Croatia recorded the highest growth in purchasing power among European Union member states in 2024.

Real median income increased by 21.1 percent and reached 16,277 euros annually, allowing Croatia to overtake Lithuania, and now eight EU member states have a lower real median income than Croatia.

Gross wage growth in 2025 is expected to amount to around 8.5 percent, which could enable Croatia to overtake Estonia and potentially the Czech Republic in terms of median income. In 2024, the employment rate rose to 68.3 percent, and the number of employed people increased by 3.9 percent, while the number of unemployed decreased by 15.5 percent.

Employment growth in Croatia was six times faster than the average in Central and Eastern Europe. At the same time, a strong increase in general-purpose consumer lending was recorded, around 15 percent year-on-year, reflecting consumer optimism and confidence in economic growth.

Despite the slowdown in the growth of personal consumption and construction, as well as the somewhat lower contribution of net exports, real GDP growth in the first quarter of 2025 is estimated at around three percent, following last year's 3.8 percent. At the level of the whole year, continued growth in personal consumption is expected, but at a somewhat slower pace, driven by strong wage growth and pension indexation.

EU funds remain a key source of financing and a driver of the development of the Croatian economy. Croatia has so far drawn a significant portion of the available funds, and 2025 will be crucial for the use of the remaining funds, which will further support the investment cycle and competitiveness.

Although strong growth in public spending and the labor market has prolonged the period of dynamic growth, analysts warn that this pace is unsustainable in the longer term. The continuation of expansionary fiscal policy could lead to an excessive deficit and slow progress in improving the country's credit rating.

Despite the progress, Croatia still lags behind the EU average in GDP per capita, which stood at 77 percent of the European average in 2024. Nevertheless, compared with the previous year, an upward shift was recorded, and further growth will depend on the sustainability of fiscal policy, the use of EU funds, and strengthening the competitiveness of the economy.