AGP Executive Report

EU Budget Standoff: Seventeen EU countries, including Croatia, Bulgaria and Italy, are pushing back against cuts to agriculture and cohesion funding in the 2028–2034 budget, warning the “Friends of Cohesion” plan could be undermined ahead of an Oct. 15–16 leaders meeting. Football & Business Risk: Manchester City’s guilty verdict for Premier League financial rule breaches is now driving uncertainty beyond sport—club leaders have filed an appeal, while England coach Thomas Tuchel says he won’t automatically rule out City players even if sanctions force relegation. Croatia Trade & Ports: Adriatic Gate Container Terminal in Rijeka (ICTSI) hit 4 million TEUs since 2011, underscoring its role as a regional Adriatic gateway via rail and road links. Healthcare Tech in Croatia: Siemens Healthineers’ new Accela radiotherapy system is set to be installed at Radiochirurgia Zagreb in November, aiming to speed complex treatments while keeping precision. Croatia Economy Watch: Croatia’s inflation rose to 4.7% in September, with energy prices up 20.5%. EU Mobility/Policy: The UK published a list of 38 ATAS-exempt countries for certain jobs, including Croatia.

EU Legal Pressure on Croatia: The European Commission issued Croatia two reasoned opinions over breaches tied to renewable energy rules (not fully transposed) and consumer credit, giving Croatia two months to respond or face a possible referral to the EU Court of Justice. Croatian Business Concentration: FINA data shows companies in just 10 Croatian cities generated €7.2bn net profit in 2025 (69.9% of the national total), led by Zagreb with €5.1bn. Housing & Construction Watch: A Croatian construction expert warns that developers often cut costs on hidden building elements like waterproofing, reinforcement and sound insulation—problems that can surface as damp and black patches years later. Tourism & Connectivity: Zagreb Tourist Board says the new direct Beijing–Zagreb flight is already lifting Chinese arrivals (+7%) and overnight stays (+8%) in September, boosting tourism and business links. Energy & Industry Deals: Hrvatski Telekom signed a €40m loan with Deutsche Telekom to refinance; separately, Croatia’s JANAF received an OFAC license extension for continued cooperation with NIS. Rail Investment: Croatia signed a €900m deal for its biggest-ever railway project, while broader plans point to a €6bn railway programme. Regional Crime/Compliance: Former Croatian footballer Dario Šimić was charged in a graft case linked to a coastal campsite permit.

Rail Investment: Croatia signed contracts for a €900m upgrade of the Dugo Selo–Novska railway corridor, adding a second track over 83 km with works set to run about five years and 10 months. Housing & Prices: Croatia’s residential property prices rose 12.7% year-on-year in Q2 2026, with Zagreb showing the strongest quarterly jump. Tourism Revenue: Croatia logged €4.59bn in foreign-tourist revenue in H1 2026 (up nearly 5%), while domestic tourism also hit record levels for arrivals and overnight stays. Energy & Sanctions Watch: OFAC extended permissions for MOL’s talks to buy a majority stake in Serbia’s NIS, while JANAF said it received an OFAC license to keep transporting oil to NIS through Oct. 30. Croatia–China Link: A new direct Beijing–Zagreb flight is already boosting Chinese arrivals and overnight stays, with Zagreb’s tourism board calling it a growth lever for business and cultural ties. Telecom Finance: Hrvatski Telekom secured a €40m Deutsche Telekom loan to refinance an existing facility. Environment: Major works at Vransko Lake aim to curb seawater intrusion and protect biodiversity as salinity rises. Business/Startup: LAUNCHub Ventures closed €65m for Fund III, targeting €75m+ for CEE/SEE early-stage startups. EU Consumer Rules: The European Commission warned Spain it faces court action over consumer credit rule delays, with Croatia among the states in the infringement package.

Croatian Rail Upgrade: Transport Minister Oleg Butković says Croatia will sign the biggest rail contract in its history—nearly €900m to reconstruct and add a second track on the Dugo Selo–Novska line (83 km), with India’s first win in such a tender highlighted. Tourism Cash Inflow: Croatia’s foreign-tourist revenue hit €4.59bn in 2026 H1, up nearly 5% year on year, while domestic tourism also posted record numbers. EU Single Market Push: The European Commission is preparing a roadmap for “gradual integration” into the EU single market for candidate countries, tied to foreign-policy alignment and restrictions on transfers of key technologies. Tech & Automation Deal: HCLSoftware (HCLTech) plans to acquire Croatia-based Robotiq.ai for about €9m to expand enterprise agentic automation. Startup Funding: Sofia’s LAUNCHub Ventures closed Fund III’s first round with €65m committed, targeting €75m+ and backed by EIF and EBRD. Travel Industry Agenda: WTTC’s Global Summit in Malta will bring 100+ speakers to focus on investment, AI, workforce and sustainability in travel and tourism.

Tourism Momentum: Croatia’s foreign-tourist revenue climbed to €4.59bn in 2026 H1 (+~5% y/y), with Q2 alone at €3.64bn and domestic tourism hitting record arrivals and overnight stays. Tech & M&A: HCLSoftware plans to acquire Zagreb-based Robotiq.ai to boost AI-driven enterprise automation, integrating its RPA tech with HCL’s agentic platform. EU Single Market Push: The European Commission is considering “gradual integration” for accession candidates—earlier access to parts of the single market, research and industrial cooperation, but conditional on alignment and enforcement. Data Centers Under Fire: A complaint says the EU is limiting public access to individual data-center energy and water use, arguing for a “wall of silence” as AI demand accelerates. Retail Expansion: Beauty brand rhode (e.l.f. Beauty) expands via Sephora into 19 new European countries, including Croatia. Croatian Collectibles: The Croatian National Bank issues a new commemorative €2 coin featuring Vukovar, with pre-registration for exchanges open until 5 October.

Croatia & EU Mobility: Croatia is among the countries applying the EU Entry/Exit System (EES), meaning many non-EU travellers now face biometric checks before entering Schengen—an update that has already triggered queues and delays across Europe. Regional Business Expansion: Fitout Solutions Design (FSD Group) is scaling its furniture installation division across Romania, Bulgaria, Hungary, Greece, Italy and Croatia, targeting retail chains expanding in the region. Beauty Retail Push (Croatia included): Rhode is rolling out in Sephora across 19 European markets, with Croatia among the new countries—boosting the brand’s physical retail footprint beyond its own web shop. Energy & Infrastructure: Wellovar, Bjelovar’s geothermal sports and recreation complex, has opened after 23 months of construction, adding multiple pools and facilities. Local Economy & Tourism: Istria has been named the world’s best olive oil region for the 10th time in Flos Olei, reinforcing the peninsula’s food-tourism positioning. Tech & Transport in Croatia: Uber CEO Dara Khosrowshahi visited Zagreb and tested Rimac’s robotaxi concept, signaling continued momentum for autonomous mobility projects. EU Policy Watch: The EU is raising retirement age across member states; Croatia is not set to move above 65, but the broader shift could reshape labour markets. Security & Crime: EU prosecutors report raids across 19 countries targeting phone fraud worth about €300m, involving used devices sold as new.

Tech & Security: The U.S. State Department awarded a $50,000 contract to Oxygen Forensics via its Zagreb embassy months after internal warnings about alleged Kremlin links, as the company faces claims it was Russian-owned/controlled. Mobility & Regulation: Tesla says Croatia has approved its supervised Full Self-Driving system, with rollout expected soon—drivers still must supervise. Aviation Manufacturing: FACC opened an expanded aircraft cabin interiors plant in Jakovlje, a €36m investment aimed at meeting rising aviation demand. AI Automation (Croatia): HCLSoftware plans to acquire Zagreb-based Robotiq.ai to expand enterprise automation and agentic AI execution. Energy & Industry: Wellovar, a €42m geothermal thermal complex near Bjelovar, officially opened with 10 pools and an Olympic 50m facility, boosting inland tourism. Healthcare Workforce: Primorje-Gorski Kotar launched a €250 monthly nurse/technician bonus plus 50 scholarships to tackle staffing shortages. Waste & Enforcement: Croatian authorities searched Neum over alleged illegal waste dumping from Croatia, temporarily seizing documentation. EU/Regional Business: COOL-BORDER starts an Interreg project to cut barriers in chilled/frozen food supply chains across Central Europe.

Croatia–US Business Push: Croatia and the USA are stepping up economic ties after a New York forum by HGK and HTZ brought ~70 American and 35 Croatian firms together for B2B meetings, partnerships and investment talks, with Plenković attending. Green Energy Investment: INA is building Croatia’s first commercial green hydrogen plant at the Rijeka Refinery, targeting ~1,500 tonnes/year, with first output expected early next year and a €60m+ project cost. AI Automation Deal (Croatia): HCLSoftware (HCLTech) plans to acquire Zagreb-based Robotiq.ai for €9m to expand enterprise RPA and strengthen HCL UnO Agentic’s ability to execute workflows where APIs are limited; closing expected by end-November 2026. Data Centers & Policy: European data center groups in Zagreb urged the EU to add nuance to an efficiency labeling scheme, warning it must stay fair and not hurt competitiveness. Regional Finance Watch: Erste Bank flags Romania’s meaningful risk of an S&P downgrade, while expecting a base case of rating stability. Energy Costs Pressure: Europêche and ETF want EU fuel aid extended for fishers as high fuel prices threaten jobs and coastal communities. Infrastructure Expansion: Vertiv is adding ~22,000 sqm of manufacturing capacity in Slovakia to boost power and thermal management output for AI and cloud demand.

HCLTech Deal: HCLSoftware plans to acquire Croatia-based Robotiq.ai for €9m (all-cash), aiming to add enterprise RPA execution to its AI automation platform; closing is expected by end-November 2026. Energy Prices in Croatia: Croatia raised the Eurosuper 95 cap by 2 cents to €1.76/l while cutting Eurodiesel by 5 cents to €1.86/l, with blue diesel for farmers and fishermen also down to €1.42/l. Regulation Timing: Croatia postponed “anchor price” rules due on 1 October after pushback from tradespeople and retailers, while keeping the goal of clearer consumer price information. EU Energy Enforcement: The European Commission opened infringement letters to 18 EU states, including Croatia, over incomplete rollout of energy-sharing and supplier-choice rules. Data Center Investment: Vertiv’s Vertiv Week 2026 in Zagreb highlighted AI-driven demand for integrated power and cooling; Vertiv also announced capacity expansion in Slovakia to support high-density AI infrastructure. Tourism & Aviation: Split’s CROYA Yacht Charter Show drew ~250 international brokers and 36 luxury vessels; Israir is awaiting final approval for new Tel Aviv–Tokyo and Tel Aviv–Miami routes and added Split among 2027 European destinations. Trade Policy Watch: The US partially lifted aluminum duties on qualifying Indian can stock, affecting imports including Croatia. Regional Energy Push: Western Balkans renewables conference (Oct 6–7, Budva) targets 20 GW of new capacity by 2040.

Energy & Utilities: Croatia’s wind and solar output dropped sharply week-on-week, but hydropower rose and demand fell, leaving net electricity imports up despite lower consumption—another reminder that the grid still leans on balancing and cross-border flows. Fuel Prices: Diesel in Croatia could fall by about eight euro cents per litre from Tuesday, while petrol is expected to edge up. Gas Security: Croatia remains well positioned for winter, with the government pushing faster gas storage filling to reach at least 85% by October (above the EU average). Healthcare Procurement: HZZO opened a tender for 7,000 extra hyperbaric oxygen therapy treatments to cut waiting lists. Labour & Public Transport: Zagreb faces a likely disruption as unions and Zagreb Holding/ZET head into a strike over salary demands. Agriculture: Drought has hit Croatian arable production hard, with spring crops and irrigation constraints weighing on revenues. Energy Transition & Regional Policy: The EU is raising concerns about US energy expansion in the Western Balkans, warning it could lock countries into fossil-fuel dependence. Innovation & Industry: The Hydrogen Ecosystem North Adriatic is moving toward market deployment, with new open calls and a major conference in November. Trade: The US partially lifted antidumping/countervailing duties on certain aluminium can stock from India, affecting multiple countries including Croatia. Mobility: Croatia’s passport ranks 16th globally in 2026 with access to 172 destinations. Business & Culture Abroad: Israir is seeking final approvals for new routes to Tokyo and Miami and adding destinations including Split for spring-summer 2027.

Healthcare & Public Services: Croatia’s health insurer HZZO has opened a tender for 7,000 additional hyperbaric oxygen therapy treatments through end-2026, aiming to cut waiting lists and improve access across the country. Local Economy & Regulation: Zagreb traders, business groups and private landlords have announced a protest for 10 October over new “anchor price” rules, higher administrative burdens and tourism-related changes, with fines for non-compliance set at €3,000–€30,000. Energy & Industry: EU officials are increasingly concerned about US energy firms expanding influence in the Western Balkans, warning that LNG deals could lock countries into fossil-fuel dependence and clash with net-zero goals. Business & Mobility: Croatia’s passport ranks 16th globally in 2026, offering access to 172 destinations via visa-free, visa-on-arrival or eTA arrangements. Energy Storage Tech: Qnetic has moved its 200 kWh flywheel energy storage prototype into low-speed testing after 100 fault-free charge-discharge cycles, signaling a push toward long-duration renewable storage. Diplomacy & Trade: Croatia and US businesses are stepping up efforts to strengthen economic ties as Croatia’s PM engages on European integration and investment cooperation abroad.

Energy & Grid Resilience: Swedish startup ViaEuropa is partnering to develop smaller, local electricity grids covering 1 million apartments, aiming to cut costs and boost security after Ukraine’s 2022 power-grid attacks. EU Energy Regulation: The European Commission opened infringement proceedings against Croatia and 17 other states over incomplete electricity market rule transposition, and against 26 countries over hydrogen/gas directive notifications. Croatia–EU Business Links: In New York, Croatia’s PM Andrej Plenković met Moldova’s PM Vasile Tofan and Slovenia’s Janez Janša to push EU integration support and expand trade and investment. Local Business Pressure: Zagreb traders and private landlords announced a 10 Oct protest over new “anchor price” rules, tourism reform and higher compliance burdens, with fines up to €30,000. Energy Storage Tech: Qnetic began low-speed testing of a 200 kWh flywheel prototype after 100 fault-free cycles, positioning flywheels as a long-duration alternative to lithium-ion batteries. Healthcare Costs & Public Trust: Pula Hospital introduced parking charges from 1 Oct, adding waiting-time costs for patients and visitors. Tourism Tech Award: Dubrovnik Pass won a European smart tourism award for digital visitor management, integrated ticketing and crowd forecasting.

Croatia–EU Business & Regulation: The European Commission opened infringement proceedings against Croatia (alongside 17 others) for incomplete transposition of new electricity market rules, and separately launched action against 26 states over hydrogen and decarbonised gas rules—giving governments two months to respond. Croatia–EU Energy Policy: Parliament approved a temporary zero excise duty on natural gas and LPG used as motor fuel for Q4 2026, aiming to cushion high fuel prices and supply-chain disruptions. Local Economy & Costs: Croatia’s Market Inspection found widespread price-control issues in retail: 1,351 violations in 5,409 checks, including missing required price markings on nearly 5,000 products. Tourism & Digitalization: Dubrovnik’s “Dubrovnik Pass” won a top ECTN award for smart tourism digitalisation, using real-time visitor monitoring and crowd forecasting to protect heritage while generating revenue. Labor & Public Services: Zagreb is bracing for a strike by ZET and Zagreb Holding workers on 28 September, with tram services and school transport at risk. Trade & Investment Push: A Croatia–US business forum in New York highlighted the long-stalled Croatia–US double taxation agreement as a key blocker to easier investment and lower admin costs. Industry & Tax Debate: Croatia’s coffee sector is calling to abolish a special levy on roasted coffee and coffee extracts, arguing it adds cost and paperwork for businesses.

UN Diplomacy & Trade: Bangladesh PM Tarique Rahman wrapped a five-day UNGA visit in New York with meetings with leaders including Croatia’s Andrej Plenković, Türkiye’s Erdogan, Iran’s Pezeshkian and Pakistan’s Sharif, focusing on trade, investment, skilled manpower and economic cooperation. Public Transport Disruption: Zagreb faces a major public-service headache as unions at ZET and Zagreb Holding confirm a strike for Monday, 28 September, starting 3:30am, with tram services and school transport likely hit. Smart Tourism: Dubrovnik Pass won top recognition in the EU’s Digitalisation in Smart Tourism category, praised for real-time visitor monitoring, crowd forecasting and integrated ticketing tied to heritage protection. Energy & Regulation Watch: Croatia is among EU states facing infringement steps over industrial emissions and other rule gaps, while Parliament approved a temporary zero excise duty on natural gas and LPG used as motor fuel (Oct–Dec 2026). Cost of Living & Compliance: Croatian inspectors found widespread price-control irregularities, including nearly 500 products sold too expensively and thousands of cases where required price markings weren’t displayed. Tourism Housing Debate: Split is pushing an alternative accommodation structure beyond hotels and apartments, triggering resistance from small private landlords. Business Links to the US: A Croatia–US business forum in New York highlighted the still-pending Croatia–US double taxation agreement as a key hurdle for investment and lower admin costs. Industry Expansion: FACC outlined expansion in Croatia, while INA’s Rijeka refinery moved ahead with a delayed coker start-up after major work.

Banking & Investment: Erste Group plans a tender offer to raise its stake in Erste Bank Polska by up to 26%, aiming for a holding above 50% but capped at 75%, with the offer expected in November. EU Policy Watch: Italy is the only EU country that has fully transposed the hydrogen and decarbonised gases directive on time; the Commission has opened infringement steps against the other 26 states, including Croatia. Croatia Business & Restructuring: Retailer Studenac has filed for pre-bankruptcy proceedings to restructure debt after failing to agree credit extensions; operations continue and the company employs 7,000+ people. Energy & Climate Risk: Europe’s electric car momentum keeps rising (battery EVs hit 29% of new sales in August), while climate risk is increasingly shaping insurance and property values. Tourism & Consumer Rules: Croatia introduces “anchor price” menu rules from Oct 1, requiring restaurants to show the Sept 10 price alongside current prices. Regional Economy & Trade: Croatia’s PM tells business leaders in New York the next wave of US investment could target energy, data centres, IT, pharma, food and infrastructure, with trade already near $1bn in 2026’s first half. Transport & Infrastructure: Croatia Airlines marks 30 years of Zagreb–Sarajevo flights, topping 1.34m passengers since 1996.

Artemis Accords: Croatia has become the 74th signatory to the Artemis Accords, with Science Minister Radovan Fuchs signing on behalf of the country—an effort framed as boosting Croatia’s tech, science and economy after the CroCube satellite launch. Transport & Industry: Končar used InnoTrans in Berlin to showcase Croatian rail manufacturing, presenting its electro-diesel trainset and highlighting Zagreb–Split route modernization. Urban Living in Zagreb: The city unveiled plans for a permanent pedestrian zone in central Zagreb (Masarykova and Teslina streets plus parts of Preradovićeva and Gajeva), with uniform paving, greening, accessibility upgrades and new bike parking. EU Finance for Infrastructure: The European Investment Fund and six EU countries (including Croatia) launched a Three Seas Initiative Infrastructure Fund of Funds aiming to mobilize at least €2bn for energy, mobility, digital and social infrastructure. Digital Identity & Child Safety: Croatia’s mGrađani age-verification model is being considered as the country prepares for the EU KIDS Act, which will require stronger age checks and platform responsibility. Energy & Security: A Croatian court approved the extradition of a Ukrainian suspect wanted over the 2022 Nord Stream pipeline explosions, though the decision is set to be appealed.