Croatia Economic Outlook
A tourism-driven economy:
Croatia, with a GDP of around $80 billion, relies heavily on tourism, which accounts for roughly 20% of its economy. The country’s Adriatic coastline and historical cities make it a major tourist destination, attracting millions of visitors each year. The economy rebounded strongly after the pandemic, but growth slowed in 2023 due to weaker external demand and inflationary pressures. Croatia’s accession to the eurozone and Schengen Area in 2023 boosted investor confidence and facilitated trade and travel within the EU.
Key industries and exports:Beyond tourism, Croatia has a diverse economic base, including shipbuilding, pharmaceuticals, and agriculture. The country is a significant exporter of refined petroleum, electrical equipment, and food products. Croatia has also been expanding its renewable energy sector, particularly in wind and solar power. The country benefits from EU funding, which has supported infrastructure projects, including road networks and port expansions.
Challenges:Croatia’s economy faces several structural weaknesses, including a rigid labor market, high public debt, and low productivity growth. The country struggles with an aging population and a persistent brain drain, as many skilled workers migrate to Western Europe for better opportunities. Public sector inefficiencies and bureaucracy remain barriers to business expansion, limiting the country’s competitiveness.
Croatia’s economic outlook:The economy of Croatia is set to grow well above the EU average in the coming years, supported by continued tourism growth, EU investment, and trade integration within the eurozone. However, external risks—including economic slowdowns in major European economies—could impact exports and tourism revenues. Addressing labor shortages and improving the business environment will be critical for sustaining long-term growth.
Croatia's Macroeconomic Analysis:
Nominal GDP of USD 84.4 billion in 2023.
GDP per capita of USD 21,958 compared to the global average of USD 10,589.
Average real GDP growth of 2.7% over the last decade.
Sector Analysis
In 2022, services accounted for 61% of overall GDP, manufacturing 11%, other industrial activity 25%, and agriculture 3%. Looking at GDP by expenditure, private consumption accounted for 58% of GDP in 2023, government consumption 21%, fixed investment 22%, and net exports -1%.International trade
In 2021, manufactured products made up 64% of total merchandise exports, mineral fuels 12%, food 16%, ores and metals 4% and agricultural raw materials 4%, with other categories accounting for 0% of the total. In the same period, manufactured products made up 66% of total merchandise imports, mineral fuels 16%, food 14%, ores and metals 3% and agricultural raw materials 1%, with other goods accounting for 0% of the total. Total exports were worth USD 21 billion in 2023, while total imports were USD 39 billion.Main Economic Indicators
Economic growthThe economy recorded average annual growth of 2.7% in the decade to 2023. To read more about GDP growth in Croatia, go to our dedicated page.
Fiscal policy
Croatia's fiscal deficit averaged 2.3% of GDP in the decade to 2023. Find out more on our dedicated page.
Unemployment
The unemployment rate averaged 9.6% in the decade to 2024. For more information on Croatia's unemployment click here.
Inflation
Inflation averaged 2.6% in the decade to 2024. Go to our Croatia inflation page for extra insight.
Monetary Policy
Euro Area monetary policy rate ended 2024 at 3.15%, up from 0.05% a decade earlier. See our Croatia monetary policy page for additional details.
Exchange Rate
From end-2014 to end-2024 the euro weakened by 20% vs the U.S. dollar. For more info on the euro, click here.
Economic situation in Croatia
Annual economic growth ticked down to 3.7% in Q4 from 3.9% in Q3, but remained well above the Euro area average. The deceleration was driven by a sharp decline in inventories and a larger expansion in imports. That said, both private and public spending, as well as fixed investment and exports, grew at faster clips. Shifting to Q1, our Consensus is for GDP growth to have slowed, and available data bears out this projection. Economic sentiment deteriorated in Q1 relative to Q4. Moreover, retail sales growth slowed to an over one-year low in January as inflation accelerated from Q4 at the outset of the year. On a more positive note, industrial output rebounded in January. Meanwhile, the government announced a new subsidy package worth nearly EUR 300 million in a bid to tackle stubborn inflationary pressures, covering energy costs for households and businesses.Croatia Economic Forecasts
Projections out to 2034.57 indicators covered including both annual and quarterly frequencies.
Consensus Forecasts based on a panel of 24 expert analysts.
Want to get insight on the economic outlook for Croatia in the coming years? FocusEconomics collects projections out to 2034 on 57 economic indicators for Croatia from a panel of 24 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts, and averaged to provide one Consensus Forecast you can rely on for each indicator. This means you avoid the risk of relying on out of date, biased or outlier forecasts. Our Consensus Forecasts can be visualized in whichever way best suits your needs, including via interactive online dashboards , direct data delivery and executive-style reports which combine analysts' projections with timely written analysis from our in-house team of economists on the latest developments in the Croatia economy. To download a sample report on the Croatia's economy, click here. To get in touch with our team for more information, fill in the form at the bottom of this page.