Economic Overview

For the latest updates on the key economic responses from governments to address the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.

After becoming the 28th member state of the EU on July 1, 2013, the Croatian economy was only able to return to growth in 2015: since 2008, the country had experienced six consecutive years of economic recession, with the GDP falling by 12% (EU data). The economy was severely hit by the crisis linked to the covid-19 pandemic; however, it managed to recover and return to its pre-crisis level in 2021. GDP growth continued in 2022 (+5.9% as per the IMF estimates) thanks to a strong first half of the year on the back of domestic demand, but contracted in the third quarter (-0.4%) due to lower investment and government consumption in a context of tighter financing conditions, supply chain bottlenecks and soaring inflation. In 2023, real GDP is forecast to grow by 3.5% (IMF, 1.2%  according to the EU commission) supported by the accession of Croatia to the euro (which was adopted on 1 January) and Schengen areas, although geopolitical tensions and a weaker global environment are set to weigh on external demand. For 2024, the IMF projects growth at 3% with household consumption as the most important contributor.

Croatia's public debt stood at 72.6% of GDP in 2022, returning around its pre-COVID level, with the ratio expected to decrease further this year (68.6%) and in 2024 (65.9%). In 2022, the general government deficit was estimated at 3.4% of GDP as despite the phasing out of support measures the government adopted several packages to fight inflation and the rise in energy prices. The 2023 budget draft envisages a general government budget deficit equivalent to 2.3% of GDP. The aforementioned rise in global energy and food prices contributed to a spike in inflation, which reached 9.8% in 2022, above the euro area average (8.4%). In 2023, base effects and a steeper decline in energy and food prices than previously expected are set to lower inflation to 5.5% and 3.9% in 2024.

According to IMF estimates, unemployment decreased to 6.9% in 2022, from 8.1% one year earlier, and is expected to follow a downward trend in 2023 (6.6%) and 2024 (6.1%). Real incomes are projected to start recovering in the second half of 2023, benefiting from lower inflation and a still resilient labour market, supporting a mild increase in household consumption. Though the average revenue of Croatians is still below the European one (with an estimated GDP per capita PPP of USD 37,550 in 2022 according to the IMF), Croatia remains the second most developed economy of the Balkan region, after Slovenia.

Foreign Trade

Croatia joined the WTO in 2000 and depends heavily on foreign trade, which amounts to 104% of the GDP (World Bank, latest data available). The country mainly exports petroleum oils (9.5%), electrical energy (5.2%), medicaments (3.4%), and wood (2.2%); while imports are driven by motor cars (4%), petroleum oils (6.5%), petroleum gas (3.8%), and medicaments (3.2% - data Comtrade).

In the first eleven months of 2022, the EU accounted for 68.7% of Croatian exports (mainly towards Italy, Hungary, Slovenia, and Germany). Bosnia and Herzegovina was the second single destination (10.4% of total exports). In the same period, the leading import origins were the EU (70.3%, reflecting the structure of exports’ destinations), Serbia (3.4%), Bosnia and Herzegovina (3.4%), and China (3.3% - data Croatian Bureau of Statistics).

In terms of merchandise, Croatia has a structural trade deficit: according to figures by WTO, in 2021 exports of goods totalled USD 22.8 billion (+32.8 y-o-y) while imports increased by 29.4%, to USD 34.5 billion. However, the country is a net exporter of services, with exports – at USD 16.7 billion – far above imports (USD 5.1 billion). According to figures by the World Bank, the overall trade deficit stood at an estimated 1.5% of GDP in 2020, much lower than the level of -7% recorded one year earlier. Preliminary figures from the Croatian Bureau of Statistics show that in the first eleven months of 2022, the value of Croatian merchandise exports totalled HRK 165.8 billion (EUR 22 billion), an increase of 32.1% over the same period of 2021, while the value of imports reached HRK 287.8 billion (EUR 38.2 billion), up by 48.5% year-on-year.

COVID-19 Country Response

Travel restrictions

Regularly updated travel information for all countries with regards to Covid-19 related entry regulations, flight bans, test and vaccines requirements is available on TravelDoc Infopage.
To find information about the current travel regulations, including health requirements, it is also advised to consult Travel Regulations Map provided and updated on a daily basis by IATA.

Import & export restrictions

A general overview of trade restrictions which were adopted by different countries during the COVID-19 pandemic is available on the International Trade Centre's COVID-19 Temporary Trade Measures webpage.

Economic recovery plan

The summary of the EU’s economic response to the COVID-19 pandemic is available on the website of the European Council.
For the general overview of the key economic policy responses to the COVID-19 outbreak (fiscal, monetary and macroeconomic) in Croatia, please consult the country's dedicated section in the IMF’s Policy Tracker platform.

Support plan for businesses

For an evaluation of impact of the Covid pandemic on SMEs and an inventory of country responses to foster SME resilience, refer to the OECD's SME Covid-19 Policy Responses document.
You can also consult the World Bank's Map of SME-Support Measures in Response to COVID-19.