Manufacture of electrical and optical equipment in Croatia

Besides manufacture of domestic electrical appliances, the manufacture in Croatia of electrical and optical equipment also includes manufacture of office machinery and computers, manufacture of electrical machinery and appliances, manufacture of radio/television sets and communication equipment and devices, manufacture of medical, precision and optical instruments, watches and clocks.

The electrical and optical equipment industry imports most of the raw materials and basic manufacturing components. This branch of industry, like many other branches of Croatian industry, faces technological obsolescence. However, there are experts, qualified workers and good programmes that put certain segments of this industry on a par with developed countries (manufacture of transformers, manufacture of telecommunication devices, etc).

The manufacture of office machinery and computers, manufacture of electrical machinery and appliances, manufacture of radio/television sets and communication equipment and devices, manufacture of medical, precision and optical instruments and the manufacture of watches and clocks accounted for 5.12 % of industrial gross domestic product in 2004.

Although the manufacture of electrical and optical equipment is in a very difficult position due to the process of structural adjustment to business and operating conditions governed by market forces, a large number of companies have survived in the market and show gradual manufacturing growth. In 2003, total revenues in the manufacture of electrical and optical equipment amounted to 9.62 % of total revenues in the manufacturing sector, or 2.43 % of the total revenue of the Republic of Croatia.

Export-import trends in the branches of industrial production presented here show a change in comparison with previous years. In 2004, the manufacture of electrical and optical equipment saw a 38.1% increase in exports in comparison with 2003. Simultaneously, imports grew by 17.8% compared to the year before. The highest growth of exports was registered by the following manufacturers of electrical and optical equipment - Ericsson Nikola Tesla Zagreb, Siemens Zagreb, Elektro-Kontakt Zagreb, Elka Zagreb, Koncar – Power transformers Zagreb, Koncar – Distribution and special transformers Zagreb, Eurocable Group Zagreb, Volex Zagreb, Koncar – Switchgears Zagreb and Elcon Zlatar Bistrica. The manufacture of electrical and optical equipment in 2004 held a 12.6% share of the manufacturing sector’s total exports, with the latter itself accounting for 95.1% Croatia’s total exports.

The total number of employees in the manufacture of electrical and optical equipment is about 18500, including those employed in the manufacture of electrical household appliances. There has been a gradual drop in employment due to restructuring and the introduction of new technologies. On the other hand, raised competitiveness achieved through further training and increased productivity could be observed. An important resource are the professionals from all walks of life - highly regarded not only at home but also internationally, and providing a solid foundation for the further development and introduction of new manufacturing methods and technological processes, as well as for the development of new products.

The strategy for the development of Croatian industrial production is based on restructuring companies into profitable, export-oriented facilities, and on privatisation, while encouraging all types of foreign investment, which is necessary owing to domestic companies’ limited financial resources. A number of electrical and optical equipment manufacturers have been privatised and are majority owned by small shareholders or by private owners, while others are owned by state funds and banks.

On the basis of Joint-stock Company Law, in Croatia are defined organisational aspects for companies and the procedure for foreigners to acquire stocks in domestic companies and shares.

Market opening and economic integration in Europe have created the need to bring uniformity into quality assurance systems. Many Croatian companies have launched projects for the introduction of quality management systems in order to meet customers’ growing demands for quality system certification. Today, there are the most manufacturers of electrical and optical equipment in Croatia, which have one of the ISO 9000 certificates.

Efforts are continuously made in order to improve procedures, organisation and quality systems as a whole. Having recognised environmental protection as an important challenge for us today, certain companies have included environmental protection among the key parameters for their business strategy and introduced environmental management systems compliant with the international ISO 14000 series.