Currency Croatia

Euro – introduction and what to do with the old Kuna and What next?

On January 1, 2023, Croatia joined the Eurozone as the 20th member, replacing the national currency, the kuna, with the euro, which is seen as a significant step in the country’s economic and political integration into the European Union.

New currency for Croats

New currency for Croats

The introduction of the euro as official currency marks a new era for Croatia after long-standing use of its own currency, the kuna, since independence in 1991. This indicates the country’s growing economic and political connection with the European Union.

Important data and facts about the introduction of the euro in Croatia


Fixed conversion rate:

1 Euro = 7.53450 HRK


Parallel use of both currencies:

1 – 14 January 2023


Exclusive use of the euro:

from January 15, 2023


Unlimited exchange at the central bank


Coins can still be exchanged free of charge at any bank until the end of 2025

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Only advantages for Croatia with the new currency?

Eliminating currency risks through measures such as a single currency or fixed exchange rate systems has many positive effects for companies, consumers and the entire economy: planning security is significantly increased.

Companies and investors no longer have to protect themselves against exchange rate fluctuations and thus reduce hedging costs and hedging strategies. It also provides consumers with the desired price stability and eliminates the need for costly currency exchanges in the Croatian kuna.

Not to be ignored is the fact that competitive advantages also increase through reduced uncertainty in international trade and the simplification of cross-border transactions. Additionally, the elimination of currency fluctuations facilitates price comparisons and cost transparency abroad, enabling consumers and companies to make quick and informed decisions.

In addition, a higher standard of living is likely to occur in the long term, which is due to the higher income, but then also leads to higher prices and therefore Croatia also may get more expensive.

A Further Reading “The euro benefits us all” can be found in the publications of the European Union.

Challenges and concerns with new currency in Croatia

Challenges and concerns with new currency in Croatia
Rigid exchange rate systems or the introduction of a common currency limit the flexibility to correct economic imbalances such as export surpluses or import deficits through adjustments in the exchange rate system.

In situations with centrally managed exchange rates such as with the the European Central Bank (EZB), countries are often forced to accept a uniform monetary policy – even if this is not always ideal to the individual economic situation of the respective country.

For countries with strong export sectors and companies with an international focus, the advantages of eliminating exchange rate fluctuations clearly outweigh the disadvantages. Nevertheless, it is crucial to consider and weigh possible constraints (such as monetary and fiscal policy).

Croatia collapse and Greece 2.0 because of the Euro?

Croatia collapse and Greece 2.0 because of the Euro?

Croatia depends heavily on tourism – similar to Greece. In times of global crises or declines in the travel sector, sudden loss of income can occur and have a severe impact on the economy. If government spending exceeds revenue development in the long term, a critical debt situation could arise. As a result, austerity measures would be essential – which could potentially be burdensome for the population. Without consistent modernization of the administrative apparatus or the tax and pension system, there may be a risk of a similar reluctance to reform as was temporarily observed in Greece.

What speaks against this, however, is the fact that lessons have been learned in the past (hopefully).

The European Union and its member states have learned important lessons from the Greek debt crisis and are now placing greater focus on compliance with fiscal rules and regulations. The country of Croatia is being closely monitored by the European institutions and must meet certain criteria – a preventative measure Tourism is of great importance for Croatia, the country has diversified its offerings. With activities in various areas such as shipbuilding or the pharmaceutical industry, the country contributes to a broader economic base. Stability mechanisms such as the European Stability Mechanism (ESM) have also been introduced. created to identify crisis situations in a timely manner and to counteract uncertainties. A tool was developed that did not exist during the first phase of the Greek crisis.

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Euro in Croatia and the parallels to the introduction of the euro in Slovenia

Euro in Croatia and the parallels to the introduction of the euro in Slovenia

Slovenia was one of the first countries to introduce the Euro on January 1st in 2007 and was therefore one of the pioneers, but the countries Croatia and Slovenia have similarities.

Both countries met the admission criteria relatively quickly; Croatia only introduced the euro 10 years after joining the EU, while Slovenia did so just three years later.

Both countries have roots in the former Yugoslavia and also the corresponding trade relationships, for example Germany is the most important trading partner for both. Slovenia initially had problems with implementation and costs increased, but Slovenia benefited in the long term. A difference that can still be observed is that Croatia, in contrast to Slovenia, suffers heavily from people leaving the country. However, we believe that this can be reversed in the context of rising wages and alignment with European standards.

Incidentally, the same thing can also be observed in Slovakia, Latvia and Lithuania, which led from the phase of uncertainty to stabilization and greater integration.