GEM survey shows Croats often start businesses out of necessity

Croatia continues not to be an entrepreneurial country, with businesses frequently started out of necessity and not opportunity, and entrepreneurs have a low social status, it was said on Monday at a presentation of the findings of the Global Entrepreneurship Monitor (GEM) global entrepreneurship survey.

National Competitiveness Council president Ivica Mudrinic said entrepreneurship was not accepted in Croatia to the extent that it encouraged starting a business.

"We enter into entrepreneurship mainly out of necessity, when we lose a job or our livelihood is in danger. Abroad, entrepreneurship is accepted, here it's treated as a negative phenomenon, as semi-crime. It's problematic when new companies don't appear at the pace that ensures employment and well-being for the national economy. We should start educating the Croatian public that without entrepreneurship there is no healthy economy and the well-being we desire," Mudrinic said.

Croatia has been participating in the GEM survey since 2002. Last year it covered 62 countries which account for 85 percent of global GDP.

The head of GEM's Croatian team, Osijek Law School professor Slavica Singer, said the latest survey showed that Croatia lagged behind developed Europe in a string of parameters.

Croatia's value of perceived entrepreneurial opportunities is 22.3 percent, while the EU average is 34.8%. On the other hand, 47.5% of Croatian respondents believe in their abilities, as against 42.5% in the EU. Also, 20.9% of Croatian respondents have some entrepreneurial intention, as against 15.1% in the EU.

Entrepreneurs in Croatia and the rest of Europe share the fear of failure. Forty-two percent of Croatian respondents feel that entrepreneurs have a high social status, while the EU average is 66%. On the other hand, Croatian companies are technologically better equipped than the EU average, but have too few new products and too low exports.

"We need urgent and radical change. Over the past three years, Croatia is last in Europe in terms of attitude towards entrepreneurs," Singer said, adding that Croatia had too few new business ventures, a low motivation index and too few growing companies.

She also complained about the media's treatment of entrepreneurs. "We are a non-entrepreneurial country in many elements. Of 11 elements of the entrepreneurship ecosystem, Croatia ranks last in Europe in five elements. The biggest problem is the regulatory framework, and it is incomprehensible that not one government has used our evidence of regulatory problems." 

Singer said Croatia was a non-entrepreneurial country also because education did not contribute to the creation of entrepreneurial competencies. The transfer of knowledge into the business sector is inadequate, she said.

She said Croatia also lagged behind successful countries because it had too few new products, although it invested more in technology than the EU average. "Unfortunately, competitiveness is not achieved through technology but new products."

Last update: Mon, 18/04/2016 - 16:17

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