Croatia on the Verge of OECD Membership: How Will It Shape the Economy and Real Estate?

The news that Croatia will soon become a member of the OECD has echoed across the media. Truth be told, this has been circulating for quite some time, but accession is expected soon-by the end of this year or at the beginning of the next.

What Is the OECD?

Why this news matters, what the OECD is, what accession means for Croatia, and how it will reflect on the real estate market and the daily lives of citizens, will be explained in the following text.

Behind the cold acronym OECD stands the full name Organisation for Economic Co-operation and Development. It is an international organisation-a forum for discussing policies and improving the socioeconomic conditions of its member states. The OECD is a consultative organisation and its decisions are not binding for members.

The organisation’s headquarters are in Paris. It was founded in 1960 as the successor to an organisation established under the Marshall Plan with the goal of rebuilding post-war Europe. It currently has 38 members, mostly distinguished and developed European and global economies.

The goals of the OECD include improving the economic growth of its members, increasing living standards, expanding international trade, and contributing to the development of the global economy.
Topics discussed at OECD forums include trade development, energy and agriculture, social issues, education, environmental protection, and more.

What Does Membership in This Organisation Mean for Croatia?

First and foremost, after joining NATO and the EU, by joining the OECD Croatia would further affirm its position as one of the more developed countries. Membership gives Croatia access to relevant analyses and research-valuable information whose usefulness will depend on the competence of domestic policymakers. It will strengthen the country’s reputation and investor confidence.

As mentioned, Croatia’s accession has been announced for a long time, but certain conditions needed to be fulfilled, similar to the processes for entering NATO or the EU.

According to Croatian Prime Minister Andrej Plenković, membership will help Croatian diplomacy and the Government adopt key foreign policy positions, while Foreign Minister Grlić Radman states that joining the OECD further affirms Croatia’s foreign policy direction.

Another consequence of joining the OECD will be an increased inflow of foreign capital into Croatia. Data shows that from 1993 until today, nearly 54 billion euros of foreign capital have been invested in Croatia. However, when we consider that 17 billion of that was invested in the past five years alone, we can speak of significant growth.

Croatia is not only a transit point but a meeting point between East and West and an important transportation and logistics hub thanks to its geographic position.

Foreign investments are extremely important as they lead to higher employment, development, and productivity. OECD membership will act as an additional invitation to investors, who will most strongly direct their capital toward tourism, banking, and infrastructure.

Impact on the Real Estate Market

One of the conditions for joining the OECD was the equalisation of property acquisition rights in Croatia for all member states of the organisation. Because of this, we expect an influx of capital from Americans, Japanese, Australians, Swiss, Canadians, Mexicans, Chileans, and the British.

Particular attention is being paid to the entry of Turkish capital into the domestic market after accession, especially in the field of investment properties. It is believed that significant funds will be invested in tourist complexes, marinas, and similar projects.

Consequently, the equalisation of property acquisition rights will lead to increased demand, which could ultimately result in rising real estate prices, especially along the coast. A surge in demand for luxury properties is expected, as investors from these countries often seek a home paired with an investment.

Given that these changes could further burden young families and negatively impact their future plans-should another price increase occur-the Government will need to take steps to protect its citizens.

Conclusion

Croatia’s entry into the OECD represents an important step toward strengthening its international reputation and attracting new investments. Although membership brings economic and political advantages-especially regarding investment and the growth of the real estate market-potential consequences such as further price increases require careful handling and timely government measures. How these changes will affect the economy and citizens’ everyday lives will become clearer in the years ahead.