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Shen Zhifei, Ambassador, People’s Republic of China in Croatia China will not use its huge foreign exchange as a “monetary weapon”

Farmeron: Tools for farmers of the digital era The waiting list has over 800 registered and interested farmers globally

Restoration of cattle breeding on Rab An ethnic village will be built on the agricultural estate




Croatian Business & Finance Weekly Established in 1953 Monday / 29th August / 2011 Year IV / No 0163




pvinternational pv international C R O A T I A N





Arduous finale Certain problems, such as kuna exchange rate or fees paid to the state for the use of coastal land, cannot be tackled by investors. Long term business sustainability is a common goal ready offered 25% of the shipyard shares to workers, whilst Končar proposed that all interested parties – the state, the investor, trade unions and local government – should focus on a common goal and that is long term business sustainability of shipyards. Certain problems, such as the kuna exchange rate for exporters or fees paid to the state for the use of coastal land, cannot be tackled by investors, opined Končar. The fees for the use of coastal land stand at a mere 1% of annual income, nevertheless Končar finds it unacceptable, as in the European Union the profit of shipyards is below 2% even in the best times, and he believes that

Drago Živković he arduous privatisation process of Croatian shipyards has entered its final stage where all interested parties are attempting to achieve favourable positions. Trade unions and the state are striving to save jobs, whilst investors are aiming to assume as little liabilities as possible on more favourable commercial conditions. Juraj Šoljić, as a member of Privatisation Monitoring Commission of 3 Maj shipyard and also Metal Workers Trade Union Commissioner explained for Privredni vjesnik it is vital that restructuring measures are not taken by any shipyard boards, as any action included in the adopted programmes and approved by the European Commission is to be taken in co-operation with trade unions. According to him, some shipyard boards have commenced with restructuring activities, irrespective of several modifications of programmes which, according to trade unions, are yet to be analysed. The merger of 3 Maj, Brodotrogir and Kraljevica shipyards is the most controversial, as it is uncertain whether it is to occur during the first five forthcoming years or in the consecutive five years. In the case of 3 Maj the merger would apparently imply laying off of 670 workers over a five year pe-


riod, sending them to early retirement or retraining them, which has yet to be decided. Privatisation of shipyards is a political decision and the government can take it whenever it finds it appropriate, nevertheless Šoljić anticipated that all social partners will be consulted on the final decision. Full-time Commission Šoljić stated that the government has to make a decision on the continuation of work of the Privatisation Monitoring Commission after the signing of the Sales and Purchase Agreement. Trade unions are advocating that the Commission should be

authorised to assess the level of assumed liabilities of the new owner and that the assessment should have a significant impact on the report to the European Commission. Nenad Končar, Director of Jadranska ulaganja, the company which is supposed to take over 3 Maj, Brodotrogir and Kraljevica shipyard, is fundamentally not against the continuation of work of the Commission. Nevertheless, he mentioned the fact that rigorous privatisation monitoring is already being conducted by the government, the Ministry of Economy and the European Commission. The investor has al-

The merger of 3 Maj, Brodotrogir and Kraljevica shipyards is the most controversial such a tax prevents businesses from operating profitably. Nevertheless, Končar is optimistic and believes that Jadranska ulaganja will take over the three shipyards by 1st October. The first sessions of the Privatisation Monitoring Committee are scheduled for the beginning of September and they might shed some light on the events occurring in the forthcoming future.


Privredni vjesnik Year IV No 0163


Stand on solid ground It cannot be said that the interruption of big infrastructural projects is the only cause of the crisis. The business of certain companies was afflicted by inexperience and lack of realism

he recent past has been marked by the extreme boom in road construction which lasted seven years. Afterwards, the crisis has affected the entire construction sector for the past several years. The result is the present condition – some companies perished and a large number of those who managed to survive are desperately struggling. Such a favourable period for Croatian companies will probably never repeat itself. However, recovery is visible despite the significantly decreased quantity of work. Those that survived were those that stood on solid ground during the period of favourable circumstances, mainly the result of the construction of state, county and local roads. They reinvested or retained profits, but they did not plunge into uncontrolled expansion and new debt. The construction sector had a very long favourable cycle since big infrastructural project were created which generated a series


IMPRESSUM: Privredni vjesnik Kačićeva 9 10000 Zagreb +385 1 5600020 subscription

of smaller ones. The number of companies grew, assets were bought, investment in businesses not linked to the core business was made, and profits earned. On the other hand, appetites grew as well as uncontrolled indebtedness in some cases. Companies acquired a large number of machines and construction operations grew and these machines were mainly leased. Therefore it cannot be said that the interruption of big infrastructural projects is the only cause of the crisis. The business of certain companies was influenced by inexperience and a lack of realism. During the last year and the year before that, almost all investment was interrupted. However, this year investment slowly began to pick up. However, I am not sure whether financing has been secured. There is more work compared with a year ago, but illiquidity remains a big problem. Yet again, those standing on solid ground during the boom, managing to maintain profitability, will manage to overcome this period. Tehnograd has been a successful company during the past twenty years, completing local projects and still operating solidly. We strive to perform quality work within agreed deadlines. If mishaps do occur, we correct them immediately without any questions. This is how companies should act, and for a more significant recovery of the sector and exit from the crisis, new, bigger investments in the infrastructure will be necessary.

FOR PUBLISHER Nikola Baučić +385 1 4846661

IMC MANAGER Dea Olup +385 1 5600028

EDITOR IN CHIEF Darko Buković +385 1 5600003

TRANSLATION Lučana Banek Mirjana Cibulka

EXECUTIVE EDITORS Andrea Marić Vesna Antonić



% increase of Chinese exports to Croatia


China will not u reserves as a “

Chinese government placing significant focus on the develo Svetozar Sarkanjac he Chinese economy currently ranks as the world’s second largest as a consequence of thirty years of permanent growth at an average annual 10% rate. According to expert estimates, China will replace the US in becoming the world’s leading economic power in the forthcoming future. Shen Zhifei, Ambassador of the People’s Republic of China in Croatia, illustrated the strong and primarily stable growth of the Chinese economy for Privredni vjesnik. The Chinese economy has achieved considerable success since China initiated reforms and adopted a policy of opening up to the outside world in 1978. GDP surged from $140 billion in 1978


China will continue to pursue the strategy of opening-up for mutual interest, the deepening of economic co-operation with the world and the promotion of mutual development to $6 billion in 2010. The rapid development of the Chinese economy was achieved mainly as a consequence of the choices made by the Chinese people to adopt reform policies and the policy of opening up to the outside world, together with socialism. Consequently, China will continue to pursue the strategy of opening-up for mutual interest, the deepening of economic

co-operation with the world and the promotion of mutual development. China has achieved remarkable success in its economic development, although it is still considered as a developing country. The Chinese economy is huge, yet GDP per capita is currently merely $4,000, which ranks China as 100th in the world. Nevertheless, China has to make arduous endeavours to join the medium-level developed countries by the middle of the century. Chinese foreign exchange reserves are approaching a record amount of $3 trillion. How is China, with its huge financial power, planning to impact on the recovery and development of the world economy? China is a responsible large country and we are not going to use our foreign exchange reserves



( 97.3% surge

of Chinese imports from Croatia


use its huge foreign exchange monetary weapon”

opment of economic and trade relations with Croatia, advocating co-operation for mutual interest

as a “monetary weapon” to the disadvantage of other countries. China is, on the contrary, striving to assist countries faced with crises by purchasing government bonds and consequently providing assistance as they overcome their difficulties. In addition, Chinese foreign exchange reserves have accounted for an increase in our foreign investment, with the Chinese government placing significant emphasis on guaranteeing the safety of those investments. What are Chinese plans regarding the European economy and the EU specifically? Economic and trade relations between China and Europe are witnessing permanent increases and becoming the most dynamic and the most influential bilateral economic and trade co-operation globally. 35 years ago, the bilat-

eral trade in goods and services between China and the EU totalled merely $2.4 billion; that level is now achieved in just two days. The bilateral trade in goods and services has increased 150 times. The EU has been the largest Chinese trade partner, the largest export market, the largest source of technology imports and the second largest import market for years. In tandem, China has been the second largest trade partner and the largest importer of European goods. The Chinese government advocates win-win co-operation. What does this model imply in its co-operation with Croatia? China and Croatia are traditionally friendly countries. In the last 19 years there have been intensive visits at a senior level significantly encouraging the

permanent development of bilateral relations since diplomatic relations were established. Nevertheless, current economic and trade co-operation is still at a low level and there is huge potential for growth. The Chinese government places significant emphasis on the development of economic and trade relations with Croatia, advocating co-operation for mutual interest. In bilateral trade, China has identified the problem of the Croatian deficit. China has taken a range of practical measures for improvement and achieved a certain level of success over the last few years. According to Chinese customs data, bilateral trade has seen an increase of 8.7% during the first half of 2011 – Chinese exports to Croatia have increased 6.1%, whilst Chinese imports from Croatia have surged 97.3%. Simultaneously, according to the Croatian Bureau of Statistics data, Chinese exports to Croatia were 2.2% down, whilst Chinese imports from Croatia were 22.3% up over the first half of this year. From a philosophical point of view, the trade balance is relative, whilst any trade imbalance is absolute. China is prepared to strengthen trade in services between the two countries in order to compensate for the deficit from the Croatian side in the bilateral trade of goods. One such activity is encouraging Chinese tourists to visit Croatia. I am convinced that bilateral trade between China and Croatia will achieve balance and permanent development through co-operation in trade in services. We place considerable emphasis on enhancing investment in Croatia through the active en-

couragement of companies from both countries towards bilateral investment, where we not only encourage Chinese companies to actively analyse the Croatian market, but also offer a range of advantages to Croatian companies wishing to enter the Chinese market. What assistance is the Chinese Embassy in Croatia offering to those interested in business cooperation with China? Trade is crucial for both China and Croatia and our main thrust is through companies. Chinese government institutions and the Chinese Embassy in Croatia offer a range of business information services to both countries. I am convinced that there is huge potential for the strengthening of trade both in goods and services, mutual investment and co-operation for mutual interest. You have been the Chinese Ambassador in Croatia for a year. Which areas have you identified as providing the best business opportunities and cooperation between Chinese and Croatian economies? In my opinion the optimal opportunities are in the field of traffic infrastructure construction such as railways and in tourism through mutual measures from both governments. There is huge potential also in personal exchange between the two countries. The number of Chinese citizens wishing to be better acquainted with Croatia and examining the huge potential of economic and trade co-operation between the two countries is growing rapidly.


Privredni vjesnik Year IV No 0163

( 800 farmers ( 25 licences globally showing interest

for management systems


Tools for farmers of the digital era The waiting list has over 800 registered and interested farmers globally Svetozar Sarkanjac uring the recession in Croatia and beyond, venturing into entrepreneurial waters was considered an act of bravery. This is precisely what, less than a year ago, two young men from Osijek did. They formed a company Agerpreeo for the production of agricultural software. As they explained, they decided to develop a tool which would offer farmers a simple and more transparent insight into production efficiency and which would help them make decisions and reduce expenditure. Soon after establishing the company, they took over the FMS development project (Farm Management System) for the management of livestock production on cattle breeding g and milk farms within the framework of the Croatian agricul-


tural system. After the successful work, they placed 25 licenses for desktop applications for Cattle farming management on the markets of Croatia, Bosnia and Herzegovina and Serbia. Natural combination Although at first sight this seems an unusual combination of young IT’s and agriculture, this is not the case. The bases for such a specialty were their degrees from the Faculty of Organisation and IT in Varaždin, as well as a long family ttradition in agriculture. ad They both come T from the area f of o Miholjac. “Since I was a cchild I lis-

They refused €1.4 million worth offer The promotion of the web application was held in July in the regional Mini Seedcamp in Ljubljana. The project was selected, as the only regional representative, to participate at the London Seedcamp, where Farmeron caused great interest from investors and media. After, they were offered to sell the entire company for 1.4 million. The young experts and entrepreneurs refused the offer. According to Kopić, their long-term plan is to keep the development centre in Osijek. However, in order to have an easier approach to capital and quality market experts, they plan to open branches and move the company headquarters to one of the world software industry centres such as London, San Francisco or New York. tened to problems of agricultural production, so this area is not unfamiliar to me. During my studies, I thought about how to create a basis for making agricultural decisions. Together with my colleagues, I tried to create a prototype of certain software modules and offer it to farmers. They found it interesting and we noticed they were missing sometthing. Most of today’s soluttions offered to farmers ffocus on large consorttia, on corporations tthat find it important tto cover the crucial sside of the farming business. They are sales, marketing, clients, storage facilitties and many others. Until now, no one U hhas focused on the core essence of farming operations in such a way as to digitaally copy these operattions into software. First we developed F aan application for ddata management in calf fattening and

then in milk production. Now we are working on farming in order to round off one production cycle of our offer,” says Matija Kopić, CEO of Agerpreeo. Through internet to farmers This is how Farmeron was developed; a web application for the supervision and analysis of farming efficiency. In order to bring it closer to smaller farmers, they concentrated on the web instead of the former approach of desktop applications. The result of such a strategic decision in the company’s development is the fact that the software module for the monitoring of calf fattening and milk farms is on the web. The application is in English, since it is intended for the global market and represents a combination of cattle farming data management solutions and an advanced module for analysis and reporting. Such a business decision is justified by over 800 registered and interested farmers globally on the waiting list – from New Zealand to the US. Farmeron is expected to be launched on the global market in a matter of days. Business & Finance Weekly



€14 million revenue generated by ACI No modifications in prices in ACI marinas, but remarkable success achieved which is usually around Easter time. The success is remarkable as there have been no changes in prices since last year. Total revenue generated by ACI over the first seven months of 2011 was €14.05 million, 7% up over the same period last year. Gross profit was 24% up, at €3.12 million.

ccording to several indicators, Adriatic Croatia International Club (ACI), the largest marina chain on the Adriatic, could see its


most successful season. Results from the first quarter recorded a gross profit of €4,400. This is the first time profit has been made prior to the start of the season,


Marina Split – the most successful An increase in revenue has been recorded in all ACI marina revenue categories; €7.3 million for residential moorings over the first seven months in 2011, an

increase of 5% over 2010, whilst monthly mooring fees generated €0.54 million (11% up), €3.18 million (3% up) recorded for transit moorings, €0.95 million (15% up) from leasing and €1.84 million (22% up) from other marine services. According to business results, the best overall results were achieved by ACI Marina Split with €0.72 million in gross profit (25% up), followed by ACI Marina Dubrovnik with €0.70 million (13% up), ACI Marina Rovinj with €0.43 million, (17% up) and ACI Marina Umag with €0.41 million (13% up). (J.V.)


16.8% is the registered €11.31 billion assets unemployment rate I

ccording to the latest data provided by the Central Bureau for Statistics, in July the unemployment rate registered a minimal decrease in relation to June, standing at 16.8% (16.9% in June). The unemployment rate dropped slightly, even though the number of unemployed increased in relation to June (by 84 people or 0.03%), which leads to a conclusion that growth of the total workforce was stronger than the growth in unemployment. Furthermore, the seasonal characteristic of unemployment rate movements is visible in the fact that the July rate was the lowest


since August 2010, but remains higher compared with July 2010, as shown by the unemployment figures which increased by 4,803 people or 1.7% in relation to July 2010, warn RBA analysts. In July 2010, the unemployment rate stood at 16.4%. With the beginning of autumn and the lack of a positive contribution from seasonal hiring, we expect further and more intense unemployment growth on a monthly level. RBA analysts also warn that recovery in the real sector is a precondition to any recovery in the labour market. Although current indicators point to the beginning of some economic recovery, positive impulses remain considerably weak to generate new jobs and employment. Even though the unemployment growth rate year-on-year is considerably lower, partly because companies had already downsized the number of workers as much as they could in order to continue with normal performance, generating new jobs remains a challenge. This especially hit the age group between 25 and 34, which shows the largest share of unemployed (24.6%). (V.A.)

n July, the monthly downfall of total assets of the Croatian National Bank continued. According to their latest report, assets dropped to €11.31billion, some 0.6% less compared with the end of June. Year-over-year total assets continue to show growth. However, the 2% growth rate is considerably lower compared with previous months. Considering foreign assets account for 99.98% of total assets, the trends are the same as in the case of total assets. Foreign assets (or international reserves in the form of term deposits in foreign banks and placement into securities denominated in foreign currencies) amounted to €11.29 billion at the end of July. Since around three quarters of international reserves are denominated in Euro, the shrinking of the kuna in relation to Euro (2.8% per annum), contributed to an annual growth of foreign assets (+2%). The relatively small amount of bank claims is a consequence of a high level of liquidity in the system. On the side of CNB

liabilities, primary money is the largest component. At the end of July it totalled €7.72 billion, €0.78 billion less than in June, but €0.31 billion more year-onyear. The considerable decrease in overnight deposits at the end of July (to €0.16 billion from €1.08 billion in June) probably contributed to the monthly growth in primary money, according to RBA analysts. Foreign liabilities of CNB remain unchanged in relation to June, amounting to €0.05 million. Due to considerable obligations towards international organisations during last year, this is €1.12 million less compared with the end of June 2010. (V.A.)


Privredni vjesnik Year IV No 0163




Kuna exchange mid-rate


5,433792 5,245328 6,721476 6,522543 8,451268 5,173052 7,470921



















4.760 22.8.

WEEK AUGUST 27, 2011



5.160 22.8.





6.50 22.8.





::: news


Podravska banka issues bonds Podravska banka has issued €10 million hybrid bonds. The bonds have been issued in the names of specific owners; they are transferable and Eurodenominated, with currency clause pegged to the Euro, maturing in 2018. They are 7% annual coupon bonds payable semi-annually. Over 80% of bonds have been subscribed by private investors, with Agrokor amongst the top 10 investors, having invested €1 million.


Foreign debt up €1 million Gross foreign debt stood at €47.49 billion around the end of May, which was a nominal increase of 2.2% over the end of 2010, or slightly exceeding €1 million, according to the latest Croatian National Bank data. On a monthly level the debt saw an increase of €351.3 million or 0.7%. Banks had the greatest impact on the increase, as their debt exceeded €12 billion at the end of May. Sate foreign debt stood at €6.88 billion, matching April figures, whilst 4.3% up or €283.6 million over the end of 2010. Civil engineers facing losses Entrepreneurs in civil engineering saw a consolidated loss of €0.17 billion at the end of 2010, according to the data by the Financial Agency Fina. The absolute decrease in physical volume of construction work was 15.9%. Fina data indicate that the number of entrepreneurs in civil engineering increased by 2.4% in 2010 over 2009, but also that entrepreneurs in this sector recorded a decrease of 21% in total revenue in 2010, their total expenditure was 19% down, profit decreased 10.1%, whilst there was a considerable increase in losses (49.6%).

By the end of the year the Bank will approve loans without a currency clause with three models of their insurance y home, my freedom it is a far fetched dream for most people. The salvation, if it can be called that, is in Euro loans; God forbid in Swiss Francs, for so many people are struggling to survive. Hrvatska poštanska banka (Croatian Postal Bank) decided last week to offer a new product – housing kuna loans without a currency clause. The Bank opted for such a move on the basis of continuous improvements in business results and financial indicators, a favourable structure of financial sources and a good liquidity situation. Until now HPB offered its clients housing loans with a currency


A possible extension of housing loans offered in kuna will depend on the forthcoming market situation clause in Euros, but had never offered loans in Swiss Francs. Moreover, the Croatian Postal Bank was one of the first to lower the interest rate on housing loans at the beginning of the year, below 5% for certain categories of clients, whereas the regular interest rate for this type of credit is 5.95%. Higher interest rate Considering its specific situation in the banking market and connection to savings and

deposits in local currency, they decided to include housing kuna loans in their range which will last until the end of this year. A possible extension of housing loans offered in kuna will depend on the forthcoming market situation and the Bank’s currency, interest and liquidity risk assessment, HPB points out. The difference in the conditions under which the Bank will approve housing kuna loans and those expressed in the currency clause is in the interest rate which

will be half a percentage point higher. Regarding loan insurance, clients are offered three models, and one of them supports the approval of loans without bail. Borrowers can also use purpose deposit, collateral on property, life insurance policy and shares in the HPB Invest funds. The maximum deadline for repayment is 30 years with a possibility of grace period of up to 12 months. Furthermore, the loan may be used to repay previous housing loans at HPB or other banks. (V.A.) Business & Finance Weekly




Luxury in the peaceful oasis of Dalmatian zagora

Local Croatian pasta Our main objective is the production of homemade products with added value

In general, visitors are delighted since they arrive at a completely non-urban area, a domesticated environment and organised estate illa Olka, the only tourist villa in the area of Dalmatian zagora, with five stars, started commercial operations this year. The villa is owned by the family Dundić and after renovation of the villa and the entire estate made it suitable for renting to more affluent visitors. Brela, located 22 kilometres away, is the nearest tourist village. However, not a single visitor has yet swum there, simply because there is a pool within the villa facilities. There is also a sauna, jacuzzi, gym and wellness centre. These


The villa is booked by exceptional agencies specialised in this type of tourism and other additions offer visitors various sports and recreational activities, such as billiards, bowling alleys, card tables, or darts. In general, visitors are delighted since they arrive at a completely non-urban area, a domesticated environment and an organised estate with many details which the owner brought from his travels. Villa Olka is a 150 year-old restored house which was partly destroyed during World War II. In

addition to the villa, tourists can also stay in a one storey house that was restored from a building once used for meat curing. Now, it is equipped with a big fireplace, bread oven and en suite room. Villa Olka has seven luxuriously equipped rustic style rooms. Careful selection of visitors The villa is rented as a totality, seldom by the room. This season we had visitors from Russia, Great Britain, Germany, Austria, Italy and Poland. The villa is booked by exceptional agencies specialised in this type of tourism. Visitors are of different ages, although I believe the building will be rented more to the elderly considering the design and the indescribably peaceful environment. I decided not to rent the villa to anyone. I will choose them carefully. When the tunnel through Biokovo is finished, Villa Olka will be 10 kilometres from Baška Voda, allowing it to accept visitors and increasing overall competitiveness. For now visitors are offered a carefully planned seven-day stay and activities such as rafting, riding, cycling, wine cellar tours, gastronomy tour, religion tourism and an excursion to Imotski. (J.V.)

ariolina, a company from Krk, clearly indicates that the production of fresh and dried pasta in Croatia does not have to be avoided merely because it is still at its inception stage and that it can be a huge success. The company’s tradition dates back to 1993, whilst it became a food production and catering business in 2008. It employs four full-time


High levies imposed by shopping centre chains are a serious problem staff and several more during the peak season, producing macaroni pasta, fuži (Istrian pasta made from homemade dough), multicoloured pasta spirals, Krčke šurlice pasta (hand-made pasta with a particular shape), handmade gnocchi and spaghetti. Boris Dujmović, Director and owner of Mariolina, pointed out that the company is equipped with state-of-the-art technology and it constantly invests in training and an increase in quality and productivity, which is vital to be competitive. “Our main aim is the production of homemade products with added value. Such products are imperative for quality business activity and create our competitive advantage over classical products which are normally included in the pasta range. Our production capacity is currently restricted to a daily maximum of 800 kg”, stated the

Director, whose products can be purchased in several shopping centres, stores and restaurants. Levy imposed by traders Competition is huge and is becoming increasingly fierce, added Dujmović. “Our biggest problem is underhand competition at a local level, primarily for krčke šurlice which are legally produced in this region solely by Mariolina”, he explained. High levies imposed by shopping centre chains are a serious problem, consequently impacting on considerable increases in domestic product prices. The levy considerably exceeds prices of raw materials and other expenditure which is absurd, yet true. “We are helpless here as we depend on shopping centre chains but are not allowed to negotiate conditions”, emphasised Dujmović. Since total Croatian production can be compared with a medium sized Italian pasta factory, he claims that a network of quality producers and the formation of a strong and consistent co-operative of producers is an imperative. Subsequently, there would be huge potential for development of their own technology and Croatian producers would not have to depend on more costly Italian technology and consequently become more competent. He added that the company’s objectives for the forthcoming future embrace further investment in technology in order to achieve higher quality and unique products. (B.O.)


Privredni vjesnik Year IV No 0163


When a dream becomes reality An ethnic village will be built on the agricultural estate above Barbat where tourists will be able to experience a past way of life and the cuisine Sanja Plješa he largest number of producers of milk or sheep milk products can be found on the islands, predominantly Pag, Brač, Krk, Cres and Rab. Many years ago, owned by the co-op and then Merkur (the former largest commercial organisation on Rab), there was a so-called economy (to-


day’s farm) where sheep were bred and cheese produced. After Merkur, the farm was taken over by the companies Diona and Gavrilović. However, in time this business deteriorated. At the beginning of this year it became privatised and the concession of 20 years was issued to Slavko Perkić, owner of the craft Diving and Stonemasonry Services from Barbat on Rab. Cheese factory for the production of sheep cheese At the beginning of this year I bought the entire equipment and sheep herd from Diona with the aim of creating a brand on the agricultural land. I intend to build an ethnic village, where tourists will be able to taste lamb and other local products, primarily sheep cheese, said Perkić. He will build houses and display

various tools so tourists will be able to experience a past way of life. The Perkić farm spreads across 500 hectares; it has 450 sheep and 25 rams, and the herd will soon produce offspring. The production of sheep cheese will start in April 2012, and he plans to build a barn for milking by the end of this year or the beginning of the next. On his private estate, below the farm, Perkić will build a small cheese factory, and according to his estimates, in the beginning he will produce half a tonne of cheese in one milking season. The sheep are milked from 70 to 90 days during each year, depending on their quantity of milk and nutrition. Furthermore, Perkić believes 300 sheep will be milked during the next two to three years, increasing the production of cheese.

Fishermen houses as an attraction So far we have restored the water-hole, built a sheep dip and designated the space where we will build a barn for milking 150 sheep. We invested around €30,000 in this project. In order to improve it even further, we will also compete for EU funds, pointed out Perkić He had already submitted the project documentation to the cattle breeding fund, and he hopes to obtain state subsidies next year. Perkić will not stop there. He is already considering preserving drywalls and plans to open a school for drywall builders. Nearby, there is a beautiful bay called Mel, where there were once two fishermen houses which Perkić intends to restore and promote as a tourist attraction.

nominally 1.34% higher. On a year-on-year basis, the average monthly salary was nominally 1.53% higher. The growth of average salaries on a year-on-year basis is primarily a consequence of the changes to the system of income tax and cancellation of the lower crisis tax rate by 2% from June 1st 2010.

stores across Croatia. The regional co-operation also includes Raiffeisen Bank in Bosnia and Herzegovina that also signed the contract. RBA currently has a 20% share of the POS terminal market, and it registered an increase of 15% during the first six months in 2011. Mercator Group achieved €1.054 billion income in Southeastern Europe, which is 23.1% more in relation to 2009.

::: news Large companies in big surplus

Large companies last year created a €0.65 billion consolidated nett profit, some 311.3% more over 2009, when they operated with around €0.16 billion. According to data provided by FINA, SME’s achieved an overall nett loss in 2010. Medium-sized entrepreneurs also posted a nett loss of €0.54 billion, and small-sized enterprises similarly

with €0.34 billion. Total result of all entrepreneurs was a nett loss of €0.23 billion in 2010. Average monthly nett salaries of large companies stood at €785, 24.7% more than the average (€630). In the case of small-sized companies, employees received average monthly nett salaries of €515, which is 18.3% below the average. Average nett salary €10 higher Average nett salary per employee in companies stood at €743 in July, according to data provided by the Central Bureau of Statistics. In relation to May, average nett salary in June was

Regional co-operation between Mercator and Raiffeisen Raiffeisenbank Austria and Mercator, have signed a contract regarding the acceptance and processing of MasterCard, Maestro and Visa cards in over 700 POS terminals in Mercator’s

PV International 0163  

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

PV International 0163  

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