With the municipal and county elections in Croatia resulting in a change of guards of sorts, Vukelic Law Office Partner Luka Vukelic explains how it might affect the Adriatic country going forward, while also sharing developments regarding the country's newest unicorn.
“The most important things of note, lately, are the local municipal and county elections that took place in May,” Vukelic begins. “The elections saw the dominant, ruling party – HDZ – lose both Zagreb and Split, which are two of the biggest cities in the country,” he adds. Vukelic says that this is a major hit for the long-governing political party, seeing as how it will lead to them losing access to some HRK 60 billion of budgetary funds.
The second reason for which Vukelic believes the elections are of note is that they led to fresh faces entering the political stage. “This was the first time in a long time that neither of the two standard-bearing parties, HDZ and SDP, swept the elections on this level,” he says. According to him, having fresh faces means that it may “finally be the time that Croatia breaks the cycle of HDZ and SDP passing the baton.” Still, changes in government notwithstanding, Vukelic feels that it would take a year at least before it could have any impact on investments. “It remains to be seen if the new leaders will fulfill all of their promises of transparency and advancement.”
What does seem to be a favorable thing for reintroducing trust in the legal system in Croatia, Vukelic reports, is the recent apprehension and arrest of three criminal court judges from the Osijek County Court, on charges of corruption. “This made huge waves with lawyers recently – such a thing hadn’t happened in a long time – and could go a long way towards restoring trust in the system,” Vukelic says.
Finally, speaking of the general atmosphere of the Croatian market, Vukelic says that things have been picking up this year. “Investments, transactions – it all went a level higher this year in comparison to the pre-COVID-19 era,” he says. “Investors are propping up, acquiring companies, and the economic outlook predictions are looking up too.” As an example of things improving, Vukelic says that Croatia has just got its second unicorn – Rimac Automobili. “Rimac just unveiled Nevera, a fully electric hypercar, which is the world's fastest accelerating production road car in history – and it’s a thing of beauty,” he says. “It’s getting a lot of international investor attention.”
Additionally, Vukelic says that the Peljesac bridge – connecting the two parts of Croatia that have been hitherto accessible only via Bosnia & Herzegovina – is due to be completed “in the coming few months.” Tourists are slowly coming back to the country as well, and Vukelic reports that, with daily newly infected numbers hovering around 50 and more than half of the population being inoculated, Croatia may see a good tourism season. “Things are slowly returning to some form of normal, as the country no longer finds itself on red/orange lists when it comes to COVID-19. This holds nothing but promises for the immediate future,” Vukelic concludes.