Azernews.Az

By Gulgiz Muradova

Head of Croatian Chamber of Economy (CCE), Mr. Luka Burilovic tells Azernews about the Croatia-Azerbaijan business ties, activity of the Croatian companies in Azerbaijan, touching upon works to be done to boost the ties.

Question: Can you please outline the specific spheres of economic cooperation between Azerbaijan and Croatia? What is the current progress with interaction, in particular, in the fields of energy and infrastructure?

Answer: When we talk about the bilateral relations between the Republic of Azerbaijan and the Republic of Croatia, it is important to say that even though Croatian companies are not unknown to this market and their Azerbaijani counterparts, our mutual cooperation is still small and below the potential level. Foreign trade between Croatia and Azerbaijan in 2015 amounted to the total of $396 million, which is an increase of 11 percent compared to 2014. The Croatian export that amounted to $4.6 million in 2015, was dominated by textile products, tobacco, cosmetics, aluminum products and furniture. We imported the goods in the value of $392 million, predominately oil.

Q.: Which sector do you consider as the most successful to build the stronger ties with Azerbaijan?

A.: Some of Croatian companies have already established a successful cooperation with their Azerbaijani partners, especially in the field of ICT, shipbuilding, energy sector, food and pharmaceutical industry. But the potential is much greater. Besides already mentioned sectors, the possibilities for cooperation exist in the field of infrastructure, electro, metal and chemical industry, sectors of energy, oil and gas, construction, tourism just to name a few. There are many Croatian companies with an excellent track record on foreign markets that can participate in the modernization and construction of petrochemical plants, railway system, its electrification, signalization etc., projects of construction of gas and oil networks, hydropower plants etc.

Q.: Azerbaijan makes big investments in Croatia and has voiced its intention to increase its capital in this European country. Which spheres would Croatia welcome to see Azerbaijani investments?

A.: Even though Croatian companies have been oriented to known European and neighboring countries, they are ready and willing to go and do business on other, not so traditional markets like Azerbaijan. One of the reasons why our bilateral trade does not correspond to its real potential could be seen in the lack of information of the business possibilities and conditions for doing business in both of our countries. That’s why this visit of the Croatian business delegation to Azerbaijan is so important, to give the opportunity to our businesses to get to know each other, make contacts that will hopefully result in some concrete business deals. Economic development of every country can only be greater with political and institutional support. That’s why we are very grateful to both Presidents, H. E. Ilham Aliyev and H. E. Kolinda Grabar Kitarović that this visit of the Croatian business delegation has occurred on the occasion of their official meeting at the highest level.

Q.: What kind of role does the Croatian Chamber of Economy have when it comes to stimulating the Croatia-Azerbaijan business ties?

A.: This is the third presidential visit to Azerbaijan and I am very glad to see that the number of Croatian business delegation is only getting bigger. This time I am proud to lead a business delegation of 60 participants from 35 Croatian export oriented companies. They are all characterized by tradition and quality in manufacturing, educated workforce, experience and extensive track record on foreign markets.

Q.: In previous years, Croatia abolished visa regime for citizens of Azerbaijan during tourist season. Do the two countries plan to simplify general visa procedures further or apply any mechanism to boost the tourism sector?

A.: It is a political question. But as the Croatian Chamber of Economy we would support such simplifications. As along with the tourism sector this will also contribute to business sector of both sides. Azerbaijan can invest in Croatia’s tourism sector, and also Croatian companies can invest in the tourism sector of Azerbaijan. Croatian travel companies are here today so they are studying opportunities here.

Q.: Have you reached any agreements in this regard during today’s forum? How fruitful were your meetings today?

A.: We are satisfied with our meetings here. We had a number of fruitful meetings. But we cannot be satisfied with this as our trade volume is small given the opportunities that Azerbaijan and Croatia enjoy. We have excellent companies in ICT and shipbuilding, so we can build stronger ties in these sectors. Also, agriculture is one of the strongest sectors in the Croatian economy. Podravka [a food processing and pharmaceutical company producing high quality] can be an example for this.

Q.: Is there any plan about signing an agreement on avoidance of double taxation and mutual protection of investments?

Yes, in the nearest future such a document can be signed.

Q. To what extend the current macroeconomic situation is suitable for investors? From the prospect of business leaders, what important steps should the governments take to further improve the business climate in the country?

A.: If we take a look at Croatia’s macroeconomic indicators we will see that after 6 years of negative growth, the Croatian economy is currently experiencing a positive trend, with the GDP growing 7 quarters in a row. Last year Croatian GDP growth rate was 1,6%. As expected, the GDP continued growing also in the 2nd quarter this year when the growth rate was 2.8%. These positive trends are expected to continue, so the estimations are that this year should end with a GDP growth of over 2%.

Regarding the investment and business climate, I would like to point out that the Republic of Croatia guarantees by law the same rights to foreign investors as it does to Croatian ones. By constantly improving the investment climate, and in addition to benefits provided by agreements for the avoidance of double taxation signed with over 50 countries, Croatia offers numerous incentives for business activities to investors, such as tax incentives, incentives for employment and education, and additional incentives for capital expenses and labor intensive investment projects. The World Bank in its report Doing Business 2016, ranked Croatia at the 40 place among 189 countries in the world.

I do hope that this visit will also result in an increase of Azerbaijani investments in Croatia, since they have not been significant so far. One of the goals of this visit is also to send the message Azerbaijani businessman and to potential Azerbaijani investors that Croatia is an attractive and favorable country for doing business, being a Central European, Mediterranean and EU member country, offering numerous opportunities for joint projects and guaranteeing stability and the safety of business activities and investments.

Q.: What are the current challenges hindering the greater and prospective Azerbaijan-Croatia economic cooperation?

A.: As the president of the Croatian Chamber of Economy, a modern, professional institution representing more than 110,000 members, I can offer a full support to the Azerbaijani companies in every step they take to the Croatian market. Our tradition lasting more than 164 years is a guarantee that we are a reliable partner to every foreign company wishing to do business in Croatia. With, numerous professional associations, 20 county chambers in Croatia and representative offices abroad, CCE is a reliable source of information for all companies wishing to do business in Croatia being constantly at their disposal by providing business data, services and contacts. The CCE organizes numerous business forums, B2B meetings, conferences, business delegations home and abroad HGK with the aim of finding reliable business partners to our companies and informing potential investors on business and investment climate as well as investment possibilities in Croatia. We provide investors with all the necessary support before, during and after investing and doing business in Croatia, in dealing with necessary administrative and legal proceedings and in finding them a suitable business partner.

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