World Bank: Investment in Croatian Agriculture Justified

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The initial results of an in-depth analysis of Croatian agriculture show that investment in agriculture is economically justified, and that 1 million dollars invested in agricultural production generates an increase of 5.19 million dollars in the value of the total volume of economic output.

 The analysis was carried out by World Bank experts, who say that the Croatian agricultural sector has many comparative advantages that can be used to increase growth and development, such as unrestricted access to the EU market, access to funding under the Common Agricultural Policy, diverse agricultural and environmental conditions, good land and rich water resources, relatively low labour costs, good road infrastructure, and growing tourism.

The World Bank, however, notes that Croatia is still dependent on agricultural and food imports, while Croatian farmers use obsolete and ineffective machinery, slowly adjust to technological changes and innovations, and rarely form associations, which makes them less competitive and less adaptable to change.

The document shows that in order for the agricultural and food sector to achieve its full potential, it is necessary to make improvements in agricultural productivity and in creating added value by connecting primary production and processing.

 “Agriculture and rural areas, as well as aquaculture, have huge potential for growth and development, and the structural transformation of these sectors, which in particular has been encouraged since Croatia’s entry into the European Union, is going in a good direction,” Agriculture Minister Tomislav Tolušić said.

He said that a strategic vision for the development of agriculture and rural areas would be finalised by the end of the year, and that a national strategic plan for the EU’s Common Agricultural Policy 2021-20127 would also be prepared.

The analysis shows that Croatia is currently competitive in low-value primary agricultural products, such as cereals and oil crops (sunflower and soybean), while its competitiveness in high-value products is limited to a relatively small number of horticultural and livestock products.

The document also shows that Croatia should seize the opportunities offered by organic production because compared with other EU countries Croatia has recorded the largest increase in areas under organic production.

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