Did you know about business culture in Croatia? Watch this video animation to find out some interesting facts:
Business Culture in Croatia is characterised by: business communication, business etiquette, business meeting etiquette, internship and student placements, cost of living, work-life-balance and social media guide.
Croatia is strategically placed at the crossroads of Central Europe, the Balkans and the Adriatic Sea and is also close to the Mediterranean. It is bordering Hungary to the north-east, Serbia to the east, Bosnia and Herzegovina to the south-east, Montenegro to the south-east, the Adriatic Sea to the south-west and Slovenia to the north-west.
The population of Croatia is 4,290,612 (census 2011) and its capital and largest city is Zagreb with a population of 792,875, followed by Split-Dalmatia with a population of 455,242. Altogether Croatia comprises 20 counties as well as the city of Zagreb. Most of the population are Croat, with the most common religious denomination being Roman Catholicism.
Croatia covers 56,594 square kilometres (21,851 square miles) with a diverse climate ranging from continental to alpine and Mediterranean along the coast. Croatia’s Adriatic coast contains more than a thousand islands.
Croatia has a low birth rate of 9.4 per 1,000 inhabitants (2011), while the death rate is higher at 11.6 per 1,000 inhabitants. According to the Croatian Bureau of Statistics (2009), the age of the population is distributed as follows: 15.3% are 14 years old or younger, 15 – 64 years 67.5% are between the ages of 15 to 64 and 17.3% are 65 years or older. The main ethnic groups are Croats at 90.4%, followed by Serbs at 4.4% and the remaining population at 5.2% (including Bosnian, Hungarian, Slovenians, Czech, and Roma) (Wikipedia, 2011).
Croatia today has a very high Human Development Index. The International Monetary Fund classified Croatia as an emerging and developing economy, and the World Bank identified it as a high income economy. Croatia is an acceding state of the European Union, with full membership expected in July 2013. The Croatian economy has been steadily declining for the past four years and the government national debt is currently estimated at 59.535% of GDP.
Croatia’s main export partners are Italy, Bosnia and Herzegovina, Germany, Slovenia and Austria, which is similar to its main import partners: Italy, Germany, Russia, China, Slovenia and Austria (2011). Croatia’s main exports are transport equipment, machinery, textiles, chemicals, foodstuffs, fuels and its main imports are machinery, transport and electrical equipment; chemicals, fuels and lubricants, and foodstuffs.
Foreign Direct Investment into Croatia has been in continual decline since 2008 and currently has some of the lowest levels of FDI in south-eastern Europe.
The official language of Croatia is Croatian and its official currency is the Kuna (HRK). Croatia is in the Central European Time Zone and adheres to CET (UTC +1) during the winter and CEST (UTC +2) during the summer.
For further information, please see below:
- http://www.balkaninsight.com/en/article/foreign-direct-investment-in-croatia-nosedives (Balkan Insight)
- http://www.dzs.hr/default_e.htm (Croatian Statistics Office)
- http://www.hnb.hr/o-hnb/eo-hnb.htm (Croatian National Bank)
- http://www.tradingeconomics.com/croatia/balance-of-trade (Trading Economics)
- http://countryeconomy.com/gdp/croatia (Country Economy)
- http://www.economywatch.com/economic-statistics/country/Croatia/ (Economy Watch)
Xenophobia: being a foreigner in Croatia
Businesses in Croatia are very formal, but receptive to cross cultural management. This means that they are ready to accept foreign ideas if they are approached in a respectful way, whereas any dictatorial or forceful approach to business by a foreigner will not be tolerated. Croatia remains a country in transition and that is why the government is promoting foreign direct investment (FDI) and partnerships with local companies through liberal frameworks and tax breaks.
International business in Croatia
When you visit another country on business, you expect some differences in how business is conducted. However, you do not always have sufficient time to learn these differences through personal experience. Sometimes, you will find yourself in a meeting only a few hours after your arrival, where your lack of local knowledge leads you to make basic cultural mistakes, which can have serious repercussions on your efforts.
The literacy level in Croatia is 99% with a highly skilled workforce like most of the other south-eastern European countries.
The primary school education starts from grade 1 to grade 8 from the age of 6 to 14, and then there are two possibilities to choose from, a vocational or specialized and gymnasium secondary school. After four years of education they graduate at the age of 18 and students from gymnasium secondary schools have the best chance of furthering their education by attending a university. Most of the students that went to a vocational / specialized school will either enter the workforce directly or go to university.
University education normally takes four years for an undergraduate degree, although this varies according to the subject matter, and most postgraduate degrees require a further two years of study.
The educational standard in Croatia is on a par with the rest of Europe. The primary and secondary education is compulsory for every citizen of the country and it is free of charge.
University education is also free but some costs are involved.
During the past ten to fifteen years, the number of Croatians emigrating to other EU-countries has been stagnant or even slightly declining. However, this trend has changed in the last couple of years because of the economic situation, which has been a catalyst for many young professionals to emigrate to other EU countries.
Due to emerging skill shortages in some sectors, labour migration to Croatia has also been growing in recent years. Most migrants come from the successor states of the former Yugoslavia, in particular Bosnia and Herzegovina and Macedonia, taking up jobs in the construction, shipbuilding and tourism sectors. Though calculations on the potential migration flows following EU accession are missing, it can be assumed that the numbers will be small; even taking into account those Croats from Bosnia and Herzegovina with dual citizenship.
Given Croatia’s economic situation (21.6% unemployment rate), the difficulties of unemployment facing minority returnees cannot solely be attributed to discrimination. Many of the regions where the majority of people are returning to were underdeveloped, even before the war. Yet the percentage of jobless minority returnees is disproportionate to that of the general population. In particular, the percentage of ethnic Serbs employed in the public sector does not correspond to their numbers as a percentage of the general population.
The Constitutional Law on the Rights of National Minorities (CLNM) guarantees employment of national minorities at all levels of public service, including State and local administration, which incorporates the police and the judiciary.
For further information, please see below:
- http://www.wiiw.ac.at/?action=publ&id=details&publ=LMS3_HR (Vienna Institute for International Economic Studies)
- http://www.internal-displacement.org/idmc/website/countries.nsf/%28httpEnvelopes%29/68E056DC618EFC35C125713400378E2A?OpenDocument (Internal Displacement)
- http://www.dzs.hr/Hrv_Eng/msi/2013/msi-2013_03.pdf (Croatian Bureau of Statistic)
Because Croatians like to know their business partners very well there might be some mixing of business with pleasure but try not to over step the boundaries.
It is important to avoid:
- Mixing confidential and intimate discussion on personal and business level
- Personal financial questions
- Any subject or question that might show that you have lost respect for them or that may cause them to lose respect for you.
- Discussions concerning the political and military history of Yugoslavia, collapse of communism, the war in Bosnia-Herzegovina (1992-5), and anything related to war crimes.
- Raising the thumb, index, and middle finger at once, because it is a Serbian gesture and is connected to Serbian nationalism.
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