Croatia
Overview
Many popular tech companies have their headquarters in the capital Zagreb and satellite cities such as Vodnjan. As an emerging outsourcing destination, Croatia is a good cultural match with Western clients and English proficiency is high in the business and tech communities. Since joining the European Union, an estimated €1.7 billion investment has been specifically dedicated to supporting Croatia's digitalization and smart economic transformation.
A popular tourist destination, Croatia is made up of 1,246 islands, although only around 50 of them are inhabited. Dubrovnik, known as the Pearl of the Adriatic, is a UNESCO World Heritage Site in recognition of its outstanding medieval architecture and fortified old town. Vinkovci, in the east, is the oldest continuously inhabited town in Europe, dating back some 8,300 years.
Croatia’s continental climate with cold winters and hot summers also makes it perfect for producing Old World wines. In fact, readers of USA TODAY voted it one of the most beautiful wine regions in the world, surpassing much more famous rivals such as Tuscany, Napa Valley, Oregon and Bordeaux.
The Accelerance Global Network is the most curated list of high-quality global teams ever assembled.
600
Developers
Total number of developers in our certified partner network by country
2
Certified Partners
Total number of certified partners in our global network by country.
11hrs
Time Travel (From NY)
Average flight time from NY to the major cities in the country.
63
Partner Innovation capability
The score reflects investment in STEM progrms and IT funding by country.
84
Partner Skill Level
Level of workforce skills and quality of education, including factors such as digital literacy, interpersonal skills, etc.
68
Partner Global Competitiveness
National productivity based on 12 core pillars, including government policy, infrastructure, economic stability, etc.
High
Software Outsourcing Readiness
Overall rating, based on the maturity of the tech sector, socio-political conditions, and on-the-ground research by Accelerance.
Talent Pool & Education
Croatia’s digital sector has seen accelerated growth over the past few years, with government and private investment in talent development to stem the outflow of IT professionals in search of better opportunities elsewhere. The country has shown promising results: the number of start-ups is now above the average for Eastern and Central Europe. In the International Olympiad in Informatics, a prestigious global computer science competition for secondary school students, its per-capita medal haul ranked it first out of the top 15 countries.
According to the European Commissioner for Cohesion and Reforms, Elisa Ferreira, EU investment in the country's development since it became a member has been equivalent to 4% of GDP, improving the country's competitiveness, creating new jobs, and promoting a greener and more digital economy. Much of this funding is specifically dedicated to supporting Croatia's digitalization and smart economic transformation by increasing the competitiveness and internationalization of small and medium-sized businesses, and contributing to improving the skills of employees.
Croatia’s favorable business environment, with low taxes and a supportive regulatory framework, have helped to attract foreign investment and drive growth in the IT services market, according to Statista. A key trend is the growing demand for cloud-based solutions and many businesses are outsourcing their IT needs to third-party providers as a way to reduce costs and improve efficiency.
Language
Croatian is the national language, while Serbian and Italian are recognised as minority languages. English skills are improving rapidly, especially in the main centers and within the business community.
Economic Outlook
Croatia’s steady economic growth is expected to remain robust into 2025 supported by strong wage growth, a booming tourism sector and the recent influx of European Union funds. The economy remains well above the EU average, with the country's GDP per capita exceeding 75% of the average in 2023. However, despite significant economic progress, Croatia was not spared from the adverse effects of inflationary pressures and tighter monetary policy, which weighed on business investments and external demand.
In a landmark development, Croatia joined the EU Schengen area and adopted the euro in 2023. This has already provided a boost to the already strong tourism industry, which contributes 25% of GDP and provides a similar share of the country’s jobs. Tourism is expected to remain robust throughout 2024 after reaching a record peak during the previous summer season, outstripping pre-pandemic levels.
The European Commission expects the labor market to remain tight, with growth in employment and a gradual further decline in inflation. Investment and infrastructure spending will continue to be supported by Croatia's entry into the Schengen area as the absorption of EU funds continues over the next few years.
Political Conditions
Prime Minister Andrej Plenkovic, of the conservative pro-European Croatian Democratic Union (HDZ), began his third term in office following elections in April 2024, while falling short of a majority. The far-right Homeland Movement (DP) emerged as a kingmaker to form a governing coalition. A relative newcomer to Croatian politics, DP is primarily composed of radical nationalists and social conservatives who previously split from the center-right HDZ. It campaigned on an anti-immigration platform and shut out minority Serb parties from the coalition negotiations.
This has raised fears of a radical shift to the right. However, political analyst Davor Gjenero has argued this remains unlikely given the HDZ’s significant majority and he expects no major change in public policies. "It is obvious that Prime Minister Plenkovic will find the way to continue to lead centrist policies focused on the EU. Croatia remains stable as the state advocating more Europe."