Remediation of consequences of the March 2020 earthquake

On 12 November 2020, the Government adopted a decision establishing the manner of allocating EUR 683.7 m in grants from the EU Solidarity Fund, approved for financing the restoration of earthquake damages. Thereby a legal framework was established for coordination, implementation and monitoring of the system of use of these funds.The funds of the European Union Solidarity Fund are intended for urgent rehabilitation measures, providing for the affected population, reconstruction of infrastructure and public buildings, and cannot be used for the reconstruction and construction of family houses and residential buildings.The Government Decision contains annexes that specify the types of operations to be implemented, the respective funds allocated for them, the bodies in charge of individual operations and their scope (Annex 1 and Annex 2).Implementing bodies shall announce public calls for different categories of costs, under which beneficiaries submit their applications. The national coordinating body for implementation is the Ministry of Physical Planning, Construction and State Assets and the bodies responsible for the implementation of the financial contribution according to their responsibilities are: Ministry of Economy and Sustainable Development, Ministry of Health, Ministry of Physical Planning, Construction and State Assets, Ministry of the Interior, Ministry of Culture and Media, Ministry of Defence, City of Zagreb, Zagreb County, Krapina-Zagorje County and Fund for Reconstruction of the City of Zagreb, Krapina-Zagorje County and Zagreb County. The Central Finance and Contracting Agency for European Union programmes and projects (CFCA) is the independent audit body.The procedures are governed by common national rules for the EU Solidarity Fund and according to them, individual calls regulate more closely the issues of eligible applicants and costs. All costs that are eligible in terms of the provisions of the Regulation establishing the EU Solidarity Fund and were incurred from the date of the earthquake, i.e. from 22 March 2020 on, may be reimbursed on the basis of accepted project proposals and concluded contracts.In accordance with the Government's conclusion of 10 June 2020, the Republic of Croatia requested a grant from the European Union Solidarity Fund to remedy the consequences caused by the earthquake in March 2020.At the plenary session held on 23 November 2020, Members of the European Parliament approved granting of assistance to Croatia from the European Solidarity Fund for the remediation of the consequences of the devastating earthquake in Zagreb on 22 March 2020 in the amount of EUR 683.7 million.The first calls for project proposals were announced already in January 2021. The line ministries and implementing bodies have so far announced 14 calls for the reconstruction of infrastructure for water supply and drainage, energy, transport, education, health care, prevention infrastructure and cultural heritage protection, costs of rescue services and provision of temporary accommodation and prevention of soil erosion, and the grant funds are used for reimbursement of public expenditures in the areas of the City of Zagreb, Zagreb County and Krapina-Zagorje County.Under these calls, by 25 January 2022 a total of 560 project proposals were received, worth a total of HRK 12.1 billion, and 348 contracts worth HRK 8.43 billion were concluded, including funding from the EUSF as well as other sources. Out of the contracted project proposals amounting to a total value of HRK 12.1 billion, out of which a share of HRK 5.1 billion is financed from the European Union Solidarity Fund, 162.7 million were disbursed based on the submitted applications for reimbursement of funds.

Remediation of the consequences of the December 2020 earthquake

In accordance with the Conclusion of the Croatian Government of 18 March 2021, the Republic of Croatia sent to the European Commission a request for funds from the European Union Solidarity Fund (EUSF) for the remediation of damages caused by the series of earthquakes in Sisak-Moslavina County starting on 28 December 2020, together with the request for advance payment.The estimated value of total direct damages caused by the Petrinja earthquake, in accordance with EU rules, amounts to HRK 41.6 billion (HRK 41,633,410,427.00) and EUR 5.5 billion (EUR 5,508,740,811.00), which represents 10.21% of GNI (gross national income) of Croatia.Following the request from the Republic of Croatia, on 29 October 2021 the European Commission proposed to the European Parliament and the Council that Croatia be allocated the requested amount of aid of EUR 319.2 million from the European Solidarity Fund. The procedure for approving this proposal was completed on 14 December 2021 by adopting the Decision on granting financial support by the European Parliament.An advance of EUR 41 million EUR (41.325.507.00 EUR) was paid to the Republic of Croatia on 2 August 2021, while the remainder of 277.8 million EUR was paid on 30 December 2021.The use of assistance funds is directed towards the reconstruction of infrastructure and public institutions in the area of the City of Zagreb, Krapina-Zagorje County, Zagreb County, Sisak-Moslavina County, Karlovac County, Varaždin County, Međimurje County, Brod-Posavina County, Koprivnica-Križevci County and Bjelovar-Bilogora County for: 

• returning to the correct working order of infrastructure and facilities in the energy sector, in the field of water supply, waste water management, telecommunications, transport, health and education;

• the provision of temporary accommodation and the financing of rescue services, to cover the needs of the affected population;

• ensuring preventive infrastructure and measures for the protection of cultural heritage;

• cleaning up disaster-affected areas, including natural areas, in accordance with, where appropriate, ecosystem-based approaches and the urgent restoration of affected natural areas in order to avoid immediate effects of soil erosion.

By Government Decision of 24 November 2021 (Official Gazette 127/21, 143/21) the implementation system has been defined. The Ministry of Physical Planning, Construction and State Assets is the National Coordinating Body, while the competent line ministries are designated for the implementation of the financial contribution under their competence. Common national implementation rules were adopted on 28 December 2021.On 5 January 2022, the respective line ministries announced 12 public calls for the reconstruction of buildings in the fields of education, cultural heritage, energy sector, transport infrastructure, telecommunications and health, and for the purpose of ensuring temporary accommodation, financing rescue services as well as cleaning disaster-stricken areas and restoring affected natural areas in order to avoid direct effects of soil erosion.In the preparation of the calls themselves, all bodies that have already incurred costs eligible for the Solidarity Fund have been considered, in order to ensure by refund of such costs the speedy realisation and to primarily refund funds already invested, as well as to secure part of the funds for new contracting.According to available data, out of the already incurred or contracted costs amounting to about EUR 240 million, nearly EUR 80 million have so far been spent on operations whose financing is eligible from the Solidarity Fund, whereas projections of needs for concrete projects expressed on the earthquake affected area range up to EUR 760 million.Under the said calls, a total of 134 project proposals, worth a total of about HRK 1.3 billion, were received by 25 January 2022.The deadline for the use of the European Solidarity Fund grants expires after 18 months from the date of award, i.e. at the end of June 2023.