The World Bank has released its Country Climate and Development Report (CCDR) for Croatia, analyzing the country’s climate challenges and proposing strategies to support low-carbon, resilient, and inclusive economic growth. The report emphasizes that by investing in resilience measures such as renewable energy, Croatia can create jobs, protect public health, and secure a more sustainable future.
According to the CCDR, Croatia will need to invest an additional 1.1 percent of its GDP beyond current levels to achieve lower carbon emissions targets. This investment is considered financially feasible if both public and private sectors participate. However, the report notes that attracting private capital requires clearer policy direction and removing regulatory obstacles.
The report highlights increasing climate risks in Croatia—including hotter summers, frequent droughts and floods, and coastal vulnerabilities—that are already affecting key sectors like agriculture and infrastructure. Without further action, modeled climate events could reduce Croatia’s GDP by up to 2.1 percent by 2050. Sectors such as tourism are particularly at risk. The CCDR suggests that targeted investments equal to about 0.04 percent of GDP could significantly reduce or even offset these losses outside tourism.
To address these challenges, the CCDR recommends several actions:
- Facilitating private investment in renewables with streamlined administrative procedures.
- Tripling building energy efficiency upgrades through improved institutional capacity and financing.
- Accelerating zero-emission transport via tax reforms and expanded charging infrastructure.
- Investing in water management for drought resilience.
- Strengthening disaster risk management laws and funding.
- Reducing urban heat risks through green infrastructure planning.
“Investing in resilience and adaptation, including renewable energy, can deliver strong development dividends for Croatia. These include faster and more resilient growth, increased productivity, greater competitiveness, new jobs and export opportunities, increased energy security, and cleaner air,” the report states.
The CCDR warns that delays could result in higher disaster losses, missed EU targets leading to financial penalties for emission allowances, stranded assets, fiscal pressures, and reduced competitiveness.
“Strengthening adaptation is an opportunity for Croatia to restructure its economy, secure climate resilience, and achieve low-carbon growth that will allow the country to sustain income convergence with the rest of the EU,” according to the findings.
The report also stresses place-based adaptation measures—especially important given Europe’s highest urban heat mortality rates found in Croatian cities—and calls for prioritizing water security initiatives alongside agricultural resilience efforts.
Slightly over half of required investments could come from private sources; however “significant capital is being held up by regulatory and administrative bottlenecks.” The success of these recommendations depends on better governance structures: “Success hinges on stronger governance and institutions, removal of regulatory and administrative hurdles...private sector participation...and social support for a just transition.”
Recommendations include expanding climate finance options by involving banks and institutional investors; supporting workforce transitions toward green jobs; improving state-owned enterprise alignment with national goals; enhancing coordination between public-private sectors; helping firms access funding; meeting sustainability standards; strengthening disaster risk management frameworks; integrating local communities into planning processes; promoting insurance innovation; supporting PPPs (public-private partnerships); implementing efficient social protection systems; increasing transparency through inclusive public engagement.
With improved policies focused on predictability—combined with skills development programs—Croatia may continue progressing towards sustainable economic convergence within the European Union while managing growing climate-related risks.