Meeting G2.2 Conclusions

Connecting business people in Croatia with those living abroad opens up a new chapter in Croatian economic development, growth and productivity. That is the message from the MEETING G2.2 (second generation meeting) Business Conference which for the second year in a row, was held at the FORUM Zagreb Congress Centre from 10th to 12th October, this time under the title ‘Croatians, together in Business’.

The comprehensive three day Program began on 10th October with a visit by Conference Participants to Prime Minister Tihomir Orešković at the government’s offices in Banski Dvori and a welcome dinner for all participants in the evening.

The following two days, 11th and 12th October, nine panel discussions were held on topics such as innovation, exports, privatisation, branding Croatia and developing health tourism as well as alternative sources of energy, all of which produced innovative ideas by the top experts in their fields. A business trip to the City of Rijeka was organised for all registered participants for an additional fourth day of the Conference on 13th October.

On 11th October, the organisers arranged a question and answer session or Open Hour giving participants from the Diaspora the opportunity to directly engage with representatives of the Government and the public sector. On 12th October, participants visited the Office of the President of the Republic of Croatia, Kolinda Grabar Kitarović.

The Conference gathered 190 participants of which 70 were from Australia, Austria, Bolivia, Bosnia and Hercegovina, Chile, Ecuador, Finland, France, Canada, Macedonia, Germany, Paraguay, Peru, USA, Slovenia, Switzerland, Great Britain and Venezuela.

The Conference is an integral part of the G2 Project whose mission is to introduce and connect Croatians from around the world with Croatians and business opportunities in Croatia via the internet and social networking with the personal, practical exchange of knowledge and ideas. The organisers considered that it was high time to connect with the diaspora from a business perspective.

Although the goal of the G2 Project is first and foremost to connect Croatians through business, we hereby present several general recommendations from the Conference, important for developing positive relations with Croatians living outside the Republic of Croatia:

  1. Croatian emigrants face a large number of administrative barriers Croatians are dying out as a nation statistically and partly because a large number of Croatians throughout the world do not manage to get Croatian citizenship. It is therefore recommended that the procedure for applying for Croatian citizenship be simplified. Enable postal and/or electronic voting. This is important for emigrants to feel a part of Croatia’s future.
  2. Croatians abroad must establish a connection with the Homeland. The Ministry of Foreign and European Affairs must continue with the policy of establishing Honorary Consuls in all countries and cities in which Croatians live. Honorary Consuls must be of Croatian heritage and have private sector experience in their respective countries because part of their duties would involve a business aspect.
  3. Instead of three, we propose five Members of Parliament for the Diaspora. Under Article 44 of the Law on Relations between the Republic of Croatia with Croatians Abroad which ensures the involvement of Croatian abroad, we propose that there be five representatives of the Diaspora in the Croatian Parliament, one for Australia, New Zealand and South Africa, one for South America, one for the USA, one for Canada and one for Europe.

We have set out hereunder Conference recommendations in relation to the business and investment climate in Croatia:

Croatia should cultivate sectors of the economy in which it is most successful as well as setting out guidelines for the development of sectors which have enormous potential.

Croatian innovations are increasingly found in the economy. Even though there exists an incentive program for investment in the ownership capital of small and medium-sized innovative entities (Pre-Seed) and a Fund established for stimulating investment in the early stages of financing (SEED) which ensures the co-financing of small innovative entities through loans alongside private investment, there is still room for establishing funds which would provide financial means to strategic companies for their development. Croatia would then surely become a more attractive business environment for quality and promising start-ups which increase employment, generate income, exports and ultimately, economic growth for Croatia.

Our higher education institutions must train students for the global market. The huge brain drain in the IT Sector means that companies in Croatia complain that they do not have people to employ. It is imperative to listen to the needs of employers.

The solution to unemployment is more flexible and competitive higher education institutions.  Creating experts is an expensive and drawn out process but with increasing mobility we can bring in experts from other countries and thereby speed up this process. Moreover, by establishing departments for lifelong education (possibilities for additional training or retraining) opens the door to flexibility and development. Figures showing the mass exodus of experts in the fields of medicine and engineering also evidence that Croatians are competitive on the employment market. International accreditation and international exchanges speak in favor of higher education institutions but in order to strengthen the competitiveness of higher education institutions it is imperative to be focused on all three important aspects of education: the professors, students and infrastructure. There are more than 20 studies in Croatia all dealing with studying the past and not one with studying the future. We need to turn towards new trends, connect with foreign institutions and work on foreign projects with foreign associates.

Stimulating multidisciplinary studies and facilitating students to change their fields after their undergraduate studies, particularly after finishing their university degree and enrolling in a doctoral degree. The world is currently too multidisciplinary to expect from students that they choose one particular field after high school and to stick to it for the next 50 years. The best ideas actually come when mathematicians work together with doctors or engineers work with designers etc.

Increasing funds for educating young people. Funds for doctorates have been significantly reduced over the past few years so that the majority of young people go abroad and do not have the means to return. Every quality young person that stays behind is extremely important. Establishing scholarships (similar to the City of Zagreb Scholarships) for the top students in particular fields (especially in undermanned areas where we need more experts such as – STEM, Medicine, etc.) and students who stand out by being proactive and successful in various activities (student organizations, sports activities, jobs during their studies etc.). The total amount for annual scholarships need not be huge but will directly show the best people that they are appreciated and valued.

Encouraging an entrepreneurial spirit amongst students by providing support to student organizations and educational institutions with entrepreneurial programs.

Enabling successful exporters new opportunities. In order to enable successful exporters to expand and for them to show the way to newcomers with their example, we propose that the procedure for approving loans be expedited, within 1-3 weeks, for projects for which there are signed contracts. Furthermore, the Croatian Bank for Reconstruction and Development is called upon to come up with new models of financing.

Opening Croatian offices abroad and strengthening support for Croatian institutions abroad. Croatia needs a real export offensive and the Croatian Chamber of Economy could assume the role of a sort of export agency. Furthermore, Croatian offices must urgently be established in distant countries, a sort of Croatia House which would employ local people who would help our entrepreneurs that go there or wish to export. Priority countries are Australia, Canada, USA, Argentina, Chile and South Africa. The state should also ensure entry into non-western countries such as Algiers which do not deal directly with private entrepreneurs but the competent institutions must open doors. Every Croatia House around the world must have available information on every Croatian product.

Croatia has a lot of potential for investment through the privatization of existing companies as well as investment in new projects. Croatia still has many companies in state ownership that need to be privatized and DUUDI’s (the Government Office for Managing State Assets) plan is to simplify, expedite and complete already begun privatizations through amendments to the Law on the Management and Disposal of Property owned by the Republic of Croatia and the Directive on the Sale of Shares and Business Stakes. Croatia is now part of the European Union, the largest single market in the world and its geographical location as well as a productive, quality and relatively inexpensive labor force enables us to be positioned as a serious player in attractive investment.

It is necessary to make a brand out of Croatia. Globalization has resulted in increased competition which offers the same or similar goods and services at around the same prices so that branding is having an ever more significant role in increasing competitiveness, increased market share and profits. Branding is becoming a basic discipline and key to success under current global economic conditions. The Croatian Government has put in little effort in branding Croatia over the years and even the smallest step forward has basically been through sheer luck (Filming of Game of Thrones, Star Wars, and famous people holidaying in Croatia etc.) rather than any thorough planning or strategically outlining the necessary collective action. As a result, the perception is that Croatia is just a great place to visit but nothing more (place to work, live, invest, study etc.). Above all, we need to make a brand out of Croatia by answering the questions: Who are we and what do we offer and to build an image and tell a story that will greatly differentiate Croatia and lift it above its competition using social media which is today an integral part of a brand and communication strategy of any successful county.

Health tourism is one of the potential key catalysts of GDP growth and overall well-being for the next 20-30 years. Apart from having great potential for the development of Croatia, its tourism and agricultural sectors as well as the economies of particular areas of the country, health tourism can help in the development of the public health system and improve national health standards. Moreover, it can encourage the return of doctors who have left Croatia in search of jobs. The key to the development of health tourism is that all interested institutions as well as individuals in the country and abroad, including the diaspora which is scattered all over the world but possesses enormous knowledge, expertise and a lot of positive energy, in cooperation with the new Croatian Government, make an ambitious business plan and identify the development of health tourism as one of the national priorities for Croatia. Clinics, health spas and many other institutions already exist, several clusters have been formed and documents have been drafted, including the Tourism Strategy which mentions health tourism. However, all these individual government initiatives must be integrated as soon as possible and placed under one roof, in an organised system under the umbrella of a particular ministry or at least a working group which will make a document for the development of health tourism in the years ahead.

Croatia still has to develop an energy market which is based on competition, diversification, transparency and liquidity. It is imperative to change the approach to the production of electrical energy which will rely on local energy sources and thereby satisfy at least 90% of domestic demand from its own sources. Croatia must develop renewable energy sources (RES) which do not depend on government subsidies and which are based on the needs of entrepreneurs and citizens through production at the point of consumption which will enable strong economic and sustainable development. The recommendation is to include the private sector in the whole gas business including production and supply. Croatia, as a signatory to the Paris Convention, must encourage and be an example of a decreasing carbon footprint in its own country and wider, through public-private partnerships.

Message to potential investors from Croatians abroad: Every business has its difficulties and the same applies to doing business in Croatia but good will and persistence which are always a big part of any success story in business will also bring success when doing business in Croatia. One should accept the local rules of engagement as in any other country and it is recommended to cooperate with local business partners or entrepreneurs. Croatians are a flexible and resilient people and find quick solutions for practically everything.

– – –

The Conference was held under the auspices of the President of the Republic of Croatia Kolinda Grabar Kitarović along with the Ministry of Foreign and European Affairs, the Ministry of Entrepreneurship and Crafts and the Office for Croatians Abroad. The Conference was supported by the Agency for Investments and Competitiveness, HAMAG-BICRO Agency for SMEs, Innovation and Investments, the Croatian Bank for Reconstruction and Development, the City of Zagreb Tourist Office, Law Firm Grubišić &Lović&Lalić, MBA Croatia Association.  The following contributed to the work of the Conference: the Croatian Chamber of Economy, Croatian Exporters, KWVD – Kroatische Wirtschaftsvereinigung Deutschland e.V., AVR, ID kongres, Spoon, HIA.com.hr – Hrvatski iseljenički adresar, HMI – Croatian Heritage Foundation, HSK – Croatian World Congress, CROWN – Croatian World Network, CRO% HOMEMADE. Conference media coverage by Business G2, BIZdirekt, Lider, Nacional, Poslovni dnevnik, Poslovni turizam and Direktno.hr.