AGP Executive Report

Croatian Labour Market: Croatia now has more than 150,000 foreign workers paying social contributions—about 8% of contributors—highlighting how tourism, construction, transport and manufacturing are leaning on overseas labour to plug shortages. Healthcare for Visitors: Croatia has opened 50 tourist medical clinics across 11 counties to ease pressure on local health centres and emergency departments during peak summer, with EHIC holders able to access medically necessary care. Tourism Pricing Pressure: Prime Minister Andrej Plenković says Croatia’s tourism has hit practical capacity limits (around 22m visitors and 110m overnight stays) and that growth now depends more on keeping prices competitive than on adding more volume. World Cup Business Spotlight (Indirect): England’s quarter-final win over Norway in Miami keeps the tournament’s huge commercial momentum going, while Croatia’s tourism and labour trends show how summer demand is reshaping the domestic economy.

Croatian Tourism Pricing Pressure: Prime Minister Andrej Plenković says Croatia’s tourism has hit recurring capacity limits (about 22m visitors and 110m overnight stays) and that growth now depends more on keeping prices “reasonable and competitive” than on adding more guests. Tourism Performance Snapshot: Croatia logged 7.6m visitors and 29.5m overnight stays in Jan–Jun 2026, with rising air, road and sea traffic. Housing Market Cooling: Eurostat data shows Croatia was among only three EU countries with fewer residential property sales in Q1 2026 (down 3.9% y/y), even as prices keep climbing. STEM Spotlight: Croatian students placed among the world’s best at RoboCup 2026, earning top rankings in robotics and AI categories. Tech & Industry Signals: Croatia’s shipbuilding and defence ecosystem continues to attract deals and partnerships, including MoUs tied to corvette work and new industrial cooperation. Global Mobility for Croatians: China’s visa-free list includes Croatia, allowing short stays up to 30 days for tourism/business/visits.

Croatia Housing & Tourism Watch: Croatia saw residential property sales fall 3.9% year-on-year in Q1 2026, one of only three EU countries with declining transactions, even as prices keep climbing—especially in Zagreb and along the Adriatic. Private Rentals: The private holiday-rental market is softer too, with some destinations reporting drops of 20–30% in arrivals and overnight stays, while hotels are holding up better. STEM & Talent: Croatian students delivered strong results at RoboCup 2026, ranking among the world’s best in robotics and AI, reinforcing Croatia’s push in STEM education. Diaspora Policy: Croatia launched a €1.2m funding call to support diaspora return and integration, including event, information, and business networking programmes. EU Politics: MEPs say Serbia’s EU path is stalled due to rule-of-law and implementation gaps, plus concerns over alignment with Russia and China. Regional Business Links: Croatia and Moldova discussed reintegration efforts in Transnistria and the role of the Convergence Fund, with interest in further cooperation.

Croatia Economy & Jobs: Croatia hit its lowest registered unemployment since records began, with 59,423 people out of work at end-June (down 15.2% year-on-year), and new hiring concentrated in accommodation and food services plus wholesale/retail and manufacturing. Tourism & Ports: Dubrovnik stayed Croatia’s cruise heavyweight, with 49 foreign ship calls and 221,500 passengers in Jan–May 2026 (+6.7%); the city also moved closer to its €60m multifunctional arena financing. Real Estate: Croatia’s property market kept climbing, even as sales cooled—prices rose while transactions fell, echoing broader European pressure on affordability. Diaspora Policy: Croatia launched a €1.2m funding call (until 10 Aug) to support diaspora return, immigration and integration, including business networking and return-focused events. Defense & Industry: Fincantieri signed MoUs with Croatian shipyards Brodotrogir Cruise and Iskra Shipyard for potential work under Croatia’s Multi Role Corvette program. International Business Links: Croatia and Pakistan agreed to boost trade, investment and connectivity, including plans to expedite a Croatian visa facility in Islamabad. Energy/Infrastructure: Croatia’s unemployment and tourism momentum come alongside wider regional infrastructure and industrial cooperation signals, including NATO-linked industrial activity in the region.

Croatia Jobs & Labour: Croatia hit its lowest registered unemployment since records began, with 59,423 people out of work at end-June (down 15.2% year-on-year), and hiring strongest in accommodation/food services. Tourism & Ports: Dubrovnik stayed Croatia’s top cruise hub in early 2026, adding 221,500 cruise passengers (+6.7%) and 130 ship calls in Jan–May; the city also moved closer to its €60m multifunctional arena as financing nears completion. Diaspora Policy: Croatia launched a €1.2m public funding call to support Croatian diaspora return and integration, running 9 July–10 August. Defence & Shipbuilding: Fincantieri signed MoUs with Croatian yards Brodotrogir Cruise and Iskra Shipyard for potential work under Croatia’s Multi-Role Corvette programme. Property Market: Croatia’s house prices keep climbing while sales fall sharply, highlighting a market split between higher asking prices and weaker transaction activity. EU/Global Context: NATO’s Ankara summit pushed pooled procurement and surveillance upgrades as the US reshapes its role; meanwhile, e& agreed to sell its Vodafone stake for about $5.95bn.

Croatia–Pakistan Business Push: Croatia’s FM Gordan Grlić Radman met Pakistan PM Shehbaz Sharif and FM Ishaq Dar in Islamabad to boost trade, investment, IT, connectivity, agriculture, tourism and skilled labour, with leaders also inviting Croatia’s top officials to visit Pakistan. Visa Facilitation: Dar said work is underway to open a Croatian visa processing facility in Islamabad, sparing applicants from traveling to a third country; both sides also discussed legal pathways for skilled workers and steps against human smuggling. EU Trade Stakes: Pakistan highlighted preparations to reapply for the EU’s GSP+ ahead of January 2027 rules, calling it a key pillar of economic cooperation. Croatia in Tech Growth: Deloitte’s 2025 EMEA Technology Fast 500 ranking lists 13 Croatian firms, led by Margins (82nd) and Cactus Code (84th). Defence Industry Link: Fincantieri signed MoUs with Croatian shipbuilders Brodotrogir Cruise and Iskra Shipyard for the MRC corvette programme, aiming to localize design and construction work. Ground Drone Venture: Rheinmetall launched Rheinmetall Unmanned Vehicles with Croatia’s DOK-ING to develop modular UGV platforms for combat support, engineering and minehunting. Tourism & Property Signals: Croatia reported strong first-half tourism results (29.5m overnight stays) while property sales fell sharply even as prices kept rising. Rights & Travel Backlash: A 2,000-passenger LGBTQ+ cruise (Scarlet Lady) was denied entry by Turkey and then Egypt, forcing repeated itinerary changes.

Tech & Growth in Croatia: Deloitte’s 2025 EMEA Technology Fast 500 list puts 13 Croatian tech firms in the spotlight, with Margins (82nd) and Cactus Code (84th) among the top performers. Retail Real Estate: InterCapital Real Estate Fund Alfa has signed to buy full ownership of Zagreb’s Avenue Mall and Avenue Centar complex in a deal worth about €100m, with completion expected by 31 July. Tourism & Consumer Pressure: Croatia’s tourism minister says visitors have less spending power and competition is rising, after June saw a 7% drop in tourists and a 6% fall in overnight stays. Croatian Business Abroad: Street-food brand Koykan opened its first German restaurant in Munich and is already planning 10 locations across the DACH region in a ~€5m project. Finance: Croatia raised €1.25bn via a new five-year government bond (2031 maturity), with strong demand from institutional investors. Defense Tech: Rheinmetall and DOK-ING launched a Croatian venture to develop modular ground drones for combat support and minehunting. Bilateral Trade Push: Croatia and Pakistan agreed to deepen cooperation on trade, investment, visas and port connectivity, including plans for a Croatian visa facility in Islamabad.

Adriatic Connectivity: Jadrolinija launched a new high-speed catamaran line linking Zadar and Ancona in about four hours, with 3 sailings a week at first and up to 5 during peak summer, aiming to boost both tourism and business travel. Short-Term Rental Crackdown: Croatian municipalities are asking the government for stronger powers to curb illegal holiday rentals, arguing local authorities can spot unregistered providers faster; the push ties into a planned Hospitality Act that would restrict online ads to legally registered stays with trackable IDs. Tourism Watch: Dubrovnik reported a modest rise in the first half of 2026 (546,170 arrivals and 1,666,574 overnight stays, +1% year-on-year), while the tourism minister said June’s dip shouldn’t be read alone and pointed to stronger first-half revenue growth. Croatia in the Spotlight: A family says a 22-year-old with Type 1 diabetes detained in Croatia needs an urgent hospital transfer after alleged delays in access to insulin. Sports & Talent: FC Dallas striker Petar Musa was named to the 2026 MLS All-Star team after a strong start to the season.

Croatian Tourism Watch: Croatia logged 7.6 million tourist arrivals and 29.5 million overnight stays in the first half of 2026, matching last year, with the Adriatic driving 27.1 million nights and continental Croatia (incl. Zagreb) up 1% to 2.4 million; Tourism Minister Tonči Glavina said results hold up despite geopolitical uncertainty and stressed “sensible pricing” for the peak season. Property Market Cooling: Residential transactions in Croatia fell 42% year-on-year in Q1 2026 to 17,067, while prices kept rising—existing homes up 16.1% and new-build up 9.7%—as affordability and tighter purchasing power slow deal flow. Work-Life & Equality Certification: Telemach became the first major Croatian company to earn the Mamforce Lead standard, with an audit showing a 15-point improvement since initial certification, citing progress in talent management and responsible leadership. Aviation & Trade Links: Air China plans to relaunch Zagreb service from Sept 4 via Bucharest, boosting Croatia Airlines’ Star Alliance connectivity and restoring direct China–Croatia links after Croatia Airlines ended its seasonal Bucharest route. Health & Enforcement: Croatian customs seized 970 disposable vapes ordered online by minors/young adults, warning that untested products from unofficial channels can’t be verified and are prohibited under age 18. Defense & Mobility: Croatia joined a seven-nation A400M military transport programme under NATO, with no financial obligations before 2030, aiming to strengthen strategic airlift capacity. World Cup Aftermath (Sports Business): Zlatko Dalić stepped down as Croatia coach after the team’s World Cup exit, ending nearly nine years at the helm.

NATO Defence Industry Push: NATO kicked off its Ankara summit by announcing major multinational air power deals worth “billions,” including up to 10 Saab GlobalEye surveillance aircraft to replace aging AWACS, new Airbus A400M pooled airlift plans that include Croatia and Poland, and MQ-4C Triton drone procurement to strengthen ISR. Croatia in the Mix: Croatia is also tied into NATO’s strategic airlift cooperation and the A400M pooling framework, positioning the country to access heavy airlift capacity without immediate full national procurement. Regional Transport Deal: Serbia and Italy discussed rehabilitating rail passenger services between Belgrade and Trieste, aiming to restore a cross-border route via Zagreb and Ljubljana. Capital Markets: InterCapital Securities will list its Romanian-focused ETFs on the Budapest Stock Exchange, giving Hungarian investors access to Romanian equity and government bond exposure. Tourism & Cost Pressure: Cyprus posted the strongest EU retail sales growth in May, while Croatia’s heatwave is driving a surge in air-conditioning demand and longer technician waiting times. Agriculture Policy: MED9 ministers in Zadar, with Croatia’s Anton Refalo, focused on generational renewal and rural revitalisation, while young farmers urged predictable CAP conditions to invest long-term.

Croatian Agriculture & Rural Jobs: Minister Anton Refalo joined MED9 agriculture ministers in Zadar to push generational renewal, better knowledge-sharing and a stronger link between farming, entrepreneurship and demographic policy. NATO Airlift & Surveillance: NATO leaders in Ankara backed a pooled Airbus A400M airlift “high-visibility” project that includes Croatia and Poland, plus plans to buy up to 10 Saab GlobalEye aircraft to replace aging AWACS. Croatia Housing Market: Property sales in Croatia fell 42% year-on-year while residential prices rose 14%, as supply stays tight and many homes remain off-market. Regional Finance: InterCapital Securities plans to list its Romania-focused ETFs on the Budapest Stock Exchange, giving Hungarian investors access to BET-TRN and Romanian government bond exposure. Tourism & Costs: Slovenia heads into peak season with visitor momentum, but staffing shortages and higher operating costs are squeezing operators. Heat & Consumer Services: Croatia’s air-conditioning demand is surging, with technicians reporting up to two-week waits and doctors warning against extreme indoor-outdoor temperature gaps. Business & Travel Deals: Octoplay expands its Entain iGaming partnership to more markets including Croatia, while Kensington markets more food-and-culture itineraries across Croatia and the region. Global Enforcement: A coordinated crackdown on human trafficking (“Operation Global Chain”) across 59 countries led to 2,070 victims identified and 1,024 suspects arrested.

Energy Aid to Ukraine: Ukraine’s Energy Minister Denys Shmyhal says European partners have already shipped 199 batches of decommissioned power equipment (over 3,300 tons) and that it’s operating in regions including Vinnytsia, Kyiv, Kharkiv and Dnipropetrovsk; deliveries include 152 shipments via Lithuania’s Ignitis Gamyba and 41 batches enabled by the Ignalina Nuclear Power Plant, with more inspections underway across Latvia, Croatia and others. Croatia Tourism & City Rules: Dubrovnik extended bar and restaurant opening hours to 4:00 a.m. for the Summer Festival opening night, while reminding venues to keep public order and respect noise limits. Retail Pulse in the EU: Eurostat data show euro area retail trade volume up 0.2% month-on-month in May and up 1.6% year-on-year; among member states with data, Croatia saw a monthly drop (-2.0%), while Bulgaria (+7.9%) and Cyprus (+8.4%) led annual growth. Croatian Sports Talent on the Move: Marcelo Brozović is now a free agent after leaving Al Nassr, ending a three-year Saudi stint. World Cup Meets Finance (and Crypto): Portugal–Spain match chatter is driving volatility in $POR and $SNFT fan tokens on Chiliz, with traders watching halftime and knockout swings.

Film & TV Industry: CineLink Industry Days in Sarajevo has unveiled the full Co-Production Market and Drama line-ups, with 16 feature projects and 8 drama series competing for prizes including a new €10,000 cash award. Croatian Arts Spotlight: Jozo Schmuch’s war-memory short Shallow Ground and Mate Ugrin’s debut Petty Thieves are both set for major festival exposure, keeping Croatia’s film scene in focus. Energy & Industry: INA says solar panels at its Rijeka Refinery are installed for Croatia’s green hydrogen push, with the 11 MW photovoltaic plant set to power the electrolyser (completion expected by end-2026). Tourism & Local Development: Dubrovnik logged nearly 88,000 nautical overnight stays in the first half of 2026, while Dubrovačko Primorje plans a new 5-km walking and cycling trail with accessibility and safety features. Transport Regulation: Croatia’s updated taxi rules via amendments to the Road Transport Act introduce per-vehicle permits, standardised plates, and legally defined maximum fares, plus tighter oversight of ride-hailing platforms. Macroeconomy: Eurostat data show euro area retail sales rose 0.2% month-on-month in May and 1.6% year-on-year, slightly above expectations.

World Cup Knockout Drama: Erling Haaland powered Norway past Brazil 2-1 in the Round of 16, setting up a quarterfinal vs the England-Mexico winner. England-Mexico Shock: England survived Mexico at the Azteca after Jude Bellingham’s rapid brace, with Mexico’s Julian Quinones replying late to make it 2-1. France Advances on Mbappé Penalty: Kylian Mbappé scored the only goal as France beat Paraguay 1-0 in Philadelphia, booking a quarterfinal vs Morocco. Croatia U-19 Breakthrough: Croatia’s U-19s beat Serbia 3-0 to reach the European Championship semi-final against Spain. Prediction Markets Under Scrutiny: Polymarket’s World Cup trading hit $3.9B volume, while legal challenges raise questions about what’s allowed depending on where users live. Tourism & Business Angle: Data suggests Toronto’s World Cup hosting delivered limited economic gain despite $380m in taxpayer costs. Regional Politics: Serbia’s EU path and regional stability message was reiterated in Brussels, with Croatia and Hungary cited as key reconciliation examples.

Croatian Business Awards: Croatia’s top performers for 2025 were named at the Zlatna Bilanca (Golden Balance Sheet) awards by Fina, with Končar D&ST taking the top large-company prize, Zagrebačka banka named the most successful bank, and sector winners including Koka (agriculture), Turisthotel (tourism) and Belupo (manufacturing). Hospitality & Tourism Investment: Aminess Hotels & Resorts opened the five-star Aminess Younique Vollo Hotel Residences near Opatija, adding 58 residence-style units plus a wellness club, spa and Il Cantuccio dining—another push to upgrade Kvarner’s premium offer. World Cup Economy (Croatia-linked): Croatia’s tourism momentum continues to be highlighted alongside World Cup travel demand, while broader host-city data shows how FIFA’s model can limit local economic gains even when matches draw crowds. Regional Infrastructure Watch: Serbia redirected about €10m from budget reserves to continue the Raca-Bijeljina highway, underscoring how cross-border transport projects keep moving even amid shifting regional priorities.

World Cup Business: France edged Paraguay 1-0 in Philadelphia as Kylian Mbappé converted a VAR-awarded penalty in the 70th minute, sending Les Bleus into the quarterfinals to face Morocco; the match was marked by heat, physical play, and post-game sportsmanship after a tense moment involving Paraguay keeper Orlando Gill. Croatia Housing & Costs: Eurostat data shows Croatia recorded the sharpest rise in residential rents in the EU—up 21.9% in Q1 2026 vs 2025 average, with monthly growth since Aug 2025 approaching 40% year-on-year, far above the EU overall. Croatia Mobility & Travel: Taxi use in Croatia dropped sharply as fares rose, while the country also introduced mandatory country-of-origin labels at markets. Diplomacy & Trade: Australia appointed Glenn Morrison as its next ambassador to Croatia, citing $328m two-way trade in 2024 and a planned double taxation agreement to deepen investment links, especially in retail and tourism. Local Infrastructure: Croatia is pushing ahead with major transport projects, including an EU-funded Osijek–Koška railway upgrade and plans for a Zagreb–Karlovac motorway third lane.