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Croatia’s EU Accession as a Chance For Austria

Published: June 18, 2013; 19:02 · (Vindobona)

Soon, there are more than 1,000 Austrian businesses operating in Croatia and the volume of trade is supposed to increase.

Croatia’s EU Accession as a Chance For Austria / Picture: © Wirtschaftsbund / Christoph Leitl

Head of the Austrian Chamber of Commerce (WKO) Christoph Leitl is convinced that Austrian enterprises will use Croatia’s EU Accession to find a business location in the Western Balkan country.

“Currently we have 750 business locations and I am convinced that in the foreseeable future we will celebrate the thousand,” Leitl announced in an interview with the Austrian Press Agengy (APA) on the occasion the event “Business to Customer” at the Austrian center of foreign trade in Zagreb to celebrate Croatia’s EU membership starting on July 1.

“Austrian enterprises invest sustainably and by a long-term strategy. A quick cashing in is not their thing, that is why I believe, we fit in there very well,” Leitl said. However, there were also expectations by the Austrian investors. “We are willing to respect the law, to pay taxes but investors want to be treated equally, regardless whether they are foreigners or not and regardless of the amount of the investment,” he said in reference to a new law for strategic investments, which plans to simplify proceedings for investments above the amount of € 20m. “Many small investments create just as many jobs as a major investment,” Leitl is convinced.

The bilateral volume of trade between Austria and Croatia came to € 2bn before the financial crisis in 2008. Austria has invested € 7bn in the meantime. “I can imagine that trade will be intensified after the accession,” he said.

By Croatia’s EU membership a door to Europe and a joint market will be opened in economically difficult time. “One should not believe that by this heaven on earth will be created. In some sectors there will be difficult adaption phases, for instance in the food industry.” In Austria there were sectoral and reconversion aids. “In difficult areas we have agreed upon transitional provision with the EU,” Leitl explained.

Such a transitional provision was made for limiting the free movement of workers or the cabotage. Austria will limit the access to its labor market for Croatians for two year. Furthermore, certain occupations in the healthcare sector, for instance nursing, are not able to be offered by Croatians during that time. “It is a natural development that countries, which are sensitive in some sectors have transitional provisions as these transitional provision prevent damages,” Leitl explains.

According to the head of the Austrian Chamber of Commerce, there were fears in Austria. “In a difficult situation, the social partners need to sit together and do away with risks.” The social “peace” is not to be unterestimated “not for the sake of peace but one has to motivate the people and not frustrate them,” he concludes.

Leitl determines three aspects that needed to be fulfilled for the successful enlargement of FDIs in Croatia: trust in the economic development, in the financial and fiscal framework of the government, and in the business location.

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