"Croatia has made so much of the opportunities that peace has given. So, Madame President, may I congratulate Croatia on its achievements and may I wish you all continuing peace and prosperity," Prince Charles said in his toast at the dinner, which brought together more than 60 guests, including political leaders, religious dignitaries, business people and prominent public figures.
Prince Charles said he was confident relations between Great Britain and Croatia would grow even stronger.
The Prince of Wales visited Croatia twice during and immediately after the war in 1996.
"This afternoon I have seen something of Zagreb and I can't tell you how wonderful it is to see how this beautiful city has been so sensitively restored. There could be no better illustration of the extraordinary progress you have made in the past twenty years.
He wrapped up with a traditional Croatian toast "Hvala lijepa. Zivjeli" which means "Thank you very much. Cheers."
Croatian President Kolinda Grabar Kitarovic, who also have a toast in English, told Prince Charles he had brought new optimism which everyone in Croatia needed and stirred positive emotions in the Croatian public.
Your last visit to Croatia was 20 years ago and I hope you see how much has Croatia changed. We made an enormous progress as a country and as citizens, the president said, toasting to bilateral relations between Croatia and Great Britain, primarily to their friendship, understanding and a shared future.
The dinner was attended by numerous politicians, scientists, academicians, artists and representatives of religious communities. Apart from the president and her husband Jakov, the dinner was also attended by Prime Minister Tihomir Oreskovic, his wife Sanja, First Deputy Prime Minister Tomislav Karamarko and wife, Parliament Speaker Zeljko Reiner, Foreign and European Affairs Minister Miro Kovac, representatives of the judicial authority, the Armed Forces, as well as representatives of ethnic minorities. Among the guests was Croatian actress Zrinka Cvitesic who has achieved great success in London's West End.
President Grabar-Kitarovic and Prince Charles also exchanged gifts. The Prince and the Duchess were presented with a painting by Matko Trebotic and a bottle of vintage wine from Ilok, eastern Croatia. The president received a set of six plates and a signed photograph of the royal couple.
The royal couple will continue their visit to Croatia on Tuesday in Osijek, Kopacki Rit and Djakovo.
"Tomorrow I greatly look forward to visiting Osijek. I will have the opportunity to meet religious and community leaders and to learn about how they are working together following the peaceful reintegration of Eastern Slavonia into Croatia," the Prince of Wales said.