Croatia Economic Forecast

Croatia Economic Outlook

June 7, 2022

The pace of year-on-year GDP growth moderated in Q1 but remained healthy nonetheless. A faster expansion in fixed investment was more than offset by softer increases in private and public consumption. Meanwhile, the external sector contributed positively to growth, likely supported by a recovering tourism sector. Economic growth should moderate in the current quarter, partly due to a higher base of comparison. That said, rising consumer and business sentiment in April suggest that economic dynamics remain strong, although soaring inflation could be weighing on household spending. Meanwhile, in May, Fitch Ratings affirmed the country’s investment rating at 'BBB' with a positive outlook, citing a recovering tourism industry and limited exposure to the Russia-Ukraine war. Moreover, the European Commission recently praised the country’s reduction of private and public debt.

Croatia Economic Growth

The economy looks set to expand solidly this year, underpinned by a recovering tourism sector, EU recovery funds and unleashed pent-up spending. However, soaring inflation and a weaker-than-expected EU economy—due to the war in Ukraine—will restrain activity. Global supply bottlenecks pose downside risks. FocusEconomics panelists forecast the economy to grow 3.3% in 2022, which is unchanged from last month’s estimate, and 3.6% in 2023.

Croatia Economy Data

2015 2016 2017 2018 2019
Population (million)4.24.24.14.14.1
GDP per capita (EUR)10,69911,21811,95312,68413,276
GDP (EUR bn)45.046.849.351.953.9
Economic Growth (GDP, annual variation in %)2.43.53.12.72.9
Consumption (annual variation in %)0.23.13.23.23.6
Investment (annual variation in %)3.86.55.14.17.1
Industrial Production (annual variation in %)2.55.01.9-1.00.5
Retail Sales (annual variation in %)2.44.04.73.83.7
Unemployment Rate17.614.712.29.67.9
Fiscal Balance (% of GDP)-3.3-1.00.80.20.4
Public Debt (% of GDP)84.380.877.874.773.2
Money (annual variation in %)11.418.219.120.714.3
Inflation Rate (CPI, annual variation in %, eop)-0.60.21.20.81.4
Inflation Rate (HICP, annual variation in %)-0.3-0.61.31.60.8
Inflation (PPI, annual variation in %)-  -  -  -  -  
Policy Interest Rate (%)3.003.003.003.003.00
Stock Market (annual variation in %)-2.818.1-7.6-5.115.4
Exchange Rate (vs EUR)7.647.557.437.417.44
Exchange Rate (vs EUR, aop)7.617.537.467.427.42
Current Account (% of GDP)3.12.23.91.72.8
Current Account Balance (EUR bn)1.51.01.71.01.6
Trade Balance (EUR billion)-7.1-7.6-8.4-9.6-10.3
Exports (EUR billion)10.210.511.712.212.8
Imports (EUR billion)17.318.120.221.923.2
Exports (annual variation in %)8.03.111.44.55.0
Imports (annual variation in %)7.74.711.38.56.0
International Reserves (EUR)13.713.515.717.418.6
External Debt (% of GDP)10795.588.682.375.8

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Croatia Facts

Value Change Date
Bond Yield0.670.0 %Dec 31
Exchange Rate6.64-0.54 %Jan 01

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