[37] Croatia's labor market has been perennially inefficient, with inconsistent business standards as well as ineffective corporate and income tax policy.

As the war progressed the government kept printing more money and its amount in circulation was rapidly increasing, resulting in high inflation rates.

[56] After World War II, the new Communist Party of Yugoslavia converted to a command economy on the Soviet model of rapid industrial development.

The industrialization plan relied on high taxation, fixed prices, war reparations, Soviet credits, and export of food and raw materials.

A rapid improvement of food production and the standard of living was expected, but due to bad results the program was abandoned three years later.

This, coupled with austerity programs and hyperinflation in the 1980s, led to discontent in both Croatia and Slovenia which eventually fuelled political movements calling for independence.

With the end of the war, Croatia's economy recovered moderately, but corruption, cronyism, and a general lack of transparency stymied economic reforms and foreign investment.

The anti-inflationary stabilization steps in 1993 decreased retail price inflation from a monthly rate of 38.7% to 1.4%, and by the end of the year, Croatia experienced deflation.

After several years of successful macroeconomic stabilization policies, low inflation and a stable currency, economists warned that the lack of fiscal changes and the expanding role of the state in the economy caused the decline in the late 1990s and were preventing sustainable economic growth.

[65][68] The new government led by the president of SDP, Ivica Račan, carried out a number of structural reforms after it won the parliamentary elections on 3 January 2000.

Economic growth in the 2000s was stimulated by a credit boom led by newly privatized banks, capital investment, especially in road construction, a rebound in tourism and credit-driven consumer spending.

Most economic indicators remained positive in this period except for the external debt as Croatian firms focused more on empowering the economy by taking loans from foreign resources.

[76] In spite of the rather slow post-recession recovery, in terms of income per capita it is still ahead of some European Union member states such as Bulgaria, and Romania.

[82] In terms of average monthly wage, Croatia is ahead of 9 EU members (Czech Republic, Estonia, Slovakia, Latvia, Poland, Hungary, Lithuania, Romania, and Bulgaria).

Unemployment is regionally uneven: it is very high in eastern and southern parts of the country, nearing 20% in some areas, while relatively low in the north-west and in larger cities, where it is between 3 and 7%.

[citation needed] During 2015 the Croatian economy started with slow but upward economic growth, which continued during 2016 and conclusive at the end of the year seasonally adjusted was recorded at 3.5%.

[83] The better than expected figures during 2016 enabled the Croatian Government and with more tax receipts enabled the repayment of debt as well as narrow the current account deficit during Q3 and Q4 of 2016[84][85] This growth in economic output, coupled with the reduction of government debt has made a positive impact on the financial markets with many ratings agencies revising their outlook from negative to stable, which was the first upgrade of Croatia's credit rating since 2007.

[87] In July 2021 projection was improved to 5.4% due to the strong outturn in the first quarter and the positive high-frequency indicators concerning consumption, construction, industry and tourism prospects.

[89] The recovery was supported by strong private consumption, the better-than-expected performance of tourism and the ongoing resilience of the export sector.

The Commission warned that the key downside risks stem from Croatia's relatively low vaccination rates, which could lead to stricter containment measures, and continued delays of the earthquake-related reconstruction.

[98] In 2021 Croatia joined the list of countries with its own automobile industry,[99] with Rimac Automobili's Nevera started being produced.

In late March 2022 Croatian Bureau of Statistics announced that Croatia's industrial output rose by 4% in February, thus growing for 15 months in a row.

[107] The International Monetary Fund (IMF) projected in early September 2022 that Croatia's economy will expand by 5.9% in 2022, whilst EBRD expects Croatian GDP growth to reach 6.5% by the end of 2022.

[108] Pfizer announced launching a new production plant in Savski Marof[109] whilst Croatian IT industry grew 3.3%[110][111] confirming the trend that started with Coronavirus pandemic where the Croatia's digital economy increased by 16 percent on average annually from 2019 to 2021.

Economic outlook for 2023 for Croatian economy are mixed, depends largely on how the big Eurozone economies perform, Croatia's largest trading partners; Italy, Germany, Austria, Slovenia and France are expected to slow down, but avoid recession according to latest economic projections and estimates, so Croatian economy as a result could see better than expected results in 2023, early projections of between 1 and 2.6% economic growth in 2023 with inflation at 7% is a significant slow down for the country, however country is experiencing major internal and inward investment cycle unparalleled in recent history.

On 12 July 2022, the Eurogroup approved Croatia becoming the 20th member of the Eurozone, with the formal introduction of the Euro currency to take place on 1 January 2023.

[126] Croatian agricultural sector subsists from exports of blue water fish, which in recent years experienced a tremendous surge in demand, mainly from Japan and South Korea.

By January 2022, Croatia had completed more than 1,300 kilometres (810 miles) of motorways, connecting Zagreb to most other regions and following various European routes and four Pan-European corridors.

The high quality and safety levels of the Croatian motorway network were tested and confirmed by several EuroTAP and EuroTest programs.

The bulk of Croatian imports are supplied by the Krško Nuclear Power Plant in Slovenia, 50% owned by Hrvatska elektroprivreda, providing 12% of Croatia's electricity.