According to the first estimate, in real terms, the Croatian GDP grew by 6.3% YoY and amounted to EUR 57.2bn. Meanwhile, seasonally adjusted quarterly GDP in real terms increased by 0.9% QoQ and 4.2% YoY in Q4 2022.

Looking at the first estimates for the Croatian GDP, released yesterday by the Croatian Bureau of Statistics (DZS), the Croatian GDP grew by 6.3% YoY in real terms during the entire 2022. In terms of the seasonally adjusted quarterly data, in real terms, the GDP increased by 0.9% QoQ, and 4.2% YoY. This would also mean that on a full-year basis, it amounted to EUR 57.24bn, while in Q4 2022, it amounted to HRK 14.05bn.

Breaking the components of the GDP a bit further, on a YoY basis, in 2022 final consumption expenditure increased by 4.5%, and amounted to EUR 45bn. Inside this category, Households and NPISH recorded growth of 5.1%, while the General government increased by 3%. Gross capital formation increased by 13.4% YoY, amounting to EUR 12.9bn, with increases in Gross fixed capital formation of 5.8%, while Changes in inventories recorded growth of more than 160% YoY. Exports of goods and services grew by 25.4% YoY, amounting to EUR 34.7bn while imports of goods and services grew by 25%, amounting to EUR 35.4bn, implying that exports grew faster than imports.

Meanwhile, on Q4 2022 vs. Q4 2021 basis, Final consumption expenditure increased by 2.9% YoY, with Households and NPISH driving an increase of 1.3%, while the General government contributed 6.8% growth. Gross capital formation was even higher on a Quarter-vs-quarter basis, with 13.8% growth YoY, driven by higher Gross fixed capital formation (+9.6% YoY). Exports of goods and services grew by 14.2% YoY, while imports of goods and services grew by 14.6%.

In this estimate, we can see that the Croatian GDP grew across its constituent lines, with household expenditure, investments, and exports/imports especially growing. This is quite encouraging, especially considering the current macroeconomic situation and the developments we are currently seeing, including high inflation rates, and rising interest rates. There are some estimates that in H1 2023, Croatia will enter a technical recession (2 consecutive quarters of GDP decline), but as things are seeming right now, even if this does happen it will be a mild recession at best.

Croatian GDP growth (YoY, %)*

Source: Croatian Bureau of Statistics, InterCapital Research

*Quarterly Gross Domestic Product, seasonally adjusted real growth rate