In the aftermath of independence, Croatia underwent a period of reconstruction and institutional transformation. It has made much progress since, moving successfully to a market-based economy that has become closely integrated into the European and global economy through international trade and cross-border flows of investment and knowledge. Over an extended period, Croatia’s solid economic growth resulted in partial convergence to the average European level of income. While it still has considerable room for improvement, Croatia’s accession to the European Union can be seen as the culmination of a reform effort aimed, among other things, at facilitating investment, strengthening competition and reducing bureaucracy, and implementing the acquis communautaire.