Environmental funding is very limited in Croatia, and in general it is extremely difficult to obtain funds from the central budget. There are no environmental funds established on the state or the regional level, either. The only fund in the country currently related to environmental investment is the water fund, which deals with water management activities and related projects and operates by collecting fees for water pollution and consumption charges. Spending from the private sector also is estimated to be very low compared to other countries.
Because of the recent political upheaval, Croatia is not involved with the main foreign assistance programs (e.g. the PHARE Programme). However, funding is still required to establish a monitoring system for air and water, to develop projects for solid and hazardous waste management, to clean up the main polluted rivers and the Adriatic Sea, and to reconstruct water supply and sewage networks.
The environment is not treated as a priority by either the government or the public. This is evident in the small amount of environmental funding derived from state or municipal budgets.
Of four surveyed countries, the government of Croatia is giving the least attention to environmental protection issues. Environmental priorities are currently set without any comprehensive strategy and instead are mainly in response to the most pressing environmental problems causing threats to human health.
However, over the past few years some priority was given to the quality and availability of environmental information. The State Directorate for Environmental Protection has established an Information System for the Environment program designed to support decisionmaking in environmental regulation and protection. The system contains information on pollution levels, selected information on the state of the environment, expert and scientific information from various institutions and documentation and information related to environmental protection issues. Furthermore, priority was given to the protection of sea and surface water, consistent with the fact that the most extensive parts of environmental legislation are dedicated to water protection issues.
One of the major environmental problems facing Croatia is still a lack of proper waste management. Municipal and industrial waste is dumped on open dumpsites, jeopardizing soil and groundwater. The problem mainly stems from the lack of appropriate landfill sites, incomplete legislation and illegal dumping of all kinds of waste.
The major direct environmental investments so far have focused on water protection issues and include the construction of sewage systems and wastewater treatment facilities. In the future, major spending can be expected on waste management projects and perhaps air and nature protection. However, the lack of accurate data makes it extremely difficult to predict the magnitude of spending that is likely to take place.
To date there is sufficient institutional capacity only in a few environmental areas, and few specific regulations and standards have been implemented. In particular, the most comprehensive regulations can be found in the fields of water protection and environmental impact assessment. Besides specific environmental regulations, there are more than 400 regulations relating to the environment but with little coverage of environmental issues. In addition, national environmental protection issues are also incorporated in the Physical Plan and in several sectoral strategies, such as the Strategy for Water and the Agricultural Strategy.
In general, the legislative basis of environmental protection is fragmented, does not address specific urgent problems, and lacks regulatory coordination. There are also major gaps in regulations, and a large part of the regulations are inappropriate or outdated. In particular, there is a lack of systematic environmental monitoring, and the clear definitions of rights, liabilities, responsibilities, control, financing and charges. Overall, environmental regulation is weak, and major improvements will be required to bring the country up to date with current EU standards.
In short, the lack of comprehensive environmental regulations and the insufficient enforcement of existing legislation seriously hinder the development of Croatia's environmental business sector.
In general, the State Directorate for Environmental Protection has the main responsibility of coordinating environmental activities, but its activities are hindered by a low operational budget and a lack of support from other related ministries. Also, many problems arise because the State Directorate operates at a lower level than the ministries, resulting in difficulties of coordination among the various bodies.
Under the existing administrative scheme, most environmental protection issues are handled at the national level. Municipalities have authority mainly over local environmental protection issues and physical planning. Monitoring and enforcement of laws and regulations is carried out by the local governments and state inspectorates. The Environmental Law contains numerous measures an inspector in charge may undertake to ensure compliance. However, the level of enforcement is still inconsistent, and pollution fines are too low to change the behavior of the polluting industries, especially state-owned companies.
There are also specialized agencies that deal with environmental protection issues and are organized as public companies, such as the Croatian Hazardous Waste Management Agency (APO), the Waste Management and Environmental Protection Agency and the Energy Research and Environmental Protection Institute (EKONERG).