Croatia country brief

Overview

The Republic of Croatia is bordered by Slovenia, Hungary, Serbia, Montenegro, and Bosnia and Herzegovina. Its extensive Adriatic coastline on the south-west includes nearly 1,200 islands and islets. The Croatian population is approximately 4.2 million (according to the 2011 Census).  Croatia joined the European Union on 1 July 2013.

Political overview

The Republic of Croatia is a parliamentary democracy. The President of the Republic is the Head of State, directly elected for a five year term. As Commander in Chief of the Armed Forces, the President also participates in foreign and national security policy decision-making. The current President, Ms Kolinda Grabar-Kitarovic – the first female President of Croatia – was inaugurated on 19 February 2015. The candidate of the centre-right Croatian Democratic Union (HDZ), Ms Grabar-Kitarovic won the second round of the presidential elections with 50.74 per cent of the vote.

The Prime Minister, currently Mr Andrej Plenkovic, is the Head of Government.  Mr Plenkovic is leader of the Croatian Democratic Union (HDZ) and assumed office in October 2016.

Croatia is a member of the United Nations, the European Union, the North Atlantic Treaty Organization (NATO) and the Organization for Security and Co-operation in Europe (OSCE).   

Economic overview

The Croatian economy was seriously affected by the global financial crisis.  GDP dropped 7.4 per cent in 2009.  Croatia's economy continues to grow slowly, and has almost recovered to pre-financial crisis levels.  Real GDP growth was forecast at 2.9 per cent for 2017. 

On 16 July, Croatia officially exited the Excessive Deficit Procedure, opening the path to membership of the Eurozone.

Bilateral Relationship

Australia recognised Croatia on 16 January 1992, following its declaration of independence from Yugoslavia on 25 June 1991. Diplomatic relations were established on 13 February 1992 and the first Australian Ambassador to Croatia (resident in Vienna) presented credentials the following month. On 21 September 1992, an Australian Consulate was opened in Zagreb. Australia opened an Embassy in Zagreb in October 1999.

At the heart of the bilateral relationship are the significant people-to-people links built by Australians of Croatian descent.  The 2016 census recorded 43,688 Croatia-born people in Australia, and 133,264 people claiming Croatian ancestry.

The Croatian diaspora is eligible to vote in Croatian presidential and parliamentary elections.  

Bilateral agreements

On 13 May 2003, the Australian and Croatian Governments signed a bilateral social security agreement to give improved social security protection to people who have lived and/or worked in both Australia and Croatia. The Agreement came into effect on 1 July 2004.

On 8 December 2004, the Australian Government amended Australia's extradition legislation in relation to Croatia. The Extradition (Croatia) Regulations 2004 simplify the requirements for Croatia when making an extradition request to Australia.

In 2013, Australia and Croatia signed an Air Services Agreement. The Agreement, together with a Memorandum of Understanding between the aeronautical authorities, entitles airlines of both countries to operate daily services between Australia and Croatia.

High-level visits

(Note: Positions indicated in the list below were held at the time of the visits)

To Croatia

  • 2017: Ms Julie Bishop, Minister for Foreign Affairs.
  • 2014: Mr Greg Hunt, Minister for the Environment.
  • 2012: Mr Richard Marles, Parliamentary Secretary for Foreign Affairs.
  • 2008: Australian Parliamentary delegation led by Senator the Hon John Hogg, President of the Senate.

To Australia

  • 2017: Ms Kolinda Grabar-Kitarovic, President of Croatia.  This was the first official visit to Australia by a Croatian President since 1995.
  • 2014:  Mr Zoran Milanovic, Prime Minister, and Mr Ante Kotromanovic, Defence Minister.  This was the first visit to Australia by a Croatian Head of Government.
  • 2005: Ms Kolinda Grabar-Kitarovic, Minister for Foreign Affairs and European Integration.
  • 2004: Ms Vesna Pusic, Deputy Speaker of the Croatian Parliament.
  • 2003: Croatian Parliamentary delegation led by Mr Zlatko Tomcic, Speaker of the Croatian Parliament.
  • 2002: Mr Tonino Picula, Minister of Foreign Affairs.

Bilateral economic and trade relationship

In 2016, total two-way goods and services trade between Australia and Croatia was $155 million. While this was down by 13.9 per cent on 2015, the five-year trend is positive (2.6 per cent). Total trade in services was worth $108 million in 2016, with imports from Croatia of $92 million and Australian exports of $16 million.

Total two-way merchandise trade was worth $47 million in 2016, with imports from Croatia worth $31 million. Major imports from Croatia include certain food products, electric machinery and parts, and non-electric engines and motors. Australian exports to Croatia grew strongly in 2016, to $16 million, a 340.5 per cent increase on 2015 and consistent with the five-year growth trend of 44.8 per cent. Coal, fruits and nuts were major Australian exports to Croatia, with non-electric engines and motors also a significant export item.

Total foreign investment from Croatia grew strongly to total $45 million in 2016, an increase of 12.5 per cent from 2015. Total Australian investment in Croatia was $7 million, a decrease of 80 per cent on 2015. The availability of FDI figures is limited (not published or zero), but available data suggests that FDI between the two countries is negligible.

Opportunities may exist for Australian companies in Croatia's energy (infrastructure, resources, oil and LNG), tourism (services), marine and education sectors.

Last Updated: 23 August 2017