PV International 0186

S U P P O R T E D B Y T H E C R O A T I A N C H A M B E R O F E C O N O M Y

pvpvinternationalinternationalCroatian Business & Finance WeeklyEstablished in 1953Monday / 13th February / 2012Year V / No 0186www.privredni.hr

Davor Runje, Director of DRAP Agency and co-founder of CCMASocial media are excellent platforms for giving feedbackINTERVIEW

PAGES 2-3

Race for EU fundsThe process of allocating EU funds is currently lasting on average between 12 and 18 monthsEU FUNDS

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Croatian Postal BankPreparing for privatisation: talks with representatives from CO, Croatia Lloyd, EBRD and pension fundsFINANCE

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2008 20092010 2011

Igor Vukić

Croatian exports totalled €8.73 billion in 2011. At the same time imports

totalled €14.49 billion, giving a foreign trade deficit of €5.76 billion, according to data pro-vided by the Central Bureau for Statistics. However, as a result of a 1% growth in exports and a 1.4% decrease in imports, the positive trend continues. In 2011, the trade balance increased by 1.5%, to 60.3%. The processing industry, with exports totalling €7.91 billion, increased exports by only 0.5%; the timber industry grew by 7.7%, and food products increased by 2.5%. However, exports of leather decreased by 1%, textiles by 2.7% and tobacco products by 12.4%. Chemicals and chemical products decreased

by 3.4%, although the export of pharmaceutical products and preparations increased by 7.3%.The sluggishness of Croatian exports is partly a result of its orientation towards the mar-kets seeing increasingly ag-gravating circumstances dur-

ing the past several quarters. One such is Italy, to which 20% of Croatian exports go. Last year, Croatian exports to Italy plum-meted from €1.6 billion to €1.35 billion (down 15%). The decline in Italy was partly compensated for by growth in exports to France (up 125%, to €0.27 billion) and

Hungary (up 12%, to €0.21 bil-lion). Exports to Germany de-creased by 3.2%. A total of €0.8 billion in goods were exported to Germany. On the other hand, exports to Slovenia improved (up 5.2%, to €0.71 billion) and Austria (up 6.8%, to €0.46 bil-lion). Total exports to EU mar-kets resulted in a 1.7% decrease. Imports from the EU remained at almost the same level as 2010; a slight increase of 0.6%. Last year, exports to CEFTA countries grew by 3.2%, totalling €1.66 billion. Croatia has a positive balance with this group, since imports totalled €0.85 billion (up 9.2%). Imports have mainly stagnated since the beginning of 2010. Negative trends to the im-port of capital products and raw materials for industrial produc-tion remain the most dominant.

FOREIGN TRADE DEFICIT €5.76 BILLION

BALANCE IMPROVINGAccording to the Croatian Chamber of Economy, the sta-tistics point to a decrease in overall local demand which re-flects on imports. In terms of imports, the highest value in-crease concerns crude oil and oil derivatives as well as elec-tricity and metal. CCE analysts warn that this is due to move-ments in the price of crude oil which, together with oil deriva-tives, has a high import share of around 17%. Last year, the price of crude oil increased by approximately 20.5% on the global market. Since signifi-cant subsidising of export pro-duction cannot be expected, this year will still depend on demand from traditional mar-kets. According to the Croatian National Bank, the trade defi-cit might continue to decrease through limited import growth and mild export increase, even though it will continue to slow. Croatian export growth will de-pend on surrounding regional

growth and ef-forts to attract export-oriented

f o r e i g n d i r e c t invest-ment.

Decline in local demand

Processing industry increases export share by only 0.5%

A 1% growth in exports and a 1.4% decrease in imports indicates the positive trend of export/import coverage continues

2 Privredni vjesnikYear V No 0186

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Jadranka Boban Pejić, Director Biovega

Leaders in organic food Consumer confidence due to uncompromising quality with profit as a result

The organic food business is currently one of the most stable businesses and si-

multaneously one of the most remarkably growing businesses in the world. There is increasing interest in organic products both amongst consumers and corpo-rations. Consequently, there are highly processed and refined products consisting of organic ingredients, yet, as any other re-fined and processed products, of lesser nutritional value.Organic farming and production undoubtedly imply a wide range of benefits: from environmental protection and biodiversity to the positive impact on our health. The organic food business eradicates a deeply embedded misconception about lower yields and the belief that sufficient food quantities can be produced exclusively by con-ventional or GM methods. On the other hand, organic growth is the prerequisite for our survival and the safest way to live without en-dangering either the environment or our health.

Consumer confidence is due to the uncompromising quality of our products, whilst profit is a result rather than the driver of our work. The policy of Biovega focuses on personal lifestyle. In addition, our launch created a business niche both in Croatia and throughout the region. Our business has been founded on education as the start

point, aiming towards the achieve-ment of a balance between eco-nomics, ethics and ecology. In addition, we present products that we ourselves use and which, in our opinion, are top quality. The concept of customers as partners as well as uncompromising qual-ity account for our success, ir-respective of the economic crisis and the fact that our product prices are higher than conventional prod-ucts by around 30%. Educated and trained, customer oriented and an interested sales team together with quality products account for the success of the domestic organic food product chain ‘bio&bio’, with its 11 stores throughout Croatia and with a product range of around 2,500. Biovega as the parent company, groups Makronova - an educa-tional institution, Planetopija - a publishing house, Biozrno – an ecological facility and the Bio-vega subsidiary in Slovenia. The group is a unique and an innova-tive project as a result of which we have become the regional leader in organic food.

Organic growth a prerequisite for our

survival

Andrea Šalinović

The Croatian Community Managers Association (CCMA) was founded re-

cently, giving this relatively new profession of community man-agement a framework which will regulate the profession. This is also confirms it as a valid profes-sion, which many dispute. Since this profession is relatively new, professional standards must be adopted, which CCMA will ad-vocate. One of the main goals is to introduce awards so that crea-tors of a successful campaign could obtain recognition for their work. Certified courses will raise service quality and help clients select. However, criteria in terms of prices must also be set. Clients are now confused since we of-fer services which vary both in price and quality, highlights Da-vor Runje, DRAP Director and co-founder of CCMA. ‘DRAP’ is one of the leading agencies in Croatia and creator of some of the most successful social net-

work campaigns. Davor Runje explained for Privredni vjesnik the importance of social media and reasons why many compa-nies should join them.

Why should a company have an account with a social net-work?Mass brands should opt for mass media. Social media are an excellent platform for giv-ing feedback The company can

also obtain information which would be impossible to do in some other way. Social net-works are an excellent indicator of what the business lacks. Thus, a community manager should inform the board about feed-back posted on a social network.

Is it better to hire an agency or in-house community manager?It depends on the size of the com-pany. Larger companies should hire in-house community man-agers who are then completely dedicated to that particular brand and react much better in certain situations. However, technical support of agencies for applica-tion, design and other creative tasks should also exist. Smaller companies which cannot af-

On of the main tasks is to establish emotional

relations between user and brand which is not

easy

(Facebook users in Croatia

1.5 million

DAVOR RUNJE, DIRECTOR OF DRAP AGEN

Social media are exIn our experience, Facebook targeting is twice as efficie

www.privredni.hrBusiness & Finance Weekly 3

ford to hire a person to deal ex-clusively with social networks should outsource to agencies. The really small companies that cannot afford even that, and they are mostly crafts, could do that themselves since they know the details of their business better than anyone else.

What is the main activity of a community manager?Some think the work consists of posting statuses, which is partly true and also requires prepara-tion; keeping up with related themes; researching and being informed on the subject-matter since credibility can be easily

lost. Therefore, this job is not at all easy. One of the main tasks is to establish emotional relations between user and brand, which is not easy thing. It takes talent and experience, all of which reflects in the end result.

What defines a good social me-dia campaign and how are re-sults measured?It is very important to set cam-paign goals – sales increase, brand awareness, or something else, and then find a way to meas-ure it. The best indicator is the financial result. Page interaction can also increase, but numbers are not the only way to measure this interaction since someone may post a controversial status which others will comment on only because the person annoys others. Furthermore, the number of readers is not as important as the way in which you attracted them. Some pages “buy” fans with various contests, complete-ly unaware there is a “mafia” of winners each of whom have sev-eral thousand fake accounts. The numbers are certainly necessary for some kind of conversation, but they are not the only meas-urement standard. It is important to have quality discussions with people. Our best results so far were not based on direct com-munication between brand and consumers, but that the consum-

ers communicated with each other through the brand page. It is important to be presented as a medium that connects people. It is much easier to attract Face-book people, but is much more difficult to keep them. Only good community managers know that.

What are top Croatian brands on Facebook and which cam-paign is an example of a good campaign?The biggest brand on Facebook is currently OK magazine. How-ever, there are few categories I would divide into media, brands and celebrities. These groups cannot be compared since a sing-er will attract fans much faster than a brand, whilst media can acquire fans in some other media space they own. For example, by these standards Konzum, 24 sata and Severina could not fall into the same category. One of the most successful Facebook cam-paigns was Životinjsko carstvo of Kraš and Ante & Darinka of Tomato.

Why opt for social networks for advertising, particularly Face-book which you mentioned as the most popular network?Social media are a fast and cost-effective way of sending a mes-sage. Companies should not avoid them. In every campaign it is important to determine the target group to be addressed and want to attract and Facebook has proved to be the most successful. It gives quite precise options for targeting according to various in-terests. Once you have managed to attract this target group to your page, then you are able to suc-cessfully communicate with it. In our experience, Facebook target-ing is twice as efficient as other channels, as well as most favour-able in terms of price.

(LinkedIn accounts

150,000(are fake accounts

200,000

CY AND CO-FOUNDER OF CCMA

cellent platforms for giving feedbacknt as other channels

Social media in numbers

According to current data, there are over 1.5 million Facebook users in Croatia, of which 200,000 are fake accounts, says Davor Runje. Linke-dIn has around 150,000 accounts, Twitter 20.000, and Foresquare around 6,500 (half of whom are located in Zagreb). Each of these networks has its advantages. Fa-

cebook was designed to connect with friends; LinkedIn serves to re-main in touch with business peo-ple, and it is an excellent place to look for work or recruit staff. Twit-ter is a very fast medium where many things happen in a short pe-riod of time. Foresquare is a geolo-cation network which is very practi-

cal for tourists since it helps them to find restaurants or hotels. Goog-le + cannot compete with the Fa-cebook social component, but it does have an advantage in that it can optimise search results on Google browser, and company business often depends on how high they rank in search results.


Lada Stipić-Niseteo

C roatia does not want tax from mobile operators but investment. Problems

have started to be eliminated by direct conversations. Gov-ernment Vice-President Neven Mimica flew to Brussels to meet Digital Agenda Commissioner and EC Vice-President, Neelie Kroes, soon after the European Commission, protecting the in-terests of foreign telecommunica-tions owners in Croatia, warned Zagreb that if the 6% excise duty from phone calls and SMS, would be returned, European reg-ulations would be violated. The Croatian side explained the reasons for introducing the tax as being in accordance with the European strategy of digi-talisation and implementation of broadband infrastructure. The first has already been conclud-ed. What remains now is to sign contracts with the two remaining companies which will enable a different regulation of special compensation. The operators’ contribution through increased tax will contribute to the crea-

tion of the EU’s Digital Agenda, which is also a part of Croatian preparation for EU membership. The taxes will be in force only until Croatia joins the EU, when Croatia will harmonise all prac-tices with the EU.

Investment is the key wordConsultations continue, and pol-icy harmonisation will be moni-tored. Investment is the key word in the new budget, since it is the

only aspect that can generate growth. In this case, if telecom-munications do not have invest-ment, this area will not grow and development will not be sub-sidised. We expect transparent investment plans from the two remaining companies. He also estimates that investment such as this would in fact return to the national budget due to growth the investment will bring. The return is estimated at around 40%.

Mutual respectThe issue of tax seems quite tech-nical. However, the government Vice-President went on to deliver an important message – both sides are expected to apply European regulations, not only Croatia. If the Union is already asking Croatia some 16 months before accession, to abide by the Euro-pean regulations in force, then Croatia has the right to ask the same from the European Union. The results of the first monitoring of Croatia will be known in late March. For now everything is going as planned, with expected remarks, primarily regarding the sluggish resolution of the ship-building issue.

Croatian Government Vice-President Neven Mimica in Brussels

If the EU is already some 16 months prior

to accession, asking Croatia to abide by the

regulations in force then Croatia has the right to

ask the same from the EU

Investment sought for telecommunicationsThe issue of tax seems quite technical. However, Government Vice-President went to Brussels to deliver an important message – both sides are expected to apply European regulations not only Croatia

Croatia Insurance and Postal Bank privatisationThe government is anticipating €2 billion revenue from the pri-vatisation of Croatia Insurance (CO), the Croatian Postal Bank (HPB) and other state owned property and stakes in mixed ownership companies, stated Slavko Linić, Finance Minister, in his recent interview with Reu-ters. Slashes in the budget for 2012 and in public consumption are expected to assist Croatia to preserve her current credit rating, which would enable favourable foreign lending stated Linić.

Lesser amount of goods transported from portsTransport of goods from Croatian seaports in December in 2011 was 34.1% down over December in 2010, according to data provided by the Croatian Bureau of Statis-tics. Goods transport in 2011 was 10.1% lower over 2010. On the other hand, passenger transport saw a 10.7% increase in Decem-ber 2011, 7.5% up year-on-year. 2011 saw a 6.4% increase in the number of ships entering seaports.

Total lending up 6.1% Total bank lending at the end of 2011 stood at €38.57 billion. Ac-cording to the Croatian National Bank data, 2011 saw an increase of 6.1% in loans. Housing loans stood at €7.94 billion, 2.8% up year-on-year. Corporate lending totalled €15.84 billion, 9.8% up over the end of 2010. State loans saw an increase of 6.8%, standing at €4.9 billion at the end of 2011.

Končar exhibiting in DubaiKončar representatives have re-cently participated at the Middle East Electricity Fair in Dubai, one of the most important fairs of ener-gy sector and energetic equipment in Middle East region. Končar has exported equipment worth between €5.3 billion and €12 bil-lion to the United Arab Emirates in the last several years. Accord-ing to Končar, the market will see further growth during the next five years. Consequently, the company is anticipating new contracts, fol-lowing its participation at the fair.

::: news

HBOR and EIB sign loan contract

Another €150 million for SMELoan is primarily intended for projects in renewable energy and local infrastructure

T he Croatian Bank for Re-construction and Develop-ment (HBOR) and Europe-

an Investment Bank (EIB) signed a loan contract for €150 million for financing small and medium-sized enterprises, mid-cap com-panies and local administration. Interest rate is fixed at 3.5%, and payment deadline is set between 12 and 15 years, with a grace peri-od of between four and five years. This is the first tranche of a €250

million loan that was approved at the end of 2011. The second tranche of €100 million should be used by the end of this year. Con-sidering the market situation, for Croatian entrepreneurs the loan under such conditions will be €70 million more favourable. HBOR Board President, Anton Kovačev, added that the loan includes deeds of donation of €6.5 million that could be obtained by projects with an element of energy efficiency

included. The loan is primarily intended for projects in renewable energy and local infrastructure. The Minister of Entrepreneurship and Crafts, Gordan Maras, evalu-ates the loan is a subsidy for the Government’s announced invest-ment cycle of €1.1 billion. He is convinced that other investment projects will soon be realised in co-operation with EIB and the Eu-ropean Bank for Reconstruction and Development. (D.Ž.)

www.privredni.hrBusiness & Finance Weekly 5

contributed by Croatia to the EU budget€267.7 million(

received from the EU budget€687.5 million(

Drago Živković

Croatia, as a new EU mem-ber, will have to pay €267.7 million into the EU

budget during the second half of 2013. Simultaneously, she will be entitled to receive €687.5 million from Structural and Cohesion Funds and from the Rural Policy Fund, which indicates she might be operating at a profit of around €420 million. Nevertheless, it is currently uncertain, since the ac-tual EU fund allocation amount will be determined by those projects for which Croatia will apply. According to experience thus far, there are indications

Croatia might see the end of 2013 at a disadvantage, as was the case for Romania and Bulgaria. In or-der to prevent a similar outcome, civil servants will strengthen their encouragement for apply-ing for tenders, which will also be available in Croatian, as one of the official EU languages, following EU accession. The three Croatian statistical regions (North-Western, Adriatic and Pannonian) are currently entitled to apply for EU funds, as they stand at below 75% of EU aver-age economic development level. The North-Western region has approached the threshold, which does not imply it will not be enti-tled to apply for EU funds, since statistical regions may be altered

every four years, explained Mar-ija Rajaković from the Ministry of Economy, Labour and Entre-preneurship, to entrepreneurs at-tending her presentation in the Croatian Chamber of Economy, following the constituting ses-sion of the Economic Council.

No advance fundsIn addition, according to the New EU Financial Framework for the forthcoming seven years there will be opportunities for regions standing at between 75% and 90% of EU average to apply for projects for some programmes. Nevertheless, there is news for entrepreneurs that no EU funds will be allocated in advance. They are currently allocated sub-sequently as a return on invest-ment. This implies that entrepre-neurs need to be able to provide their own investment funding in advance or resort to bank lending prior to EU funds allocation. The state will provide support with affordable loans via the Croatian Bank for Reconstruction and Development (HBOR). Conse-

quently, the IPA programme ir-recoverable fund tender winners will be granted a loan of at least €10,500 by HBOR for a five year term with a 12 month grace peri-od. The EU fund allocation proc-ess normally lasts on average be-tween 12 and 18 months, but will be reduced to 6 to 7 months fol-lowing Croatian EU accession, when it will be implemented from Croatia rather than Brus-sels, stated Marija Rajaković.

Various experiencesEntrepreneurs have had various experiences with EU funds and all agree on the EU fund allo-cation process being extremely lengthy and complicated. Ac-cording to Vitomir Klasić, the Director of Ivanićplast, his com-pany has had positive experienc-es, since they have an employee who deals exclusively with EU funds, due to the complexity of the entire process as well as en-gaging outsourced consultants. This has proved to be beneficial thus far, as the company has been allocated around €100,000

from the PHARE programme for a new robotised toilet cover production line, for which they obtained the most important cer-tification in the bathroom plas-tic industry. On the other hand, Josip Kudelić, owner of Kudelić meat industry, was expecting to be allocated €120,000 from the SAPARD fund at the end of 2009 for a new cold storage facility, yet he received a letter of refusal and the funds were returned to Brussels. Kudelić blames the SAPARD agency at the Ministry of Agriculture and has conse-quently taken legal action against the state, since he had employed 9 staff and invested €1.7 million whilst waiting to be granted EU funds. According to Kudelić, it is all due to the bureaucracy in public administration and the major reason for Croatia having obtained merely 12.5% of avail-able SAPARD funds. If a similar situation occurs with the Cohe-sion and Structural Funds, the Croatian start of her European journey will certainly not be sat-isfactory.

RACE FOR EU FUNDS

Costs certain, profits uncertainThe process of allocating EU funds is currently lasting on average between 12 and 18 months. Nevertheless, this will change following Croatian EU accession as it will be fully implemented from Croatia rather than Brus-sels with the entire process lasting 6 months

There are projections about the New EU

Financial Framework enabling wealthier

regions to apply for projects

dget

6 WE PRESENT Privredni vjesnikYear V No 0186

When Pero Kojan founded his tourism micro busi-ness for horse rental and

horse riding in 2003, it was the only Croatian micro business of this type. In time, it expanded into a tourist agency, which, in addi-tion to its prime activity – horse riding and horse care – deals with horse rental, transport organisa-tion, excursions and room rental. “The idea originated from my deep love of horses; I have want-ed to own a horse since my child-

hood. I completed my training in Zagreb, where I learnt to ride and about horse care and subsequently I decided to create my own busi-ness and transfer my enthusiasm into work”, he explained.There are currently six horses at the facility and the owner cares for them in person and with the assist-ance of one full-time employee, whilst during the peak season he employs three to four more staff, depending on the need. In order to prevent horse abuse, he launched ATV safari, which is currently one of the most profitable activities.

The tour also includes visits to family farms and the finale is in the exciting crossing of the river Ljuta. “This is a new experience and has shown significant suc-cess. I believe merely horse rid-ing would not be sufficient for Koral, as I invest extensively into stabling and the entire facility”, stated Kojan.

Warming wineDuring the off-peak season there are more local visitors. All visi-tors, those interested in horse riding and those opting for ATV, are offered a glass of wine, local cheese and pršut, as well as return transport from Dubrovnik to the facility. Pero Kojan anticipates active tourism will become the principal activity of his agency in the forthcoming future. Various team building programmes, such as cycling, kayaking and climb-ing, can currently be booked and the owner is hoping he will be able to provide motorcycling tours throughout South Eastern Europe. He is one of the rare horse owners in the wider Dubrovnik area interested in community well being. “There already are some dystrophic individuals who are regular visitors and I am pleased to be volunteering. Neverthe-less, we are planning to employ a professional who will be able to adapt to each individual child”, he anticipates. (A.Š.)

The Bota-Šare fam-ily founded the company Kirnja and is currently

the only Croatian family, which has managed to open a restaurant chain, identifiable by its locally-oriented cuisine. The restaurant chain currently comprises five restaurants. They employ at least 50 staff full-time, 10 of whom are family members. During the peak season, Kirnja employs up to 100 staff. “Our competitive advan-tage is the fact that core staff are family members and staff with long term contracts. The remain-ing employees are trained, with many of them opening their own restaurants following training, which is quite understandable”, stated Pero Šare, Director of Kirnja. The Šare family opened their first restaurant at the begin-ning of the 1980’s, in Mali Ston. At the beginning of 2003 they opened a restaurant near Split. The first Zagreb-based restaurant was opened in 2006, with a sec-ond following in 2007. During the peak season of 2011, Kirnja opened an Oyster&Sushi Bar in the centre of Dubrovnik, next to the cathedral.

Home grown oysters “We expected clients in our su-shi bar, which is the first inside the Dubrovnik city walls, to be foreigners. Nev-

ertheless, we were pleasantly surprised by the fact that around 90% of clients in Dubrovnik are local tourists. Subsequently, we opened other sushi bars within our Split-based restaurant and Zagreb-based restaurant, prompt-ed by the satisfactory attendance at the Dubrovnik-based restau-rant”, pointed out Šare.

Pero Šare emphasised that their restaurants are fish restaurants and they are identifiable by their menu of fresh Ston oysters throughout the year, as well as a wide range of dishes from Adri-atic shellfish and fish.“The family has been growing oysters for four generations. In addition, several years ago we held oyster party events, oyster picnics and oyster farm visits in Maloston bay in co-operation with tourist agencies. We trans-port tourists from Mali Ston with

our two boats”, noted the company Director. The Zagreb-based restaurant provides light Dalmatian fish-based meals, particu-

larly bluefish, at affordable pric-es. (J.V.)

KOJAN KORAL, KONAVLE KIRNJA, MALI STON

Love of horses makes a successful business

Local tourists opt for sushi

Pero Kojan anticipates active tourism will

become a primary activity of his agency in the forthcoming future

Kirnja employs some 100 staff during peak season

The Bota-Šare family-owned restaurant chain, well-known for its local cuisine, offers a wide range of dishes with shellfish and fish from the Adriatic

Horse riding is not the only countryside attraction: one of the most profitable activities is a safari through fields and forests of Konavle

www.privredni.hrBusiness & Finance Weekly 7CROATIAN FOREIGN CURRENCY MARKET

Too many VAT ratesIntroduction of new VAT rates could raise the price of tax collec-tion and increase the possibility of tax frauds, pointed out Katarina Ott, Director of the Institute of Public Finance, at the recent as-sembly on Hidden public spend-ing. Ott believes the poor should be helped by direct money trans-fers from the budget. She supports a deduction in personal income tax which will be compensated if the general VAT rate increases to 25%.

Croatia a medium risk Croatia falls into the category of those countries with a medium political risk for 2012, according to Aon Risk Solutions, the global risk assessment and insurance company. Aon Risk Solutions assesses the political risk con-sidering potential disturbances in foreign currency payments and the supply chain. Legal and regulatory risk as well as prob-ability of political interference and violence is also assessed. Since Croatia was categorised as a country of low political risk for 2011, the present rating is actu-ally a deterioration in status.

Savings will not growIn 2012, public savings growth will be limited by the aggravated circumstances according to Raif-feisen Bank analysts. Unemploy-ment growth and stagnating real income will lower more intense growth of deposits. Due to poor liquidity, companies had re-duced savings and term deposits already in 2011, and a healthier trend should not be expected in 2012, according RBA analysts.

Source: HNB WEEK FEBRUARY 11, 2012

Currency Kuna exchange mid-rate

AUD 6,114079CAD 5,727849JPY 7,356595CHF 6,267765GBP 9,053189USD 5,717911EUR 7,580235

::: news

Boris Odorčić

Changes in the ownership structure of Croatian Post-al Bank are considered,

confirmed HPB Board President, Čedo Maletić, last week. This is a good path to take. In this way, Croatian Postal Bank will secure the preconditions for further de-velopment and growth, Maletić pointed out. Currently, 51% of the bank is state-owned; some 28% is owned by Croatian Post, 20% by pension funds and 1% by small shareholders. Discus-sions regarding the privatisation headed in several different direc-tions after the concept of a public tender for its shares had stalled. Discussions with representatives

from Croatia osiguranje, Croatia Lloyd, European Bank for Re-construction and Development and pension funds are on-going, revealed Maletić. He added that additional capitalisation would require between €106 million and €0.13 billion, and that the book value of HPB is slightly below €0.17 billion. According to the

unrevised financial reports, HPB nett profit in 2011 increased by 72.6% over 2010, to €11.69 mil-lion; assets increased by €0.21

billion in relation to late 2010, to €2.2 billion, with market share increasing from 3.7% to 4.03%.

Credit portfolio increaseThe gross credit portfolio totalled €1.4 billion at the end of 2011, increasing by 9% compared with 2010. Lending rose significantly in the public sector (11.4%) as a result of a range of credit prod-ucts and easier lending condi-tions, as well as a new approach to distributive sales channels. Housing loans increased con-siderably, by 47.6% over 2010. Gross corporate lending totalled €0.79 billion in late December 2011, (up 12.6%). Deposits in late 2011 were €1.68 billion, up 15.4% during the year.

CROATIAN POSTAL BANK

In 2011, nett profit increased by 72.6%, to €11.69 million

Talks with representatives from Coatia osiguranje, Croatia Lloyd, European Bank for Reconstruction and Development and pension funds

PREPARING FOR PRIVATISATION

6.2. 7.2. 8.2. 9.2. 10.2.

7.584

7.582

7.580

7.578

7.576

7.574

EUR 5.825

5.800

5.775

5.750

5.725

5.700

USD 6.30

6.29

6.28

6.27

6.26

6.25

CHF

6.2. 7.2. 8.2. 9.2. 10.2. 6.2. 7.2. 8.2. 9.2. 10.2.


Fourteen Croatian exhibi-tors participated at ‘Boot Fair’, held in Düsseldorf

at the end of January and the largest European boat show. Pro-ducers exhibited small boats and vessels, sailing boats and yachts, with the appearance of diving agency and ACI marina repre-sentatives. The Croatian Tourist Board presented Croatian nauti-cal destinations using video pres-entations and also organised the distribution of Croatian tourism promotional material.According to the data provided by the German Marine Industry Association (BVWW), which

conducted a survey within the yachting fraternity, Croatia has been identified as the second most desirable European charter

destination for 2012, behind the Baltic Sea. On the other hand, Croatia is the top Mediterranean destination, followed by Greece, Spain, Turkey and France. ‘Boot Fair’ has witnessed continuous success and ACI has been iden-tified as a brand, due to its long presence and satisfactory refer-ences amongst European sail-ors, according to Silvana Štiglić from Opatija-based ACI. She an-nounced ACI is planning to focus on maintaining quality market positions.

Good contacts – good resultsElan Yachts also participated at the boat show, presenting its pro-duction programme, particularly the Elan 210 yacht, nominated as the best European yacht in 2012 and the Elan 350, which received the prestigious European boat of the year award in 2011. Jasmina Čerina, Executive Di-rector of Elan, pointed out that participation at the show contrib-uted to making and strengthen-ing useful business contacts. She is particularly pleased with the

fact that Norwegian and Swedish Coast Guards will test its vessels, which may result in sig-nificant co-operation.The Zagreb-based Grginić Yachting exhib-ited its boats at the show achieving significant success with sales con-tacts from Austrian buyers, who purchased three boats in 2011, whilst 2 more were sold to Slov-enia. According to the owner, the yachts produced with prices slightly below €100,000, are up to 30% more affordable than their peer competitors. Consequently, Grginić anticipates satisfactory contracts in 2012, irrespective of the adverse impact of the crisis.

State support assistance‘Boot fair’ has inspired European producers. Mega-yacht producers are faced with the most serious problems and have had to sig-nificantly reduce production over the last two years. Consequently, Ferretti, a symbol of glamour and luxury, is facing bankruptcy and the owners are looking for global

investors to save this well-known company. It is highly probable the company will be sold to a Chinese investor. Scandinavian boat producers have large na-tional government support, since the small ship building industry has been identified as a strategic branch of the economy and is consequently provided with co-financing for half their participa-tion at boat shows. Similar support is expected by Croatian producers, as this year there was no company presenta-tion through the Small Shipbuild-ing Cluster, whilst it accounted for a highly acclaimed exhibi-tion at the show covering a wider area during the last several years. Croatian companies exhibited over 442 m2 this year. (K.S.)

The company Elan has expressed considerable

satisfaction that Norwegian and Swedish Coast Guards will test its

vessels

BOOT DUSSELDORF, THE LARGEST EUROPEAN BOAT SHOW

Inspiring European vessel producersAccording to a survey conducted amongst the sailing fraternity, Croatia is the top Mediterranean destination, followed by Greece, Spain, Turkey and France

Boot Düsseldorf

‘Boot Düsseldorf’ is one of the leading world boat shows and 1,656 exhibitors from 62 coun-tries participated in 17 pavilions, covering 16 areas. The show was visited by over 50,000 foreign visitors, with a total of 246,700 visitors from 60 countries. Sailing boats and motor boats aroused the greatest interest. The empha-sis this year was on quality and comfort. The next show will be held in January 2013.

PV International 0186

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