The first country to join the bloc since 2007, Croatia officially became a member of the European Union on 1 July 2013.
A historic moment for what has been a politically unstable nation, fireworks lit the sky as the membership became effective. But the celebrations were amidst a cloud of caution not too dissimilar to the literal clouds of smoke caused by the illuminations in the sky.
Indeed, as Croatia still battles with its own economy’s five-year recession, the news has been greeted with several caveats from corners of the Europe’s media.
The global financial crisis of 2008/09 hit the tourism-orientated economy hard, but there was much more positive news in 2012 when the sector hit back with gusto, registering its best tourism season on record. Its current GDP represents a modest 0.10 per cent of the world economy, and in 2011 GDP was worth USD63.85bn.
But there are other areas that the country will look towards with optimism as it hopes to bolster its economy. Croatia’s coastline line is a well-known asset, but the country boasts a skilled and linguistic workforce with many employees in towns and cities being educated to degree level. With 49 per cent of Croatians reported to speak English, the market is promoted as a knowledge-based economy with expertise in IT and Biotech.
It is a well-connected maritime country, with six ports, and is the most favourable destination for maritime transport from Asia, Australia and Oceania through the Suez Channel to Europe, shortcutting shipping times by five to eight days. It is also recognised as the best solution for the transport of goods from Europe to North and South America and Africa.
Croatia’s main trading partners are Italy, Germany and Austria – primarily importing machinery, transport and electrical equipment, fuels, lubricants and foodstuffs. More than 60 per cent of Croatian exports are sent to their Italian neighbour.
Provisional figures show the value of Welsh exports to Croatia in 2012 were £9m, up from £4m in 2011, while in 2011 UK visible exports to Croatia were approximately £150m.
UK Trade & Investment highlights a number of sectors Welsh businesses can tap into to increase these figures: tourism and leisure, ports and marine, education, creative and media, security, food and drink, energy, environment and water protection.
Applying for membership over 10 years ago (February 2003), Croatia is the second ex-Yugoslavian country to join the EU after Slovenia. But enthusiasm has been dampened by the euro zone’s crisis and the country’s ongoing economic struggle. Despite this, two-thirds of Croatians voted in favour of the accession in 2012, and the celebrations on the streets of Zagreb last month suggest the country sees this as a new chapter of economic prosperity.
Now a fully-fledged member of the EU, Croatian businesses will be able to move capital between the other 27 member states, and take advantage of rules facilitating cross-border payments. And it stands to benefit from gaining access to the European market of 500 million consumers. Perhaps, after all, there might be cause for optimism.