Unveiling Croatian International Competitiveness Through Export Performance

Exports attract special attention in the economic literature and practice due to its contribution to the stability and long term development of any economy, particularly small one as Croatian economy. Also, its role is additionally augmented in the contemporary context of increasing global competition. The multifold contributions of exports are particularly evident in accelerating of economic growth not only directly through production, but also indirectly, through facilitating the imports of goods and services, transferring and spreading out of new ideas, knowledge and technologies, i.e. through forcing all stakeholders to more innovative behavior and increased productivity. Furthermore, it contributes to resolving of macroeconomic problems like unemployment and external debt which is of significant importance when their current dimension in Croatia is considered. Export volume and structure portray export performance of an economy and indicate the level of its international competitiveness. Export performance of Croatian economy is extremely weak, implying at the same time its poor international competitiveness. The main purpose of this paper is to explore the reasons for such weak export performance as well as to discuss issues facing the export enterprises in Croatia. The special attention is given to the exploration of small and medium sized-enterprises’ contribution to the total Croatian exports.