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This paper provides a contemporary analysis of human resource development (HRD) in Croatia. The main sections of the paper examine the following areas: main economic developments; current situation and trends in labour market and HRD; analysis of relevant policies and identification of challenges in relation to the main priorities of the employment guidelines; supporting instruments from the European Union (EU) and other donors in the field of employment and HRD; the challenges and recommendations for HRD and labour market related reform/modernisation processes underpinning Instrument for Pre-Accession Assistance (IPA) objectives; and institutions and capacity for good governance and partnership.