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Military as economic factor Barracks for entrepreneurs Croatian military industry exports totalled €90.4 million in 2009

Roko Markovina, Faculty of Naval Architecture Shutting big shipyards would cause chaos with many workers losing their jobs

Cargo centre, Zagreb Dugo Selo becomes a container town changing the logistics of South-Eastern Europe

MILITARY IECONOMICS

INTERVIEW

TRANSPORT

PAGE S 2 -3

PAGE 4

PAGE 5 2010

Croatian Business & Finance Weekly Established in 1953 Monday / 22nd November / 2010 Year IV / No 0131 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

FUNDING FOR ECONOMIC COOPERATION

MILLIONS FOR RISKIER INVESTMENT Five new risk capital funds will increase investment potential of new projects to €20 million Krešimir Sočković y the end of this year, five new risk capital funds will be formed that will handle €170 to €200 million intended for investing into the share capital of companies. This ten-fold increase of venture capital investment into Croatia will benefit the Croatian economy, which lacks capital. Moreover bank finance is becoming more expensive and too difficult to obtain. Currently, Nexus FGS, Quaestus Private Equity II, Alternative Private Equity FGS, Prosperus FGS and Honestas Private Equity FGS are in the process of being established. The funds are formed at the initiative of the government in co-operation with private investors, since the government will provide matched funding for economic co-operation on a “one-for-one” basis with private investors, exclusively on a commercial basis and without political influence. Similar projects, such the Israeli Yozma and the British Capital for Enterprise have shown to be a good method of boosting the economy. The first investment in companies should take place during the first quarter of 2011 and the priority rate of return to investors should amount to 8%

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per year. Potential users of the funds will be companies from the energy sector, re-cycling, IT and infrastructure, and some of the funds will be allocated for consolidating companies in certain sectors. Timeless and above politics The president of the Croatian private equity and venture capital association, Mirna Marović, points out that similar projects throughout the world have been very successful. Other countries’ experience have shown that for each unit of currency invested in a specific company, a further five units from other sources can be pooled, says Mirna Marović. Marko Marek, board member of Nexus Private Equity Partners, says these funds basically function by securing fresh capital and liquidity and their goal is to motivate potential private investors and banks to reinvest in the economy. However, only companies which offer competitive advantages and are able to grow fast, can count on this money. Until now, funds has been used for helping unsuccessful companies on the market, whilst the new measure for boosting the economy is “timeless and above politics”. Moreover, decisions on investing

in companies will be exclusively based on market principles, points out Marek. Private equity and venture capital funds were crucial for founding many big companies (Microsoft, FedEx). It can be expected that banks will cover the investment of risk capital funds with an additional €0.5 to €0.7 billion, which could

boost the total amount of investment to €1 billion. If the initiative of funding for economic cooperation and the development of venture capital investment succeeds, the Croatian economy could well start to rise during the interim period at an increasingly higher growth rate than experts anticipate.


2 VIEWPOINT

Privredni vjesnik Year IV No 0131

PETAR ZEKAN, OWNER, CENTAR KONZULTANATA

Small entrepreneurs need consultants The most common problems entrepreneurs face are a low level of formal education, lack of expert management skills, spontaneous growth, poor expense control and heavy liabilities

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he project Network of consultants, which aims at certifying consultants for small enterprises, is trying to organise the market in consulting services. The project includes cofinancing of consulting services, which enables small entrepreneurs to access subsidised services of certified consultants who are registered with the Croatian Agency for SME’s (HAMAG). HAMAG offer their services to beginners and entrepreneurs in the making and they are those who most often use services relating to obtaining funding, such as feasibility and investment studies. The most common problems we face are a low level of formal education, lack of expert management skills, spontaneous growth, poor expense control and heavy liabilities. Centar konzultanata specialises in business consulting for strategic planning, drawing up operational business plans and the implementation of control systems and models. We manage internal processes, create systems of financial and managerial accounting, investment studies and manage finances amongst others. Our activities mainly relate to the construction and tourism sectors and renewable energy sources, but we are also linked to the production of olive oil and wine. I believe Croatia should increase support for small enterprises, since they are the generators of development and prosperity. Furthermore, it is necessary to invest in the training of entreIMPRESSUM: Privredni vjesnik Kačićeva 9 10000 Zagreb +385 1 5600020 uprava@privredni.hr www.privredni-vjesnik.hr/ subscription

( 130 business facilitiess Rented by the Ministry of Defence

MILITARY AS ECONOMIC FACTOR

FAREWELL FOR ENTRE

According to estimates from the Ministry million in 2009, some €35.6 million ove Drago Živković

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preneurs, create a positive entrepreneurial atmosphere, eliminate or decrease administrative procedures and to draw up a map of projects and activities which are regionally supported. We had an initiative for drawing up an economic analysis of the county of Split and Dalmatia. The project would insure control over the economic potential of the county in order to create the necessary conditions for the implementation and monitoring of strategic development guidelines. With this kind of approach, local administrations are gaining a tool for analysing economic growth as well as for predicting further development.

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

ith a budget of €0.64 billion a year and over 20,000 employees, the Ministry of Defence and Armed Forces has great potential not only in a defence-military sense, but also in an economic one during times of peace. This especially regards the engineering regiment and its mechanisation, plus considerable real estate which could be, or is already, used for economic purposes. According to the Ministry of Defence, hiring military to perform engineering and construction works is implemented on the basis of an annual work schedule for the needs of military and civilian buildings. Work in the civilian area is performed according to the demands of local authorities and if there is available capacity, since Armed Forces have priority when hiring engineers. The military provides personnel and machinery for such needs whilst materials and other expenses are a civilian cost. During last year, 30% of total engineering forces were hired for civil purposes. A similar percentage is expected this year. Work on civilian structures con-

tributes to the development of the wider local community and also serves as training for engineers, where Armed Forces incur the same expenses as they would had they performed the training in barracks and on training grounds. Areas of Special State Concern have priority in terms of work carried out. Potential commercial engagement The Ministry of Defence uses help provided to the city of Vukovar as an example of hiring engineering groups for civil needs. Members of the engineering regiments, amongst other activities, participated in providing help to flooded areas of the counties of Slavonski Brod and Posavina, as

3,568 hours for medical purposes In addition to fire protection, hiring helicopters from the Croatian Air Forces, emergency medical assistance, tracking and rescue, transporting organs for transplantations and cargo transport are most often demanded. Emergency medical flights and flights for tracking and rescue are performed at the request of authorised institutions, through the state centre 112. Between 1998 and 2008, military air forces flew a total of 3,568 hours for the requirements of the health system.


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( 117 military facilities scheduled to be vacated

TO ARMS, BARRACKS PRENEURS

y of Defence, the export value of the Croatian military industry totalled €90.4 er 2008

well as Zagreb. The engagement of Armed Forces under commercial conditions is possible in special circumstances and then a contract or an agreement is signed with the end-user. For example, special circumstances include building a pontoon bridge and its commercial use. Such a construction erected for the needs of the Garden Festival in Zadar this year is another example mentioned by the Ministry of Defence. Of 335 military facilities used by Armed Forces five years ago, it was concluded that 218 were viable, whilst 117 were scheduled to be vacated. Barracks for entrepreneurs The Ministry of Defence rents out 130 business facilities mostly used for storage, and land for cultivation. Furthermore, some nonviable military property is used for economic purposes, based on decisions of the government committee for property. All monthly income from the rent is paid into the state budget. In most cases, military property was given to would local government, which

F14 planes and 5 helicopters for fire-fighting Within the Armed Forces, there are organised fire-fighting forces, which were hired 90 times this year, a total of 1,299 flying hours. Fire-fighting forces consist of Croatian land forces, Croatian military air forces and air defence forces, as well as Croatian naval forces and a battalion for special actions. For the fire-fighting season this year, which ended on the 31st October, 14 planes and 5 helicopters were hired. then put it into economic use. For example, land in Gornje Plavnice was given to the city of Bjelovar, which built an entrepreneurial zone on this location. The training ground Jalkovec was given to the city of Varaždin for opening a servicing zone and individual residential and business facilities for motivating small-sized enterprises. An entrepreneurial zone was opened on the location. The former barracks of Taborec was given to the city of Samobor, which will transfer its administration into this facility. 90% local supply The Ministry of Defence is one of the biggest consumers in the system of public procurement. From

food, beverages, clothing and footwear to arms and equipment, this year the Ministry agreed around 90% of contracts for the supply of local products and services. The remainder were agreed with foreign economic bodies, mostly in the area of supplying arms and military technology not produced in Croatia. Regarding Croatian military production, in the past couple of years several modernisation projects have been implemented, with the

goal of making the Armed Forces reliant upon the Croatian economy. A good example is co-operation with the “community of offerors”, 14 Croatian companies which have signed a contract with the Ministry of Defence regarding the procurement of new uniforms. Another example is cooperation with the company HS Produkt, concerning the supply of the VHS assault rifle. There is also a project for the procurement of armoured-fighting vehicles in co-operation with the company Đuro Đaković – Special vehicles. The Ministry of Defence initiated a programme for forming a Croatian militaryindustrial cluster with the goal of building a network consisting of the economy, the education system and science. The Ministry of Defence wishes Croatian companies to obtain, on market principles, the largest possible share of the €2.05 billion which will be spent for military purposes by 2015. The Association of Manufacturers consisting of 44 companies is working in conjunction with the Croatian Chamber of Economy. According to estimates by the Ministry of Defence, the export value of the Croatian military industry totalled €90.41 million in 2009. Full Croatian membership in NATO has certainly contributed to this result.


4 INTERVIEW

( 45,000

people employed in shipbuilding

Privredni vjesnik Year IV No 0131

( US $780 million annual export earnings

Roko Markovina, professor at the Faculty off El Electrical i l EEngineering, Mechanical Engineering and Naval Architecture

Shutting big shipyards would cause chaos Around 38,000 people would lose their jobs, 150,000 people would be left without any means of living and the state budget would lose €0.26 billion with contributions for the unemployed increasing in the price of steel (up by 500% since 2004 when China entered the global shipbuilding, arena) and the failure to provide guarantees over the past few years, allegedly ordered by the EU. Additional reasons responsible for this poor condition are that technological modernisation halted and organisation and ownership systems restructured. The last significant investment in the modernisation of shipyards took place in 2003.

Jasminka Filipas t the 19th symposium of shipbuilding held in Lumbarda on the Island of Korčula in October, 168 experts from nine countries discussed data which cannot be heard or seen in most media. Solutions for salvaging the Croatian shipbuilding industry were also suggested. This motivated Privredni vjesnik to interview Roko Markovina, professor at the department of naval architecture at the Faculty of Electrical Engineering, Mechanical Engineering and Naval Architecture at the University of Split.

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What facts are avoided by the media? The shipbuilding industry directly and indirectly employs 45,000 people. Unlike other economic sectors, which do not work for more than five months a year, the shipbuilding industry counts on 16 months of work plus overtime. Around 200,000 people live from this industry. Its exports bring in roughly US$780 million annually, which amounts to around €0.55 million due to the weak dollar exchange rate. With a multiplier effect of 2.91, consisting of equipment producers, suppliers, subcontractors and others, the shipbuilding industry achieves around €1.64 billion in turnover and contributes €0.26 billion to the state budget. What about state subsidies? In a worst case scenario, subsidies given to strategic industry by the state amount to roughly €0.22 billion. This means that at least €41 million remains

Is this the only problem for the Croatian shipbuilding industry? The large number of permanently employed is also a problem. There is an unsuitable ratio between production and administration workers. The co-operation, often linked to corruption, is poorly organised and the Unions performance is inefficient. All this leads to the conclusion that Croatian shipbuilding is burdened with internal and external problems, but which can be solved. in the state budget from the shipbuilding industry. Furthermore, the majority of technical, technological, control and other innovations have come to Croatia through shipbuilding. A Croatian ship is a world recognised brand, which has thus far won 26 world awards for the “ship of the year”. The Croatian shipbuilding profession is aware it could achieve more. It has been suggesting solutions since 1992, which would double its income from shipbuilding activities in a short period of time, but these have not been recognised by a single government so far.

What has effected the erosion of shipbuilding? The erosion started in 1991 when shipyards became state owned without indemnifying the real owners, and were considered private property of the authorities just as most companies ruined during the transformation. As a consequence, they appointed their “own” leading people and not experts. The only exception is Uljanik in Pula, where professionals have always been in charge. That is why it still operates successfully. The problem was reinforced by an unrealistically high kuna exchange rate and a fall in the value of the dollar, an enormous rise

If shipbuilding perishes, what would be the consequences? Some 38,000 people would lose jobs, 150,000 people would be left without any form of living, departments for shipbuilding in high schools and colleges would disappear, important scientific and research work would stop, the state budget would shrink by €0.26 billion and unemployment contributions would increase. Dissatisfaction would transfer to other endangered producers in agriculture, fisheries, food and the textile industry. I believe chaos would emerge, without any hope of recovery.


www.privredni.hr Business & Finance Weekly

5

CARGO CENTRE, ZAGREB

Dugo Selo becomes a container town In the business zone of Dugo Selo a container town will be situated on 1 million m2 which will change the logistics structure in Eastern Europe Igor Vukić hen the Cargo centre Zagreb is completed in April 2012, lorries heading from Sofia, through Belgrade to pick up cargo in the port of Hamburg will no longer turn from the capital of Serbia to Hungary and thence arrive in northern Germany. They will travel straight to Zagreb and load goods which arrived through the port of Rijeka, in Dugo Selo. In the business zone of Dugo Selo, a container town will be situated on 1 million m2. This ambitious plan was presented last week by Marijan Banelli, president of the Association of Croatian Road Hauliers (HCP) and member of the Cargo centre Zagreb (CCZ) Supervisory Board, a joint-stock company founded over a month ago.

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Opening in April 2012 The foundation of CCZ has been in preparation for seven

years, said Banelli. The company founders are Luka Rijeka, HŽ Cargo, Cargo centre Graz,

transporters, freight forwarders and other private stockholders. According to plans, international

investors should join the project after the land documentation is secured. When the location license is obtained, the construction of the road and railway infrastructure should begin, followed by opening in April 2012. Private investors will finance everything, whilst constructors will be private companies winning by tender. “We are not asking for money from the government,” points out Banelli. Big companies, such as Maersk, Hutchinson Port Holding (Hong Kong), ZIM Line (Israel), Mariner corporation, Dubai Port and many others have expressed interest in working and investing in CCZ, The government of Turkey is also very interested, since goods shipped from China could arrive five days sooner than when shipped through Rotterdam. Chinese companies are also mentioned as potential investors in CCZ.

20th anniversary of Benko Kotruljić

CALCULATE LOCALLY, WRITE GLOBALLY Major projects include structuring and organising accounting forms and register for companies involved in various activities operation with them has brought them the Lexis Nexis award for the best international tax team.

Boris Odorčić he basic activity of Benko Kotruljić, which is marking its 20th anniversary, is in accounting services, the calculation of taxes and salaries in addition to other consulting and administrative services. It was named after a trader, economist, diplomat and humanist from Dubrovnik, Benko Kotruljić (Benedikt Kotruljević, 1416-1469), who is considered as the inventor of the double-entry bookkeeping system, one of the basic principles in accounting. Major projects include structuring and organising accounting forms and register for companies involved in various activities. They also

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make presentations of local regulations and laws to foreign representatives of accounting chambers in co-operation with the Ministry of Finance with whom they held seminars for foreign representatives of accounting chambers. They are a subcontractor to renowned accounting and auditing companies and co-

Conflicting provisions Some of the obstacles that regularly complicate business are those employees face when working with state institutions, due to inconsistent administrative support and complex state apparatus. Financial reports for big multinational companies covering the previous year need to be prepared in the first days of the following year. Since the deadline for submitting financial reports in compliance with Croatian regulations is the 31st March (Financial Agency – Fina), or 30th March (Ministry of Fi-

nance – Tax Administration), additional explanations from both the Ministry of Finance and Fina are often published immediately before these deadlines, which is too late for clients. “A large proportion of these problems result from the fact that provisions within Croatian legislation are conflicting. Laws and regulations are written in such a way that it is possible to interpret them in two different ways. Therefore, it happens that different tax control inspectors interpret identical situations in a different manner. We feel better legislative consistency and more timely additional explanations would immensely simplify our work,” points out Dobrila Mikac.


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Privredni vjesnik Year IV No 0131

CROATIAN FOREIGN CURRENCY MARKET Currency

AUD CAD JPY CHF GBP USD EUR Source: HNB

EUR

Kuna exchange mid-rate

7.40

5,319005 5,291974 6,476364 5,452372 8,661454 5,387217

USD

::: news

CHF

5.46

5.50

7.38

5.44

5.48

7.37

5.42

5.46

7.36

5.40

5.44

5.38 14.11. 15.11. 16.11. 17.11. 18.11.

5.42 14.11. 15.11. 16.11. 17.11. 18.11.

CROATIAN INSURANCE DAY 2010

Foreign deposits increase by 7.8% According to data provided by the Croatian National Bank, money supply and total liquid assets continue to grow. At the end of September money supply totalled €7.08 billion, to which the growth of foreign exchange contributed €4.89 billion. Total liquid assets amounted to €31.88 billion.

Still room for further development

Austrian Hypo Bank withdraws more profit from Croatia Hypo Alpe-Adria-Bank in Croatia summoned an emergency meeting of shareholders, which should decide on the payment of €5.67 million from other reserves, as a dividend from previous business periods. The total amount will be paid to the parent company of Hypo Alpe-AdriaBank International in Austria. In April 2010, during a regular meeting of shareholders it was decided to pay €20.74 million of which €1.03 million went to reserves, whilst the parent company received the remainder.

Jozo Vrdoljak

Signed contracts worth €12.6 million HŽ-Infrastruktura (Croatian Railways Infrastructure) signed two contracts related to the project System of Signalling and Safety Devices at Zagreb Terminal. The contract on the performance of work was signed with a consortium consisting of Siemens Austria and Elektrokem from Zagreb, whilst the contract on the work supervision was signed with the Spanish company Tecnica y proyests (TYPSA). Total value of the contracts is €12.6 million, of which 85% is via non-refundable EU funds from Pre-Accession Assistance (IPA), and 15% from funds from the Croatian state budget.

5.52

7.39

7.35 14.11. 15.11. 16.11. 17.11. 18.11.

WEEK NOVEMBER 22, 2010

5.48

Average pensions are insufficient for a comfortable life. That is why life insurance managers need to give more information to the public on life insurance policy advantages he eighth annual gathering of insurers took place in Zadar this year. It was organised by the Croatian Chamber of Economy, Insurers Association of the CCE and was sponsored by the Croatian Ministry of Finance. The CCE president’s advisor for banking and finance, Miljenko Fičor, pointed out the insurance industry still had room and opportunity for further growth and development. This primarily concerns life insurance. He pointed out that the take-up level between life and non-life insurance in Croatia is 26% to 74%, whilst it is 61% to 39% in EU countries. The CCE is ready to support and join projects which would improve the sector, especially those which inform the public of the importance and profitability of life insurance. Average pensions are insufficient for a comfortable life. That is why life insurance managers need to provide greater information to the public on the advantages of life insurance policies, pointed out Fičor.

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Big changes Total calculated gross premium of insurance agencies amounted to €1.34 billion last year, a drop of 2.7% in relation to the year before. “The financial crisis not only decreased sales of insurance, but also had a negative effect on the

public. Consequently, insurance agencies oriented more towards risk management. In a short period, changes occurred as a result of implementing new technology and creating new sales channels. Additionally, changes are numerous, and regulations are different. It is a question now of how much the insurance sector can change, since it is a conservative industry,” pointed out Snježana Bertoncelj, president of the CCE Insurers’ Association and board

president of Erste Insurance of the Vienna Insurance Group. The leading people within insurance agencies concluded that local insurers manage risks quite poorly and that its business remains non-transparent regardless of evident improvement during the previous year. This might be the reason why Boris Galić, board president of Allianz Zagreb referred to this sector as chaotic, rather than conservative, as some might claim.


www.privredni.hr Business & Finance Weekly

WE PRESENT 7

KNOWLEDGE EXCHANGE, SLAVONSKI BROD

ANALIZA 360º, ZAGREB

When women come together Marketing decisions need not be based entirely on instinct as there are methods of transforming information into arguments which companies then turn into profit dvertising is sensitive work, not only for marketing agencies or the company marketing department, but also for advertisers. It is difficult to choose the right advertisement and targeted groups, but it is even more difficult to predict whether the money invested in advertising will bring return and to what extent, or was it spent in vain. The most difficult aspect might be to evaluate how, where and how much to advertise considering the vast number of media and technological platforms. There is endless contradictory information in the world of marketing, which makes it difficult for entrepreneurs to take decisions about advertising and branding. That is why help from casehardened professionals comes in useful, or even better, women professionals.

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Innovation and money in one place On this web site innovators can sell their innovations at the very start of the design phase whilst companies can find inventive solutions eing an innovator myself, I realised that an innovation is good only if it has a buyer and practical use. The market was missing a link which would, with one click, connect people searching for innovative solutions and those offering such solutions. Therefore, I decided to create such a web site which would link people with money to those with ideas and knowledge, said Bratislav Bukvić, creator and owner of the internet agency www.burzaznanja.com.hr. Bukvić has mainly been known to the public for his electronic tourist guide and protection of industrial design for the project ‘I love the city which constantly sails’ (referring to Slavonski Brod). He is also preparing new innovative solutions. His web site functions quite simply. People who are interested in working via the exchange register on the web site and the same applies to innovators and investors. After sending their information, they receive a feedback contact for the verification of their information and enclosing a contract for business co-operation. Finally

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the individual receives a user name and password for the site. At that moment the site reveals an unlimited offer and demand of ideas, patents, production development, industrial design and much more. Therefore, members of the Knowledge Exchange can trade, buy and sell the published advertisements, pointed out Bukvić. Knowledge leads Europe There are currently 10 registered innovators with around thirty innovations and several investors. “Innovators are college professors, PhD doctors, engineers, managers, predominantly people with knowledge and the desire to expand it. I feel, and so does the wider public I believe, that knowledge is the quickest way to Europe, with the power to keep us there,” concluded Bukvić. He added it took three years to develop the website, and the trial version was released two years ago. He is still updating protection and safety options. All patents are presented on the website of the State Intellectual Property Office. (J.F.)

Turning information into arguments Ozana Jurković and Nada Finderle joined their exceptionally varied individual and even greater collective marketing and advertising experience. During her career, Ozana earned the trust of global companies such as Unilever, Gillette, Kraft, Henkel, and m a n y

others. Before starting her own company, she consulted for Styria, one of the biggest regional media groups. For the past ten years of working in media advertising, new and traditional, Nada gained experience on numerous start-up projects. These included work for Hubert Burda Media, the daily newspaper 24sata, the weekly magazine TV tjedan and others. With such a depth of experience, Nada and Ozana decided it was time to set sail into entrepreneurial waters, individually and as a team. They founded the company Analiza 360°, which they say is one of a kind on the Croatian market. The key skill which Analiza 360° offers is the ability to turn numbers into understandable foresights on the basis of which clients can make marketing decisions in a quicker, more reliable and simpler manner. Analiza 360° aims to help professionals needing to make marketing decisions, whether they be owners of companies, board members, marketing directors, brand managers or media planners. Marketing decisions need not be exclusively based on instinct. There are methods of transforming information into arguments, which companies can then turn into profit. (D.Ž.)


8 ::: news 28% of Croats use mobile internet In Croatia, 28% of Internet users also surf using their mobile phones, according to research from Nokia on the use of mobile internet and applications. Nearly half of all respondents have already been using mobile phone applications, mostly games and multimedia. The greatest problem which discourages Croats to use mobile internet is the uncertainty of surfing expense (49%). 106 million passengers transported During the first nine months of this year 106.4 million passengers and 94.2 million tonnes of goods were transported in Croatia, according to the Central Bureau for Statistics. The number of passengers transported fell by 4.5% over 2009, and goods, measured in tonnes, decreased by 15.1%. During the first nine months, railways took a 49% share of transported passengers, sea and coastal transport with 10%, and air transport with 1%. 12 Croatian companies at the Furniture Fair in Belgrade At the 48th International fair of furniture, equipment and interior decoration (UFI) in Belgrade, 12 Croatian companies from the wood processing sector exhibited their furniture and wood products. The promotion of the Croatian wood processors was organised by the Croatian Chamber of Economy, the Ministry of Regional Development, Forestry and Water Management and the Ministry of Economy, Labour and Entrepreneurship. The companies exhibiting their products as a joint venue covering 500m2 were Spin Valis, Masivni namještaj, Marin BFD, Proizvodnja Javor, Drvoproizvod, PPS Galeković, Spačva, A.G. Dinas, Kordun alati, F e n d i interijeri, Lupino and Bernarda.

Privredni vjesnik Year IV No 0131

FESTIVAL OF OLIVE OIL, GASTRONOMIC DELICACIES AND WINE

LOCAL IS LOCAL Each Croat consumes only two litres of olive oil per year but the aim is to increase it to at least four litres triesHence Croatia can only compete through quality. “We need to gain over customers, primarily through tourism and by increasing exports,” pointed out Miloloža. He mentioned that Croatia is interested in Russ i a n , Scandinavian, Swiss and Austrian markets.

Sanja Plješa t is known that olive oil and olives have exceptional nutritional value. alue. Therefore, greater consumption mption of extra virgin olive oil is recommended. mful fat, prevents It destroys harmful ardidiabetes and cardiases ovascular diseases rain and increases brain cordfunctioning according to recent studies. crease In order to increase awareness of the onbenefits from conl, suming olive oil, various events and festivals are organised throughout Croatia dedicated especially to this oil. Recently the festival off oolive oil, gastroies nomic delicacies and wine was held in Zagreb. Visitors te supreme were able to taste onomic delolive oils, gastronomic icacies made with olive oil nes of extremeand Croatian wines ly high quality. Even though the level of public awareness is still ble level regardnot at an enviable ing consuming olive oil, it needs to be pointed out that Croatian easingly opt for consumers increasingly local olive oils for which they are end more money prepared to spend than in the case of imported ones, opold Botteri, the pointed out Leopold il shop, and manowner of Uje oil ner of the co-opager and co-owner erative Brachia.

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Predominant cultivation in plantations According to statistics, the consumption of olive oil in Croatian households is not at an enviable level, since less than two litres were consumed last year per capita. For example, average consumption in the EU is around six litres of oil per capita. Croatian producers and other experts believe that local consumption should increase to at least four litres of olive oil per year per capita. Last year, five million litres of oil was produced in Croatia, with some 350,000 litres being export-

ed mainly to regional countries. Imports totalled 1.8 million litres, mostly from Greece, Spain and Italy. Regarding the production and consumption of olive oil, the secretary of the Association of Agriculture and Supporting Industry of the CCE CCE, Dražen Miloloža Miloloža, said that atian olives are cul most Croatian culn plantations. Oil is tivated on imported from Greece, Italy n at a price of €2and Spain €3 per litre. Naturally olive Croatian plantations a r e m u c h smaller than in these coun-

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