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Main article: Economy of Croatia
Croatian banknotes
Croatian banknotes
The Croatian economy has a stable functioning market economy according to EU reports and is the most advanced economy of South-Eastern Europe (Greece excluded). The Croatian preliminary 2008 GDP data states that the Croatian GDP is USD 68,208 billion, or just over USD 17,100 per capita (real income), putting Croatia ahead of the EU member-states Romania, Bulgaria , Poland and Latvia. “Grey” economy of about 2 bln $ is still not includeed in GDP calculation like in other EU country states.
The economy is service-based, with the service sector accounting for 67% of the total GDP. The industrial sector is dominated by shipbuilding, followed by food processing and chemical industry. Industry makes up 27% of Croatia’s total economic output. Agriculture makes up 6%. Tourism is a notable source of income during the summer. With over 10,0 million foreign tourists in 2006 generating a revenue of EUR 7 billion, Croatia is ranked as the 18th most popular tourist destination in the world. In 2006 Croatia exported goods in value of USD 10.4 billion (FOB) (19.7 billion including service exports).
Unemployment was 11.9% in 2006. Of particular concern is the heavily backlogged judiciary system, combined with inefficient public administration, especially issues of land ownership and corruption.
The country has been preparing for membership in the European Union, its most important trading partner. In February 2005, the Stabilization and Association Agreement with the EU officially came into force.
In the first quarter of 2007, Croatian economy rose by 7.1%, in second quarter 6.6% so the annual growth rate which was expected to be around 4.7% has now been rev
In the first quarter of 2007, Croatian economy rose by 7.1%, in second quarter 6.6% so the annual growth rate which was expected to be around 4.7% has now been revised to 6.5% or more. Analysists believe that the Croatian economy, after modest growth of around 4.5% so far, is finally entering a period of faster and stronger economic prosperity.