Croatia is taking action to address its declining population and low birth rate with a €685mn plan focused on supporting families and encouraging the return of emigrants. 

Prime Minister Andrej Plenković unveiled the measures, which will roll out in March 2024, saying that demographic revitalisation is crucial for the country's future.

For years, Croatia has faced a steady drop in its population. Since joining the EU in 2013, the population has shrunk by nearly 10%, and projections suggest it could fall to just 2.5mn by the end of the century. Last year, the number of births hit a record low of 32,170, compared to 55,000 in 1997.

The new plan focuses on improving conditions for parents. Maternity allowances will triple, rising to €3,000 for the second half of parental leave, and paternity leave will double from 10 to 20 days. A one-time allowance for newborns will also double to €618. These measures aim to ease the financial burden of starting a family and encourage more people to stay in Croatia.

The government is also focusing on the housing and education sectors, aiming to address challenges young families face. Investments of €2.7bn will target preschool education, schools, sports halls and single-shift teaching. By 2030, every child is expected to have a guaranteed place in kindergarten. To support young people further, the government plans to increase creditworthiness and offer housing incentives, including measures to make renting and first-time home purchases more affordable.

The country’s declining workforce has added another layer of urgency. Croatia has seen a significant brain drain, with 400,000 people leaving since 2013, many citing better wages abroad. Previous efforts, such as offering financial incentives for expatriates to return, have had limited success. Only around 700 people have returned under a scheme offering €26,000 to start a business.

Plenković acknowledged the magnitude of the challenge, noting that Croatia’s fertility rate of 1.53, though slightly above the EU average of 1.46, is far below the replacement level of 2.1 needed to maintain population levels. He said that the new strategy represents a comprehensive approach, involving tax, education, health, and housing reforms to create an environment where families feel supported.

The government has also increased the budget for demographic measures significantly, with allocations rising to €769 million by 2026 and €805 million by 2028.

Plenković referred to demographic renewal as "the responsibility of this generation" to implement necessary changes.

Countries across Central, Eastern and Southeast Europe are suffering from a combination of low birth rates and mass emigration. Population decline of more than 40% is projected by 2100 in Croatia, according to the UN World Population Prospects 2024 projections.