Lack of workforce, tax pressure, and inconsistent application of regulations make it harder for companies to do business in Croatia, and makes them less competitive, business owners and CEOs agreed at a recent business conference in Zagreb.

Although Croatia’s economy is developing and growing, the problem is that other similar countries are developing at a faster pace compared to Croatia, the Croatian Chamber of Economy (HGK) said at a conference on ways to improve the local business climate on Wednesday.

HGK had recently presented results of a poll in which some 750 businesses listed the tax burden, the slow judiciary, and the ever-changing regulations as the key obstacles to do business in the country.

Goran Grotic, the CEO of ACG Lukaps, the largest European maker of capsules for medications based in the northern town of Ludbreg, said it was becoming increasingly difficult to find and retain workers, Poslovni Dnevnik reported.

“In northern Croatia it has been almost impossible to find workers for several years now, in spite of net salaries which are, in our company, 5700 kuna (€770) on average, more than what is the average in the region. In the next three years businesses in Varazdin County will need some 600 new workers. Where are they supposed to find them? We are seriously considering bringing in workers from India,” said Grotic.

Managing director of the Pet Minuta IT company which operates offices in Zagreb and New York, Luka Abrus, told Poslovni Dnevnik that high taxes make it impossible to increase salaries.

“Our worker, with a net salary of 12-15,000 kuna (€1,620-2,020), costs us about $60,000 in Croatia per year, which is only slightly less than our employee in New York, where IT experts are paid $80-100,000 dollars. However, the net salaries the workers get are vastly different,” Abrus told Poslovni Dnevnik on Thursday.

(€1 = 7.41 kuna)