Abstract
Taking into consideration the advantages of FDI and their impact in case of transition countries’ successful integration with the EU, this paper focuses on FDI-policy in Croatia. The aim is to analyze institutional conditions for investment with special reference to government support schemes and their effectiveness in case of existing inter-regional disparities. Through evaluating differences in the business and investment climate as well as in FDI-inflow on regional level, national FDI-policy is evaluated with reference to its compatibility with regional development goals. FDI policy so far has not been effective in attracting FDI and achieving development goals what is seen in regional characteristics of FDI-inflow according to which the greatest part of investment went to just a few (most developed) locations. However, significant improvements in legislation show that actual FDI-policy is more development oriented and creates conditions for attracting foreign capital in underdeveloped regions and target sectors. Success of some Croatian regions in attracting FDI proves that central government measures should be complemented by a strong pro-investment attitude of local government administration in order to achieve full potential of FDI-policy.
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