COMMENTARY: New Industrial Strategy Lacks Corresponding Financial Backing

Vrdoljak_ 25_7_1415 September 2014, LPJ Croatia Issue 100

Last week, the Croatian government ratified the Croatian Industrial Strategy for the period 2014-2020, which was drafted by the Ministry of Economy; the strategy forecasts a yearly GDP growth of 2.8%, creating over 85,000 new jobs.

The strategy defines four key areas of focus: creating a stable investment climate, integrating a systematic cooperation between industry/business and the educational system, restructuring of the public administration, and the development of financial markets.

According to Economy Minister Ivan Vrdoljak (HNS), the strategy plans to increase exports by 30% and worker productivity by 68.9%.  However, other than the inclusion of the maximum use of EU Cohesion and Structural Funds without a clear timetable of using these funds in correlation with the strategy’s driving business sectors, the strategy lacks a corresponding financial strategy that would be integrated with the strategy. In other words, the state has not yet integrated this strategy with the state budget and has not integrated with the state’s financial plans in the coming year, let alone through 2020.

Therefore, this national industrial strategy would be better named a national industrial objective with the strategy to be finalised later after the integration with the short-term and mid-term plans of the ministries of Agriculture, Health, Finance, Public Administration, Construction, and Environment, which are the government resources key to the success of such a strategy…

See more