Like many countries, Croatia was hit hard by the COVID-19 crisis. Yet, as often happens in times of upheaval, the crisis exposed not just vulnerabilities, but also opportunities. While the broader economy suffered a steep decline in 2020, certain sectors, notably IT and digital services, managed not only to endure, but thrive. Five years on, Croatia finds itself on the cusp of a tech-driven renewal – and cities like Šibenik in Dalmatia are playing an increasingly vital role in that story.
A Country Shaped by Crises
Over the past three decades, Croatia has weathered a number of deep crises: the war in the early 1990s, a delayed international reintegration, the banking crash and recession of 1999, and the long economic stagnation from 2009 to 2015 that dampened the post-EU accession boom expected in 2013.
COVID-19, with its devastating impact on the tourism industry – once contributing over 17% of Croatia’s GDP – served as yet another reckoning. However, by late 2020, GDP had begun to rebound, and a different kind of economy was starting to emerge: one less reliant on seasonal tourism, and more grounded in innovation and high-value exports.
The Fragility of the Pre-COVID Economy
Prior to 2020, Croatia’s economy leaned heavily on traditional sectors: tourism, construction, and a struggling industrial base. Shipyards like those in Split continued to fight for survival, while firms like AD Plastik and Đuro Đaković remained among the few industrial players of note.
Yet even during the pandemic, industrial production remained relatively stable, and IT began to quietly outpace every other sector. With over 5,700 IT firms employing 33,000 people and growing at nearly 15% annually, Croatia’s tech industry generated more than €3.6 billion (27 billion HRK) in revenue, including €1 billion in exports.
The IT Surge: From Zagreb to Dalmatia
Infobip, Croatia’s first unicorn, and Rimac Automobili, now backed by Porsche and Hyundai, became international headlines. Gaming studios like Nanobit, acquired by Sweden’s Stillfront Group, and AI-focused startups like Mindsmiths and Photomath, raised Croatia’s profile globally.
But it’s not just a Zagreb story anymore. The digital revolution is rippling outward to coastal cities long reliant on sun and sea. Which brings us to Šibenik.
Šibenik and the Rise of Specialized Tech Hubs in Croatia
As Croatia looks to redefine its economic model in the wake of successive crises, a new kind of opportunity is emerging—not in the traditional industrial sectors or even mass tourism, but in high-value, knowledge-based industries like information technology, artificial intelligence, and cybersecurity.
Cities like Šibenik, once known primarily for their historical and touristic appeal, are now quietly transforming into specialized digital hubs. With a growing ecosystem of innovation centers, EU-funded programs, and a favorable environment for remote work, these smaller cities offer the ideal conditions for focused, high-impact technological development. Their size becomes an advantage: they are agile, collaborative, and able to attract experts looking for both professional depth and quality of life.
In Šibenik, for instance, the local innovation center Trokut has become a launchpad for startups and advanced tech initiatives. One notable example is a company developing cutting-edge tools in AI and cybersecurity, now hosting events that gather leading researchers, ethical hackers, and privacy experts from across Europe. This is not an isolated case—it reflects a broader trend across Croatia, where digital nomads, local talent, and international entrepreneurs are converging around shared values: specialization, independence, and technical excellence.
What sets this new wave of digital Croatia apart is its move toward quality over quantity. Rather than compete with global tech giants in scale, Croatia has the potential to build highly specialized micro-ecosystems—especially in domains where trust, security, and technical sovereignty are paramount.
In a global landscape marked by increasing threats to digital privacy and rising demand for secure, responsible AI, Croatia could position itself not just as a low-cost IT destination, but as a European center of excellence in cybersecurity, ethical AI, and privacy engineering. With the right support, cities like Šibenik could lead the way, showing how local ecosystems can nurture global impact—one focused innovation at a time.
A Heritage of Innovation
Let’s not forget: Nikola Tesla was born in modern-day Croatia. That heritage of brilliance and invention still resonates. Rimac’s electric hypercars and Infobip’s global communication platforms are more than just business successes – they are symbols of a new Croatian narrative.
Croatia’s young talent is thriving at institutions like Zagreb’s FER (Faculty of Electrical Engineering and Computing), which ranks among Europe’s best. And as the digital sector grows, it may help reverse Croatia’s worrying demographic decline, marked by years of brain drain and emigration. The net migration rate remains negative, but there are signs the tide is beginning to turn.
Policy and Infrastructure Catching Up
Encouragingly, policy is starting to match ambition. The government’s 2020-2024 strategy earmarks over €22 billion in EU funds to accelerate digitalization, support workers, and overhaul education and research. More than €650 million is dedicated to innovation and tech infrastructure.
One early success: the introduction of a digital nomad visa, which was rolled out in under two months. That visa has brought international talent to Croatian shores year-round, filling seasonal housing gaps and blending tourism with tech.
Looking Ahead
The road ahead is not without hurdles. Croatia still faces bureaucratic inertia, underdeveloped capital markets, and gaps in technical education. But momentum is building.
If Croatia can retain its young talent and continue to attract global innovators, it may finally break free from its economic fragility. And as Šibenik, Split, and other Dalmatian cities lean into the digital future, the region could emerge not just as a tourist hotspot, but as a technological one.
The question is no longer whether Croatia can reinvent itself through technology.
It’s whether it can do so fast enough.
