The figure, which includes Italian companies' investment in Croatia via third countries, was released by the Italian Embassy in Zagreb on Wednesday.
The amount is double the figure released by the Croatian National Bank (HNB), which does not include three-way transactions.
According to HNB figures, which include only transactions coming directly from a country, Italian direct investment in Croatia in 1993-2004 was $590 million.
However, the many Italian companies which invested in Croatia did so through third countries, mostly Luxembourg, Austria and the Netherlands, which have very favourable conditions for financial holdings, the embassy said.
For example, the investments of Gruppo Intesa, which owns 76 per cent of Croatia's second largest bank, Privredna Banka Zagreb, and the Assicurazioni Generali insurance company were made through Luxembourg and Austria, while investment in the large distribution and textile sectors were made through EU holdings.
Therefore, the real estimate of the scope of Italian investment in Croatia must take into account such three-way transactions, the embassy said.
Foreign direct investment in Croatia in 1993-2004 totalled $10.7 billion, according to the HNB.