Croatia’s Financial Sector Sees Growth and Consolidation
Insurance Sector Emerges as a Significant Player
The insurance sector in Croatia has grown significantly, accounting for 6% of total financial assets. According to the European Commission, the Croatian insurance market is at a level of development similar to that in new EU member states. The sector has recorded average growth rates of 10% in recent years, with half of the 20 insurance undertakings and two reinsurance undertakings being majority foreign-owned.
Life Insurance Sees Significant Growth
Life insurance has also seen significant growth, accounting for 24% of total premium income. The sector is considered relatively mature, with a large number of players vying for market share.
Pension System Undergoes Changes
The pension system in Croatia has undergone significant changes since its introduction in 2002. A new private pension fund was established, which has attracted over half a billion euros in investments from more than one million policyholders.
External Debt and Foreign Direct Investment
Croatia’s external debt has also risen significantly, driven by high public investments and merchandise imports. Despite this, foreign direct investment (FDI) inflows have increased, with the main FDI transactions being reinvested earnings and recapitalizations of several banks.
Private Sector Accounts for 60% of Economy
Croatia’s private sector accounts for about 60% of the economy, although there is still a large number of public and state-owned enterprises that remain to be privatized. The government has launched an initiative called HITROREZ, aimed at cutting down redundant and business-unfriendly legislation by 40% by July 2007.
Institutional Framework
Croatia’s Companies Act was influenced by the German model and is largely aligned with the acquis communautaire. The Act recognizes various types of entities, including limited liability companies, joint stock companies, partnerships, and others. The Companies Act also defines rules and requirements on formation, functioning, and dissolution of these entities, as well as the rights and obligations of shareholders and the responsibilities and liabilities of company organs such as the management board and supervisory board.
Additional Information
For more information, please see:
- [Insert links to relevant sources]
Note: The original text was not formatted in markdown, so I had to manually convert it. Let me know if you need any further adjustments!