ECONOMICS
Croatia Economic Indicators
Croatia’s Economic Outlook: Growth, Technology, and Education
Croatia’s nominal GDP is projected to reach $88.08 billion in 2024, with steady growth supported by private consumption and investments. The unemployment rate has declined to 5.6%, while inflation is expected to stabilize at 2.5%. The ICT sector, a vital economic driver, continues to expand, with tech exports rising to 2.14% of GDP in 2022. Investments in education and sustainability are fostering a skilled workforce, essential for long-term growth. Croatia’s integration into the EU, Schengen zone, and euro area further bolsters trade and investment prospects.
GDP Growth Rate: The economy is expected to grow by 2.6% in 2024 and 2.8% in 2025, supported by robust private consumption and investment activities. The economy experienced a growth rate of 3.9% year-on-year in Q3 2024, up from a revised 3.5% expansion in Q2.
The Croatian economy is projected to grow by 2.6% in 2024 and 2.8% in 2025, supported by robust private consumption and investment activities. In Q3 2024, the economy expanded by 3.9% year-on-year, improving from a revised 3.5% growth in Q2. The unemployment rate stood at 5.6% as of April 2024, continuing a positive trend of decline in recent years, reflecting improvements in the labor market. Inflation is expected to ease to 2.5% in 2024, signaling a stabilization in prices. While specific data on Foreign Direct Investment (FDI) inflows for 2024 is not readily available, Croatia’s full integration into the European Union, including its accession to the Schengen zone and the euro area, is anticipated to encourage greater trade and investment in the 2025-2027 outlook.
The Information and Communications Technology (ICT) sector is a significant component of Croatia’s economy. In 2021, medium and high-tech industries constituted approximately 32.65% of the manufacturing sector’s value added. Projections indicate that Croatia’s digital economy could account for up to 15% of GDP by 2030, underscoring the sector’s growth potential. Croatian IT firms are expanding their reach, with ICT sector exports rising from 1.51% of GDP in 2018 to 2.14% in 2022. This trend highlights the sector’s growing international competitiveness. Croatia is integrating sustainability into all education levels, as recognized in several strategic documents, to prepare students for future challenges. Both the technology and education sectors are integral to Croatia’s economic development. The tech sector is experiencing robust growth, contributing significantly to GDP and export expansion. Concurrently, substantial investments in education are laying the foundation for a skilled workforce, essential for sustaining long-term economic growth.
Sources:
- U.S. Department of State. (2024). 2024 investment climate statements: Croatia. Retrieved January 21, 2025.
- OECD. (2024, December). OECD economic outlook, Volume 2024, Issue 2: Croatia. Retrieved January 21, 2025.
- European Commission. (n.d.). Education and training monitor: Croatia. Retrieved January 21, 2025.
- Trading Economics. (n.d.). Public spending on education in Croatia (percent of GDP, WB data). Retrieved January 21, 2025.
- Emerging Europe. (n.d.). IT sector in focus: Croatia. Retrieved January 21, 2025.
- CEIC. (n.d.). Croatia: Gross domestic product – Share of GDP in manufacturing, medium and high-tech industry. Retrieved January 21, 2025.
Croatia Regulatory Enviroment
Croatia’s business environment has improved, with the time to start a company reduced to seven days and corporate tax rates of 18% or 10%, depending on revenue. While VAT stands at 25%, reforms in 2024 aim to boost net wages and refine personal income tax structures. Although rankings in the World Bank's new "Business Ready" report are unavailable, Croatia continues to advance in regulatory efficiency and economic reforms.
Croatia Economic Indicators
Croatia’s nominal GDP is projected to reach $88.08 billion in 2024, with steady growth supported by private consumption and investments. The unemployment rate has declined to 5.6%, while inflation is expected to stabilize at 2.5%. The ICT sector, a vital economic driver, continues to expand, with tech exports rising to 2.14% of GDP in 2022. Investments in education and sustainability are fostering a skilled workforce, essential for long-term growth. Croatia’s integration into the EU, Schengen zone, and euro area further bolsters trade and investment prospects.