REGIONAL COOPERATION AND ECONOMIC INTEGRATION

2.1. Croatian FDI outflows to the Western Balkans region
CEFTA-2006 TRADE COOPERATION
Total Croatian FDI outflows to the region were 828.6 million EUR (2000-2008), which is
approximately 43.4% of total Croatian FDI outflows. Of that amount, 57.5% of investment
has gone to Serbia (476.5 million EUR). On the other hand, total FDI outflows from
Serbia to Croatia, from 1993 to 2008(IIQ), amounted to -6.95 million EUR. However,
the intensive investment between these two counties has begun in 2003 (HGK, 2009).
Croatian investors have primarily invested in food industry, building material industry
and retail. It is about the sectors that mainly have good market conjuncture, so it can be
stated that the Croatian investors have done a good job in evaluating Serbian market. The
largest business dealings have been done by one of the leading Croatian concern – Agrokor.
This company has gained good positions in frozen food industry, food oil industry, bakery
industry and retail. The first step for Agrokor was the acquisition of leading Serbian frozen
food brand – Frikom. Agrokor has stabilized, technologically modernized the company
and expanded the market assortment offering new products like frozen fish and seafood.
The net income of Frikom in 2007 was nine times bigger than it was in 2006. The second
large acquisition was takeover of food oil and margarine factory Dijamant in Zrenjanin. In
the capital structure, Agrokor takes fourth position with the share of 12.82%. The second
successful investor in Serbian economy is Nexe group from Naљice. This company has
integrated in its system three carefully selected companies. The largest among them is
Building Ceramic industry Polet. The second acquisitioned firm is Jelen Do, the largest
quarry on the Balkans. The smallest member of Nexe group is brick factory Stražilovo in
Srijemski Karlovci. All three companies have increased their net income and production,
and acquired significant market share in branches, respectively (Harak, 2008).
Another country that has received a large amount of FDI from Croatia is Bosnia and
Herzegovina. Croatian companies have invested around 287.2 million EUR from 2000 to
2008. That makes 34.7% of Croatian FDI outflows to the region or 15.0% of total Croatian
FDI outflows in the same observed period, while investors from Bosnia and Herzegovina
have invested 61.7 million EUR which is 0.4% of total FDI inflow to Croatia. Croatian
investors have mainly invested in post and telecommunications, food and beverages
industry and financial intermediation and retirement insurance, whereas investors from
Bosnia and Herzegovina have mainly invested in retail, manufacture of food products and
beverages and manufacture of chemicals (HGK, 2009). The most significant investors
from Croatia are; T-HT and Croatian Post Zagreb which are part-owners of Croatian
Telecommunications Mostar and Croatian Post Mostar (investment worth 136.4 million
KM, 2007 – that is the 8 th largest investment to Bosnia and Herzegovina from 1994 to
2007); Croatian oil company INA which has, together with Hungarian MOL, recapitalized
Energopetrol from Sarajevo (46.0 million KM, 2007 – 18 th ); Zagrebačka banka which
is, as the daughter firm of Italian UniCredit Group, the owner of UniCredit Bank from
Mostar (82.2 million KM, 2004 – 11 th ); Fininvest from Čabar which is the owner of similar
factory for wood processing in Drvar (43.3 million KM – 20 th ); and Agrokor’s companies
Ledo which owns ice-cream factory in Čitluk (21.7 million KM) and Konzum with the
chain store across Bosnia and Herzegovina (Šutalo, 2008). A possible cooperation between
Croatia and Bosnia and Herzegovina could be expected in the field of energetic. The latter
is a signatory of the Declaration on the Ionian-Adriatic gas pipeline project. The Ionian-
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