The Croatian Employers' Association (HUP) commented on Friday on the government's announcement that a new package of crisis measures will be calibrated and gradually reduced. It emphasised that when adopting these measures, it is crucial to protect the most vulnerable, including micro and small businesses.

The HUP also expressed concern about the possibility of electricity cuts in the EU due to shortages.

The crisis measures have made it much easier to do business during the difficult times of the energy crisis, the HUP said, recognising the need to return to market conditions.

Domestic industry and other large companies have been paying market prices for energy for a long time, so the changes will not bring any new developments for them, HUP said. The market price for gas has long been below the cap of €180/MWh, but due to geopolitical instabilities, companies find it important that this cap remains in place as a safeguard.

Higher electricity prices reduce competitiveness

Small businesses are concerned about the possible abolition of gas subsidies, as this could lead to a 30% increase in energy costs for many of them. As micro and small businesses are the backbone of the Croatian economy, such a move could have a negative impact on their business and employment.

As far as electricity is concerned, current market prices are slightly more favourable than last year due to an unusually warm summer, but the possibility of reductions is worrying.

The industry has long faced the problem of higher electricity prices compared to households, which is not common in most European countries and further burdens Croatian producers and reduces their competitiveness, according to the HUP.

Prices for electricity, gas and thermal energy are subsidised until 30 September

Last March, the government introduced its sixth package of measures to protect households and businesses from rising prices, worth 503 million euros. These measures were aimed at keeping energy prices low and protecting against inflation. As a result, the prices of electricity, gas and heating energy will be subsidised until 30 September, as will the prices of 30 basic foodstuffs.

Prime Minister Andrej Plenkovic said on Thursday that consultations were underway on a new package of measures to combat the energy crisis and that the new measures would take into account the European context, which is moving towards phasing out such measures.

Minister of Economy Ante Susnjar announced that the Croatian Energy Regulatory Agency (HERA) will soon publish a methodology for calculating electricity and gas prices. According to this, slight adjustments to the measures to protect households and small businesses from the crisis are possible.