What Makes this Croatian Town Europe’s No.1 Micro City for Investment?

Ivanec (photo: ivanec.hr)

Last week the small northern Croatian town of Ivanec was named by Financial Times’ fDi magazine as the No. 1 Micro European City of the Future for Investment. So how did the tiny town with just 14,000 residents reach the top of the list?..

Ivanec Mayor Milorad Batinić, who is now in his third term in charge, explained to Dnevnik.hr what has held the unknown town reach not only the pages of the Financial Times, but be named the top microcity in Europe.

It is not the first time Ivanec has made the list however, back in 2014 the town was ranked in 9th spot. Ivanec had many economic advantages which were in effect even before Croatia entered the EU. One of them was the city’s Business Friendly Certification (BFC). The BFC programme gives guidelines to cities on how to create a good business environment and introduce standards for an efficient and transparent local government.

Purchase of private land

“In 2011 we started land acquisition and formed an industrial zone in an area of 300,000 square meters. It is in its initial phase and there is still room for entrepreneurs. Advantages of industrial zones, among other things, are the benefits and incentives for investors when buying or building or operating a business. There are subsidies of 2 -3% interest on business loans, etc,” said Batinić, adding that the town purchased land from private owners without help from the state.

He said that the city bought the land from private owners and municipal equips it without help from the state. “We have established a firm which deals with economic development, and the development of business infrastructure,”said Ivanec’s Mayor.

Batinić explains that through the business zone, the plan is to encourage the development of industrial production, and in this way to create an entrepreneurial climate that will help attract new companies from Croatian and abroad to set up operations in Ivanec.

Since 2009 Ivanec has organised an annual business fair, where exhibitors are not charged for attendance, training, consultations and access to regulations and trends.

“‘We also founded a Business Club which aims to promote the economy of Ivanec. In addition, last year established a project office. It will be open till 1 May and it employs nine people trained in running EU projects, and their knowledge will also help local businessmen,” explains Batinic.

100% exemptions

Financial benefits that entice investors to Ivanec include 100% exemption from municipal contributions, company tax and utility charges up to five years, tax on use of public land, and fees for connecting to utility infrastructure (water, gas) In addition, investors in the industrial zone also have 100% exemption from payment of land conversion when obtaining documentation.