The document discusses key goals and factors for Croatian enterprises related to exporting. It provides: 1) Questions that will be addressed about coping with crises, exporting to foreign markets, and functioning within the EU single market and CEFTA market. 2) An overview of PEST analysis and typical factors including political, economic, social, and technological considerations. 3) Current situations for Croatian enterprises including benefits and challenges of joining the EU such as duty-free trade but also economic instability and a need to restructure exports.

2. KEY PRESENTATION
GOALS

3. GIVING ANSWERS ON QUESTIONS
• What should entrepreneurs do in the case
of a crisis?
• What can entrepreneurs do in the case of
exporting to foreign markets?
• How will entrepreneurs function within
Single Market?
• How will entrepreneurs function within
CEFTA Market?
• What possible scenarios await regional
trade once we join the EU?
• What is current situation for croatian
enterprises?
• What are key challenges for croatian
enterprises?

4. IF WE WANT TO HAVE
CLEAR ANSWERS ON
EXPORTING FIRMS
PERSPECTIVE...

5. WE HAVE TO
INVESTIGATE
BUSINESS
ENVIRONMENT!

6. PP
EE
SS
TT
AA
NN
AA
LL
YY
SS
II
SS

7. PEST (Political-legal, Economic, Socio-
cultural, and Technological) Factors
• The macro/remote environment
principally consists:
• Economic environment
• Political environment
• Legal environment
• Socio-cultural environment
• Demographic environment
• Natural environment
• Physical and technological environment
• Technological Environment
• Global or International environment

8. TYPICAL PEST (Political-legal,
Economic, Socio-cultural, and
Technological) Factors EXAMPLE
FactorFactor Could include:Could include:
PoliticalPolitical e.g. EU enlargement, the euro,e.g. EU enlargement, the euro,
international trade, taxationinternational trade, taxation
policypolicy
EconomicEconomic e.g. interest rates, exchangee.g. interest rates, exchange
rates, national income, inflation,rates, national income, inflation,
unemployment, Stock Marketunemployment, Stock Market
SocialSocial e.g. ageing population,e.g. ageing population,
attitudes to work, incomeattitudes to work, income
distributiondistribution
TechnologicalTechnological e.g. innovation, new producte.g. innovation, new product
development, rate ofdevelopment, rate of
technological obsolescencetechnological obsolescence
EnvironmentalEnvironmental e.g. global warming,e.g. global warming,
environmental issuesenvironmental issues
LegalLegal e.g. competition law, health ande.g. competition law, health and

9. CURRENT SITUATION
OF CROATIAN
ENTERPRISES:
POLITICAL AND
ECONOMICAL
FACTORS

10. KEY POLITICAL AND ECONOMICAL
FACTORS – BENEFITS AND
CHALLENGES
• Once Croatia enters the EU in July 2013,
we will stop being a member of CEFTA
• Croatian export and import in EU will be
“duty free”
• Private and public debt influence on
stability of Croatia economic system
• Monetary stability is influenced by foreign
banks
• Waiting time for joining Eurozone
• Croatian kuna remains till 2016/2017?
Maastricht Criteria

11. KEY POLITICAL AND ECONOMICAL
FACTORS: CONCLUSION
• Croatia will experience a fall in its balance of trade
as it will reduce its exports to CEFTA countries
• Its exports to other member states will show
rather small or even no positive movements
• Export from Croatia to CEFTA country members
approximately 20% of total exports
• In 2011. Croatia imported from EU in value of 9
billion euros and exported 5,4 billion of euros
• Croatia still has a poor export structure and low
competitiveness
• The process of restructuring is rather slow. The
economic crisis in the EU and Croatia has
contributed to these poor results.

12. KEY POLITICAL AND ECONOMICAL
FACTORS: CONCLUSION
• Croatia will experience a fall in its balance of trade
as it will reduce its exports to CEFTA countries
• Its exports to other member states will show
rather small or even no positive movements
• Export from Croatia to CEFTA country members
approximately 20% of total exports
• In 2011. Croatia imported from EU in value of 9
billion euros and exported 5,4 billion of euros
• Croatia still has a poor export structure and low
competitiveness
• The process of restructuring is rather slow. The
economic crisis in the EU and Croatia has
contributed to these poor results.

13. KEY POLITICAL AND ECONOMICAL
FACTORS: CONCLUSION
• In spite of all these negative projections, the
advantages of joining the EU are numerous:
“500 million consumers in EU Market against 27
milion CEFTA consumers”
The EU is a big market, and as such it provides for:
• Economies of scale
• Greater competition (we all know that healthy
competition increases the ability of enterprises)
and
• Investment (easier access to financial means and
potential investors)

14. KEY POLITICAL AND ECONOMICAL
FACTORS: CONCLUSION
• The EU is a single market, and as such has a:
• Cost-cutting effect - The abolition of customs
procedures, inspection and other customs
formalities at the border will lower the costs of
trading and will result in faster shipment of goods
as they no longer have to wait at the border.
• Psychological effect – A country that is a
member of the EU leaves a better impression on
its partners i.e. one of higher economic stability.

15. EXAMPLE: ISTRIAN WINE EXPORT -
lower costs of trading and the access to
a wider market
• Istria is a region in west Croatia, bordering with
Slovenia and Italy
• Many Italian tourists come to Istria over
weekends to enjoy Istrian gourmet food and
exceptional wines
• Although there is also a demand for Istrian wines
in on the Italian side of the border, exporting
wine was very difficult, especially for small
entrepreneurs
• High freight and other export costs presented
an obstacle in exporting wine to restaurants in
Italy.
• Namely, the Italian restaurants demanded a small
amount of wine, two – three boxes and a retail

16. EXAMPLE: ISTRIAN WINE EXPORT -
lower costs of trading and the access to
a wider market
• This turned out to be cost-ineffective, due to high
export costs which exceeded the price of goods
• This could have been resolved by maybe having a
big buyer that would purchase larger amounts of
wine and then ship them to Italy
• However, a big buyer demands low prices and
large quantities, which was again unacceptable
for the Istrian wine producers due to their small
scale production
• With Croatia’s accession to the EU and the
abolition of customs procedures, Istrian wine
producers will be able to deliver their products
to the interested Italian restaurants, without
extra costs and at an affordable price

17. CONCLUSIONS

18. Conclusion (1)
-- in terms of Croatia, the enlargement ofin terms of Croatia, the enlargement of
the EU has not and will not have anythe EU has not and will not have any
significant impact on regional tradesignificant impact on regional trade
unless enterprises and are restructured.unless enterprises and are restructured.
- EnterprisesEnterprises need to undergo a fullneed to undergo a full
technological renewal;technological renewal; EnterprisesEnterprises needneed
new capital and most importantly, theynew capital and most importantly, they
need a new market.need a new market.
- DDevelop and start new enterprises basedevelop and start new enterprises based
on knowledge and innovations. The newon knowledge and innovations. The new
export structure design should beexport structure design should be
founded primarily on knowledge. Thisfounded primarily on knowledge. This
process mostly relies on the intellectualprocess mostly relies on the intellectual
capital of the young people i.e. thecapital of the young people i.e. the
educated and unemployed.educated and unemployed.

19. Conclusion (2)
If you are not a big company and you wantIf you are not a big company and you want
to export your products, secure stableto export your products, secure stable
income and a stable position on theincome and a stable position on the
market, you could:market, you could:
• Supply your products to a larger companySupply your products to a larger company
• Develop and market a top quality productDevelop and market a top quality product
(a product based on you individual(a product based on you individual
invention or knowledge)invention or knowledge)
• Find a new market outside the EUFind a new market outside the EU
• Become a representative of a famousBecome a representative of a famous
brandbrand
• Become a franchiseeBecome a franchisee
• always remember that investing in youralways remember that investing in your
own staff is a prerequisite to every successown staff is a prerequisite to every success

20. Thank you for your attention!