Croatia Country Summary
Higher Risk
View full Ratings TableSanctions
Higher Concern
FATF AML Deficient List
Higher Concern
Terrorism
Medium Concern
Corruption
Medium Concern
US State ML Assessment
Lower Concern
Criminal Markets (GI Index)
Medium Concern
EU Tax Blacklist
Lower Concern
Offshore Finance Center
Lower Concern
Please note that although the below Summary will give a general outline of the AML risks associated with the jurisdiction, if you are a Regulated entity then you may need to demonstrate that your Jurisdictional AML risk assessment has included a full assessment of the risk elements that have been identified as underpinning overall Country AML risk. To satisfy these requirements, we would recommend that you use our Subscription area.
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Anti Money Laundering
FATF Status
Croatia is on the FATF List of Countries that have been identified as having strategic AML deficiencies
Compliance with FATF Recommendations
The last Follow up Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Croatia was undertaken in 2024. According to that Evaluation, Croatia was deemed Compliant for 7 and Largely Compliant for 29 of the FATF 40 Recommendations. It remains Highly Effective for 0 and Substantially Effective for 1 of the Effectiveness ratings.
Sanctions
The report indicates that Croatia is included in the scope of sanctions related to the Western Balkans, particularly under Executive Order 14033 issued by OFAC. This order expands the sanctions authorities to target individuals and entities involved in activities that threaten peace, security, or democratic processes in the region, which includes Croatia.
Criminality
Rating |
0 (bad) - 100 (good) |
|---|---|
| Transparency International Corruption Index | 47 |
| World Bank: Control of Corruption Percentile Rank | 60 |
Croatia has established a robust legal framework to combat corruption, including comprehensive laws and penalties that empower investigative authorities to address various forms of corruption. Despite these measures, challenges persist, such as public trust in the judiciary being notably low and ongoing issues related to corruption in sectors like healthcare and construction, which hinder foreign investment and economic stability.
The country faces significant criminal challenges, including human trafficking, drug smuggling, and financial crimes, often facilitated by both local and international criminal networks. While anti-corruption mechanisms and civil society organizations are actively working to address these issues, the effectiveness of these efforts is undermined by implementation gaps, recent scandals, and a strained social protection system, highlighting the need for improved governance and cross-border cooperation.
Economy
Croatia's economy has gained significant momentum following its full integration into the European Union on January 1, 2023, marked by the adoption of the euro and entry into the Schengen zone, which has bolstered its trade and investment landscape. The country has demonstrated resilience with a 2.8% economic growth in 2023, driven largely by its robust tourism sector, which accounts for a substantial portion of GDP, while the government continues to implement measures to combat inflation and support economic stability. With favorable credit ratings and an increasing focus on diversifying investment opportunities in sectors such as IT and clean energy, Croatia is positioning itself as an attractive destination for foreign investment, despite challenges related to bureaucratic inefficiencies and the need for judicial reforms.
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