The economic situation in Croatia is less than ideal, according to the majority of some 140 German companies present in Croatia polled by the German-Croatian Chamber of Industry and Commerce (DKIHK) in February. The number of those who said they would invest in Croatia again has dropped, compared to the last year’s results.

Only 10 percent of companies polled believed the economic situation in Croatia is good, and only 33 percent said it was moving in the right direction, down from 57 percent last year, DKIHK said on Thursday.

The number of entrepreneurs who said they would invest in Croatia again revolved around 80 percent in recent years, but has now dropped to 68 percent. The lack of reforms continues to be the main cause of frustration among companies operating in Croatia.

Some 37 percent of respondents believe the economic situation in central and eastern European countries has improved, assessing it as good, up from 30 percent in 2017. In those countries, the number of entrepreneurs who believe the economic environment is improving increased from 30 percent last year to 39 percent this year.

The main disadvantages of doing business in Croatia cited were high tax rates and system, inefficient mechanisms for the prevention of corruption and crime, legal uncertainty, and red tape. On the other hand, Croatia’s main advantages include its European Union membership, educated workforce, workers’ productivity, and good infrastructure.

Of the 20 central and eastern European countries covered by the survey, Croatia was eighth in the investment destination rankings. It has had the same ranking since 2014, except last year, when it ranked seventh. The top three countries were the Czech Republic, Poland, and Estonia.

Around 57 percent of respondents are in favour of introducing the euro, up from 46 percent in 2017.