Eurostat's latest report on gross domestic product (GDP) for the third quarter of 2025 shows a somewhat more moderate picture of economic activity.

The Croatian economy grew by 0.3 percent compared with the previous quarter, thereby fully matching the eurozone average growth rate.

While Croatia is the absolute frontrunner in the labor market, in terms of economic growth it currently shares the fate of most members of the monetary union, following a stable but modest pace of recovery. At the level of the entire European Union (EU27), growth was only slightly higher, amounting to 0.4 percent.

An annual growth rate almost twice as strong as the European one

The true strength of the Croatian economy is most clearly evident in the annual comparison. Compared with the same period of the previous year, that is, the third quarter of 2024, Croatian GDP grew by 2.6 percent.

This result is significantly better than the European average. Namely, the eurozone economy grew by 1.4 percent year-on-year, which means that Croatia continues to grow almost twice as fast as the average of the countries that use the euro. Although this is not the highest growth rate in the Union, with Ireland (10.9 percent) and Denmark (3.9 percent) ahead, Croatia is steadily holding its place in the upper part of the ranking with this result, alongside Poland and Cyprus.

Annual GDP growth in Germany in the third quarter of 2025 amounted to only 0.3% compared with the same quarter of the previous year.

Who are the winners, and who are the losers?

For the analysis of short-term economic dynamics, we return to the comparison with the second quarter of 2025. These seasonally adjusted data provide the clearest picture of the current quarterly state of economies within the EU.

According to Eurostat's seasonally adjusted data, the biggest surprise of the quarter was delivered by Denmark, with robust growth of 2.3 percent compared with the previous three months. It is followed by Luxembourg and Sweden, both with growth of 1.1 percent.

On the other side of the spectrum, several European economies recorded declines. Ireland and Finland posted a minus of 0.3 percent, while Romania fell by 0.2 percent. It is also interesting to note the stagnation of Europe's largest economy: Germany recorded zero growth (0.0%) in the third quarter of 2025, which further underscores the importance of the fact that Croatia, despite the slowdown, continues to maintain a positive trajectory above zero.

These data suggest that, after a period of exceptionally high growth rates, the Croatian economy is slowly 'cooling' and converging toward the European average at the quarterly level, while retaining strong annual momentum that continues to ensure real convergence in living standards toward the more developed member states.