On Friday, the Croatian Bureau of Statistics published its first estimate for the GDP in Q3 2022. According to the estimate, the GDP grew by 5.2% YoY in real terms. In 9M 2022, GDP increased 7.1% in real terms.
According to the first estimates of the Croatian Bureau of Statistics, GDP grew by 5.2% YoY in real terms in Q3 2022. It should be noted that this refers to the non-adjusted data. According to the seasonally adjusted data, the GDP decreased by 0.4% compared to the previous quarter but grew 5.5% YoY. In 9M, GDP increased by 7.1% in real terms.
Final consumption, the largest contributor to the GDP, increased by 4.3% in Q3 2022, continuing the economic growth (and recovery) that started in Q2 2021 with the complete easing of COVID-19 measures and the total reopening of the economy. This is also evident if we look at the households (the largest contributor to the final consumption at 76%), which grew by 5.6% YoY. However, we note current inflationary pressures are persistent with inflation numbers peaking, which might discourage further growth in final consumption resulting in lower growth rates in the last quarter of the year. Next up, we have the General Government (making up the remaining 24% of the final consumption), which increased by 1.3% YoY. Meanwhile, Gross fixed capital formation increased by 8% in Q3, and this number is expected to keep growing as more funds from the EU continue to be implemented in the economy.
At the same time, the export of goods and services increased significantly, growing by 23.3% YoY. Tourism has positively affected the growth of GDP, while the export of services grew by 18.4% YoY. export of goods, growing with double-digit figures (37% YoY), showing increased demand for domestic products. This is further evidence that the complete easing of measures and border restrictions has significantly impacted the growth of exports. However, total export was mainly driven by the growth of services which is usual seasonality as top tourist season is important driver of GDP growth in Croatia.
On the other hand, the import of goods and services also grew significantly, increasing by 30.5% YoY. Out of this, goods grew by 33.4%, while services grew by 15.3%. Due to the fact that export, which amounted to HRK 103.3bn, were higher than imports (HRK 71.8bn). This means that even with higher import growth, there were still net positive exports of HRK 31.4bn reported. We note that higher net positive exports contributed significantly to GDP growth during Q3.
In total, GDP in 9M 2022, in real terms amounted to HRK 325.4bn, representing a 7.1% increase YoY. As the current inflationary pressures peak and the supply chains are still in a precarious situation (but much better than compared to 2021), the GDP growth is expected to continue. However, this growth should happen at a slower pace than especially the levels seen in 2021 (it should be noted that Q3 2021 GDP growth amounted to 15.1%, and Q4 amounted to 9.7%) meaning that the base is also higher. As such, and according to our estimate for FY 2022 the GDP growth is expected to be 5.3% YoY.
Croatian GDP, real growth rates (%, YoY)*
*Quarterly Gross Domestic Product, seasonally adjusted real growth rate