44 PERSPECTIVES ON BUSINESS AND ECONOMICS | VOL 44 | 2026 Croatia joined the UN in 1992 and took early steps toward sustainable development with support and resources from the international community. For example, in 1994, the Mediterranean Environment Technical Assistance Programme and the European Investment Bank financed the development of a waste management system in Kvarner Bay and Istria. Integrated waste collection and disposal was also identified as a national priority in Croatia’s 1992 Agenda 21 UN country profile (State Directorate for the Environment, 1997). Though considered a national priority, enforcement of waste regulations remained the responsibility of local government units. A pattern was emerging with national ambitions for waste management but reliance on local decisions and capacities. The widening gap created a disconnect that stalled the execution of waste system improvements. The Republic of Croatia The Homeland War ended in fall 1995, and Croatia became an independent country consisting of 428 municipalities. That same year, Croatia began building a national waste policy framework. The First Waste Act (1995) introduced organized recycling, reuse incentives, and waste reduction targets (Vucinic et al., 2018), and the 1996 Rule Book on Packaging Waste established manufacturers’ responsibility for collecting and recycling (State Directorate for the Environment, 1997). In 1995, Croatia produced an estimated 205 kg of waste per person per year (Traven et al., 2018), less than 30% of the US rate (United States Environmental Protection Agency, 1997). But the low figure reflected postwar economic weakness, and national policies did little to advance waste systems. The newly independent Croatia consisted of over 500 local government units, each responsible for its own waste collection and disposal, making national coordination difficult from the start (Boromisa et al., 2022). Croatia’s waste disposal was typical of developing countries in the EU at the time, characterized by low recycling rates, inadequate management of hazardous waste, and poor landfill disposal. Waste management was a low priority for policymakers who focused more on rebuilding the economy following the conclusion of the war. Then, in 2003, when Croatia applied for EU membership, tighter national waste legislation was implemented. Nonetheless, operational responsibility remained with municipalities, reinforcing the implementation gap stemming from the legacy of varying local capacity to deal with national regulations. Economic growth coupled with waste generation Directly after the war, the economy stagnated (Traven et al., 2018). As the economy began to recover, solid waste generation increased with it. Between 1997 and 2004, Croatia implemented no substantial waste policies, allowing waste generation to continue increasing. In 2004, Croatia produced an estimated 1.31 million tons of solid waste, and generated waste continued to increase until it peaked at 1.79 million in 2008 (Kučar et al., 2007). A large portion of this waste was landfilled. The subsequent decline is commonly attributed to the 2008 global financial crisis and decline in consumption (Bakker & Klingen, 2019). Economic growth in recent years has proved inconsistent among municipalities. In some with low tourism that lack its economic benefits, large amounts of waste are still produced because they lack the funds to invest in waste management infrastructure, in turn harming industries like fishing and tourism and creating a cycle of declining economic activity in those communities. For instance, areas in the Slavonia region that are more inland have low levels of tourism and exhibit less economic growth than coastal tourism hotspots. On the flip side, some wealthier municipalities with less tourism have invested more effectively in recycling and other waste reduction measures. Fragmentation issues exposed by Croatia’s EU membership When Croatia joined the EU in 2013, it inherited a stricter set of waste regulations. The EU’s circular economy implementation timeline gave Croatia only a short time to comply. These more demanding regulations placed high stress on Croatia as its previous infrastructure was built for the linear economy model and relied heavily on landfilling to manage its waste. Fragmentation across municipalities made meeting EU schedules difficult, and national policy implementation proved uneven. The European Union and the circular economy Since 2000, the EU has prioritized the idea of a circular economy over the previous linear model. The purpose of a circular economy is to expand the lifetime of materials through recycling and circulate them back into the economy. Reusing the products creates further value, limits the environmental impact, decreases the dependence on raw materials, and creates jobs and market competition (Circular Economy, 2023). The circular economy is also part of the EU’s effort to create a low-carbon, resource-efficient, and sustainable economy.
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