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EBRD adopts new strategy for Croatia
EBRD’s Board recently approved the Bank’s new Strategy for Croatia. EBRD will continue to support the transition process in Croatia and in the coming period will focus its activities on the following sectors:
- In the enterprise sector, the Bank will assist the government with privatisation and restructuring industries, in particular shipyards and tourism, a sector seen as essential for Croatia’s future. The EBRD will continue to support the consolidation and regional expansion of Croatian companies and will continue to seek investment opportunities in economically-depressed regions of the country.
- EBRD will work with a number of large and medium-sized municipalities to finance essential infrastructure and to develop projects for prospective EU financing. The Bank will also support national infrastructure projects which can be financed on a commercial basis. In the energy sector, the Bank will promote energy efficiency through credit lines through banks and energy audits, and focus on infrastructure needed for security and diversity of energy supply, including renewable energy projects.
- In the financial sector, the EBRD will pursue SME finance with the support of the EU under the SME Finance Facility. The Bank will promote new products, such as securitisation, and develop financing for leasing companies.
In its latest strategy, the EBRD concludes that Croatia has made notable political success with getting EU candidacy status and opening of EU accession talks. The macroeconomic environment has improved, exports have performed better than expected and the important tourism sector continues to develop.
The Bank notes that despite the overall improved climate, the country still faces structural challenges such as restructuring and privatisation of the remaining state-owned enterprises, in particular shipyards; modernisation and improvement of services offered by locally-owned tourism companies and encouraging foreign operators to establish operations in the market. Further reform is needed to improve the effectiveness of the judiciary and to reduce corruption. Significant levels of investment and private sector participation in public infrastructure will also be necessary.
The EBRD will continue to engage in a policy dialogue with the Croatian government with respect to privatisation and restructuring, laws on securitisation and non-bank credit institutions, the handling of concessions and involvement of private sector in public infrastructure and generally creating a favourable and competitive business climate.
Since the last strategy two years ago, the Bank’s commitments in Croatia have increased to a total of €1.7 billion for 78 projects across all sectors of the Croatian economy, with a concentration in the financial sector and in infrastructure. In addition, the Bank helped mobilise €3 billion from other sources.
Last year’s projects include €110 million of pre-IPO equity investment in the regional food and beverage company Agrokor, €10 million loan for water treatment in Karlovac, €40 million loan for construction of the last section of the Rijeka bypass and €50 million loan for the Rijeka-Zagreb motorway. Last year’s projects in the financial sector included credit lines to Hrvatska Postanska Banka (HPB) and to S-Leasing and Reiffeisen Leasing for financing SMEs.
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