and Fami representatives, a cross-section of small food manufacturers, winemakers and owners of family farms will attend the fair, hoping to attract future customers as well as Chinese travel agencies. Mirjana Zelenika, representative of the company Izvor Života, will be promoting ‘Carmen Sylva’, a sparkling wine with pine needles, which has recently attracted many British wine traders at the fair in London. (I.V.)

First discussions on EU projects Small and medium-sized companies account for more than 99% of all registered companies in Croatia. They also provide the entrepreneurial foundation not only for countries in AdriaticIonian basin but also for other European countries. Hence, the Small Business Act, introduced by the EU in order to provide help and entrepreneurial access for small and medium-sized companies, and the rôle of the Forum in its application were

the most discussed themes at the conference. Round-table talks included topics related to the rôle of women in entrepreneurship, transport, the tourism industry, agriculture, fisheries and environmental protection. A relatively new topic on EU projects, which generated some fresh ideas for new initiatives and project co-operation, was also introduced. Procedures, held at the Arbitration Tribunal of the Adriatic-Ionian region, contributed to the conciliation process between Albania and Montenegro. The Bosnia and Herzegovina representative required Croatian help in relation to its arbitration processes, following the example of Montenegro. Jasminka Trzun, CCE Vice-President, welcomed the idea and offered any necessary help. According to the new Act, implemented in March 2010, Italian judicial proceedings regard the conciliation process as an obligatory procedure in any civil dispute.

MARKETING

Minimal investment for maximum profit

Attendees at the First Marketing Forum, under the lead of “Where has all the thrill in marketing gone”, tried to solve problems related to creativity within the marketing industry, a lack of precision as to the degree that marketing activities boost individual sales as well as why marketing provides a wider focus on product awareness rather than increasing interest, yearning and action. The word “thrilling”, as emphasised by Orhan Lujinović, marketing auditor and consultant,

is excellent ‘bait’ which should be an integral part of each marketing campaign. According to Lujinović, marketing departments should have a strategic function in every company, as marketing strategies can detect growth potential for every product and develop business strategy for their placement on the market. On the other hand, Ines Došen, Executive manager of the market research agency, Hendal, believes that accurate information is the key factor in advertising. Conference attendees were also able to attend presentations on ‘guerrilla’ advertising and how to maximise profit through minimal investment. Strategic marketing tools and creativity, as the most appropriate prerequisite for successful advertising, were the most discussed topics. (B.O.)


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Privredni vjesnik Year III No 0112

CROATIAN FOREIGN CURRENCY MARKET Currency

Kuna exchange mid-rate

AUD CAD JPY CHF GBP USD EUR

5,037368 5,736692 6,413177 5,162738 8,723246 5,953553 7,260358

Source: HNB

EUR

Almost 50% of respondents satisfied with current jobs A survey, conducted in May by the portal MojPosao, covered some 500 respondents and showed that 45% were rather happy with their current jobs whereas 29% were rather dissatisfied. 52% of those contacted, who are happy with their current position, work for foreign private companies whereas 40% of unhappy employees work for local private companies. Franck dividend of €1.40 per share The Franck General Assembly has decided that part of last year’s profit, amounting to €6.96 million after taxation, is to be used for a dividend payment which equates to €1.40 per share. The remainder is to be allocated to retained profits. The dividend is to be paid within 30 days after the General Assembly meeting, which was held on May 26, according to the report published on the Zagreb Stock Exchange. Croatian Employers Association (HUP): Insolvency problems cleared by autumn The Croatian Employers Association offered to assist the government in tackling the problem of insolvency. In the opinion of HUP, it could be significantly reduced by the end of summer, providing that the government develops a bold operating plan with clear goals and includes public companies at local and state level. Hence, the government should introduce a model of “quasi-governmental factoring”. The basic idea relates to governmental involvement into the collection of outstanding debts with the help of a public institution, such as Croatian Privatisation Fund.

USD

6.00

1.6.

2.6.

4.6.

CHF

5.18

7.28

5.98

5.16

7.27

5.96

5.14

7.26

5.94

5.12

7.25

5.92

5.10

7.24 31.5.

WEEK JUNE 5, 2010

::: news

7.29

5.90 31.5.

1.6.

2.6.

4.6.

5.08 31.5.

1.6.

2.6.

4.6.

ECONOMIC REVIEW

2010 the year of economic survival

Ivana Jović, PBZ analyst, stresses the importance of urgent and whole-hearted support and implementation of the government Economic Recovery Programme to ensure that zero growth and mere survival do not continue into 2011 urrent estimated GDP trend for the first quarter of 2010 show an increasingly rapid decrease in economic activity in Croatia than previously anticipated, amounting to 2.5% when compared with the same period of 2009. Contrary to all expectations, the nett foreign component obviously has not significantly compensated for a sizeable decrease in personal consumption and investment, according to PBZ analyst, Ivana Jović. Statistically, further decreases in GDP in comparison with previous quarters, has shown a slower

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growth. However, her analysis shows a slight decrease in comparison with the period prior to the global financial crisis began. It should be noted that the first quarter of 2009 showed a 6.7% GDP decrease in comparison with the same period in 2008. With a further 2.5% decrease in the first quarter of 2010, the Croatian economy now shows a contraction of 9%, when compared with the first pre-crisis quarter of 2008. Ms Jović also points out that the trend of high-frequency indicators during the first quarter were varied and unstable,

showing a similar tendency in the forthcoming period. Although preliminary estimated trends in GDP for the first quarter of 2010 do not anticipate trends for its components, those of high-frequency data show that domestic consumption and investment still have considerable negative influences on total GDP whilst nett foreign demand only slightly contributed to total economic activity, according to the PBZ analyst. “In terms of salary trends and the forthcoming fiscal contraction (a reduction in pensions and the cancellation of collective agreements), household demand is not expected to recover before the end of the year, regardless of the announced lifting of solidarity taxes. Simultaneous negative trends in the so-called ‘PIGS countries’ (Portugal, Italy, Greece and Spain) as well as a reduction in fiscal incentives in EU countries emphasise negative trends regarding foreign demand. Regardless of the final numbers, it is more than clear that 2010 can be described as a year of economic survival. Urgent and whole-hearted support and implementation of the government Economic Recovery Programme should ensure that zero growth and mere survival do not continue into 2011”, concludes Ivana Jović.


www.privredni.hr Business & Finance Weekly

WE PRESENT 7

GLOBAL PROMET, ZAGREB

D.N.M.B., SESVETE

A simple but Traditional Croatian pastries brilliant idea Customers recognise the quality and foreign visitors buy them as souvenirs

A patented wardrobe for shoes solves the problem most modern families face – where and how to neatly store shoes anijel Blaško, a carpenter from Sesvete, created a patented shoe wardrobe which has become a fashionable worldwide trend. Two years ago, Blaško decided to develop his 20-year-old idea of how to solve the problem most modern families face – where and how to neatly store shoes. However, he did not only have footwear in mind, but he considered the problem of storing other items not having an ideal place in modern homes. Hence, this wardrobe is convenient for storing shoe polish, brushes, slippers, belts, shoehorns and socks, which can be sorted according to their colour or owner, as well as for other small household arti- cles. The wardrobe, with its characteristics of practicality, excellent layout and good air circulation, is manufactured in five different sizes, conveniently adapted to small or large shoes, boots, highheeled shoes and sandals. They can also be manufactured in different colours and sizes. “These wardrobes are very practical with all shoes being neatly stored. As a very functional and attractive product, it is a perfect match for creating order in modern homes”, says Blaško. His wardrobes of various sizes can store up to 50 different pairs of footwear and are ideal even for extremely narrow areas. Although they are currently sold only on the Croatian market, mostly at fairs, Blaško plans to introduce his product to the external market.

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hen Ljiljana Marinac lost her job, she decided to start preparing pastries according to old traditional recipes. “As I was thinking about how to find a new job, I received a present from Italy. It was a wicker basket containing figs in chocolate, which reminded me of old, traditional pastries our grandmothers used to prepare. This is how I came to the idea to start producing bakini poljupci (grandmother’s kisses), which

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Ljiljana Marinac pastries are all hand-made, without additives or preservatives

are made of dried figs and plums, raisins, walnuts, almonds and honey”, says Ljiljana Marinac. She has also created Nonice (“Grannies”), a pastry made of dried figs with almonds, chocolate, oranges and rum, biskupski smokvenjak (“Bishop’s fig cake”), prepared from dried figs, walnuts, honey, candied fruits and brandy, Mandolica (“Almond cake”), made from apples, almonds and lemon as well as Mandolica with chocolate. Global promet also offers traditional Croatian dry biscuit with pepper, carob biscuits as well as those with cheese and olive oil.

In addition, Ms Marinac prepares almonds fried in sugar as well as salted and peppered almonds. “I may proudly say that I have preserved a variety of traditional Croatian pastries, whose practicality and original packaging may serve as a present for any occasion”, she emphasises. Financial crisis affected sales Many specialist stores, Zagreb airport and duty free shops have recognised these original and tasty pastries. “As I do not use additives or preservatives, these products have a rather short shelf life. For example, biscuits may be kept for six months whereas dried fruits for only three. As all pastries are hand-made, it significantly increases production costs. Therefore, my pastries are not sold through large chain stores, which mostly sell ‘industrial’ manufactured products, as their production costs are lower”, explains Marinac, when asked why her pastries are not widely sold. She would like to increase production, but this would require raising a loan to acquire additional machinery. As the current financial crisis has significantly affected sales, she is reluctant to borrow large sums of money. Otherwise, the situation would be completely different as customers recognise the quality of the products, which are often bought as souvenirs. (J.F.)

Export plans “D.N.M.B is currently making arrangements to introduce the wardrobe to the external market.

We have tried to gain support from Croatian diplomatic missions and consulates, including the USA, Canada, Western Europe, Russia and Australia. Unfortunately, we have not received any replies as yet.

Their current plans include co-operation with large Croatian furniture stores, which have shown significant interest. However, we have to wait until the sales boost”, says Danijel Blaško,

Wardrobes can be custom made in various colours and sizes manager of D.N.M.B., which was founded solely for the purposes of manufacturing the wardrobe. In addition to being a professional carpenter, Blaško worked as a “Gastarbeiter” (foreign worker) in Germany for more than 30 years where he was selling hand tools as well as professional power tools. Being aware that purchasing power is currently rather subdued, he decreased the wardrobe price by 50%. When sales of the wardrobe, patented 18 months ago show an increase, he is ready to launch some additional new ideas.(E.D.)


8 ::: news Bayer and Paulana contract signed The Croatian company Paulana reports that it has signed a partnership agreement with Bayer International covering the joint manufacture of ultra-light seats intended for the car industry. The Croatian company representatives announced that this exclusive contract with Bayer International regulates the production of a new polyurethane foam system for car seats. Hence, BaySystems, a part of the Bayer MaterialScience subsidiary office, is to become the major supplier of polyurethane systems for “Paulana” - the first Croatian factory which will manufacture car seats according to its own project. Software for “smart” hotel rooms Bicro, the government centre for business innovation, is to co-finance the project “Wireless smart rooms with on-line reservation system”, developed by Callidus Domus, specialised in the development of applications, “smart” homes and hotel rooms. Bicro has invested more than €35,600, and it is expected that this will cover 50% of total expenditure. Further help is expected from the Zagreb Faculty of Electrical Engineering and Computing. According to a Bicro representative, this project will ensure central application support for small and mediumsized hotels, also characterised by its simple implementation. Wood as energy source shows great potential Croatia shows great potential to

use wood and wood biomass as an energy source. A wider acceptance of wood and wood biomass, the selection of an expert team, simpler regulations, less complex procedures related to the acquisition of the required documentation as well as a construction prohibition of biomass electric power plants which have not allowed the sale of thermal energy, would highly improve the current situation.

Privredni vjesnik Year II No 0112

Historical and cultural experiences for visitors

In the footsteps of Governor Jelačić

A new tourist event aims to introduce visitors to the 19th century of the Governor of Zagreb Sanja Plješa n the slopes of Zrinska gora in Sisačkomoslavačka county there is still a path, formed in the 19th century, which was often used by Governor Jelačić. It connected the plains of Turopolje with the Croatian capital, Zagreb. As this historically significant area was managed by the Croatian governor (Ban), it was called Banovina. However, it has taken years to prepare and organise a cultural and historic path which aims to attract visitors to the area. “Along the paths of Governor Jelačić” is a completely new tourism programme to be promoted by Zagreb travel agencies in the near future. “This is an initial outline of a future tourism programme which is yet to find a place amongst Croatian tourism programmes. It should be implemented as quickly as possible, although prices are still to be defined together additional tourist attractions, appropriate accommodation and gastronomy also need to be simultaneously developed”, says Romana Franjić, Vice-Dean of Zagreb School of Management. As such historic tours are a relatively new to the Croatian market, this programme is considered as rather a good start.

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Imperial Edict What does the path of Governor Jelačić have to offer? In March, 1848 a postman delivered an imperial edict to the then Colonel Josip Jelačić who was at that time in charge of a regiment. The edict named him as the Governor of the Kingdom of Croatia, Dalmatia and Slavonia. In return, Jelačić named the postman the first administrator of Croatian and Slavonian post offices. Visitors on the tour will be welcomed by “Governor Jelačić” and the

“postman”, who will join them on the path to Petrinja, Glina and Topusko. In Petrinja, visitors will be able to visit the General’s building, which used to be the headquarters of the Governor’s brigade, as well as Strossmayer’s promenade, famous for its lime trees planted during the time of Napoleon. Glina, the birth-place

of the Croatian national anthem (composed by Josip Runjanin), is also famed for its park and planetrees, planted according to the plans of Governor Jelačić. Topusko, often entitled “little Opatija”, is popular for its mud spas in Terme Topusko, whose healing powers were used by Sofija, the Governor’s wife.


PV International 0112  

PV International - The first weekly newsletter covering the Croatian economy as well as that of the wider region, in English

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