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Croatian report
by Euro Reporter
2013-10-14 12:18:20
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Number of homeless people on a rise in Croatia

There are around 10,000 people in Croatia that have no property at all, news website Index has revealed on Thursday on the Day of homeless people. The same source quoted MediaServis saying the number of homeless people rises in capital Zagreb and the second largest city of Split, but also in other areas in the country. "Our goal is to inform the public about the problems of homeless people in Croatia", Zvovnko Mlinar, the vice president of the Croatian Network of Homeless has revealed marking the international Day of Homeless.


Croatia tycoon’s food empire began with a greenhouse

Ivica Todorić started out growing flowers in communist Yugoslavia. Today he stands on the brink of heading one of the biggest companies by revenues in central and eastern Europe. Thirty years ago, the founder and president of Agrokor was “struggling day and night to make something for my family; not to make money, to survive,” he says. Since then, he has built up a food and retail business that is a regional empire, and become, if not quite an oligarch on the Russian scale, then the richest man in the former Yugoslavia, worth €573m this year, according to Forbes. Some Croats suggest his family origins were not quite as lowly as he makes out. But Mr Todoric does have a strong record of developing companies he takes control of – a feat he intends to repeat with Mercator, the Slovenian retailer that Agrokor agreed to buy in June. Over lunch in his private dining room atop Agrokor’s headquarters in Zagreb, with views over the city’s elegant Habsburg centre and forested hills beyond, Mr Todorić is animated, keen to emphasise his business values and successes. “I started with zero and now have 42,000 employees,” he says. “I have created new productive industries. I created new value.”

Having grown up in Zagreb, and studied at its university’s economics faculty, Mr Todorić set up a greenhouse growing flowers in 1976, under rules allowing limited private business in communist Yugoslavia. That helped him to build up capital and business expertise he could utilise once communism fell.  He formally registered Agrokor as a joint stock company in 1989. Yugoslavia was starting to splinter, leading to Croatia’s 1991-95 war of independence. While many Croatian companies fell on hard times during the war, Mr Todorić seized the opportunity to take over struggling businesses. “I saw companies that were uncompetitive, and that we would go into transition,” he says. “When the transition came, we knew what we wanted to do: go into production.” Two notable decisions were his 1994 acquisitions of retailing and wholesale chain Unikonzum and ice cream and frozen goods company Ledo. That year, Unikonzum had total sales worth €30m in its 150 shops, according to Agrokor’s figures; in 2012, that had risen to €3.1bn from 1,017 outlets, under the Konzum brand. Mr Todorić attributes Agrokor’s success to investment in human resources, and the management team he has assembled, but does not shy away from taking personal credit. “I have been involved as an adviser night and day,” he says. “I’m available 24 hours a day. I never take a vacation of more than four days.”

The Agrokor founder is far from universally popular in Croatia or the broader region. Many east Europeans are suspicious of those who rose to prominence in the post-communist period. Mr Todorić’s business interests grew rapidly during the era of Croatia’s strongman president Franjo Tudjman in the 1990s.  Mr Todorić insists his accomplishments are due to skill and hard work.  “I had the opportunity to build myself as a businessman for 15 years [before the end of communism],” he says. “I simply realised what the market was; who the consumer was; and what you had to do. It has been difficult to succeed in the region, there has been too much knowledge lost over the past 25 years.”  Mr Todorić rues the fact that Croatia – which joined the European Union in July this year – did not promote private enterprise and reform sooner. He argues this is why the region has few other Agrokors, along with the reluctance of local business people to think beyond their immediate market. But he becomes most exercised – drumming out his arguments with his hands – when discussing widespread suggestions that Agrokor’s workforce is poorly paid, and its suppliers kept waiting too long for payments. “We are creating jobs, these are people with things to do,” he says. “The first one who isn’t happy with the level of wages is me, I want employees to be paid more, but we have to be realistic. I think we’re among the best partners for suppliers in the region, if not Europe. We never miss a payment, not by a minute.” He also dismisses media suggestions that his company has engaged in creative accounting, raising the subject unprompted only to declare it “made up, not correct. Nothing is true”.


Croatia's growing pains

Croatia declared independence from Yugoslavia on October 8, 1991, now a national holiday. Since then, the country shrunk from 4.7 million people down to 4.28 million. The Croatian Bureau of Statistics anticipates the population will hit 3.1 million by 2051. 

Much of that can be attributed to the Croatian War of Independence, where Croats loyal to the new government fought off Yugoslavian and Serbian forces. By the war's end in 1995, predominantly Serb areas in the country had seen hundreds of thousands displaced; many never returned. Today, the country is the most ethnically homogenous of the six countries that once formed Yugoslavia. 90.4 percent of the population is classified as Croat, 4.4 percent Serbian.

While peace has since prevailed, tensions remain. A new law requires bilingual signage in any area where more than one third of the local population belongs to an ethnic minority group, leading Croat protesters in one town to tear down its new Serb Cyrillic signs. As for its economy, Croatia is facing some of its worst economic conditions since the end of the war, facing five straight years now in a recession and 21 percent unemployment. It joined the European Union earlier this year.


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