This chapter gives a short overview of Croatia’s macroeconomic performance and highlights important features of its economic development, including its integration in European markets and the world economy, and its openness to international trade and foreign direct investment. It sketches some salient features and patterns of structural change in production and trade, including the emergence of services and the relative decline in the comparative advantage of key exporting sectors. It also looks at the current state of important framework conditions for innovation. It concludes with a discussion of the potential role of innovation in Croatia’s economic development in the longer term.