1. TRADE AND INVESTMENT PROMOTION AGENCY Zagreb, March 2010

2. BASIC INFORMATION CROATIA \ BASIC INFORMATION Population: 4,441,460 Area:56,542 km2 Coastlength:1,777 km Islands:1,185 Capital:Zagreb Language:Croatian Script:Latin Currency:Kuna (HRK) Political system: Parliamentary Democracy Climate:Mediterranean, Continental

3. ECONOMY CROATIA \ ECONOMY 200620072008 GDP per capita (EUR)7,7068,45210.681 GDP growth (%)4.85.62.9 Inflation rate (average, %)3.22.96,1 Unemployment rate (%, ILO)11.29.513,4 Export (EUR bln)8.39.010.6 Import (EUR bln)17.118.820,8 FDI (EUR bln)2.73.62,9

4. process of harmonization with EU legislative end of negotiations with EU expected by end of 2010 expected accession: 2012 process of harmonization with EU legislative end of negotiations with EU expected by end of 2010 expected accession: 2012 Croatia has become a member of NATO in April 2009 INTEGRATION PROCESSES On the way to EU … CROATIA \ ECONOMY AND INTEGRATION PROCESSES Croatia was a non-permanent member of UN Security Council 2008/2009

5. FOREIGN DIRECT INVESTMENT CROATIA \ FOREIGN DIRECT INVESTMENT Foreign direct investment 1993. – Q3 2009. 23,6 billion EUR

6. TOP 5 INVESTOR COUNTIRES TOP 5 INVESTOR COUNTIRES (1993 – Q3 2009, EUR) 1. AUSTRIA 1. AUSTRIA6.29 bln 2. NETHERLANDS 2. NETHERLANDS4.12 bln 5. FRANCE 5. FRANCE 1.36 bln 3. GERMANY 3. GERMANY 2.70 bln 4. HUNGARY 4. HUNGARY 2.12 bln FOREIGN DIRECT INVESTMENT CROATIA \ FOREIGN DIRECT INVESTMENT

7. FDI PER CAPITA (EUR), 2008 FOREIGN DIRECT INVESTMENT FDI PER CAPITA (EUR), 1993 – 2008 CROATIA \ FOREIGN DIRECT INVESTMENT

8. CROATIA \ WHY INVEST IN CROATIA? WHY INVEST IN CROATIA? EXPORT JUMPSTATION! access to EU market of 500 milion people trade aggrement signed with EU since february 1st 2005

9. INFRASTRUCTURE Railway network is constantly being improved with major project on the way Rijeka-Botovo (Hungary) Developed Natural Gas pipeline puts Croatia at the top among EU countries 100% digitalized telecom network and high penetration rate of broadband Internet places Croatia among countries with most modern ICT infrastructure Croatia has one of the densest highway network per total surface in SEE (km/km 2 ) Three major PAN-EUROPEAN corridors pass through Croatia CROATIA \ WHY INVEST IN CROATIA?

10. LNG TERMINAL - OMIŠALJ  Environmental impact study  Project documentation  Tender 2009  15 billion cubic meters  End: 2014  Environmental impact study  Project documentation  Tender 2009  15 billion cubic meters  End: 2014 Investment size: 1 bln.Eur (including Pipeline 150-200 mil. EUR) LNG TERMINAL - OMIŠALJ

11. INVESTMENT OPPORTUNITIES over 300 business zones ready for investment ICT, R&D and BIOtechnology Strategic Business support services Manufacturing – Car Industry CROATIA \ INVESTMENT OPPORTUNITIES Distribution & Logistics Tourism

12. BUSINESS OPPORTUNITIES final products in manufacturing industry: wood industry – furniture and parquetry made of Croatian oak and beech trees marine and shipbuilding industry automotive and transport industry – automobile parts such as electronic and non- electronic parts, tires etc medicine equipment and pharmaceutical products food and beverages construction and development energy sector – investment in renewable energy sources and power equipment like electro motors and transformers transfer of technology and know-how logistics and distribution – seaports tourism CROATIA \ BUSINESS OPPORTUNITIES CROATIA offers business cooperation, especially in the following areas:

13. INVESTMENT IN TOURISM CROATIA \ INVESTMENTS IN TOURISM 1.Investment in State owned shares Sale of state owned shares in 17 tourist companies – Croatian Privatization Fund 2. Investment in State owned real estate Projects of reconstruction of military bases into hotel resorts – Club Adriatic Reconstruction of military ports into marinas Project Brijuni Riviera, Istria Project Park Prevlaka, Dubrovnik region 3. Investment in real estate owned by municipalities Project Posedarje Pašman Riviera Project – Island of Pašman Other projects 4. Investment in development of golf courses 50 potential locations for golf course development on privately and State-owned land

14. POTENTIAL INVESTMENT IN TOURISM HOTEL MEDENA in TROGIR Investment Project by Croatian Privatization Fund Capacity: Main buildings A and B (611 rooms, 8 suites;1266 beds total), pavilion C (60 rooms), pavilion D (40 rooms) Estimated value: € 37 mln HOTEL MEDENA in TROGIR Investment Project by Croatian Privatization Fund Capacity: Main buildings A and B (611 rooms, 8 suites;1266 beds total), pavilion C (60 rooms), pavilion D (40 rooms) Estimated value: € 37 mln PODGORA HOTELS d.d. in MAKARSKA RIVIERA  Investment Project by Croatian Privatization Fund  Capacity: 9 suites, 546 rooms; totaling 1062 beds  Estimated property value: € 41 mln PODGORA HOTELS d.d. in MAKARSKA RIVIERA  Investment Project by Croatian Privatization Fund  Capacity: 9 suites, 546 rooms; totaling 1062 beds  Estimated property value: € 41 mln HOTEL HRVATSKA in Baška Voda, MAKARSKA RIVIERA Investment Project by Club Adriatic d.o.o. Capacity: 128 double rooms and 8 appartements HOTEL HRVATSKA in Baška Voda, MAKARSKA RIVIERA Investment Project by Club Adriatic d.o.o. Capacity: 128 double rooms and 8 appartements

15. POTENTIAL INVESTMENT IN TOURISM HTP KORČULA d.d. in Island of Korčula Investment Project by Croatian Privatization Fund Capacity: 5 hotels with total of 1 751 beds Estimated property value: € 40 mln HTP KORČULA d.d. in Island of Korčula Investment Project by Croatian Privatization Fund Capacity: 5 hotels with total of 1 751 beds Estimated property value: € 40 mln MODRA ŠPILJA d.d. in Island of Vis Investment Project by Croatian Privatization Fund Capacity: 131 rooms Estimated property value: € 9 mln MODRA ŠPILJA d.d. in Island of Vis Investment Project by Croatian Privatization Fund Capacity: 131 rooms Estimated property value: € 9 mln Holiday Resort “Perla“ and “Orebić“ Hotel in Pelješac Peninsula Investment Project by Club Adriatic d.o.o. Capacity: 5 appartements, 281 double rooms Holiday Resort “Perla“ and “Orebić“ Hotel in Pelješac Peninsula Investment Project by Club Adriatic d.o.o. Capacity: 5 appartements, 281 double rooms

16. Camp Uvala Slana in Selce Investment Project by Club Adriatic d.o.o. Capacity: 230 camp sites Camp Uvala Slana in Selce Investment Project by Club Adriatic d.o.o. Capacity: 230 camp sites POTENTIAL INVESTMENT IN TOURISM ŽIVOGOŠĆE HOTELS d.d. in Makarska Riviera Investment Project by Croatian Privatization Fund Capacity: Hotel Nimfa (155 rooms); Buildings Licinijan, Pelagija, Suzina and Pokrivenica (136 rooms); Hotel Punta (132 rooms, 14 bungalows with 39 apartments); Auto-camp Dole 50 camping spots) Estimated property value: € 34 mln ŽIVOGOŠĆE HOTELS d.d. in Makarska Riviera Investment Project by Croatian Privatization Fund Capacity: Hotel Nimfa (155 rooms); Buildings Licinijan, Pelagija, Suzina and Pokrivenica (136 rooms); Hotel Punta (132 rooms, 14 bungalows with 39 apartments); Auto-camp Dole 50 camping spots) Estimated property value: € 34 mln

17. CROATIAN AUTOMOTIVE INDUSTRY “We expect a recovery in our industry. Inside the 300 km circle around Zagreb there will be a production of one million cars per year until 2012. For this reason we are making contacts and establishing cooperation with companies in a country that is exactly in the middle of that huge anticipated production.” Mr. Hubert Hödl, Vice President Marketing & Business Development, Magna International Inc.

18. CROATIAN AUTOMOTIVE INDUSTRY Production of Motor Vehicles, Trailers and Automotive Parts Total Income 200220032004200520062007 Total income in EUR (millions)143.8171.5186.0201.0227.0260.0 % change67%19%9%8%13%15% Total income of the Croatian automotive industry has shown double digit growth rates

19. CROATIAN AUTOMOTIVE INDUSTRY AUTOMOTIVE INDUSTRY STRUCTURE CN Code20042005200620072008 Chassis fitted with engines, for motor vehicles 16459314748824168 Bodies for the motor vehicles19,67247,3337,935132,929245,921 Parts and accessories of the Motor vehicle (thousands) 91,122115,397111,411154,328178,441 Total (thousands)91,142115,445111,421154,462178,691 Indices139,3126,796,5138,6115,7

20. CROATIAN AUTOMOTIVE INDUSTRY COMPANIES IN AUTOMOTIVE INDUSTRY IN CROATIA 2004200520062007 Number of companies in automotive industry60676974 Number of employees3,0413,1353,1553,565 Founded in 2006 with headquarters in Zagreb Cluster members – producing, engineering & developing companies in the automotive sector Total Employment: 2.000+ Employees Total Turnover 2007: 105 Mio. EUR Exports – 90% to the Western European countries/regions

21. CROATIAN AUTOMOTIVE INDUSTRY CONCEPTS AND INNOVATIVE PRODUCTS Croatian company DOK-ING project Complete design and development of an Electric engine Electromotor produced by TEMA, a croatian company Test drive held in March 2010

22. ENERGY DEVELOPMENT STRATEGY 3 FUNDAMENTAL ENERGY GOALS SECURITY OF THE ENERGY SUPPLY ENERGY SYSTEM COMPETITIVENESS SUSTAINABLE ENERGY DEVELOPMENT

23. DIRECTIVE EU 2001/77/WC MANDATORY SHARE OF RES IN TOTAL EN. CONSUMPTION EMISSION REDUCTION – KYOTO PROTOCOL ENVIRONMENTAL PROTECTION REDUCTION OF IMPORT DEPENDENCY EMPLOYMENT AND DEVELOPMENT OPPORTUNITIES ENERGY DEVELOPMENT STRATEGY

24. OBLIGATIONS by 2020: greenhouse gas emissions cut by 20% 20% of total energy consuption from renewable sourcess increase energy efficiency by 20% 10% of biofuels in petrol and diesel fuel in total transportation cunsumption 35% of electrical energy production from ROI (including large hydro power plant) CO 2 emissions pcc ENERGY DEVELOPMENT STRATEGY

25. Goals by 2020 – 1,545 MW from Renewable Energy Sources 1200 MW FROM WIND MILLS 140 MW FROM BIOMASS ENERGY PLANTS 100 MW FROM SMALL HYDRO-POWER PLANTS 45 MW FROM SOLAR POWER PLANTS 20 MW FROM GEOTHERMAL POWER PLANTS 40 MW FROM THERMAL ENERGY PLANTS USIING COMMUNAL WASTE

26. REALIZED PROJECTS By March 1 st 2009 a total of 287 requests have been received : 164 wind farm 63 small-scale hydro- power plant 29 solar power plant 10 biomass 8 cogeneration

27. Wind Park Krtolin 11.95 MW WPD Germany REALIZED PROJECTS

28. 2 600 hours of sunshine per year on the Croatian coast provide ideal conditions OPPORTUNITIES INSOLATION MAP Photovoltaic Solar System Performance Calculator http://oie.pondi.hr/

29. GEOTHERMAL FIELDS The biggest geothermal fields in the Republic of Croatia

30. The Energy Act 5 sub-Acts - since July 1 st 2007Define: Right to incentives (feed-in tariff) Compulsory purchase of electrical energy from RES The operator (HROTE) has an obligation to connect the client to the network Process of acquiring the status of the eligible producer OPPORTUNITIES

31. Special support for: Manufacturing activities Technology and R&D Centres Strategic and Business Support Services INVESTMENT INCENTIVES

32. ABOUT TIPA (Trade and Investment Promotion Agency) Established by Croatian Government Project managers at your disposal 24/7 One-Stop shop for investors Our professional service is free of charge Propose measures to enhance the business environment CROATIA \ APIU

33. TIPA SERVICES LABOUR MARKET MONITOR A unique place of information about the workforce in Republic of Croatia that provides an insight into the labour legislative through a simple and structured interface and allows investors to make estimations of workforce availability and cost. LABOUR MARKET MONITOR A unique place of information about the workforce in Republic of Croatia that provides an insight into the labour legislative through a simple and structured interface and allows investors to make estimations of workforce availability and cost. BUSINESS ZONES DATABASE Database of more than 200 business zones accross the country, consisting of all data for investors such as available land, cost, legislative, incentives, infrastructure, geographical position, operational cost, etc. BUSINESS ZONES DATABASE Database of more than 200 business zones accross the country, consisting of all data for investors such as available land, cost, legislative, incentives, infrastructure, geographical position, operational cost, etc. INCENTIVE CALCULATOR Incentive calculator was developed by APIU to provide an additional service for potential investors. Through online calculator investors can instantly calculate the amount of incentives granted on the basis of Investment incentive act. INCENTIVE CALCULATOR Incentive calculator was developed by APIU to provide an additional service for potential investors. Through online calculator investors can instantly calculate the amount of incentives granted on the basis of Investment incentive act.

34. TIPA ASSISTS! prior, during and after realization of investment projects in getting promptly all needed administrative licences with gaining access to state and local incentives in creating added value for projects TIPA ASSISTS! prior, during and after realization of investment projects in getting promptly all needed administrative licences with gaining access to state and local incentives in creating added value for projects TIPA NETWORKS! government bodies local and regional institutions TAX, financial, and legal advisors utility companies TIPA NETWORKS! government bodies local and regional institutions TAX, financial, and legal advisors utility companies OUR SERVICES TIPA SERVICES CROATIA \ APIU SERVICES TIPA PROVIDES! information about economic and legal investment environment guidance through free zones and industrial parks database of available land and property organized site visits tailored to meet investors’ needs TIPA PROVIDES! information about economic and legal investment environment guidance through free zones and industrial parks database of available land and property organized site visits tailored to meet investors’ needs

35. THANK YOU! Contact Consulate General of Croatia in Chicago at 1 312 482 9902 or Trade and Investment Promotion Agency @ www.apiu.hr Phone: +385 (0)1 4866 000 +385 (0)1 4866 001 Fax: +385 (0)1 4866 009 Address: A. Hebranga 34/10000 Zagreb Croatia