Croatia has drawn 3.6 billion euros from the new generation EU funds, leading in the disbursement of tranches, but the majority of the fulfilled goals from the National Recovery and Resilience Plan relate to the implementation of reforms and regulatory activities, with a smaller part concerning complex infrastructure investments (for which deadlines are at the very end of the financial period – in June 2026), write economists from the Croatian Employers’ Association in this week’s analysis.
The European Commission ‘generically’ recommends to Croatia, as well as to most EU member states, to strengthen administrative capacities for managing EU funds, accelerate investments, and maintain the pace of reform implementation to effectively carry out the NPOO. It would be extremely useful to have precise information on the status of each investment financed by the NPOO, given that a large number of projects must be realized by June 30, 2026. HUP believes that accurate statuses and an action plan for achieving goals should be regularly published over the next two years, as well as how many end users are involved per project, when their procurements and activity executions are planned, and how much each user contributes to a specific investment goal. Project execution statuses should be regularly published on the Ministry of Finance’s website, the holder of the NPOO. This page, however, was last updated in 2022.
Entrepreneurs’ Interest in EU Projects Expectedly High
Given that allocations from EU funds in the last two years have generated nearly two percentage points of real GDP growth, and this year they could potentially have an even greater impact on the short-term potential growth rate of 3-3.5 percent, the interest of the business community in realizing investments financed through this instrument is expected to be high. We also warn that we are already halfway through the new financial period (multiannual financial framework 2021-2027), and there are very few published tenders, which could jeopardize the final result of drawing available funds.
HUP agrees with the Commission’s recommendations that it is necessary to strengthen the capacity of expert services for EU funds, especially for preparing tenders and evaluating projects. Namely, in the upcoming period, when subsidies are mainly aimed at innovative products and processes, waiting 18 months from the announcement of a tender to the contracting of a project diminishes the very factor of innovation we want to encourage. Accelerated technological changes during 18 months can easily render the initial idea of patenting an innovation obsolete.
Due to delays in implementing multiannual financial frameworks, the administration managing EU funds needs to collaborate more actively with previous and potential users in preparing tenders. The focus should be on the desire to realize investments and the impact that the project has on the development of society and the economy, so projects should not be ‘ruined’ due to inadvertently omitted paperwork, but rather allow for the supplementation of tender documentation.
Entrepreneurs (but also all other users of EU funds) need timely and precise information about which tenders will be published in the next 12 months and for which types of investments. The business sector is interested both as an investor and as a supplier of goods, works, and services on projects from EU funds and the NPOO program, but for its more active participation, timely information must be ensured. For example, if they do not know in advance what will be financed in a given quarter of the current year, entrepreneurs cannot be prepared to seize investment opportunities, warn HUP.
