Croatia’s GDP Could Be 8% Lower by 2030 Without European Funding

BRUSSELS – Croatia’s gross domestic product (GDP) is projected to rise by eight percent by the end of 2030, thanks to support from European funds. In light of this, Zagreb is advocating for the continuation of a robust EU cohesion policy, as stated by Croatia’s Minister of Regional Development and EU Funds, Šime Erlić, during a recent meeting in Brussels.

Minister Erlić asserted, “Cohesion policy is vital for financing projects in Croatia sourced from European funds. We firmly believe that maintaining a strong cohesion policy after 2027 is essential.” This statement followed a meeting of the EU Council attended by ministers from member states focused on cohesion.

The primary focus of the meeting was on the future of cohesion policy post-2027, after the current seven-year programming period concludes.

Erlić emphasized the importance of cohesion policy moving forward, stating, “We want it to remain a priority after 2027 so that we can continue accessing EU funds, which are crucial for Croatia’s development and help us close the gap with more developed nations.”

According to a report from the European Commission on economic, social, and territorial cohesion, Croatia’s GDP is expected to be eight percent higher by the end of the decade, owing to these cohesion funds.

The Commission is contemplating a new approach for the upcoming seven-year budget cycle from 2028 to 2034, which would link the allocation of cohesion funds to the implementation of reforms and investments. This method is similar to the approval process for funds from the Recovery and Resilience Mechanism, which currently requires member states to meet specific milestones outlined in their national plans.

Such a reform would necessitate unanimous agreement from all member states. However, many are concerned that it could lead to a more centralized management of European funds, potentially diminishing the influence of local and regional authorities over their allocation.

Minister Erlić highlighted the benefits seen from the Recovery and Resilience Mechanism, particularly in accelerating the implementation of reforms and associated investments. He advocated for retaining this positive experience in future cohesion policy, while also ensuring the continued involvement of all local and regional stakeholders in the planning and execution of European fund projects. (28 November 2024)