Foreign direct investments in 2015 were considerably lower than in 2014 due to round-trip investments in 2014 and negative retained earnings as a result of asset value adjustment in 2015. In 2014, foreign direct investments totalled EUR 1.42 billion.
Excluding round-tripping, foreign direct investments in 2015 were EUR 1.3 billion lower than in 2014, an annual decline of 91%, analysts at Raiffeisenbank Austria (RBA) said in their comment on the HNB report on Thursday.
Owner investments were EUR 1.86 billion, and negative retained earnings of EUR 780.2 million were mostly the result of the effects of conversion of CHF-indexed loans and to a lesser extent of adjustments of the value of fixed assets to their market value, the central bank said.
From 1993 to end-2015, Croatia recorded EUR 29.6 billion in foreign direct investments. Excluding the effect of round-trip investments, the amount was EUR 27,2 billion, RBA said.
RBA analysts noted that, in addition to a better absorption of EU funds, the government had stressed the importance of intensifying investments as one of the main drivers of growth and productivity. The latter, however, implies swift and effective removal of the biggest problems of doing business in Croatia -- an inefficient public administration and judiciary and complex legislation, which is a precondition for stronger promotion of foreign investments.