engleski

The Role of Financial Institutions and Instruments in Croatian Industry Adjustment to EU Business Environment

This paper points to the importance of the Croatian manufacturing industry restructuring within adjustment of Croatian economy to the EU business environment. Special attention is given to the importance that financial institutions and instruments have in manufacturing sector development. Therefore, development and competitiveness indicators of Croatian manufacturing industry are analysed. Based on the results of the analysis of development and of the selected manufacturing industry indicators the authors draw the conclusion that there are long-term negative tendencies present in Croatian manufacturing industry (diminishing contribution of manufacturing sector to total output, export and employment). Also, the competitiveness of Croatian manufacturing industry is at lower level compared to most CEE countries, considering labour productivity, level of costs, exports and investment. Current options of Croatian industry financing are determined by basic features of the financial sector: excessive relying upon banks and underdevelopment of other financial institutions and instruments. Therefore it is necessary to increase the share of other financial instruments in the future, such as various entrepreneurial supports, horizontal government subventions, and especially the share of various structural funds of the European Union in financing of the manufacturing sector development. That could have direct influence on financial prerequisites for the increase of Croatian manufacturing industry competitiveness.

manufacturing industry; competitiveness; financing of industry; EU

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