Croatian economy slows as growth falls to 1.7%

Zagreb

ZAGREB, 28 August 2026 – Croatia’s economic growth slowed to 1.7% year-on-year in the second quarter of 2026, down from 2.2% in the first quarter, according to an analysis of the latest GDP figures by the Croatian Employers’ Association (HUP).

The figures point to weaker household consumption and investment, while government spending, construction and exports provided much of the support for continued growth.

Household consumption increased by just 0.5%, compared with 2.6% in the first quarter. HUP said this represented the weakest growth in household consumption, outside the pandemic period, since the third quarter of 2015.

Gross fixed capital formation rose 1.7%, slowing from 2.5% in the first quarter and 7% at the end of last year.

Construction remained one of the stronger areas of the economy, with real value added increasing 3.1%.

Government consumption accelerated, rising 2%, while exports of goods and services increased by 3%. Goods exports alone grew 5.2%, although the increase was concentrated in sectors including energy, chemicals, electrical products and parts of the food industry.

Manufacturing, meanwhile, stagnated during the quarter, while total industrial value added fell 0.5%.

HUP said the figures showed that Croatia’s growth was becoming increasingly dependent on construction, public spending and a relatively narrow group of export sectors.

The employers’ association also warned that stronger productivity and private investment will be needed to support sustainable growth and maintain competitiveness.

The latest figures represent the 22nd consecutive quarter of Croatian economic growth, but confirm a slowdown during the first half of 2026.