According to the first flash estimates, in real terms, the Croatian GDP increased by 2.7% YoY and amounted to EUR 18.8bn in Q2 2023. At the same time, seasonally adjusted quarterly GDP in real terms increased by 1.1% QoQ and 2.5% YoY.
Yesterday, the Croatian Bureau of Statistics, DZS released the estimate for Q2 2023 information on Croatian GDP. According to the estimate, Croatian GDP in real terms increased by 2.7% YoY in Q2 2023. At the same time, seasonally adjusted quarterly GDP in real terms increased by 1.1% QoQ and 2.5% YoY.
Breaking this down even further, on a YoY basis, Final consumption expenditure increased by 1.8% YoY and amounted to EUR 11.6bn. Inside this category, Households recorded growth of 2.3%, and amounted to EUR 8.7bn, while General Government recorded an increase of 0.3%, and amounted to EUR 2.9bn. Moving on, Gross fixed capital formation increased by 3.2% YoY and amounted to EUR 3.9bn. On the other hand, both the export and import of goods and services decreased, by 1.6%, and 3.6%, respectively, amounting to EUR 8bn, and EUR 8.6bn, respectively. However, if we delve into this even further, we can see that goods export and import of goods decreased, by 9.7% and 7.3%, respectively, while the export and import of services increased, by 8.3% and 23.9%, respectively.
Croatian GDP, (2007 – Q2 2023, %, YoY) *
Source: Croatian Bureau of Statistics, InterCapital Research
*Quarterly Gross Domestic Product, seasonally adjusted real growth rates
Overall, we can see that the GDP is still on a positive trajectory in Croatia, and this even includes inflation as these refer to real growth rates. Final consumption is still up, which means that despite the hit to disposable incomes, it remains one of the key drivers. Furthermore, gross fixed capital formation, which includes investments from the government also continued increasing, and considering that Croatia has access to various EU funds, this is helping to offset the negative effect of said inflation. Finally, even though the decline in the export and import of goods is negative news for any economy, Croatia has been orientated more towards services, especially in the tourism and hospitality industry. As such, the growth in both export and import of services is expected. Compared to other countries in the EU, especially the larger ones such as Germany, which are already in a technical recession, the Croatian growth data is positive. However, given its dependence on the EU, it remains to be seen if this will be the case going forward.