According to Homosociety, Croatia is a Southern European state, located in the north-western sector of the Balkan peninsula. Since the early nineties of the last century, the demographic dynamics have been characterized by a slow but constant decrease, both as a reflection of the armed conflicts that have affected the area, and because of the natural balance, which has become negative: the Croatia has thus passed from 4,784,265 residents of the 1991 census to the 4,437,460 of the 2001 census. However, in the early 2000s, despite a natural balance that remained negative (in 2005 the birth and death rates were respectively 9.6 and 11.4‰), this trend has stopped, and the population, thanks above all to the return of the numerous refugees who fled abroad at the time of the conflict, has returned to increase (4,551,000 residents According to a 2005 estimate). The war years also had consequences on the country’s ethnic composition: Croats rose from 78.1 % (1991 census) to 89.6 % (2001 census), while Serbs fell from 12.2 to 4, 5 %; on the other hand, the consistency of the small groups of Bosnians, Hungarians, Albanians, Slovenes, Italians remained substantially unchanged (about 30,000 people, to whom in 1996 limited autonomy was recognized). Consequently, the religious composition has also changed: Catholics rose from 76.5 to 88 % and the Orthodox fell from 11.1 to 4.4 %; Muslims (1.3 %) and those belonging to other confessions are almost stable. The region of Zagreb, Istria, the Adriatic coast axis and the major islands represent the areas with the highest population density, and also those characterized by the greatest liveliness from an economic point of view. Zagreb, formerly the second city of the former Yugoslavia, has increased its role as an urban and industrial center, with dynamics of spatial expansion comparable to the large urban systems of Western Europe: it had 691.724 residents according to the 2001 census and 700,700 according to 2006 estimates (1,106,000 with the urban agglomeration). Apart from the capital, Croatian cities do not reach large dimensions, with only Split (Split) and Rijeka (Rijeka) exceeding 100,000 residents, and with a percentage of population residing in urban areas around 59 %, far beyond below the European averages, despite the sustained urbanization processes that have occurred in recent years.
On the political-economic front, one of the primary objectives of Croatia is represented by the entry into the European Union (planned for 2007, together with Romania and Bulgaria), to make this possible, however, official negotiations have not yet started (see beyond, History). Since the beginning of the 2000s, the country has enjoyed a stable economic situation, which has never ceased to improve, thanks above all to the support for businesses and the improvement of infrastructures promoted by the government, which has also carried out a reform of the banking system, opening it to foreign investors (the first two private credit institutions are controlled by Italian banks). International organizations support the Zagreb policy by granting large credits. The International Monetary Fund between 2001 and 2004 granted three successive loans for a total of 303 million dollars, the World Bank between 2000 and 2005 allocated 598 million dollars, and, in the context of Croatia’s candidacy for membership of the European Union, the European Bank for Reconstruction and Development (EBRD) between 1999 and 2004 decided on loans for 917 million euros. For their part, direct foreign investment has exceeded 10 billion dollars in ten years.
The growth rate rose from 1.3 % in 2000 to 5.2 % in 2002, and then dropped to 3.2 % in 2005 ; however, a new increase is expected, also thanks to the structural reforms undertaken to align the Croatian economy with that of the European countries and complete the process of joining the Union. In the same years, inflation fell to less than 3 % and the unemployment rate to 14 % (still almost double the European average), but the country experienced a worsening of the trade deficit and of the foreign debt, passed respectively from 4 to 9 billions of dollars and 11 to 30. On the other hand, the trend in exports was positive (from 4.5 to 8 billions of dollars): a phenomenon mainly due to better access to the single market of the European Union and the effects of corporate restructuring. The country exports chemicals, machinery and timber, imports cars, machinery, basic manufacturing, oil and petroleum products. Italy is among the countries most closely linked to Croatia as regards both incoming and outgoing trade; followed by Germany, Slovenia, Russia and France for imports, Bosnia and Herzegovina, Germany, Slovenia and Austria for exports. As regards the contribution of individual production sectors to the formation of GDP, the tertiary sector is in first place (61.5 %, with 62 % of the active population employed in 2003), then industry with 30.1 % (and a similar percentage of active population) and agriculture with 8.4 % (7.1 % employed in the sector). Tourism represented in the postwar years a very important element for the economic recovery, and the greatest number of investments was concentrated on it. Since the years 1992-93, tourists, mainly from Austria, Germany and Italy, have begun to return to Istria and the northern islands, areas outside the war events. After the end of the conflict, the flows increased, and also affected Dalmatia again; visitors thus increased from 2.6 million in 1996 to 9.4 in 2004. Among the industrial sectors, not only shipbuilding (driven by reconstruction activities), but also the steel industry (located in Sisak, Split, Topusko), metallurgy, chemistry and petrochemicals, mechanics, food and textiles: overall the manufacturing sector, which in the period 1990-2002 had recorded, in real terms, an average annual decrease of 3.8 %, in 2002 had an increase of 4 %. The latter rises to 5 % if the industry is considered globally, thus also including the mining, construction and energy sectors.