It coincided: within just five days, two important meetings on banking were held. Last Friday in Rovinj, the fourth Meeting of Governors and Bankers of the region was organized by Lider. And this Tuesday in Zagreb, the Croatian Banking Association and the Croatian Employers’ Association organized a conference titled ‘Loans and Economic Growth – How to Overcome Risks?’.
For those entrepreneurs who may have had a grievance against bankers at some point, there is little satisfaction – now bankers also have full warehouses of unsold goods. They have billions of kuna in their accounts, but customers do not want to take them. And those who do stop by the store – are often over-indebted and it is not wise to give ‘on credit’ with a clear assessment that the ‘warehouse’ already filled with piles of old uncollectible receivables would only be further filled.
The banking sector in Croatia, with exceptions, is stuck. Surviving entrepreneurs are hesitant. They are slowly moving towards development. As a representative from Bosnia and Herzegovina said at the governors’ meeting in Rovinj: ‘Once burned by milk, one blows on yogurt.’
Fear of choosing priorities Of course, the gloating of entrepreneurs from the real sector over the struggles that bankers are currently experiencing does not provide long-term satisfaction. For a national economy to develop, and for it to be easier to do business, the banking sector must play its role as an intermediary between savings and investment. For GDP growth rates above three percent, the connection between entrepreneurs and banks must work.
The aforementioned two meetings showed how many things should be resolved simultaneously and in a short time. Some are for reducing parafiscal levies. Others for increasing competitiveness, whatever that means. The third group puts more efficient public administration in their wish basket. The fourth sees a solution in improving the efficiency of the judiciary. The fifth does not dare to solve the over-indebtedness of companies with shock therapy as Slavko Linić dared with pre-bankruptcy settlements, but they seek some ‘light’ solutions in the form of venture capital funds and mezzanine financing. Then the situation is further complicated by the head of Atlantica, Emil Tedeschi, with the thesis about insufficiently capable and ambitious Croatian entrepreneurs (someone might interpret this as Tedeschi’s desire to be critical without offending the new government given his friendly relations with former Prime Minister Milanović). Nevertheless, it is good that he opened the topic of the quality of the local business community. While noting that local entrepreneurs are certainly much more capable than local politicians, it should still be taken into account the generational change awaiting 17,000 companies with 170,000 employees. And there are few founders managing that transition.
