January 20 13

January January 20201313

22

Structure of the City GovernmentStructure of the City Government

City AssemblyCity Assembly Mayor Mayor 1199 city administrative bodies city administrative bodies 333636 city institutions city institutions 17 city precincts, 218 community councils17 city precincts, 218 community councils

33

Quality management system Quality management system under the ISO 9001:200under the ISO 9001:20088 standard standard

The City Office for Economy, Labour and Entrepreneurship is the first The City Office for Economy, Labour and Entrepreneurship is the first administrative office of the City of Zagreb which established and administrative office of the City of Zagreb which established and certified, on 12 April 2005, a quality management system for it certified, on 12 April 2005, a quality management system for it operations in compliance with the ISO 9001: 2000 standard.operations in compliance with the ISO 9001: 2000 standard.

The quality management system which has been certified and is The quality management system which has been certified and is maintained and developed, is the first step toward a more efficient, maintained and developed, is the first step toward a more efficient, accountable and professional city government.accountable and professional city government.

The application, maintenance and further development of the quality The application, maintenance and further development of the quality management control system in compliance with ISO 9001:200management control system in compliance with ISO 9001:20088 requirements is ascertained by regular annual audits.requirements is ascertained by regular annual audits.

A commitment to the needs of citizens and other users of our services A commitment to the needs of citizens and other users of our services and their satisfaction with services rendered are the most important and their satisfaction with services rendered are the most important values according to which the City Office for Economyvalues according to which the City Office for Economy,, Labour and Labour and EntrEntreeprenepreneuurship measures and ascertains its overall performancership measures and ascertains its overall performance..

ISO 9001 Q-722

44

City statistical profileCity statistical profile

Dominant economic, financial and political status Dominant economic, financial and political status in the Republic of Croatiain the Republic of Croatia

Population: 7Population: 79090,,017017 - 18% of Croatia’s total - 18% of Croatia’s total populationpopulation

FDI in 2012 / Q1, Q2 i Q3 2012.FDI in 2012 / Q1, Q2 i Q3 2012. (in millions of euros)(in millions of euros) Croatia 452,7Croatia 452,7 Zagreb 211,9Zagreb 211,9 Average net salary above the national average Average net salary above the national average , ,

September 2012 September 2012 (Zagreb: (Zagreb: € 827€ 827; Croatia ; Croatia €€ 709709))

55

443.100443.100 employed persons employed persons (December 2011) (December 2011), or , or 32 32 % of total % of total employment in Croatiaemployment in Croatia

In Zagreb at November In Zagreb at November 20122012th wereth were registered 4 registered 44,9324,932 unemployed unemployed persons, persons, which is which is an increase of 19.1% compared to the previous an increase of 19.1% compared to the previous month last yearmonth last year

Accounts for roughly 3Accounts for roughly 37,4 7,4 % of Croatia’s total exports (% of Croatia’s total exports (EUR 2.631EUR 2.631 mimillion)llion)

Accounts for roughly Accounts for roughly 60,1 60,1 % of Croatia’s total % of Croatia’s total importsimports ( (EUR 7,326 EUR 7,326 mmillion)illion)

331.1471.147 companies, or 3 companies, or 33 3 % of Croatia’s total, operate in the City of % of Croatia’s total, operate in the City of ZagrebZagreb

The City of Zagreb participates in Croatian free enterprise:The City of Zagreb participates in Croatian free enterprise:– 553,4 3,4 % of total revenues;% of total revenues;– 554,8 4,8 % total fixed assets investment;% total fixed assets investment;– 333 3 % of the number of businesses;% of the number of businesses;– 40,3 40,3 % of the total number of employed in free enterprise% of the total number of employed in free enterprise

Source:Economic trends in the City of Zagreb and Zagreb County, I-IX 2012, CCE Zagreb Chamber

66

Zagreb31%

Croatia69%

Croatia

Zagreb

In In 2009

CROATIA’S GDP: € 44.8 billion per capita: €10.111

ZAGREB’S GDP: €14 billion per capita: €17.814

Source: City Office for the Strategic Planning and Development of the City – Statistics Department

•In 2009, the share of the City of Zagreb in the overall GDP of the Republic of Croatia was 31,4 %, which is an increase of 0.5 % in comparison to 2008

•The initial estimate indicates that the quarterly GDP for the Republic of Croatia in the third quarter of 2012 decreased in real terms by 1,9 % in comparison to the same quarter of 2011 (National Statistics Bureau)

77

8,1%

20,6%

38,8%14,1%5%

7,5%

5,9%

Wholesale and retailcommerce, motor vehicle andmotorcycle repairManufacturing

Information andCommunication

Electricity, gas, steam and airconditioning supply

Construction

Professional, scientific andtechnical activities

Other

Source:Economic trends in the City of Zagreb and Zagreb County, I-IX 2012, CCE Zagreb Chamber

Structure of Zagreb` s economy based on total revenues

(I-IX 2012)

88

EMPLOYED EMPLOYED according to the National Classification of Activitiesaccording to the National Classification of Activities

27%

10%

7%

7%7%

26%

16%Processing industry

Trade and repair of motorvehicles and motorcycles

Information andcommunication

Construction

Professional, scientific andtechnical activities

Transport and storage

Other

Source:Economic trends in the City of Zagreb and Zagreb County, I-IX 2012., CCE Zagreb Chamber

99

City of Zagreb Budget City of Zagreb Budget for 20for 201313

€ 881 million (HRK 6,67 billion)€ 881 million (HRK 6,67 billion)

1%

6%

74%

2%1%16%Tax revenues

Supports

Asset revenues

Revenues generated byadministrative fees and underspecial regulations

Revenues from sales ofnonfinancial assets

Other revenues

Structure of 2013 Budget revenues

1010

Structure of 2013 Budget expenses and outlaysStructure of 2013 Budget expenses and outlays

12%

14% 22%

33%1%11%

1%

6%

Personnel expenses

Material expenses

Financial expenses

Susidies

Supports

Allowances to citizens andhousehold

Procurement of non-financialassets

Other expenses

Source: City Finance Office

1111

InvestmentsInvestments

Investment policyInvestment policy- Allocation of considerable funds for Allocation of considerable funds for

construction of utilities infrastructure and construction of utilities infrastructure and equipmentequipment

- Funding sources: Budget, funds from City-Funding sources: Budget, funds from City-owned companies and institutions, owned companies and institutions, international capital market, public-private international capital market, public-private partnerships and concessionspartnerships and concessions

1212

• CCredit ratingredit rating Standard&Poor’sStandard&Poor’s** : : - local currency issuer rating- local currency issuer rating

BB BB++//stablestable// - foreign currency issuer rating- foreign currency issuer rating

BB BB++//stablestable// - * updated 18.12.2012.- * updated 18.12.2012. Moody’sMoody’s****:: - foreign currency issuer rating - foreign currency issuer rating

Baa3/ Baa3/negativenegative - ** updated 4.6.2012.- ** updated 4.6.2012.

1313

DESIGNATIONDESIGNATION € € m.m. DESIGNATIONDESIGNATION € € m.m.

1. Central Wastewater Treatment 1. Central Wastewater Treatment PlantPlant

304304 7. 7. Zagreb Sports and Recreation Zagreb Sports and Recreation ZoneZone

5050

2. Solid Waste Incineration Plant - 2. Solid Waste Incineration Plant - SWIPSWIP

170170 8. 8. Conference Centre ProjectConference Centre Project 5252

3. 3. Chemical Wastewater Chemical Wastewater Treatment Plant ProjectTreatment Plant Project

4040 9. 9. Small Business Centre Small Business Centre ProjectProject

4040

4. 4. The contract governing The contract governing rendering of principal works and rendering of principal works and management of installations at the management of installations at the Jakuševec Jakuševec

5656 1010. Project to construct . Project to construct underground parking garages underground parking garages with additional facilities at the with additional facilities at the secondary school playground secondary school playground site designated as “Savska-site designated as “Savska-Kačićeva-Klaićeva-Kršnjavoga”Kačićeva-Klaićeva-Kršnjavoga”

4040

5. 5. Zagreb Waste Disposal and Zagreb Waste Disposal and Management ModelManagement Model

1111. Zagreb Airport Project. Zagreb Airport Project 250250

6. 6. ZET (public transit company) ZET (public transit company)

Mass transit system renewalMass transit system renewal

272272 12. Project Aquarium in Zagreb12. Project Aquarium in Zagreb 99

Investment projects of the City of Zagreb

14

Centralni uređaj za pročišćavanjeCentralni uređaj za pročišćavanjeotpadnih voda grada Zagreba iotpadnih voda grada Zagreba ipripadajući infrastrukturni objektipripadajući infrastrukturni objekti

• The CUPOVZ Project: one of the largest and most challenging The CUPOVZ Project: one of the largest and most challenging environmental undertakings in Europe, which will resolve the problems environmental undertakings in Europe, which will resolve the problems of pollution and threats to the water table, and safeguard existing and of pollution and threats to the water table, and safeguard existing and potential water pumping sites in the City of Zagreb and the area along potential water pumping sites in the City of Zagreb and the area along the course of the Sava River downstream from Zagreb.the course of the Sava River downstream from Zagreb.

•Financing model – BOT model•The concession granted to ZOV d.o.o. (in December 2000) encompasses: planning and construction of the Plant and infrastructure facilities, Project financing and management of the Plant until 2028, when it will be turned over to the City of management•The Project consists of:1. The central plant building for the mechanical and biological treatment of sludge – 1.2 mil. ERU (equivalent resident unit); in the final construction phase 1.5 mil. ERU2. Management building, plant and servicing premises3. Main wastewater input pipeline from New Zagreb to the Plant over a length of 10 km and the Mičevac pump station4. Closure and additional construction of the Main Drainage Canal over a length of 5.5 km 5. Domovinski Bridge (transit/installation structure)6. Construction of Čulinečka road from Slavonska avenue to Radnička road (3 km)•The mechanical portion of the treatment plant has been operational since March 2004, while the final (fourth) phase of biological sludge treatment and processing has been operational since September 2007.•Approximately 98% of investments have been implemented – completion depends on remaining property rights issues•The search for a technical solution to the thermal treatment of waste sludge is under way•There is an obligation to chemically treat wastewater•The estimated investment value is €304 mil.

1616

Chemical Wastewater Treatment Plant Chemical Wastewater Treatment Plant ProjectProject

The Croatian Government, at its session held on 24 June 2010, issued the Decision on The Croatian Government, at its session held on 24 June 2010, issued the Decision on Designation of Sensitive Areas (as published in Croatia’s official journal, Designation of Sensitive Areas (as published in Croatia’s official journal, Narodne novineNarodne novine, , no. 81/10) on which basis the Danube River’s entire drainage basin was proclaimed a no. 81/10) on which basis the Danube River’s entire drainage basin was proclaimed a sensitive area.sensitive area.

On 30 June 2010, the Ministry of Regional Development, Forestry and Water On 30 June 2010, the Ministry of Regional Development, Forestry and Water Management issued the Rules on Threshold Values for Wastewater Emission (Management issued the Rules on Threshold Values for Wastewater Emission (Narodne Narodne novinenovine, no. 87/10) which stipulate that prior to release into waters in sensitive areas, , no. 87/10) which stipulate that prior to release into waters in sensitive areas, municipal wastewater must be treated at the third degree of purification for release from municipal wastewater must be treated at the third degree of purification for release from agglomerations with loads exceeding 10,000 ES.agglomerations with loads exceeding 10,000 ES.

The revised Water Utility Directive Implementation Plan of November 2010 adopted by The revised Water Utility Directive Implementation Plan of November 2010 adopted by the Croatian Government stipulates a transition period for the fulfilment of the the Croatian Government stipulates a transition period for the fulfilment of the commitments specified by the Community Wastewater Treatment Directive, which commitments specified by the Community Wastewater Treatment Directive, which requires the collection of wastewater for facilities in the Black Sea drainage basin – a requires the collection of wastewater for facilities in the Black Sea drainage basin – a sensitive zone for installations above 150,000 ERU – with more advanced treatment by sensitive zone for installations above 150,000 ERU – with more advanced treatment by the deadline of 31 December 2018.the deadline of 31 December 2018.

The national water management company Hrvatske vode has granted to Zagreb Holding The national water management company Hrvatske vode has granted to Zagreb Holding d.o.o. – Water Supply and Sewage Branch, and the city wastewater management d.o.o. – Water Supply and Sewage Branch, and the city wastewater management company Zagrebačke otpadne vode d.o.o., a water management license for the release company Zagrebačke otpadne vode d.o.o., a water management license for the release of wastewater from the public sewage system in the City of Zagreb with treatment at the of wastewater from the public sewage system in the City of Zagreb with treatment at the Central Treatment Plant (CUPOVZ), whereby Zagrebačke otpadne vode is obliged to Central Treatment Plant (CUPOVZ), whereby Zagrebačke otpadne vode is obliged to undertake activities for the construction of the third treatment phase at the Plant, to be undertake activities for the construction of the third treatment phase at the Plant, to be completed by 31 December 2016, for the purpose of protecting water management completed by 31 December 2016, for the purpose of protecting water management interests in compliance with the Program of Water Pollution Prevention Measures with interests in compliance with the Program of Water Pollution Prevention Measures with target deadlines.target deadlines.

The Project is nominated for funding from the EU's Structural FundsThe Project is nominated for funding from the EU's Structural Funds The value of this investment has been estimated at € The value of this investment has been estimated at € 4040 million. million.

1717

Jakuševec Landfill Rehabilitation ProgrammeJakuševec Landfill Rehabilitation Programme

On 18 November 1998, a Loan Agreement On 18 November 1998, a Loan Agreement was concluded between the European Bank was concluded between the European Bank for Reconstruction and Development (EBRD) for Reconstruction and Development (EBRD) and ZGOS, a City-owned company, to and ZGOS, a City-owned company, to facilitate the rehabilitation of the Prudinec / facilitate the rehabilitation of the Prudinec / Jakuševec Landfill.Jakuševec Landfill.

Investment value: €56 millionInvestment value: €56 million The Prudinec waste disposal site The Prudinec waste disposal site

rehabilitation project at Jakuševec is rehabilitation project at Jakuševec is complete. All works broken down into complete. All works broken down into packets have been assumed by the packets have been assumed by the Investor.Investor.

Currently, within the framework of the Currently, within the framework of the Jakuševec/Prudinec landfill, besides the Jakuševec/Prudinec landfill, besides the waste disposal site there are:waste disposal site there are:– Construction waste recycling Construction waste recycling

installation (350,000 t/yr.),installation (350,000 t/yr.),– Scrap metal yard (over 3,000 t/yr.),Scrap metal yard (over 3,000 t/yr.),– Discarded tyre yard (over 1,000 t/yr.).Discarded tyre yard (over 1,000 t/yr.).

1818

The contract governing rendering of principal The contract governing rendering of principal works and management of installations at the works and management of installations at the

JakuševecJakuševec

The contract governing rendering The contract governing rendering of principal works and of principal works and management of installations at management of installations at the Jakuševec waste disposal site the Jakuševec waste disposal site was concluded on 31 May 2007. was concluded on 31 May 2007. The completion deadline for all The completion deadline for all works is 31 December 2011.works is 31 December 2011.

Currently the principal Currently the principal construction works and construction works and management and maintenance management and maintenance of installations at the waste of installations at the waste disposal site are under way.disposal site are under way.

The contractor has conducted The contractor has conducted works involving the collection works involving the collection and disposal of new waste. and disposal of new waste. During During SeptemberSeptember 2012, a total 2012, a total of 2of 23.563,233.563,23 tons of new waste tons of new waste were disposed.were disposed.

RRealization of 91.9% of the Contract, ealization of 91.9% of the Contract, valued at £ 98,329,147.72valued at £ 98,329,147.72

1919

The proposal of Zagreb Holding d.o.o., ZGOS Branch, is for the existing deadline (31 December 2012) for waste disposal at the Prudinec Landfill in Jakuševec in the City of Zagreb Physical Plan be substituted with a deadline of 31 December 2018.

The previous deadline was set under the assumption that a thermal waste treatment plant would be built. However, thus far waste disposal is the only long-term waste treatment measure. The quantity of waste collected within the limits of the City of Zagreb is showing a continual growth trend. The capacity of the Prudinec Landfill and its technical potential ensure the conditions for waste disposal at the newly organized operational surfaces at the site up to 31 December 2018. Depending on implementation of comprehensive waste management measures, this deadline may also be extended.

2020

Solid Waste Incineration Plant - SWIPSolid Waste Incineration Plant - SWIP

The purpose of constructing the SWIP is to treat municipal waste by incineration, The purpose of constructing the SWIP is to treat municipal waste by incineration, including the recycling of energy and sludge from the Central Waste Water Treatment including the recycling of energy and sludge from the Central Waste Water Treatment Plant. Plant.

The City of Zagreb Physical Plan (SGGZ 02/06) specified Žitnjak-East as the The City of Zagreb Physical Plan (SGGZ 02/06) specified Žitnjak-East as the construction site for the SWIP, right next to the CWWTP.construction site for the SWIP, right next to the CWWTP.

The relevant Ministry issued a ruling whereby the intended WIP Project was assessed The relevant Ministry issued a ruling whereby the intended WIP Project was assessed as environment-friendly, subject to the application of environmental protection as environment-friendly, subject to the application of environmental protection measures and the environment status monitoring programme.measures and the environment status monitoring programme.

The documentation required to secure a location permit has been drafted. Efforts are The documentation required to secure a location permit has been drafted. Efforts are being made to align the existing documents with new legislative requirements, in being made to align the existing documents with new legislative requirements, in particular, with the new Physical Planning and Constructparticular, with the new Physical Planning and Constructiion Act (Narodne novine, no. on Act (Narodne novine, no. 76/07).76/07).

The Project is nominated for funding from the EU's Structural FundsThe Project is nominated for funding from the EU's Structural Funds The The CCity of Zagreb and the European Bank for Reconstruction and Development ity of Zagreb and the European Bank for Reconstruction and Development

(EBRD) (EBRD) are planingare planing cooperation cooperation on this project on this project The total investment value is estimated at The total investment value is estimated at €170 million.€170 million.

2121

Zagreb Waste Disposal and Management Zagreb Waste Disposal and Management ModelModel

The Waste Management Program was prepared by The Waste Management Program was prepared by Institut građevinarstva Hrvatske d.d.Institut građevinarstva Hrvatske d.d. ( (Croatian Civil Croatian Civil Engineering Institute Inc.) in 2006.Engineering Institute Inc.) in 2006.

In 2007, the Republic of Croatia Waste Management In 2007, the Republic of Croatia Waste Management Plan (Narodne novine, no. 85/07) was adopted, Plan (Narodne novine, no. 85/07) was adopted, based on draft plans for all counties and the City of based on draft plans for all counties and the City of Zagreb.Zagreb.

The City of Zagreb Waste Management Plan has The City of Zagreb Waste Management Plan has been prepared and made available to the public for been prepared and made available to the public for inspection from 10 July to 15 September 2009.inspection from 10 July to 15 September 2009.

The Contract for the Preparation of the Strategic The Contract for the Preparation of the Strategic Assessment of the Draft Waste Management Plan Assessment of the Draft Waste Management Plan was signed on 28 March 2011.was signed on 28 March 2011.

The procedure to evaluate the Strategic Impact Study The procedure to evaluate the Strategic Impact Study concerning the Draft Waste Management Plan in the concerning the Draft Waste Management Plan in the City of Zagreb to 2015 is in progress.City of Zagreb to 2015 is in progress.

Based on the results of the strategic study, the final Based on the results of the strategic study, the final draft of the Waste Management Plan will be compiled draft of the Waste Management Plan will be compiled and then forwarded to the Zagreb City Assembly for and then forwarded to the Zagreb City Assembly for adoption.adoption.

2222

ZET – Mass Tranit System Renewal ProgrammeZET – Mass Tranit System Renewal Programme

The City of Zagreb Tramcar Fleet Renewal The City of Zagreb Tramcar Fleet Renewal Programme provides for the following Programme provides for the following projects :projects :

- Procurement of 70 low-floor tramcars;- Procurement of 70 low-floor tramcars;- Overhaul and modernisation of 50 tramcars - Overhaul and modernisation of 50 tramcars TMK 301;TMK 301;- Reconstruction and modernisation of the - Reconstruction and modernisation of the tram depot at Blato in Zagreb;tram depot at Blato in Zagreb;- New fare system; and - New fare system; and - Transit control and management system.- Transit control and management system.

70 tramcars have been procured from and 70 tramcars have been procured from and supplied by the CROTRAM consortium.supplied by the CROTRAM consortium.

The production of 70 new low-floor tramcars The production of 70 new low-floor tramcars was contracted on 18 July 2007, and a total was contracted on 18 July 2007, and a total of of 70 70 tramcars has already been delivered.tramcars has already been delivered.

The new public transit control and The new public transit control and management system was launched on 5 management system was launched on 5 September 2008.September 2008.

Two short low-floor tram TKM 2300 were put Two short low-floor tram TKM 2300 were put into service since 2009into service since 2009..

The value of this investment has been The value of this investment has been estimated at € 272 million.estimated at € 272 million.

2323

Zagreb Sports and Recreation ZoneZagreb Sports and Recreation Zone

Project implementation commenced Project implementation commenced according to the Conceptual Programme according to the Conceptual Programme and Urban Planning Design for the and Urban Planning Design for the Zagreb Sports and Recreation Zone, as Zagreb Sports and Recreation Zone, as approved by the City of Zagreb Executive approved by the City of Zagreb Executive Council.Council.

The location selected for the The location selected for the implementation of this projectimplementation of this project is a site is a site west of the unfinished Zagreb University west of the unfinished Zagreb University Hospital in Novi Zagreb, at the Blato Hospital in Novi Zagreb, at the Blato location.location.

A Letter of Intent has been signed A Letter of Intent has been signed between the City and the national between the City and the national petroleum company INA-Industrija nafte petroleum company INA-Industrija nafte d.d. to implement this project.d.d. to implement this project.

A company - Terme Zagreb d.o.o. – has A company - Terme Zagreb d.o.o. – has been incorporated, with the City of Zagreb been incorporated, with the City of Zagreb and INA as its shareholders.and INA as its shareholders.

The Project is nominated for funding from The Project is nominated for funding from the EU's Structural Fundsthe EU's Structural Funds

Estimated investment value: €50 millionEstimated investment value: €50 million

2424

Conference Centre ProjectConference Centre Project

A multi-purpose centre would greatly spur A multi-purpose centre would greatly spur the development of conference tourism.the development of conference tourism.

In mid-2005, a general survey-based In mid-2005, a general survey-based competition was announced for a competition was announced for a conceptual urban and architectural design conceptual urban and architectural design for the site between Pierottijeva, Jukićeva, for the site between Pierottijeva, Jukićeva, Savska and Izidora Kršnjavoga streetsSavska and Izidora Kršnjavoga streets

The jury proclaimed the tender a success. The jury proclaimed the tender a success. The award-winning works were purchased The award-winning works were purchased and can be used as a basis for further and can be used as a basis for further study and elaboration of the project at this study and elaboration of the project at this site.site.

The drafting of project documentation is in The drafting of project documentation is in progressprogress

The Project is nominated for funding from The Project is nominated for funding from the EU's Structural Fundsthe EU's Structural Funds

Estimated investmentEstimated investment value:€value:€5252 million. million.

2525

Small Business CentreSmall Business Centre• The project has been planned in the

Kajzerica district next to the URIHO site.• A competition is underway to develop an

urban and architectural design for small business, municipal and accompanying facilities in the Small-Business Centre (small business learning centre with facilities for theoretical studies and practical learning, business premises, a multi-purpuse hall and parking garage).

• Under the Small Trades Centre construction project, there are plans to consolidate facilities that will enable the efficient functioning of tradesmen’s associations, education, events, exhibitions and fairs, business premises for small trades, a small trades savings bank and other related amenities to encourage the development of small trades and compatible city facilities.

• The Project is nominated for funding from the EU's Structural Funds

• Estimated investment value: €40 millionEstimated investment value: €40 million

2626

Project to construct underground parkingProject to construct underground parking garages garages with additional facilities at the secondary school with additional facilities at the secondary school playground site designated as “Savska-Kačićeva-playground site designated as “Savska-Kačićeva-

Klaićeva-Kršnjavoga”Klaićeva-Kršnjavoga”

•The project is being implemented through a concession of public-private partnership (PPP), in compliance with the Public-Private Partnership Act•The estimated construction cost is €40 million•The project foresees the landscaping of the secondary school playground, construction of a basement garage with service facilities and a connection to the Children’s Hospital in Klaićeva street by underground corridor, and construction of a gymnasium, youth centre, transformer station and tramway rectifier station.

2727

Zagreb Airport ProjectZagreb Airport Project

• A joint project by the RoC Government and the A joint project by the RoC Government and the City of Zagreb. City of Zagreb.

• The RoC’s share in Zagreb Airport Ltd. accounts The RoC’s share in Zagreb Airport Ltd. accounts for 55% of its capital, with the City of Zagreb for 55% of its capital, with the City of Zagreb holding 35%, and the City of Velika Gorica and the holding 35%, and the City of Velika Gorica and the Zagreb County 5% of the company’s capital each.Zagreb County 5% of the company’s capital each.

• On 14th February 2011 the Agency has issued On 14th February 2011 the Agency has issued approval to the Ministry of the Sea, Transport and approval to the Ministry of the Sea, Transport and Infrastructure for implementation of the project for Infrastructure for implementation of the project for construction of the New Zagreb Airport Terminal construction of the New Zagreb Airport Terminal

• The Ministry of the Sea, Transportation and The Ministry of the Sea, Transportation and Infrastructure opened a tender on 18 February Infrastructure opened a tender on 18 February 2011 for Construction of the New Passenger 2011 for Construction of the New Passenger Terminal at the Zagreb Airport, which also entails Terminal at the Zagreb Airport, which also entails management of the existing and newly-management of the existing and newly-constructed terminals at the Zagreb Airport and constructed terminals at the Zagreb Airport and the accompanying infrastructurethe accompanying infrastructure

• The government has decided to give the 30 - year The government has decided to give the 30 - year concession to build a new passenger terminal at concession to build a new passenger terminal at Zagreb airport French consortium Zagreb Airport Zagreb airport French consortium Zagreb Airport International Company (ZAIC)International Company (ZAIC)

• The value of this investment has been estimated The value of this investment has been estimated at €at €25250 million0 million..

Aquarium Project in Zagreb

• Planned construction site for the Aquarium: Old City Bathing Zone on the Sava River

• The Zagreb Aquarium would be a great boon to Zagreb’s tourism and overall economy, but it’s greatest importance would be the enrichment of everyday life for citizens of all ages.

• The primary purpose of the public aquarium would be educational, but it would also play a broader social role, and contribute to the economy, the hospitality industry, tourism and commerce.

• The Aquarium in Zagreb would serve as a window into the underwater world and an opportunity to teach and inform citizens of all generations.

• The estimated value of the investment is €9 mil.

2929

City-owned companiesCity-owned companies

The basic purpose of City-owned companies is to permanently The basic purpose of City-owned companies is to permanently provide quality vital public services of interest to natural and legal provide quality vital public services of interest to natural and legal persons.persons.

Performance Performance

January – June 2012January – June 2012

Zagrebački holding d.o.o.: Zagrebački holding d.o.o.: Total revenuesTotal revenues € 252.946.207€ 252.946.207 Total expensesTotal expenses € 261.433.732€ 261.433.732 Loss Loss € 8.487.525 € 8.487.525

3030

Holding’s subsidiaries:Holding’s subsidiaries:1.1. AGM (publishing and bookshops)AGM (publishing and bookshops)2.2. Autobusni kolodvor (bus terminal)Autobusni kolodvor (bus terminal)3.3. Čistoća (public sanitation)Čistoća (public sanitation)4.4. Gradska groblja (municipal cemeteries)Gradska groblja (municipal cemeteries)5.5. Gradsko stambeno komunalno Gradsko stambeno komunalno

gospodarstvo (housing and utilities gospodarstvo (housing and utilities management)management)

6.6. Robni terminali Zagreb (commodity Robni terminali Zagreb (commodity terminals)terminals)

7.7. Stanogradnja (housing construction)Stanogradnja (housing construction)8.8. Tržnice Zagreb (green markets)Tržnice Zagreb (green markets)9.9. Upravljanje sportskim objektima (sports Upravljanje sportskim objektima (sports

facility management)facility management)10.10. Vladimir Nazor (youth holidays)Vladimir Nazor (youth holidays)11.11. Vodoopskrba i odvodnja (water supply Vodoopskrba i odvodnja (water supply

and sewage)and sewage)12.12. ZagrebparkingZagrebparking13.13. Zagrebačke ceste (road management)Zagrebačke ceste (road management)14.14. Zagrebački digitalni grad (IT)Zagrebački digitalni grad (IT)15.15. Zagrebački električni tramvaj (mass Zagrebački električni tramvaj (mass

transit)transit)16.16. Zagrebački velesajam (trade fair)Zagrebački velesajam (trade fair)17.17. ZGOS (waste management)ZGOS (waste management)18.18. Zrinjevac (landscaping)Zrinjevac (landscaping)

1.1. Gradska plinara Zagreb d.o.o. (Municipal Gas Co. Ltd.) - 100%Gradska plinara Zagreb d.o.o. (Municipal Gas Co. Ltd.) - 100%2.2. Gradska plinara Zagreb – opskrba d.o.o. (Gas Supply Ltd.) - 100%Gradska plinara Zagreb – opskrba d.o.o. (Gas Supply Ltd.) - 100%3.3. Zagreb Arena d.o.o. za usluge (Event Services Ltd.) - 100%Zagreb Arena d.o.o. za usluge (Event Services Ltd.) - 100%4.4. Zagreb plakat d.o.o. (Zagreb Billboard Ltd.) - 51%Zagreb plakat d.o.o. (Zagreb Billboard Ltd.) - 51%

1.1. TERME ZAGREB d.o.o. (Thermal Spa Ltd. - 50%)TERME ZAGREB d.o.o. (Thermal Spa Ltd. - 50%)

2.2. APIS IT d.o.o. (IT Support Agency Ltd. - 49%)APIS IT d.o.o. (IT Support Agency Ltd. - 49%)

3.3. VODOPRIVREDA ZAGREB d.d. (Water Mgmt. Inc. – 36.13%)VODOPRIVREDA ZAGREB d.d. (Water Mgmt. Inc. – 36.13%)

4.4. ZRAČNA LUKA ZAGREB d.o.o. (ZG Airport Ltd. - 35%)ZRAČNA LUKA ZAGREB d.o.o. (ZG Airport Ltd. - 35%)

5.5. BICRO BIOCENTAR d.o.o. (13%)BICRO BIOCENTAR d.o.o. (13%)

Holds founder’s rights in Holds founder’s rights in the following institution:the following institution:

Gradska ljekarna Zagreb Gradska ljekarna Zagreb (Municipal Pharmacies)(Municipal Pharmacies)

Manages:Manages:Sports facilities owned by the Sports facilities owned by the

City of ZagrebCity of Zagreb

11. RAZVOJNA AGENCIJA ZAGREB - TPZ . RAZVOJNA AGENCIJA ZAGREB - TPZ d.o.o. (Zagreb Development Agency Ltd.)d.o.o. (Zagreb Development Agency Ltd.)

City of Zagreb holds 100% shares in City of Zagreb holds 100% shares in following companiesfollowing companies ::

City of Zagreb holds certain shares in the following City of Zagreb holds certain shares in the following companes:companes:

Companies in which Holding has sharesCompanies in which Holding has shares

2. ZAGREBAČKI HOLDING d.o.o. (Zagreb 2. ZAGREBAČKI HOLDING d.o.o. (Zagreb Holding Ltd.)Holding Ltd.)

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Organisational chartOrganisational chart

ADMINISTRATIVE AND LEGAL DEPARTMENT

SOLE TRADERSHIP REGISTER UNIT

UNIT IN CHARGE OF SETTING MINIMUM TECHNICALAND OTHER CRITERIA FOR ECONOMIC ACTIVITY

SUSEDGRAD LOCAL ADMINISTRATIVE-LEGAL UNIT

SESVETE LOCAL ADMINISTRATIVE-LEGAL UNIT

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Roughly 14.103 sole trades, or 16.84% of the Roughly 14.103 sole trades, or 16.84% of the national total, operate in the Citynational total, operate in the City

Sole trades in the City of ZagrebSole trades in the City of Zagreb

16,8%

83,2%

City of Zagreb

Other counties

Source: Ministry of Entrepreneurship and crafts

Central Sole Tradership Register

3333

Structure of sole trades based on Structure of sole trades based on National Classification in 2007National Classification in 2007

ACTIVITYNo. of sole

traders%

INDEXINDEKS

31.12.2011./ 31.12.2012.

Retail commerce 2.903 20,6 95,4

Hospitality 1.666 11,8 92,8

Construction 1.315 9,3 92,8

Transportation 1.590 11,3 109,2

Hair, cosmetic and pedicure salons 1.201 8,5 98,6

Textile and garment manufacturing 352 2,5 90,9

IT 388 2,7 107,2

Accounting and bookkeeping 334 2,4 101,2

Other 4.354 30,9

TOTAL 14.103 100,0 94,8

Status: as at Decembar 2012

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11,8%

2,4%

2,5%

2,7%

30,9%

20,6%

9,3%11,3%

8,5%

Retail

Hospitality

Construction

Transport

Hair, cosmetic & pedicure salons

Textile and garment manufacturing

IT

Accounting and bookkeeping

Other

STRUCTURE OF SOLE TRADES

based on National Classification of Activities, 2007

Source: Sole Tradership Register of the City Office of the Economy, Labour and Entrepreneurship

Sole Tradership Register Unit and Sesvete and Susedgrad Local Administrative-Legal Units

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Development incentivesDevelopment incentivesfor crafts, trades and SMEsfor crafts, trades and SMEs

The Crafts, Trades and SMEs Development Incentive The Crafts, Trades and SMEs Development Incentive Programme was adopted in September 2000.Programme was adopted in September 2000.

Incentive measures and activities include:Incentive measures and activities include:

• Allocation of incentive funds;Allocation of incentive funds;

• Development of business infrastructure through Development of business infrastructure through institutional development incentive networks.institutional development incentive networks.

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1. 1. Allocation of incentive funds Allocation of incentive funds (2000 - 20(2000 - 201212))

Implemented through:Implemented through:

1.1 Loans to businesses1.1 Loans to businesses

1.2 Subsidizing a portion of interest on business loans1.2 Subsidizing a portion of interest on business loans

1.3 Supports to sole traders1.3 Supports to sole traders

1.4 Supports to innovator1.4 Supports to innovator

1.5 Other supports1.5 Other supports

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2. 2. Development of business Development of business infrastructureinfrastructure

2.1 2.1 Development Agency Zagreb - TPZ Ltd.Development Agency Zagreb - TPZ Ltd.

Projects and activities: Projects and activities:

– Technical and technological processing and preparation of Technical and technological processing and preparation of inventions for use by businesses;inventions for use by businesses;

– Education of already established businesses and start-ups at Education of already established businesses and start-ups at organized seminars;organized seminars;

– Development of operating and investment plans for businesses;Development of operating and investment plans for businesses;

– Consulting services for introduction of systems of quality and/or Consulting services for introduction of systems of quality and/or environmental management - ISO 9001 and 14001;environmental management - ISO 9001 and 14001;

– Issuing guarantees for small business loans;Issuing guarantees for small business loans;

– Development of economic projects and studies, development and Development of economic projects and studies, development and management of projects financed by EU funds, etc.management of projects financed by EU funds, etc.

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2.2 2.2 Business zonesBusiness zones

The City of Zagreb Business Zone Development Programme was The City of Zagreb Business Zone Development Programme was adopted in 2005.adopted in 2005.

2.3 Clusters2.3 Clusters

Launch of the “Clusters for Competitive Products” project; Launch of the “Clusters for Competitive Products” project;

Preparation of a study for the Vehicles, Machine-Tools and Tools Preparation of a study for the Vehicles, Machine-Tools and Tools Cluster;Cluster;

To date, a total of To date, a total of € 109.845,45 € 109.845,45 has been spent for the implementation has been spent for the implementation of the project.of the project.

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Structure of funds spent to implement Programme Structure of funds spent to implement Programme incentive measures and incentive measures and activitiesactivities

((September 2000 –September 2000 – December 2012 December 2012))

Allocation of incentive funds€ 27.691.394,64

80%

Organisation of business

infrastructure€ 6.900.945,50

20%

€ € 34.592.340.1434.592.340.14

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TOTAL FUNDS EXPENDED TO IMPLEMENT PROGRAMME TOTAL FUNDS EXPENDED TO IMPLEMENT PROGRAMME INCENTIVE MEASURES AND ACTIVITIESINCENTIVE MEASURES AND ACTIVITIES

(September 2000 – (September 2000 – December 2012December 2012))In €

City of Zagreb MinistriesAllocation of incentive fundsDeposits with financial institutions 7.116.707,64 1.145.034,53Subsidies for a portion of interest 6.264.605,95 5.027.977,45Supports to sole traders 3.637.359,88Supports to innovators 921.235,23Intervention funds to entrepreneurs 2.588.122,60Other supports 990.351,37Total: 21.518.382,67 6.173.011,97Business infrastructure developmentDevelopment Agency Zagreb – TPZ Ltd. - business premises 4.364.219,97 - operating costs, projects and activities 1.762.083,96 455.251,15 - regional security instruments 86.142,64 86.142,64“Clusters for Competitive Products” project 147.105,13Total: 6.359.551,70 541.393,79Overall total: 27.877.934,37 6.714.405,77Overall total (City and ministries): 34.592.340,14

41414141

Zagreb as a tourist destinationZagreb as a tourist destination

as a business and administrative hub, Zagreb accounts for approximately 6% of tourist arrivals as a business and administrative hub, Zagreb accounts for approximately 6% of tourist arrivals and 2% tourist bednights in Croatia and 2% tourist bednights in Croatia

the total number of tourist arrivals in Zagreb in 20the total number of tourist arrivals in Zagreb in 201111 was was 730.945730.945 and and 551.043551.043 (7 (755%) were foreign %) were foreign guests. The total number of recorded bednights is 1guests. The total number of recorded bednights is 1.183.125.183.125, of which , of which 884,055884,055 (7 (744%) accounted for %) accounted for foreign visitors.foreign visitors.

COMPARISON OF RESULTS RECORDED ICOMPARISON OF RESULTS RECORDED IN I. - XIIN I. - XII. 20. 201010 and and I. – XII. I. – XII. 2012011 PERIODS1 PERIODS::

I.I.–– XII. XII. 20 201010 No. of tourist arrivalsNo. of tourist arrivals 666.106 ( + 5 % in comparison to 2009.)666.106 ( + 5 % in comparison to 2009.) - of these foreignof these foreign 4488.854 ( + 8 % in comparison to 2009.)88.854 ( + 8 % in comparison to 2009.) No. of tourist bednights No. of tourist bednights 1.085.597 (+ 3% in comparison to 2009.) 1.085.597 (+ 3% in comparison to 2009.) - of these foreign - of these foreign 801.041 ( + 5,6 % in comparison to 2009.)801.041 ( + 5,6 % in comparison to 2009.)

I. – XII.2011.I. – XII.2011. No. of tourist arrivalsNo. of tourist arrivals 730.945 730.945 (+(+ 9 9 %% in comparison to 2010. in comparison to 2010.)) - of these foreignof these foreign 551.043 551.043 ((++ 13 13 %% in comparison to 2010. in comparison to 2010.)) No. of tourist bednights No. of tourist bednights 1.183.1251.183.125 (+(+ 8 8%% in comparison to 2010. in comparison to 2010.)) - of these foreignof these foreign 884.055884.055 ( (++ 10 10%% in comparison to 2010. in comparison to 2010.))

Source: City Strategic Planning and Urban Development Office – Statistics Department

42424242

Current and actual tourists Current and actual tourists arrivals and bednights in 2012 arrivals and bednights in 2012


I. – IX. 2011.I. – IX. 2011. No. of tourist arrivals No. of tourist arrivals 575.303 575.303 - of these foreignof these foreign 445.873 445.873 No. of tourist bednights No. of tourist bednights 915.210 915.210 - - of these foreign of these foreign 702.943 702.943

I. – IX. 2012.I. – IX. 2012. No. of tourist arrivals No. of tourist arrivals 603.835 (+4.9 % u odnosu na 2011.)603.835 (+4.9 % u odnosu na 2011.) - - of these foreignof these foreign 474.460 (+6,4 % u odnosu na 2011.) 474.460 (+6,4 % u odnosu na 2011.)No. of tourist bednights No. of tourist bednights 969.506 (+5,9 % u odnosu na 2011.)969.506 (+5,9 % u odnosu na 2011.) - - of these foreign of these foreign 763.634 (+8.6 % u odnosu na 2011.)763.634 (+8.6 % u odnosu na 2011.)

43434343

Tourists arrivals and bednights 2002–2010 Tourists arrivals and bednights 2002–2010

2010. godina

• in 2010 in comparison to 2009 ,growth in tourist arrivals of 5% and bednights of 3% was noted. During the period under observation, growth in the number of foreign tourist arrivals was recorded (8%).


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Tourists arrivals and bednights 2010. – 2011.Tourists arrivals and bednights 2010. – 2011.

Year 2011.

In the year 2011. growth in tourists arrivals of 9 % and bednights of 8 % was noted. During the period under observation, significant growth in the number of foreign tourists arrivals was recorded (13%).

0

200000

400000

600000

800000

1000000

1200000

1400000

2010. 2011.

Arrivals

Bednights

Izvor: Gradski ured za strategijsko planiranje i razvoj Grada - Odjel za statistiku

45454545

Accommodation capacity in the City of Zagreb

The City of Zagreb has a total of 84 accommodation units, of which 48 are hotels

The total number of beds is 10.131 and they are distributed according to the following types of accommodation capacity:

- hotels 6.922- hostels 1.119

- rooms for rent 299- private accommodation 808- other types of collective accomodation 983

• average number of bednights per arrival in the I.- IX. 2012. period: 1.6

Structure of hotel accommodation capacity of the City of Zagreb by category (number of beds)

Since approximately 60% of hotel beds are in higher-category hotels (4* and 5*), Zagreb is characterized as a city with a predominantly high-quality hotel product.


46464646

Estimated tourist spending in the City of Zagreb in 2009, Tourism Institute

Context for the development of the City of Zagreb as a tourist destination

The City of Zagreb investment policy directly impacts the development of tourism through implementation of the following capital projects:

Zagreb Airport ProjectConference Center ProjectZagreb Sports and Recreation Zone Paromlin Hotel/Residential Complex

Strategic recommendations for tourism development in the City of Zagreb*:The focus of tourism development will be based on 3 key products:

1). Business and Culture, with events2). Tours and Brief Vacations3). Cuisine/Shopping and Special Interests

Tourist spending in the City of Zagreb in 2009

TOURIST SPENDING IN ZAGREB IN 2009

€ 307,307 million

Foreign touristspending

€ 207,578 million

National tourist spending€ 99,729

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Republic of CroatiaCity of ZagrebCity Office for Economy, Labour and EntrepreneurshipTrg S. Radića 1Phone: +385 1 610 1194, 610 1102Fax: +385 1 610 1499, 610 1077E-mail: [email protected]: http://www. zagreb.hrURL: http://www. zagreb.hr

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