Page 88 - SE Outlook Regions 2022

3.4.6 Major Sectors

Tourism remains a key sector for Croatia’s economy, contributing more
than 20% to GDP. In 2020, the sector showed a better than expected
recovery, boosting the economic growth. This trend is expected in 2022,
unless the coronavirus pandemic hits harder.

To prevent that, the country is putting efforts into persuading the
population to get vaccinated. Despite that, so far only just over 50% of
people are vaccinated.

The strong recovery of the tourism industry positively affected food
sales. Atlantic Grupa, one of the region’s largest food and consumer
goods groups, with brands including Argeta, Barcaffe, Grand Kafa and
Smoki, posted a consolidated net profit of HRK399.8mn (€53.21mn) for
the first nine months of 2021, up by 13.9% y/y.

Another food and retail company - Fortenova Group, the successor
company to bankrupt food and retail giant Agrokor – also showed good
performance in 2021. Its consolidated net profit stood at HRK1.3bn
(€173mn) in January-September, an improvement of HRK1.855bn from
the loss recorded in the same period of 2020.

Fortenova Group has invested €125mn in the first nine months of 2021
in Croatia and the nearby region and plans to make capital investments
of €130 in 2022.

The company’s biggest investment in the production segment is a
€11.5mn bottling line for non-alcoholic beverages at Jana bottling unit in
Croatia. Its installation is at the final stage.

Fortenova also said that preparations for the launch of works on a
€29.3mn cooking oil factory in Serbia and €8.2mn slaughterhouse in
Croatia are a final phase.

Croatia, with a population of just over 4mn, has seen the emergence of
a slew of high tech champions in the fields of IT software and hardware.
Overall, Croatia is punching above its weight when it comes to
technology; Deloitte’s latest ranking of the 50 fastest-growing tech
companies in the Central and Eastern Europe region included five
Croatian companies, and this is not the first time Croatia has had a
substantial number of entrants in the ranking.

The latest included cryptocurrency brokerage and payment processor
Electrocoin, e-commerce platform bazzar.hr, agriculture technology
company AGRIVI, Eco Mobile, which specialises in ICT solutions for
waste management, and smart bench creator Include.

In the robotics field, artificial intelligence (AI) startup Gideon Brothers
raised a $31mn Series A investment in a round led by Koch Disruptive
Technologies (KDT), the venture and growth arm of Koch Industries, in
2021. Gideon plans to use the funds to accelerate the development and
commercialisation of its AI and 3D vision-based autonomous mobile
robots (AMRs). It will also expand its manufacturing, sales, marketing
and customer service operations across key markets in the EU and US

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