EU Cohesion Policy: €9 billion for Croatia’s economic, social, and territorial cohesion, green and digital transition in 2021-2027

Croatia will receive a total of €9 billion from Cohesion Policy in 2021-2027 in the framework of its Partnership Agreement with the Commission to promote the economic, social and territorial cohesion of its regions and its green and digital transitions. These investments will help reduce regional economic disparities and enhance skills, training, and employment opportunities. The EU funds will also support the development of a competitive, innovative, and export-oriented Croatian economy.

Towards a net zero carbon and resilient economy

Croatia will dedicate nearly 31% of European Regional and Development Fund (ERDF) and 39% of Cohesion Fund resources to climate objectives. In particular, €2.56 billion will help the country improve energy efficiency, increase the share of renewables in energy production up to 60% of electricity in 2030, enhance the circular economy and support climate resilience and biodiversity. More than €650 million will be invested in this later objective.

Moreover, €179 million from the Just Transition Fund (JTF) will mitigate the economic and employment effects of the green transition. This will be done through decarbonising energy-intensive industries, strengthening entrepreneurship, and investing in skills of the workers, diversifying the economy in the most affected regions, enhancing cooperation between business and research, and increasing employment opportunities for the workforce.

Increasing economic competitiveness and digitalisation

€1.7 billion from the ERDF will support Croatia’s innovative and smart economic transformation by increasing the competitiveness and internationalisation of small and medium-sized businesses (SMEs) and contributing to improve the skills of employees.

Reducing regional disparities

Investments will reach the whole territory of Croatia, including its poorest areas. Almost €500 million will help improve the international competitiveness of Croatian regions by facilitating their industrial transition. Additionally, 12% from the ERDF will be dedicated to urban development and around 3% to developing smart and sustainable islands. Mountainous areas will also receive increased support. In this way, EU funds will help all parts of Croatia to catch up with the more economically and socially developed capital, Zagreb, and with the most developed EU regions.

Improving connectivity

Nearly €1 billion will enhance regional, local, and cross-border mobility in all sectors, including developing a sustainable, smart, secure, and intermodal transport network linked to the Trans-European Network – TEN-T, as well as much-needed improvements in the national rail infrastructure, and further advancements in maritime transport in this coastal country.

Social inclusion, employment, education, training

Almost €2.5 billion from the European Social Fund Plus (ESF+) and ERDF will boost quality employment, skills, education, healthcare, and social services. Well-designed active employment support, in particular for women, young people and vulnerable groups, will go hand-in-hand with improving the capacity of labour market institutions, such as public employment services, including through digitalisation.

Investments throughout all education levels will provide tangible improvements in the education system, from early childcare to adult learning. These investments will also strengthen upskilling and reskilling to better match changing labour market needs and develop building blocks for Individual Learning Accounts (ILA).

The risk of poverty and social exclusion is particularly high for older people, women, and persons with disabilities. Based on a strategic mapping of needs, the ESF+ will therefore strongly invest in the social care system and the transition from institutional to community-based social services, particularly regarding the assistance for persons with disabilities, long-term care, and aid for the most deprived. The Partnership Agreement will also support training of medical staff and strengthen the emergency medical response system and telemedicine services.

Sustainable fisheries

The European Maritime, Fisheries and Aquaculture Fund will invest €244 million in sustainable fisheries and protection of marine biodiversity and ecosystems in the Adriatic Sea. The Fund will also further support the development of sustainable and low-carbon aquaculture and processing sectors, the economic and social vitality of fisheries communities, and the implementation of international ocean governance. All supported actions will help Croatia to contribute towards the objectives of the Common Fishery Policy as well as the key EU policy priorities outlined in the European Green Deal, the Farm to Fork and the Biodiversity strategies.

Members of the College said:

Commissioner for Cohesion and Reforms, Elisa Ferreira, said: “Since the accession of Croatia to the EU, Cohesion Policy has invested in the country’s balanced development the equivalent to 4% of the Croatian GDP, improving the country’s competitiveness, creating new jobs, and promoting a greener and more digital economy. The new Partnership Agreement for 2021-2027 is making available further funding for the country to continue on its path of economic, social, and territorial cohesion and development.”

Commissioner for Jobs and Social Rights, Nicolas Schmit, added: “With this Partnership Agreement, Croatia makes a crucial step towards meeting its 2030 national social targets set in line with the European Pillar of Social Rights Action Plan. I welcome the strategic focus of the ESF+ investments, boosting quality jobs, providing workers with the skills they need to navigate today’s and tomorrow’s labour market, and investing substantial funding for social services that are key to social inclusion, including assistance to people with disabilities, healthcare, and long-term care.”

Commissioner for Environment, Oceans and Fisheries, Virginijus Sinkevičius, said: “Europe’s blue economy creates tangible opportunities for coastal communities. The European Maritime, Fisheries and Aquaculture Fund supports innovative projects contributing to the sustainable exploitation of maritime resources, decarbonisation of our economy and protection of biodiversity. This Partnership Agreement drives Croatia’s green and digital transition, helps building low-carbon, sustainable, innovative, and resilient fisheries, and aquaculture sectors in the Adriatic.”

Background 

The Partnership Agreement with Croatia covers Cohesion Policy funding (ERDF, ESF+, the Cohesion Fund, and the JTF) and the European Maritime, Fisheries and Aquaculture Fund (EMFAF).

The Partnership Agreement paves the way for the implementation of these investments on the ground. It covers four national programmes: Programme for Competitiveness and Cohesion (ERDF and Cohesion Fund), Integrated Territorial Programme (ERDF and JTF), Efficient Human Resources Programme (ESF+) and the EMFAF, which still need to be adopted.

Under Cohesion Policy, and in cooperation with the Commission, each Member State prepares a Partnership Agreement, a strategic document for programming investments from the Cohesion Policy funds and the EMFAF during the Multiannual Financial Framework. The Agreement focuses on EU priorities, lays down the strategy and investment priorities identified by the Member State, and it presents a list of national and regional programmes for implementation on the ground, including the indicative annual financial allocation for each programme.