Today the family has reached back across the sea to acquire vineyards in their native land. Returns on investments in the Balkan nation can be high, Jeramaz says, but he warns that the risks are commensurate with the potential profits.

Croatia’s steps still falter after decades of communist rule and the 1991–95 war of independence. However, the nation of 4.4 million people is forging ahead. It remains on track to join the EU by the end of the decade, and is expected to receive a formal invitation in April to join NATO. The World Bank is working with Croatia to increase transparency and strengthen business law within the judicial system, which is notoriously slow. For its part, the government is moving to reduce the number of state-owned enterprises, which comprise a formidable 40 percent of the economy. A government website, hitro.hr, explains how foreign entrepreneurs can form limited liability companies in the country.

The government and the private sector also are making investments in ports and transportation systems to draw import-export business from throughout Central Europe. In May, a 12.5-mile stretch of highway, with six tunnels, opened near Zagreb. The government owns 49 percent of the $325 million project, while Pyhrn Concession, a branch of Austria-based Strabag, owns 51 percent.

However, the spectacular Dalmatian coast of the horseshoe-shaped country shows the greatest investment and economic potential. The Adriatic Sea, with more than a thousand islands and dozens of marinas, draws tourists like a magnet. Lonely Planet named Croatia its top tourist spot in 2005, and National Geographic listed it as the number one "adventure nation" in 2006. The World Travel & Tourism Council ranks Croatia fourth out of 176 countries in 10-year growth potential. The Ministry of the Sea, Tourism, Transport and Development reported that 1.1 million tourists entered the country the weekend of July 22, and tourism in general was up 12.7 percent for the first half of 2007. The sector accounts for nearly 20 percent of GDP and, directly and indirectly, almost one-quarter of the country’s employment.

"Now everybody knows where Croatia is," Jeramaz says. "It’s a beautiful country. It was never industrialized on the Dalmatian coast, so everything is pristine."

Promise and Pitfalls
While Jeramaz’s Croatian investments lay strictly in wine, he sees tourism as the bright spot for investors. The sun and sea may be spectacular, but, he notes, visitors find little in the way of development. "When I go to Arizona it’s desert, but billions of dollars have been invested there," he says. "I see potential for smart people coming to Croatia and building resorts and giving people something to do." As recently as 2006, the entire country had only three golf courses. Jack Nicklaus is working with developer AB Maris to design a course for the Porto Mariccio Resort, scheduled to open in 2009. Officials have identified more than 20 potential golf course sites, but the mountainous terrain, water issues, land ownership and local opposition hamper development.

Croatia is also seeing the genesis of a high-end hotel and resort sector. Last December, Starwood’s Le Meridien Lav opened in Split with 381 rooms, a casino and an 80-berth marina. Officials from Dubrovnik visited their sister city of Monterey, Calif., last year looking at that city’s tourism industry and seeking out investors.

Sectors peripherally related to tourism have also experienced growth. "Lots of people are buying ancient houses on islands and remodeling them. The real estate business is strong," Jeramaz says. "The wine industry is strong. Until 10 years ago, there were just a few state-controlled wineries. Now there are thousands of little ones. We didn’t go in to make a bundle of money—we wanted to show how to make high-quality wines—but we didn’t want to lose money."

Despite the possibilities, Jeramaz warns of pitfalls. The country still struggles with the legacy of corruption under socialism, Jeramaz says. "We would love to expand, but we can’t find a person to help us. It’s hard to find a trustworthy person who won’t swindle your money," he says. "There’s a huge demand for wines there. We could start expanding, but it’s kind of a headache."

Debra Ryono is the associate managing editor of Worth.