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Tamara Škrlec, director, Mura Hrvatska We achieved our goal of remaining on the Croatian market

Traditional salt production Currently, traditional saltfarms need to rely not only on production, but also on a tourist attraction

Hypo Macroeconomic Outlook Croatia goes into another recession. Fiscal turn and regaining investor trust leave some room for optimism

INTERVIEW PAGES 2-3

SALT PRODUCTION PAGES 4-5

ECONOMIC OUTLOOK PAGE 7 2008 2009 2010 2011

Croatian Business & Finance Weekly Established in 1953 Monday / 12th March / 2012 Year V / No 0190 www.privredni.hr

S U P P O R T E D

Fitch confirms Croatia BBB- rating Fitch Ratings confirmed Croatia’s long-term credit rating at BBB- with a negative outlook. The confirmation of the lowest investment rating is the result of the fact that the 2012 budget did envisage a nominal cut in expenditure of 2.8% (€0.45 billion), which in addition to the anticipated nominal income growth of 1.5% should result in a reduced deficit, from 5.5% in 2011 to 3.8% in 2012. Should the plans be achieved, the conditions for sustainable fiscal policy would be created, or rather sustainable public debt growth dynamics. Croatia’s EU accession was rated positive in addition to the related management process improvement, increased availability of foreign capital and financing resources. However, Fitch Ratings are doubtful about the proposed realisation in income, especially under conditions of an anticipated economic fall of 1%, and believe the government will have to further cut expenditure to achieve the planned deficit. Fitch Ratings thus anticipates additional measures (fiscal and structural) that could be revealed in the July budget rebalance according to their expectations. The rating is likely to drop in the case of divergence from plans.

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pvinternational pv international C R O A T I A N

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ROLAND BERGER SURVEY OF 800 PROFESSIONALS

Private equity funds increasing interest in Croatia Based on research, the ideal target for private equity funds in Croatia would be a company worth between €50 million and €100 million as part of a larger structure or family-owned, as well as ready to sell a majority stake Vesna Antonić n 2012, Croatian companies can count on increased interest from European private equity funds, especially those involved in the pharmaceutical or health sector. This is the result of the European Private Equity Outlook 2012, conducted by Roland Berger Strategy Consultants. Almost 800 professionals from European investment funds of risk capital with private equity participated in the survey conducted for the third consecutive year. Some 73% anticipate stagnation and a decreased number of transactions, and most believe the general economic circumstances will deteriorate. Increased fund activities of 1% are predicted only in Scandinavia, Central and East Europe, including Croatia. Based on statistics, the ideal target for private equity funds in Croatia would be a company worth between €50 and €100 mil-

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lion as part of a larger structure or family-owned, as well as ready to sell a majority stake, evaluates Vladimir Preveden, executive partner of the Zagreb office of Roland Berger. Companies in the pharmaceutical and health sectors are the most interesting, followed by retail and production of goods for wider consumption or providers of logistic or professional services, in addition to the energy and utilities sector, adds Preveden.

Pharmaceutical and health sector companies are the most interesting After a two-year recovery, it is anticipated that activities of private equity funds will subside, mainly as a result of uncertainty in the economic situation and difficulties with refinancing. Whereas Polish responses predicted the

highest growth of fund activities (4%), the main markets (Great Britain and Germany) predicted a 2%3% fall. The largest fall will include Greece (10%), as well as other countries (Italy and Spain) with pronounced problems with financial market trust (7%). In future, most fund professionals expect dealing more with developing their present portfolio and less with sales and acquisitions of companies. Some 94% believe active company management will become increasingly important, and only 15% announce new investment and to continue raising funding. 66% of responses anticipate more intensive competition for attracting capital, and over 50% are convinced the current business model in the private equity sector should change.


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Privredni vjesnik Year V No 0190

Igor Čimbur, Director, Pet-it-uno (Good Food restaurants)

Unsatisfactory legislation in catering industry roatian restaurant menus are excellent, diverse and intriguing and are being constantly enriched with new gastronomy. Croatians have been recognised as gourmets who value high quality restaurants. Nevertheless, catering franchises are miserable and unattractive.

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( €65 million income from AHA Group

TAMARA ŠKRLEC, DIRECTOR, MURA HRVA

We achieved o on the Croatia preserving the

We are convinced an opportunity for co-operation with C with Varteks in the past and there is a possibility of simil

Most Croatian catering franchises are not on a par with the EU

Boris Odorčić With the exception of McDonald’s, all attempts at launching international franchises on the Croatian market have been highly unsuccessful. Most franchises are not on a par with those in the EU. This is only partly due to the weak purchasing power of the general public. In addition, there is the issue of a limited range of leading global suppliers, which has a limiting effect on opportunities for launching new products. Nevertheless, there have recently been slight improvements, which is evident in our case. We have succeeded in finding reliable partners whose assistance has been of considerable importance for our success. In my opinion, the state does not provide sufficient support for the catering industry and catering activities. Tourism is a leading economic branch and the present situation is unacceptable. We had the intention to apply for state support during the launch of our project, yet we were faced with insurmountable obstacles IMPRESSUM: Privredni vjesnik Kačićeva 9 10000 Zagreb +385 1 5600020 uprava@privredni.hr www.privredni-vjesnik.hr/ subscription

everal months ago AHA Moda became the owner of the largest operating companies within the former Mura – Slovenian textile brand founded in 1925. Tamara Škrlec, Director of Mura Hrvatska, believes that with timely reaction to current trends and market movements, in the marketing and design sense, the company will be able to take the position to which it believes it is entitled, and that is at the top of the Croatian fashion ind u s t r y.

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as it was not in compliance with current legislation. Nevertheless, we pursued our vision and have been faced with typical first business venture issues during the start-up of Good Food operations. Bureaucracy is the major burden in all economic areas and in addition the legislative framework has not been amended since the 1960’s. Consequently, I can illustrate the absurdity of current legislation whilst registering my company. If a business premises includes chairs, your working hours can only be until 2 a.m. If there are no chairs, you are entitled to work until 4 a.m., in which case you are not allowed to provide chairs during the day. Adequate and high quality legislation in Croatia would create many jobs. Unfortunately, deficiencies in legislation can be traced throughout catering and tourism.

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 Lučana Banek lucanab@gmail.com Mirjana Cibulka mirjana.cibulka@gmail.com

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

INTERNATIONAL OPERATIONS Ray Fletcher fletcher@privredni.hr

Croatia is a very significant market for Mura and their goals for 2012 are ambitious. They mainly relate to sales network development to bring the brand philosophy closer to a wider range o f customers. Mura currently owns 10 stores in Croatia.


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( €14 million investment ( 10 Mura stores by AHA Group in companies under the Mura brand

in Croatia

ATSKA

our goal of remaining an market and e sales network

Croatian producers will open if we develop our business. We worked ar partnership when favourable market conditions emerge Could you tell us more about the changes in the Mura ownership structure? AHA Moda is the central company of the AHA Group, comprising seven production companies. It employs 700 experts and achieves €65 million in consolidated sales income. At the end of August, the Group paid €9.65 million to become the owner of Mura in partnerji and the Croatian Mura as well as the accompanying stock, property and stores of Mura and e.mura brands. AHA Group cooperates with many international companies, including Ikea, BSH (Bosch Siemens), Wolford, Harrods, Volkswagen Group, Phillips, Gucci and Dolce&Gabbana. Will you hire new workers? There are currently 30 employees in Croatia. In accordance with the previously mentioned plans of developing the sales network, we expect to hire new

workers in different segments. The main goals for 2012 are to increase the number of Mura stores in Croatia, preserve the quality of all four Mura collections and continuously invest in technological innovation that will enable closer co-operation with our foreign partners and big stores in Europe. These goals can only be achieved with great support from the work force, that is motivated and trained experts. Are you satisfied with the quality of workers and the education system? We are pleased to note an increasing number of young people specialising in the textile industry and numerous projects for the affirmation of the Croatian fashion scene that will certainly help the industry return its leading position.

Loyal customers What is your opinion of working in Croatia? Mura has been present in Croatia for many years. As a result of our quality line, it has a great number of loyal customers in the region. Even when circumstances reduced our presence on the market, our customers supported us and trusted our brand so they did not find it a problem to visit our store on the other side of the city or wait a while for a collection to arrive. We are especially happy for them that the Mura takeover was successfully completed, and now we can invest all our effort in increasing our presence on the Croatian market. In fact, in the past challenging period, the main goal of Mura Hrvatska was to remain on the Croatian market and preserve our sales network despite the anticipated losses - and we managed to achieve that.

How much are you planning to invest this year and in what? The exact figures are a professional secret. However, as in the case of our new store in Zagreb, we will pay special attention to the location and interior design in our selection. Moreover, we plan to continue investing in our newest e.mura collection this year, considering excellent feedback that we received. We plan to continue working with reputable fashion stores in Germany, Italy, France, Russia and Belgium as well as increase the production of smaller clothing lines for special occasions, for example theatre shows or special events of various state institutions, economic associations and other companies. AHA Group has so far invested €14 million in all companies under the Mura brand. However, in addition to financial resources, they also highlight their contribution to corporate culture, business methods and experience gained in the fashion industry, which they will also implement in Mura. What is your relation with the competition? Our market approach does not consist of competing with the competition. We are familiar with it and respect it since we are aware of how much know-how, effort and financial capital is required for a quality market presence. We appreciate the product lines of our competition and they

motivate us to achieve even more ambitious goals. Notwithstanding that, the decision to purchase the product always depends on the end-customer. However, we believe our collections in the higher-medium price category will satisfy the fashion style of businessmen and women. What about subcontractors? Mura enjoys good professional relations with its subcontractors and business partners in Croatia and Slovenia. All its products are currently produced in Slovenia. We have had no problems in obtaining required

We are glad to notice an increasing number of young people specialising in the area of textile industry in Croatia materials, and developing business in Croatia will create new opportunities for working with the Croatian producers. We have worked with Varteks in the past and there is a possibility of similar partnership when favourable market conditions emerge. Does Croatian bureaucracy complicate business? So far we have not encountered any red-tape problems, neither when opening new stores or in our daily operations.


4 ::: news Public tender for employment subsidies This year, the Croatian Employment Agency (HZZ) has initiated an employment subsidy scheme, inviting companies to submit applications if they wish to employ workers from their register. The public tender and criteria for obtaining subsidies are available at www.hzz.hr. HZZ will allocate around €46.7 million for employment subsidies, additional qualification programmes, training and public work, which is €8 million more compared with 2011. For example, companies employing young workers without any previous work service could obtain subsidies between €1,300 and €4,100, depending on their professional skills. For workers over 50 the figures are from €1,500 to €4,800. Croatian wine makers in Germany

Organised by the CCE and in co-operation with the Ministry of Agriculture, 22 Croatian wine producers exhibited their products at the International Trade Fair of Wine and Spirits – ProWein 2012 - held in Düsseldorf. Last year, Croatia exported 628,000 litres of wine to this demanding market, worth over $2.7 million, which makes Germany the second most important export market, after B&H. In relation to 2010, wine imports decreased by 10% in total in 2011, whereas exports increased by 7%, said Igor Barbarić, secretary of the CCE Wine Association. Bank profits decreased in January According to data provided by the Croatian National Bank, bank profits totalled €51.7 million in January in Croatia. In January 2011, this figure was €57.8 million, which would mean a decrease by some 10% in one year.

Privredni vjesnik Year V No 0190

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tonnes average annual Ston salt collection over last 10 years ears

TRADITIONAL SALT PRODUCTION IN CROATIA

Branding and opening markets imperative

Currently, traditional salt-farms need to rely on a recently gained advantage – a tourist a Andrea Šalinović alt has been produced in Croatia since ancient times. Ston salt-farm is the oldest in Croatia and, according to some sources, the oldest in Europe. It is followed by those in Nin and Pag. The Pag facility, owned by the Agrokor conglomerate, is the only salt-works in Croatia to produce salt through industrial methods, whilst Ston and Nin have followed tradition. Hence, their annual harvest is highly impacted by weather conditions. The annual Ston production average over the last 10 years has been 1,500 tonnes. 1,700 tonnes were collected in 2011, which can meet the needs of the Dubrovnik-Neretva County, and with sufficient for road gritting. “Most salt is used by the Dubrovnik roads authority, yet there are currently still 2,000 tonnes of industrial salt in our warehouse. Our salt can retain its quality down to -15 degrees Celsius. In addition, we exported some of our salt to Germany over the last several years”, stated Svetan Pejić, owner and Director of Ston salt-works. The industrial salt produced at Ston is sold throughout

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the County through small stores. It covers 18 ponds, although 9 are currently being used.

Ston salt-farm

Production and tourism The salt from Ston is unique as it is not bitter and needs no chemicals to prevent it from clumping. In addition, it can be packaged soon after production and storage, pointed out Pejić. He added that long-term plans include ecological salt production, as well as the production of salt flowers. He is planning business expansion by moving towards tourism. The salt-works, which has not altered in appearance nor production methods since the Republic of Dubrovnik, is an open-air museum, where tourists are given a

Ston salt-farm has not changed its appearance nor production methods since the Middle Ages guided tour in a miniature train and told about the production process and storage. In addition to souvenir packaging of salt flowers, there are plans to expand

Salt flowers – top quality salt Salt flowers (fleurs du sel) is used for delicate salting and it is premium use salt. In ancient times it was used for purifying rooms with negative vibrations. “I am extremely pleased that the quality of Nin salt flowers has been recognised by both Croatian and global consumers. Currently, salt flower is highly valued amongst culinary experts and gourmets, as well as amongst ‘green’ consumers who understand the value of unrefined natural salt. It is collected by hand and using a special micro-filtering screen and is crystallised on the surface of the water. Nin salt flower has been recognised as a vital nutrient, enriched with natural minerals, intensifying the taste dishes. It is the healthiest of salt and rich in a natural concentration of iodine, calcium, magnesium, potassium and other minerals”, explained Damir Oštrić.

the product range to include locally made products such as capers, anchovies, honey and wine. Nin has also moved to tourism and has become a tourist attraction with its traditional production methods since it opened a museum of salt. The exhibits reveal traditional salt production and provide information on the history of salt and its use, with a particular focus on salt flower, which is often called ‘salt caviar’, due to its unique features. There are also displays of salt production which has remained almost identical since Roman times. “We believe one of our main objectives has been achieved with the museum project, as we have always attempted to emphasise the fact that salt is not just an essential culinary spice. Wars have been waged and economies altered because of salt, whilst its value was once on par with an ounce of gold. Branding is of significant importance for the future


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( 9 salt-ponds

currently operating in Ston

of new

CROATIAN RAILWAYS

Preparing for the EU market Croatia Railways have been preparing for Croatian market liberalisation with the Board announcing restruc restructuring but no layoffs.

attraction on

Krešimir Sočković roatian Railways has been allocated a reduced budget for 2012. However the new Board believes it will not have a significant impact on operations and is looking forward to Croatian EU accession. The company relies on other financing sources and state assistance. Recently there have been meetings with EBRD regarding a loan of some €53 million to purchase multi-system locomotives, as well as for severance packages, whilst EIB and the World Bank have shown interest in investing. Rene Valčić, Croatian Railways Holding Board President, stated that his team will focus on comprehensive improvement of company operations and, consequently, enable the railway market liberalisation, as well as assist the company in adapting more easily to the EU market.

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of all Croatian salt-works”, emphasised Damir Oštrić, Director at Nin. There were 4,000 visitors to the museum in 2011, which is satisfactory, since it was only opened in August. The museum

Nin exports to Western Europe and Japan was adapted by the Croatian designer Filip Gordon Frank, who has succeeded in creating harmony between the museum and the main goal of presenting the value of salt and traditional production. Exports to Japan Nin also has a pond for salt crystallisation, covering 55 hectares, with an annual production capacity of 5,000 tonnes although last year it produced 4,000 tonnes. It primarily focuses on industrial salt production, mainly sold on Croatian markets, whilst some

is exported to Western Europe and also to Japan. “In Croatia, imported salt is more affordable than that produced locally, due to high labour costs, local weather and limited production capacity. It is important to stress the top quality of salt produced at Nin as a result of the salty habitat of the algae (petula) which strengthens the taste and enhances the quality of Nin salt”, pointed out Oštrić. There has been considerable investment in the Nin salt-farm facility, new product development, opening of new markets, branding, as well as the opening of the museum over the last three years. Nevertheless, additional investment has been planned. “We will focus on employee development, since human assets are fundamental to the Nin traditional production of top quality natural salt. Also, there are plans regarding further development of production facilities, with particular emphasis on tradition”, noted the Director.

Outdated railway lines “We plan to complete the restructuring programme of local rail system which will be devised by the Board in the forthcoming month. I have not opted for consultative advice, since if restructuring plans are devised by consultants, then they also need to be implemented by consultants”, explained Valčić. Infrastructure is a state issue. “Knin-Zadar, the last railway line in Croatia, was constructed in 1965, whilst other

lines were constructed during the Austro-Hungarian Monarchy. Quality lines need considerable investment. The low standard of railway lines is due to unsatisfactory work during the last 20 years, as well as insufficient funds to retain the current standard and, consequently, we have been seeing a 10% average annual decrease in speed”, pointed out Valčić. At the beginning of the century the rail situation saw a slight

The last railway line constructed in 1965 improvement, due to regular maintenance and focus on capital overhauling. Nevertheless, standards have not been continued. There is need for significant funding for infrastructure quality improvement. Nevertheless, the company will be able to comply with EU standards following the new work plan adoption by 2020. Croatian Railways Board President opined that the restructuring will not include major layoffs. According to the Croatian Railways Board, tilting trains will appear again. There are currently six tilting trains, irrespective of the fact that the previous Boards planned to abolish them. The new Board is planning to restore this first “commercial project for local railways”.


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WE PRESENT

ASPALATHOS, PODSTRANA

Privredni vjesnik Year V No 0190

STUDILICA, ZAGREB

For Russians with affection Specialising in promoting of Russian tourism by providing comprehensive information for an interesting stay in Croatia

Group tuition and the grey economy Group tuition far more affordable than individual tuition lga Kliškinić, originally Russian, founded the company Aspalathos, following her long experience as a tourist guide. The agency provides services for both Russian and Ukrainian markets and in addition its owner represents Russian investors in Croatia. The company currently has two employees and also relies on outsourced services provided by wide range of Croatian companies and small businesses. The agency began operating one year after the Hotel Le Meridien Lav had been opened, as its premises are located in the hotel. “I was aware that in Russia there was considerable interest in travel and new experiences. Tourists are primarily interested in interesting holiday experiences, irrespective of price. The Russians are extremely well informed about their destinations and they are usually interested in a particular monument and destination. A tourist guide with profound experience is of crucial importance”, pointed out Olga Kliškinić, Director and Owner of the agency.

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Excellent co-operation When she became aware that her agency lacked capacity for attracting tourists and

Olga Kliškinić, director and owner of Aspalathos

providing bookings, she decided to organise welcoming events, provide information on free offers, advice on meals in local restaurants and similar aspects. In addition, she focused on organising excursions and regattas. “Russian tourists opt for those

Aspalathos represents several Russian investors in Croatia restaurants preferred by the locals. My agency organises excursions for them with fully committed tourist guides. In addition, we co-operate with a well-known Croatian climber, and organise excursions to bat habitats to meet the high expectations of our clients. As a result Russian tourists are extremely pleased with the Dalmatian wine cellar and our proposals concerning meals”, she explained. The owner also pointed out their co-operation for yacht excursions with lunch on the island of Brač. In addition to providing tourism services, the agency represents several Russian investors in Croatia, with Olga Kliškinić leading several real estate projects. (J.V.)

hen Mihael Arlović, a student at the Zagreb School of Economics and Management, presented his detailed business plan for his tuition centre Studilica to his parents hoping for their support and assistance, they were surprised and extremely pleased. The owner of the company Inveni plus which launched the project Studilica, employs some ten lecturers for group tuition and preparation for preliminary and entry exams. “There is huge demand for tuition in mathematics, economics and technical subjects, as well as chemistry and languages. We will expand our tuition programme according to the demand”, he announced. The idea to launch the centre was developed following his reading of research on the grey economy in this sector. He was surprised by the prices, which are not adapted to student standards. In addition, there is no certainty the student will pass the exam after completing the tuition and that funds so invested will not be wasted.

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Small group tuition “As opposed to individual tuition, which can be €13.30 per session, the price for group tuition is in the region of €3.35 per session, which is more affordable and attractive for students. Tuition groups are small, ranging between 5 and 15. Lecturers

are paid according to results or passing scores, so they are further motivated to be fully committed to their teaching. After the exam, I analyse the results together with the lecturer and thereafter decide on their fees”, explained Arlović. This tuition model is an effective way to deter the grey economy entering into the education sector.

Lecturers selected according to references but mainly assistant lecturers at various faculties Since Arlović believes passing scores are of extreme importance, he selects lecturers primarily according to their references. Hence, most of them are assistant lecturers at various faculties. “We conduct surveys amongst students following the completion of the tuition, where students assess the lecturers, tuition content and tuition methods. The scores have been excellent thus far. In addition, according to the lecturers, the students actively participate in classes and there is high level of interaction, which is seldom achieved by schools”, pointed out Mihael Arlović. (A.Š.)


www.privredni.hr Business & Finance Weekly

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CROATIAN FOREIGN CURRENCY MARKET Currency

AUD CAD JPY CHF GBP USD EUR Source: HNB

EUR

Kuna exchange mid-rate

7.59

6,066578 5,759111 6,987082 6,269938 9,011961 5,713822 7,556529

USD

5.76

6.3.

7.3.

8.3.

9.3.

5.75

6.29

7.57

5.74

6.28

7.56

5.73

6.27

7.55

5.72

6.26

5.71 5.3.

6.3.

7.3.

HYPO MACROECONOMIC OUTLOOK

GDP might fall by 2% this year and it is unlikely growth will reach 1% in 2013 which is insufficient to reduce unemployment and service debts

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this year. It is unlikely that growth will reach 1% in 2013, which is insufficient to reduce unemployment and service debts. Positive message to investors In such an unfavourable environment, the government turned to fiscal consolidation, managing to send a positive message to foreign investors. Stojić believes that after the first phase, during which public finances were stabilised in the short-term and key reforms and government in-

Fiscal turn and regaining investor trust leave some room for optimism vestment had been announced, the second phase represents a far greater challenge. In a stable currency regime, it is necessary to start huge reforms of the labour market and implement an internal devaluation through long-term savings measures to increase competitiveness and boost the growth rate. Stojić does

8.3.

9.3.

6.25 5.3.

6.3.

7.3.

8.3.

9.3.

::: news

Stojić: Croatia goes into another recession

roatia is not near the Greek scenario. However, all countries have a lot to learn from Greece: reforms must not be delayed since it will become more difficult and expensive to implement them later. This was the statement from Athanasios Vamvakidis, Director of the European Currency Strategy Department at Bank of America Merrill Lynch at the launch of the publication Macroeconomic Outlook of Hypo Bank. Vamvakidis is a former IMF permanent representative in Croatia and well familiar with the Croatian market. The will for reform and determination to implement them sends a strong message to investors. Therefore, the results of offering Croatian bonds on foreign markets will depend on how the government evaluates reform measures, concludes Vamvakidis. Croatia is sinking into another recession as a result of both production and investment falls as well as a deterioration in credit activity, evaluates Hrvoje Stojić, Director of the Department of Economic Analysis at Hypo Bank. According to Stojić, GDP fall might fall by 2%

6.30

7.58

7.54 5.3.

WEEK MARCH 10, 2012

CHF

not exclude the possibility of asking the IMF to act as a guarantor to regain investor trust and alleviate the problems of refinancing Croatian obligations. Stojić suggests infrastructural investment of the public sector was announced as an important change in the structure (investment in energy rather than motorways). Financing models are also better, with more stress on concessions and equity capital instead of new budget debt. However, how these investments will be realised has not yet been defined nor has their impact on this year’s economic growth. Reduced Croatian exports reflect insufficient integration into the “German production chain” and missed opportunities in fast growing markets of the BRIC countries. Italy’s instability could prevent tourism income growth from a big trade partner. However, a fiscal turn and regaining investor trust does leave some room for optimism. We made a turn, and we did it with a new car. Now we need to accelerate, and successfully handle this turn, Stojić explains figuratively. (I.V.)

Profits up for Zagrebačka banka This year, Zagrebačka banka will distribute a dividend of €0.30 per share from profits earned during 2011, and the decision will be made at their assembly scheduled for April 27. According to unrevised consolidated reports delivered to the Zagreb Stock Exchange, in 2011 Zagrebačka banka achieved €0.19 billion in after-tax profit, or 5.6% up compared with 2010. €31.06 million in disbursed subsidies Recently, the Ministry of Finance disbursed €31.06 million in state subsidies. The largest share (€25.97 million) was to the accounts of local housing savings banks, and the remainder paid for subsidising funds of the third pension pillar, the voluntary pension savings. These subsidies relate to 2010, which the then government failed to distribute on time. It remains unknown when those for 2011 will be disbursed. Asset increase for Imex banka At the end of February, Imex banka earned a profit of €0.61 million, which is at the same level of the good 2011 results. Total assets increased by 18%, to €0.25 billion. Expenditure rose 5%, and lending by 7%, to stand at €0.18 billion. Total deposits increased by 18%, to €0.21 billion, of which 77% relates to public savings, which stands at €0.16 billion, up by 20%. Company and small craft business deposits hold a 23% share of total deposits, at €48.13 million.


8 ::: news

Privredni vjesnik Year V No 0190

The Revitas Project

New online sales channel Adriatica.net, an online tour operator, will focus on foreign markets, adopting a new development strategy and enabling direct sales of tailor-made products for individual travellers visiting Croatia. Package tours adapted to meet local needs are available on www.atlas.hr website. The website has been included amongst the leading online sales channels to cover both foreign and local tourism. Major investment in tourism Public and private sector investment in tourism will stand at around €0.15 billion in 2012 37% up in relation to last year according to the results of a survey recently conducted by the Ministry of Tourism amongst 28 hotel companies. The survey did not include small and medium-sized investments. It is estimated that there will be around €0.2 billion investment in preparation for the season, promotional activities excluded. Those surveyed are planning to invest €114 million in innovation, 49% up in comparison with 2011. Counties and their Tourist Boards and Municipal Tourist Boards are planning to invest a total of €24.7 million, where majority funding will be allocated for infrastructure, destination management, new product development and promotion. Croatian Passion heritage in Zagreb T h i s year ’s Croatian Passion h e r i t age will be held from 24th March to 4th April in Zagreb, organised by the Passion Heritage Association. The event covers of a range of visual, musical, theatrical, literary and folk adaptations related to the Passion of Christ and His Resurrection and will be held at the Mimara Museum and in many churches. The Croatian Passion heritage was first held in 1992 and in 1998 it joined the European Association Europassion.

Istrian stories and legends come to life A project co-financed by EU in order to enhance Istrian hinterland Sanja Plješa stria is the most popular tourist destination in Croatia, yet tourism possibilities in its hinterland need enhancement. As a result a cross-border project was launched at the end of 2009 Revitas – Revitalisa-

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Tourist participation in performances of stories and legends tion of the Istrian hinterland and Tourism in the Istrian hinterland, co-financed by the EU within the Operational Programme IPA Slovenia-Croatia 2007-2013. The implementation of the project will be completed at the end of March, with participation of 10 partners (the town of Koper as the leading partner, the Istrian County, the municipalities of Isola and Piran, the Institute for the

Protection of Cultural Heritage of Slovenia – Piran branch office, the towns of Buzet and Poreč, the Istrian County Tourist Board, the municipality of Svetvinčenat and the town of Vodnjan. The project has been in place in both Slovenian and the Croatian part of Istria for 30 months. 85% of the project value, or €84 million, has been co-financed through IPA, whilst the partners’ stake is 15%. “The project includes the development and revitalisation of Istria, local activity and enhancement of tourism opportunities, the integration and development of the tourism infrastructure and people, as well as communication with and providing information to the public. It includes a methodology for the revitalisation of the rural area, as well as a joint cross-border study of the revitalisation process for the Istrian hinterland”, stated Cristina Vojić Krajcar, the Revitas Project Manager.

She added that methods for revitalisation, proposals and promotion of cultural heritage, as well as the revitalisation of old town nuclei, primarily conservation of local dry stone wall constructions, have been given particular attention. Three types of roads and 10 wayside stops have been provided in the Slovenian part of Istria, with 20 kilometres of cycle and pedestrian paths in the area of the Vodnjan eco-archaeological park in the Croatian part. In addition, a signalling system has been implemented and 5 wayside stops provided. There has also been a focus on the revitalisation of old town nuclei in the Istrian hinterland and there are 6 information centres and 20 information points with information kiosks. Moreover, 23 events have been organised in order to promote Istria as a unique tourist destination, with product tasting, promotional and educational workshops.

Journey through time Istria Inspirit, another project has been launched in addition to Revitas, to devise attractive and interactive excursions – experiences in Istria which would provide tourists with new and realistic experiences. The project has been devised by Manuela Hrvatin from the Istrian County and supported by the Istrian County, Istria Tourist Board, Istrian Development Tourist Agency (IRTA) and other partners. The Project Istria Inspirit includes a journey through time during which tourists will be offered nine attractions: from visits to castles, roman villas, old town nuclei and museums, to participation in a roman banquet, a medieval execution, a baroque ball and a stay in a mine. Tourists will also have the opportunity to participate in performances of Istrian stories and legends.


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