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The Croatian Government (Vlada) is headed by the Prime minister who has 2 deputy prime ministers and 14 ministers in charge of particular sectors of activity. The executive branch is responsible for proposing legislation and a budget, executing the laws, and guiding the foreign and internal policies of the republic.

The later kings sought to restore their influence by giving certain privileges to the towns, making them Royal Boroughs or Free Royal Towns (similar to the Free Cities in the Holy Roman Empire), which the kings defended from the feudal lords in return for the town's support.

Croatia is situated between central, southern and eastern Europe. It has a rather peculiar shape that resembles a crescent or a horseshoe which helps account for its many neighbours: Slovenia, Hungary, Serbian part of Serbia and Montenegro, Bosnia and Herzegovina, Montenegrin part of Serbia and Montenegro, and Italy across the Adriatic. Its mainland territory is split in two non-contiguous parts by the short coastline of Bosnia and Herzegovina around Neum.

The official and common language, Croatian, is a South Slavic language, using the Latin alphabet. Other languages are spoken by less than 5% of the population.

Following the Battle of Mohįcs, in 1527 some of the Croatian (and Hungarian) nobles supported Ivan Zapolja, while some preferred suzerainty to the Austrian king Ferdinand of Habsburg. The latter option prevailed by 1540, when Zapolja died.

Inflation and unemployment rose and the kuna fell, prompting the national bank to tighten fiscal policy. A new banking law passed in December 1998 gave the central bank more control over Croatia's 53 remaining commercial banks. Croatia is dependent on international debt to finance the deficit. A recently issued Euro-denominated bond was well received, selling $300 million, which helped offset economic losses from the Kosovo crisis.

A four-fold split of the province of Illyricum followed at the turn of the 4th century under Diocletian — an emperor of Illyrian descent, from Dalmatia. Other notable people from these areas in this period included the Christian Jerome, Saint Marinus (builder of San Marino), emperors Valentinian I and Valens, and Pope John IV.

The National Judicial Council (Dr˛avno Sudbeno Vijece) of the Republic appoints all judges. It is a body consisting of a president and 14 members proposed and elected by the Parliament for 4-year terms, maximum 2 terms.

Rapid industrialization and diversification occurred after World War II. Decentralization came in 1965, allowing growth of certain sectors, like the tourist industry. Profits from Croatian industry were used to develop poorer regions in the former Yugoslavia. This, coupled with austerity programs and hyperinflation in the 1980s, led to discontent in both Croatia and Slovenia that fueled the independence movement.

The recession that began at the end of 1998 continued through most of 1999, and GDP in 1999 was flat. Inflation remained in check and the kuna was stable. However, consumer demand was weak and industrial production decreased. Structural reform lagged and problems of payment arrears and a lack of banking supervision continued.

The powers of the legislature include enactment and amendment of the constitution; passage of laws; adoption of the state budget; declarations of war and peace; alteration of the boundaries of the Republic; calling referenda; carrying out elections, appointments, and relief of office; supervising the work of the Government of Croatia and other holders of public powers responsible to the Sabor; and granting amnesty.Decisions are made based on a majority vote if more than half of the Chamber is present, except in cases of national rights and constitutional issues.