Perspectives Vol 44 - Croatia

ix structure. Tourist arrivals have grown by 10-fold in recent decades, while EU accession has imposed strict recycling targets. This article examines the roots of Croatia’s decentralized waste governance, analyzes how tourism and fragmentation have stalled EU compliance, and recommends structural reforms to reduce municipal fragmentation and enable coordinated progress. OLIVIA A. LUNDQUIST 52 TEMPORAL TENSIONS IN CROATIA’S MIGRATION POLICIES Following its accession to the EU, Croatia experienced increases in emigration and immigration. These led to short-term policies that lacked lasting considerations for migration to Croatia. Recently, national demographic strategies were developed that outlined the country’s plan for migration going forward. These policies provide the opportunity for Croatia to position itself as a long-term destination rather than utilizing migration solely as a solution to structural labor market concerns. ELIZABETH M. WOLFE 61 FROM BREAKTHROUGH INNOVATION TO GENERIC DEPENDENCE: CROATIA’S PHARMACEUTICAL PARADOX Croatia has a strong history of pharmaceutical innovation, yet today it relies on imports for many essential medicines. This article looks at how changes in ownership, policy decisions, and regulations have weakened local research and shifted the industry toward generic drug production. By comparing Croatia to similar countries, the article suggests steps the country can take to rebuild advanced capabilities and strengthen its role in European life sciences through expansion of its pharmaceutical manufacturing capacity. HASHEM AL HATTAB 71 ATTRACTING TOURISTS, DISPLACING HERITAGE: CROATIA’S POSTWAR RECOVERY IN DUBROVNIK After the Homeland War ended in Croatia, the government turned its attention to rebuilding Croatia’s public-facing image—especially in locales such as Dubrovnik—to regain the economic stimulus of tourism. However, it failed to properly plan for the eventual overtourism, lacking strategies for heritage management, visitor limits, and community preservation. Inadequate war acknowledgments, coupled with the influx of tourism, have had an adverse effect on the area’s cultural heritage. AVERY MCGARRY 79 REVERSING CROATIA’S SPIRAL OF STEM DECLINE AND TOURISM DEPENDENCE Tourism plays a disproportionate role in Croatia’s economic success, putting the country at risk should tourism become less lucrative. Croatia has infrastructure and resources to expand its STEM sectors but is hindered by disjointed educational tracking, poor resource allocation, and brain drain. This analysis identifies the interactions between these elements and examines how they manifest as a negative feedback loop. Processes Croatia can alter to resolve the spiral and reinforce its national economy are recommended. CLAIRE E. WILSON 89 THE TRILEMMA IN CROATIA’S NATURAL GAS SECTOR Croatia’s new liquefied natural gas terminal has delivered security gains since 2021: eliminating Russian gas dependence, establishing Croatia as a regional energy exporter, and moderating electricity prices. However, accelerating gas investment and growing US dependency reveal conflict with binding EU climate commitments, and fugitive methane costs threaten welfare gains. Croatia’s singular focus on gas risks forfeiting its competitive edge as Europe decarbonizes. Early renewable investment and terminal conversion planning are essential to preserving long-term energy hub ambitions. GIDEON SOBEK INHERITED BANKING CAUTION AND CREDIT CONSTRAINTS FOR SMALL BUSINESSES IN CROATIA When the Croatian banking system emerged from Yugoslav-era social ownership, it inherited an environment of politically driven credit and minimal risk screening: major market economy hazards. This legacy persists in small and medium-sized enterprise finance, where leading banks are reluctant small-business lenders. This article argues that the eased collateral requirements and terms brought by EU-backed instruments reveal strong small and medium-sized enterprise demand for credit, identifying supply-side caution and regulation as the primary binding constraints. JOSEPH GUSTAV MAASS 101

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