![](media/image1.wmf)

Voluntary Report - public distribution

**Date:** 10/20/2004

**GAIN Report Number:** HR4019

HR4019

**Croatia**

**Exporter Guide**

**Annual**

**2004**

**Approved by:**

Sarah Hanson

U.S. Embassy

**Prepared by:**

Andreja Misir

**Report Highlights:**

Croatia imports a significant portion of its food consumption. The
prospect of EU accession, the growth in tourism, and continued economic
reform could make Croatia a significant long-term importer of some U.S.
food products, including seafood, wine, pet food and consumer food
products. Croatian imports of consumer food items have almost tripled
from \$267 million in 1993 to \$748 million in 2003. Croatian consumers
are anti-biotech, and U.S. meat products may not be exported to Croatia
at present.

Includes PSD Changes: No

Includes Trade Matrix: No

Unscheduled Report

Vienna \[AU1\]

\[HR\]

**I Market Overview**

###### Economic situation

Croatia faces economic challenges stemming from a history of communist
mismanagement, damage from the war in the mid 1990\'s, and the
government's struggle with tackling some difficult privatization and
labor issues. Croatia became a EU candidate country in 2003, which will
help the government to focus its economic reform efforts. For the
foreseeable future, the driving force behind the Government of Croatia's
agenda will be to finalize its negotiations with the European Union and
obtain full NATO membership that provides a security framework for its
improving economic and social prospects. Croatia is a member of the WTO
and until 2004 had signed 37 bilateral trade agreements in an effort to
liberalize trade.

There has been considerable progress in creating a market economy and
establishing macroeconomic stability. Inflation and the consolidated
central government deficit have been reduced (with a major lapse in
2003), the exchange rate of the kuna is stable against the Euro,
interest rates have fallen, and bank lending boomed the last several
years. Unemployment appears to have peaked in 2001 and positive trends
(lower unemployment, more employment in private sector firms) emerged in
2002 and continued into 2004. GDP grew by 5.2 percent in 2002 and 4.3
percent in 2003. Croatia\'s external debt grew to \$23.6 billion in
2003, a 53 percent increase over 2002 (some of this increase was related
to depreciation of the dollar against the kuna) and 76 percent of GDP.
(Country Commercial Guide, FCS)\
\
**Demographic Developments and Their Impact on Consumer Buying Habits**

Croatia's population is about 4.4 million and is stable. The age
distribution is as follows: 0 to 19 years/22.93 percent; 20 to 64
years/60.68 percent; 65 and over/16.39 percent (2003 mid year estimate).
The number of elderly and retired is rising, but they tend to have small
pensions - the elderly are not the economic force they are in other
countries.

###### Food Expenditures

Total consumption per person in 2002 was Kn 64,736 (\$8,232.2). In 2002,
personal consumption for foods and beverages was 32.15 percent of total
consumption per person. Personal consumption of foods and beverages in
2002 increased 10.45% comparing to 2000. Alcoholic beverages and tobacco
in 2002 took 3.98 percent from total personal consumption and
consumption of these products is relatively stabile in last three years.

###### Size and Growth of the Consumer Foods Market

####### General

Distributive trade (total wholesale together with total retail trade) in
2002 including VAT was Kn 180.89 billion (\$ 23 million), which is
17.89% raise from 2001. Retail trade only in food, beverages and tobacco
in 2003 including VAT was Kn 24,385,905,000 (\$ 3.6 million), which is
12.9% raise comparing with 2002, 22.2 % raise comparing with 2001 and
33.5 % raise comparing with 2000.

According to unofficial data last year, Croatia imported agricultural
products and food valued at \$1.23 billion and exported only \$768
million. The Export-Import deficit in 2003 was \$ 487 million, which is
10.36 percent more than in 2002. This deficit has a growing trend for
the last few years. Imports of food also have upwards trend last few
years thus they are expected to be even higher or at least at the same
level as in 2003.

There is little specific data on sales of food products by class or
type.

####### Beverages

Total beverage (including alcoholic drinks, tea, coffee) imports in 2003
were about \$ 145.2 million, which is 33.27 percent more than in 2001.

In 2002 annual average consumption per household member was:

-   coffee 3.24kg ,

-   tea 0.26kg ,

-   cocoa 0.34kg,

-   mineral water 37.72l,

-   soft drinks 13.50l,

-   fruit juices 13.21l,

-   syrups and concentrates 5.34kg or l

-   spirits 0.80l

-   wine 12.93l

-   sparkling wine 0.04l

-   beer 28.89l

####### Mineral water

According to the association of water and soft drink producers, mineral
water consumption in first six mounts of 2003 was 148.5 million liters.
From that number 115.2 million liters was from domestic production,
which was 5 percent more than in the same period last year. In 2003
import of waters (Mineral and aerated waters not sweetened; ice, snow
and portable water not sweeten; beverage waters, sweetened or flavored)
was \$ 25.6 million, which is 51 percent more than in 2002.

####### Chocolate

According to research firms, retail trade (excluding cash & carry
stores) sold 1,589 MT of chocolate bars (Snickers bars, Twix bars, Mars
bars, etc) or Kn 127.5 million (\$ 17.58 million) from February 2002
until February 2003. Top 5 brands in 2002 were: Kinder, Bananko, Mond,
Twix, Snickers. They form 64 percent of the market. Chocolate bars are
only 1/5 of total Croatian chocolate consumption in one year.

***Food service (Restaurants)***

According to the Croatian Statistical Institute, hotels and restaurants
sales for foods, non-alcoholic and alcoholic drinks totaled \$421,726 in
2002. Sales in this sector have been tending upwards (regardless on
dollar slide) from 2000 to present.

####### Seafood

In spite of Croatia\'s lengthy Adriatic coastline, the country is
struggling to catch and produce seafood. Croatia lacks modern vessels as
well as the infrastructure needed to transport and process seafood.
Meanwhile the demand for seafood is increasing, as Croatia becomes a
more popular tourist destination. This could make Croatia an excellent
market for U.S. seafood. Fish consumption in 2002, according to Croatian
statistical institute, was 8.76 kilograms per capita. This means that
seafood consumption in 2001 was about 7.5 kg. Total imports of fish and
sea food in 2003 were \$82 million, which is 8% increase compared with
2002. At the same time, U.S. market share increased from \$1 million to
\$2 million.

Tourists that come to Croatia expect seafood, but Croatia suffers from a
shortage of domestically caught fish. Thus, there are export
opportunities for U.S. suppliers of seafood, especially for the tourist
trade.

## Advantages and Challenges of U.S. Suppliers on the Croatian Market

  ------------------------------ ----------------------------------------
  Advantages                     Challenges

  Growth in tourism              Negative attitude towards foods
                                 containing or made from biotech products

  Urban population growing       Reservation towards products with
                                 chemical food additives

  An aging population            U.S. food products are at a tariff
                                 disadvantage compared to goods from the
                                 Macedonia, Bosnia and Herzegovina,
                                 Turkey, Serbia & Montenegro, Albania,
                                 Moldova and EU, EFTA, CEFTA countries

  Certain fruits, vegetables,    High shipping costs
  dried fruits and rice are not  
  produced domestically          

  Shortages of some agricultural Lack of awareness of U.S. goods; no
  products like beef, pork,      concept of U.S. quality by consumers
  soybean meal, and certain      
  types of sea food              

  Most importers speak English   The government is beginning to adopt
                                 restrictive EU Phytosanitary regulations
  ------------------------------ ----------------------------------------

# 

**II. Exporter Business Tips**

###### Local Business Customs 

Food retailers buy domestic and imported products from wholesalers. For
the most part, the wholesale sector is completely privatized.
Restructuring of the retail segment also occurred as retail chains were
privatized and acquired by larger groups and new private retailers
emerged on the market. The retail sector is dominated by foreign
supermarket chains like: Billa, Kaufland, DM, Ipercoop, Metro, Mercator,
Lidl; and domestic supermarket chains like Konzum, Getro, KTC, CBA
(group), CBA, and NTL. Large supermarket chains have their own
purchasing sections that buy, store, and distribute foodstuffs
centrally. These purchasing units also carry out imports. However, some
items are purchased through specialty wholesale importers.

###### General Consumer Tastes and Preferences

Croatians, in general, reject food that contains or is made from biotech
products. According to some newspaper polls, 80 percent of the
population is opposed to the technology. Consumers generally will not
buy food containing biotech content even if it is considerably cheaper.

Consumption of "light" or dietary products is increasing. Sugar free
chewing gums are more popular than gums with sugar. Croatians prefer
chocolates to other sweets. Smoked and salted meats are popular.

In organics according to research conducted by the Hendal company and
based on a random sample of 401 interviewees from all over Croatia:

-   11.7% of all Croatians have never heard of organic products

-   88.3% interviewees have heard of organic food

-   42.9% of Croatians are able to distinguish organic products in shops

-   35.6% of interviewees do not consume organic food at all, and most
    of them 44.9% consume organic products only occasionally.

-   19.5% of interviewees regularly consume organic products

###### Food Standards and Regulations

See GAINS Report HR4013, Food and Agricultural Import Regulations and
Standards Report for information on standards and regulations.

###### General Import and Inspection Procedures

Incoming goods go to the custom storage at transport terminals or
airports. After goods arrive to the custom storage, importer (in person)
or fright forwarder should start procedures for checking and clearing
goods, which includes special documents that should be sent to the
Inspection Departments and the Custom. Procedure starts with Sanitary
Inspection Department from Ministry of Health which checks all products
that are coming in contact with people except meat, which is checked by
Veterinary Inspection Department from Ministry of Agriculture. Samples
for quality checking are taken every time that import is conducted. If
border inspector (sanitary or veterinary) trusts the importer (on basis
of regular import) than products are inspected only periodically.
Product examination has to be paid by importer. If products are of
suspicious quality, their sales will be banned until analyses is
conducted and proven otherwise. Custom clearance and removal from
storage is carried out under the supervision of a custom officer who
compares the documents with the commodities after they were checked by
sanitary or veterinary inspector for ingredients and quality.

Custom rates and documents for imports can be found at:
http://www.carina.hr (As this web site is in Croatian only for
clarification, contact your Croatian partner or one of fright forwarding
companies to determine the proper rates.)

Custom import documents should be in Croatian, but documents in English
language are accepted.

III\. Market Sector Structure and Trends

## Retail Sector Key to High Value Imports

The internationalization of the Croatian retail food trade started in
1997, with the opening of the supermarket chain (Drogerie Markt). In
seven years time, supermarkets have been introduced and developed
rapidly in Croatia, leaving the traditional retail system for food far
behind. In 2002, the share of supermarkets in overall food retailing
reached 50% according to a study entitled "Rapid Raise of Supermarkets"
put out by the U.S. Agency for International Development in September
2003. Until recently, small shops dominated food retailing in Croatia.
However, currently most consumers shop at supermarkets.

Croatia's total imports of consumer foods jumped from \$267 million in
1993 to \$748 million in 2003 and still growing. Increasingly, imports
are being distributed through large (multinational) supermarkets.

######## Promotion and Marketing Strategies

Television is the food industry's favorite media. Supermarkets also send
flyers or newsletters by mail and sometimes promote themselves using
consumer participation contests on TV and radio. A media campaign is
considered necessary for the success of any new food product.

######## Tourism Sales

Tourism, although highly seasonal, is an important economic activity in
Croatia. Each year about 6 - 8 million tourists visit Croatia (compared
to Croatia's population of four million). Despite global trends, Croatia
is one of the rare countries that has not recorded a decrease in tourist
income. It has been estimated that tourist turnover will increase by 5%
in 2004 compared to the year before. The year 2003 recorded 7% more
tourists and 4% more over night stays in comparison with the previous
year. Thus, in the period under analysis, 8.9 million tourists visited
Croatia, with a total of 46.6 million overnight stays. According to the
Croatian National Bank's figures, international tourism revenues in 2003
amounted to USD 6.4 billion.

Foreign tourists represent 83-89 percent from total number of tourists.
The majority of visitors come from Germany, Italy, Slovenia, Austria,
and the Czech Republic. Tourists coming from countries outside of Europe
are mostly Americans. Tourist infrastructure is satisfactory but still
developing, particularly in the main tourist destinations. (See GAINS
Report HR 4012)

**Internet Sales**

Internet shopping in Croatia is still negligible. Most of the Internet
shopping in Croatia includes the following: travel services, IT
equipment, books, and electrical appliances. Despite this, there are a
few companies providing online sales of retail food products. These
companies are following:
[www.maxidiskont.hr](http://www.maxidiskont.hr/) (groceries that are
delivered only in Zagreb region),
[www.vivatipartneri.hr](http://www.vivatipartneri.hr/) (wine sales, but
it is more for promotion purposes than for sales),
[www.vinoteka.com](http://www.vinoteka.com/) (wine sales),
[www.puljanka.hr](http://www.puljanka.hr/) (groceries delivered in some
parts of Istra ).

V. Key Contacts and Further Information

Andreja Misir

Agricultural Specialist

American Embassy

Agricultural Section

Thomas Jefferson 2

10010 Zagreb

tel. 00385 (0)1 661 2467

fax. 00385 (0)1 665 8950

mob. 00385 (0)91 4552365

e-mail: <amisir@inet.hr>

http://www.fas.usda.gov

American Embassy

Commercial Section

Thomas Jefferson 2

10010 Zagreb

tel. 00385 (0)1 661 2224

fax. 00385 (0)1 661 2446

e-mail: zagreb.office.box@mail.doc.gov

web page: [www.export.gov/commercialservice]{.underline}

Central Bureau of Statistics

Republic of Croatia

Ilica 3

10000 Zagreb

Croatia

tel. 00385 (0)1 4806111

fax. 00385 (0)1 4817666

e-mail stat.info@dzs.hr

web page: www.dzs.hr

Croatian Chamber of Economy (Commerce)

Central office

Roseveltov trg 2

10000 Zagreb

tel. 00385 (0)1 4561555

fax. 00385 (0)1 4828380

e-mail: hgk.@hgk.hr

web page: www.hgk.hr

Croatian Chamber of Economy (Commerce)

Agriculture, Food Industry and Forestry Department

Roseveltov trg 2

10000 Zagreb

tel. 00385 (0)1 4826066

fax 00385 (0)1 4826068

e-mail: poljoprivreda@hgk.hr

web page: www.hgk.hr

Croatian Chamber of Economy (Commerce)

Tourism and Catering Industry Department

Roseveltov trg 2

10000 Zagreb

tel. 00385 (0)1 4561570

fax. 00385 (0)1 4828380

e-mail: turizam@hgk.hr

web page: www.hgk.hr

Government of Republic of Croatia

Ministry of Agriculture and Forestry

Grada Vukovara 78

10000 Zagreb

tel. 00385(0)1 6106111

fax. 00385 (0)1 6109201

e-mail: office@mps.hr

web page: www.mps.hr

Government of Republic of Croatia

Ministry of Economy

Grada Vukovara 78

10000 Zagreb

tel. 00385(0)1 6106111

fax. 00385 (0)1 6109110

e-mail: info@mingorp.hr

webpage:www.mingo.hr

+---------------------------------------------------+-------+----------+
| **[TABLE A: KEY TRADE & DEMOGRAPHIC               | **    | **[VALU  |
| INFORMATION]{.smallcaps}**                        | [YEAR | E]{.smal |
|                                                   | ]{.sm | lcaps}** |
|                                                   | allca |          |
|                                                   | ps}** |          |
+---------------------------------------------------+-------+----------+
| Agricultural Imports From All Countries (\$Mil) / | 2003  | 1,181 /  |
| US Market Share %                                 |       | 2%       |
+---------------------------------------------------+-------+----------+
| Consumer Food Imports From All Countries (\$Mil.) | 2003  | 748 / 2% |
| / US Market Share %                               |       |          |
+---------------------------------------------------+-------+----------+
| Edible Fishery imports From All Countries (\$Mil) | 2003  | 82 / 2%  |
| / US Market Share %                               |       |          |
+---------------------------------------------------+-------+----------+
| Total Population (Millions) / Annual Growth Rate  | 2003  | 4.4/-2.9 |
| per 1000 Inhabitants                              |       |          |
+---------------------------------------------------+-------+----------+
| Urban population (Millions) / Annual Growth rate  |       | n.a.     |
| (%)                                               |       |          |
+---------------------------------------------------+-------+----------+
| Number of Major Metropolitan Areas                | 2003  | \-       |
+---------------------------------------------------+-------+----------+
| Size of the Middle Class (Millions) / Growth Rate |       | n.a.     |
| (%)                                               |       |          |
+---------------------------------------------------+-------+----------+
| Per Capita Gross Domestic Product (US Dollars)    | 2003  | \$       |
|                                                   |       | 6,484^1^ |
+---------------------------------------------------+-------+----------+
| Unemployment Rate (%)                             | 2003  | 18.2%\*  |
|                                                   |       |          |
|                                                   | (VII  | 1        |
|                                                   | -XII) | 4.4%\*\* |
+---------------------------------------------------+-------+----------+
| Per capita Food Expenditures (US Dollars)         | 2002  | \$       |
|                                                   |       | 905.55   |
+---------------------------------------------------+-------+----------+
| Percent of Female Population UNEmployed           | 2003  | 1        |
|                                                   |       | 5.7%\*\* |
|                                                   | (VII  |          |
|                                                   | -XII) |          |
+---------------------------------------------------+-------+----------+
| Exchange Rate (US\$1 = X.X local currency)^5/^    | 2003  | \$1=     |
|                                                   |       | Kn6.7014 |
+---------------------------------------------------+-------+----------+

  ----------------------- -------- -------- -------- ---------------------------------
                                                     

  **Reporting Country:\                              
  Croatia\                                           
  Top 15 Ranking**                                   

  Import                  2001                       2002

                          1000\$   1000\$   1000\$   

  **Spain**               18,943   12,480   19,108   

  **France**              148      241      9,887    

  **Netherlands**         1,187    3,692    9,448    

  **Denmark**             5,626    8,387    7,829    

  **Italy**               6,095    8,203    6,345    

  **Sweden**              3,094    3,855    3,013    

  **Norway**              2,684    3,980    2,986    

  **Thailand**            1,752    2,644    2,899    

  **Argentina**           2,078    3,438    2,849    

  **Falkland Islands      140      208      2,787    
  (Islas Malvinas)**                                 

  **Ireland**             440      2,983    1,809    

  **United States**       2,273    1,047    1,534    

  **Iceland**             1,174    1,180    1,455    

  **Slovenia**            1,164    1,031    1,395    

  **United Kingdom**      173      553      1,206    

  **Other**               9,603    21,969   7,362    

  **World**               56,571   75,897   81,926   

                                                     
  ----------------------- -------- -------- -------- ---------------------------------

  ----------------- ----------------- ----------------- -----------------
                                                        

  ----------------- ----------------- ----------------- -----------------

  ---------------------------------- ------------ ------------ ------------
  **Reporting Country:\              **Import**                
  Croatia\                                                     
  Top 15 Ranking**                                             

                                     2001         2002         2003

  ** **                              1000\$       1000\$       1000\$

  **Italy**                          76,027       88,657       115,276

  **Germany**                        54,662       71,246       91,587

  **Slovenia**                       61,812       58,391       74,323

  **Austria**                        55,757       57,387       72,589

  **Netherlands**                    30,293       41,561       52,929

  **Hungary**                        54,332       52,565       50,959

  **Poland**                         14,686       23,292       29,295

  **Spain**                          14,128       17,548       26,777

  **Bosnia-Hercegovina**             10,345       16,158       23,196

  **Denmark**                        8,370        11,311       19,487

  **Czech Republic**                 9,786        10,746       16,862

  **Ecuador**                        12,968       13,336       15,606

  **France**                         10,634       10,006       12,918

  **United States**                  7,581        10,267       12,897

  **Serbia & Montenegro**            13,480       13,505       11,459

  **Other**                          63,577       84,307       122,148

  **World**                          498,498      580,355      748,357
  ---------------------------------- ------------ ------------ ------------

+-------+---------+-----------+-----------+-------+-----------+-------+
| Pr    | Market  | 2003      | 5-Yr.     | I     | Key       | M     |
| oduct | Size    | Imports   | Avg.      | mport | Co        | arket |
| Cat   |         |           | Annual    | T     | nstraints | Attr  |
| egory |         |           | Import    | ariff | Over      | activ |
|       |         |           | Growth    | Rate  | Market    | eness |
|       |         |           |           | 2004  | De        | for   |
|       |         |           | (1        |       | velopment | USA   |
|       |         |           | 999-2003) |       |           |       |
+-------+---------+-----------+-----------+-------+-----------+-------+
| Fish  | 4       | \$82      | 186%      | from  | Co        | D     |
| & Sea | 7,164MT | million   | growth in | 5% to | mpetition | emand |
| Food  | in 2001 |           | dollar    | 21%   | from some | and   |
|       |         | (         | value     |       | E.U.      | c     |
|       |         | 57,076MT) | (288%     |       | seafood   | onsum |
|       |         |           | growth in |       | exporting | ption |
|       |         |           | quantity) |       | c         | s     |
|       |         |           |           |       | ountries. | hould |
|       |         |           |           |       |           | con   |
|       |         |           |           |       |           | tinue |
|       |         |           |           |       |           | to    |
|       |         |           |           |       |           | grow  |
|       |         |           |           |       |           | along |
|       |         |           |           |       |           | with  |
|       |         |           |           |       |           | to    |
|       |         |           |           |       |           | urism |
|       |         |           |           |       |           | for   |
|       |         |           |           |       |           | the   |
|       |         |           |           |       |           | next  |
|       |         |           |           |       |           | se    |
|       |         |           |           |       |           | veral |
|       |         |           |           |       |           | y     |
|       |         |           |           |       |           | ears. |
+-------+---------+-----------+-----------+-------+-----------+-------+
| Snack | N/a     | \$76      | 110.55%   | See   | Strict    | Gr    |
| Food  |         | million   | growth in | at:   | biotech   | owing |
|       |         | (MT are   | value     | www   | le        | ma    |
|       |         | n/a)      |           | .cari | gislation | rket. |
|       |         |           | []{.mark} | na.hr | and       |       |
|       |         |           |           |       | co        |       |
|       |         |           |           |       | mpetition |       |
|       |         |           |           |       | from E.U. |       |
|       |         |           |           |       | and       |       |
|       |         |           |           |       | Croatian  |       |
|       |         |           |           |       | fra       |       |
|       |         |           |           |       | nchisees. |       |
+-------+---------+-----------+-----------+-------+-----------+-------+
| Pork  | 11      | \$58      | 143.12 %  | From  | No        | Cro   |
|       | 0,000MT | million   | growth in | 8+3   | n         | atian |
|       | in      | (         | dollar    | 6.2€/ | egotiated | meat  |
|       | 20      | 27,902MT) | value     | 100kg | USDA/FSIS | proce |
|       | 02/2003 |           | (110.45%  | Max   | cer       | ssors |
|       |         |           | growth in | 32.5% | tificates | are   |
|       |         |           | quantity) | to    |           | impo  |
|       |         |           |           | 10+6  | (         | rting |
|       |         |           |           | 4.6€/ | mandatory | s     |
|       |         |           |           | 100kg | Tr        | ignif |
|       |         |           |           | Max   | ichinosis | icant |
|       |         |           |           | 35%   | testing). | quant |
|       |         |           |           |       |           | ities |
|       |         |           |           |       |           | of    |
|       |         |           |           |       |           | pork  |
|       |         |           |           |       |           | be    |
|       |         |           |           |       |           | cause |
|       |         |           |           |       |           | an    |
|       |         |           |           |       |           | ov    |
|       |         |           |           |       |           | erall |
|       |         |           |           |       |           | de    |
|       |         |           |           |       |           | ficit |
|       |         |           |           |       |           | in    |
|       |         |           |           |       |           | qu    |
|       |         |           |           |       |           | ality |
|       |         |           |           |       |           | p     |
|       |         |           |           |       |           | roduc |
|       |         |           |           |       |           | tion. |
+-------+---------+-----------+-----------+-------+-----------+-------+
| Pet   | 2       | \$21      | 98.24%    | 5%    | Co        | Cr    |
| Food  | 0,578MT | million   | growth in |       | mpetition | oatia |
|       | in 2003 | (         | dollar    |       | from      | do    |
| (Dog  |         | 20,626MT) | value     |       | European  | esn't |
| & Cat |         |           | (98.4%    |       | companies | have  |
| Fo    |         |           | growth in |       | and U.S.  | pet   |
| od-re |         |           | quantity) |       | fr        | food  |
| tail) |         |           |           |       | anchisees | produ |
|       |         |           |           |       | in        | ction |
|       |         |           |           |       | European  | and   |
|       |         |           |           |       | Union.    | usage |
|       |         |           |           |       |           | of    |
|       |         |           |           |       |           | these |
|       |         |           |           |       |           | pro   |
|       |         |           |           |       |           | ducts |
|       |         |           |           |       |           | is    |
|       |         |           |           |       |           | exp   |
|       |         |           |           |       |           | ected |
|       |         |           |           |       |           | to    |
|       |         |           |           |       |           | grow  |
|       |         |           |           |       |           | with  |
|       |         |           |           |       |           | inc   |
|       |         |           |           |       |           | rease |
|       |         |           |           |       |           | in    |
|       |         |           |           |       |           | sta   |
|       |         |           |           |       |           | ndard |
|       |         |           |           |       |           | of    |
|       |         |           |           |       |           | li    |
|       |         |           |           |       |           | ving. |
+-------+---------+-----------+-----------+-------+-----------+-------+
| Wine  | 189     | \$ 10.5   | 323.6%    | from  | New wine  | C     |
|       | ,000,00 | million   | growth in | 10%   | law       | onsum |
|       | 0liters | (9,171MT) | dollar    | to    | doesn't   | ption |
|       |         |           | value     | 58%   | require   | of    |
|       | \+      |           | (71.58%   | or    | expensive | qu    |
|       | 5.944MT |           | growth in | 10+   | testing   | ality |
|       | in 2001 |           | quantity) | 73.6€ | for wines | wines |
|       |         |           |           | /100l | that come | is    |
|       |         |           |           | to    | from      | exp   |
|       |         |           |           | 46.7  | countries | ected |
|       |         |           |           | /100l | with      | to    |
|       |         |           |           |       | which     | grow  |
|       |         |           |           |       | Croatia   | with  |
|       |         |           |           |       | has free  | sta   |
|       |         |           |           |       | trade     | ndard |
|       |         |           |           |       | a         | of    |
|       |         |           |           |       | greements | li    |
|       |         |           |           |       | and TRQs  | ving. |
|       |         |           |           |       | for wine  |       |
|       |         |           |           |       | rec       |       |
|       |         |           |           |       | iprocity. |       |
+-------+---------+-----------+-----------+-------+-----------+-------+
| Tree  | N/a     | \$7.8     | 73.5%     | from  | no        | Gr    |
| Nuts  |         | million   | growth in | 2% to |           | ading |
|       |         | (MT are   | dollar    | 15%   |           | and   |
|       |         | n/a)      | value     |       |           | qua   |
|       |         |           |           |       |           | ntity |
|       |         |           |           |       |           | of    |
|       |         |           |           |       |           | dom   |
|       |         |           |           |       |           | estic |
|       |         |           |           |       |           | produ |
|       |         |           |           |       |           | ction |
|       |         |           |           |       |           | is    |
|       |         |           |           |       |           | ins   |
|       |         |           |           |       |           | uffic |
|       |         |           |           |       |           | ient. |
+-------+---------+-----------+-----------+-------+-----------+-------+
| Rice  | 10,299  | \$5.7     | 24.1%     | 2%    | Trans     | Cr    |
|       | MT in   | million   | growth in |       | shipments | oatia |
|       | 2003    | (         | dollar    |       | from      | has   |
|       |         | 10,802MT) | value     |       | Europe    | no    |
|       |         |           | (16.94%   |       |           | dom   |
|       |         |           | growth in |       |           | estic |
|       |         |           | quantity) |       |           | p     |
|       |         |           |           |       |           | roduc |
|       |         |           |           |       |           | tion. |
+-------+---------+-----------+-----------+-------+-----------+-------+
| Po    | N/a     | \$1.4     | -27.02%   | All   | U.S.      | Negli |
| ultry |         | million   | drop in   | pou   | suppliers | gible |
| Meat  |         | (2,058MT) | dollar    | ltry: | are being | dom   |
| only  |         | -only mdm | value     | from  | shut out  | estic |
| MDM   |         |           | (91.08%   | 19.5% | of the    | produ |
|       |         |           | growth in | to    | MDM       | ction |
|       |         |           | quantity) | 35%   | market    | of    |
|       |         |           |           | or    | due to    | MDM.  |
|       |         |           | -only mdm | 5     | E.U.      |       |
|       |         |           |           | +30€/ | --related |       |
|       |         |           |           | 100kg | phyt      |       |
|       |         |           |           | Max   | osanitary |       |
|       |         |           |           | 20%   | rest      |       |
|       |         |           |           | to    | rictions. |       |
|       |         |           |           | 10    |           |       |
|       |         |           |           | +57€/ |           |       |
|       |         |           |           | 100kg |           |       |
|       |         |           |           | Max   |           |       |
|       |         |           |           | 41.6% |           |       |
+-------+---------+-----------+-----------+-------+-----------+-------+
| Beef  | 5       | \$3.8     | -65.28%   | From  | Ce        | Cr    |
|       | 5,000MT | million   | drop in   | 25%   | rtificate | oatia |
|       | in 2001 | (1,670    | dollar    | to    | of meat   | has a |
|       |         | MT)       | value     | 30%   | quality   | sho   |
|       |         |           | (-75.74%  | or    | must      | rtage |
|       |         |           | drop in   | 8 +   | contain   |       |
|       |         |           | quantity) | 40€/  | statement |       |
|       |         |           | due to    | 100kg | that      |       |
|       |         |           | BSE       | Max   | cattle    |       |
|       |         |           | import    | 30%   | wasn't    |       |
|       |         |           | res       | to    | fed with  |       |
|       |         |           | trictions | 8.4   | protein   |       |
|       |         |           |           | +     | of animal |       |
|       |         |           |           | 109€/ | origin.   |       |
|       |         |           |           | 100kg |           |       |
+-------+---------+-----------+-----------+-------+-----------+-------+

Croatia Imports of Agriculture, Fish & Forestry Products

**(In Millions of Dollars)**

** **

> ** ** Imports from the Word
>
> Imports from the U.S.  U.S Market Share

2001 2002 2003   2001 2002 2003 2001 2002 2003

**BULK AGRICULTURAL TOTAL**   124   121   141     3   6   7     3%   5%
  5%

** ** Wheat   1   1   1     0   0   0     0%   0%   0%

** ** Coarse Grains   31   8   13     1   1   0     0.11%   0.57%   0%

** ** Rice   5   5   6     1   1   1     2%   2%   3%

** ** Soybeans   18   31   33     1   0   0     0.02%   0%   0%

** ** Other Oilseeds   2   7   5     1   1   1     6%   3%   6%

** ** Cotton   5   3   3     0   0   0     0%   0%   0%

** ** Tobacco   19   22   21     3   5   6     16%   24%   29%

** ** Rubber & Allied Gums   1   1   2     1   1   1     0.97%   0.72%  
0.30%

** ** Raw Coffee   22   19   20     1   0   0     0.36%   0%   0%

** ** Cocoa Beans   5   9   12     0   0   0     0%   0%   0%

** ** Tea (Incl. Herb Tea)   1   1   1     1   1   1     5%   10%   6%

** ** Raw Beet & Cane Sugar   10   9   18     0   0   0     0%   0%   0%

** ** Pulses   3   3   4     1   1   1     1%   1%   1%

** ** Peanuts   1   2   2     0   1   1     0%   0.34%   1%

** ** Other Bulk Commodities   1   1   1     1   0   0     1%   0%   0%

** **

**INTERMEDIATE AGRICULTURAL TOTAL**   189   253   292     2   6   2    
1%   2%   0.59%

** ** Wheat Flour   1   1   1     0   0   0     0%   0%   0%

** ** Soybean Meal   24   18   25     1   1   1     0.04%   0.07%  
0.05%

** ** Soybean Oil   1   5   5     0   0   0     0%   0%   0%

** ** Vegetable Oils (Excl. Soybean Oil)   16   23   32     1   1   1  
  0.44%   3%   0.18%

** ** Feeds & Fodders (Excl. Pet Foods)   16   22   27     1   1   1    
0.58%   0.67%   0.08%

** ** Live Animals   32   64   61     1   0   0     0.00%   0%   0%

** ** Hides & Skins   13   24   21     1   3   1     3%   12%   0.38%

** ** Animal Fats   2   2   2     1   0   0     3%   0%   0%

** ** Planting Seeds   8   8   11     1   1   1     5%   13%   5%

** ** Sugars, Sweeteners, & Beverage Bases   23   27   33     1   0   1
    0.03%   0%   0.02%

** ** Essential Oils   18   18   24     1   1   1     0.04%   0.03%  
0.09%

** ** Other Intermediate Products   36   41   51     1   1   1     3%  
3%   2%

** **

**CONSUMER-ORIENTED AG TOTAL**   498   580   748     8   10   13     2%
  2%   2%

** ** Snack Foods (Excl. Nuts)   44   60   76     1   1   1     0.28%  
0.91%   0.21%

** ** Breakfast Cereals & Pancake Mix   5   5   8     0   1   1     0%  
0.27%   0.13%

** ** Red Meats, Fresh/Chilled/Frozen   41   47   55     1   0   0    
2%   0%   0%

** ** Red Meats, Prepared/Preserved   20   22   27     1   1   0    
0.60%   0.33%   0%

** ** Poultry Meat   4   3   3     1   0   0     7%   0%   0%

** ** Dairy Products (Excl. Cheese)   44   36   37     0   1   0     0%
  0.06%   0%

** ** Cheese   19   25   36     0   0   0     0%   0%   0%

** ** Eggs & Products   3   4   5     1   1   1     2%   4%   0.02%

** ** Fresh Fruit   56   64   83     1   1   1     0.00%   0.00%   0.00%

** ** Fresh Vegetables   23   21   45     1   1   1     0.12%   0.02%  
0.30%

** ** Processed Fruit & Vegetables   50   59   76     1   1   1    
0.85%   0.88%   0.56%

** ** Fruit & Vegetable Juices   11   11   14     1   1   1     0.39%  
0.07%   4%

** ** Tree Nuts   5   7   8     1   1   2     11%   15%   20%

** ** Wine & Beer   16   21   31     1   1   1     1%   0.15%   0.19%

** ** Nursery Products & Cut Flowers   16   18   24     0   1   1     0%
  0.04%   0.05%

** ** Pet Foods (Dog & Cat Food)   13   18   21     1   1   1     9%  
3%   3%

** ** Other Consumer-Oriented Products   130   162   200     4   7   9  
  3%   5%   5%

** **

**FOREST PRODUCTS (EXCL. PULP & PAPER)**   121   153   212     1   1   1
    0.37%   0.63%   0.34%

** ** Logs & Chips   5   7   8     0   1   1     0%   0.50%   0.05%

** ** Hardwood Lumber   7   9   16     1   1   1     0.03%   2%   2%

** ** Softwood and Treated Lumber   29   33   44     1   1   1     0.05%
  0.24%   0.26%

** ** Panel Products (Incl. Plywood)   48   57   78     1   1   1    
0.83%   1%   0.23%

** ** Other Value-Added Wood Products   32   47   65     1   1   1    
0.10%   0.11%   0.04%

** **

**FISH & SEAFOOD PRODUCTS**   57   76   82     2   1   2     4%   1%  
2%

** ** Salmon   1   1   1     1   1   0     2%   2%   0%

** ** Surimi   1   1   1     1   1   0     2%   2%   0%

** ** Crustaceans   3   4   4     0   1   1     0%   0.16%   0.46%

** ** Groundfish & Flatfish   8   8   8     1   1   0     0.28%   0.23%
  0%

** ** Molluscs   9   10   15     1   1   1     14%   9%   6%

** ** Other Fishery Products   36   53   54     1   1   1     3%   0.27%
  1%

** **

**AGRICULTURAL PRODUCTS TOTAL**   812   955   1,181     13   22   21    
2%   2%   2%

**AGRICULTURAL, FISH & FORESTRY TOTAL**   989   1,183   1,475     16  
24   23     2%   2%   2%