(AFP) Visiting Croatian President Stipe Mesic is seeking Malaysian investment in his country's tourism industry, Foreign Minister Syed Hamid Albar said today.

"They want Malaysian businessmen to set up hotels in the country," he told reporters after Mesic and Deputy Prime Minister Abdullah Ahmad Badawi discussed bolstering economic ties.

Croatia had also offered itself as a gateway for Malaysian products to Europe, Syed Hamid said.

Trade between the two countries "is small", mainly involving electrical products from Malaysia, he said.

Abdullah paid a courtesy call on Mesic, accompanied by Syed Hamid, after the Croatian president was accorded an official welcome at Parliament Square.

Prime Minister Dr Mahathir Mohamad is on leave until Feb 28.

Double taxation

Mesic, the first Croatian head of state to visit Malaysia, arrived here Sunday for a five-day visit, as part of a Southeast Asian tour to boost economic relations.

Later in the day, the two countries were due to sign an agreement on the avoidance of double taxation to facilitate economic cooperation.

Mesic would also hold talks with Abdullah at the administrative capital of Putrajaya before attending a state banquet hosted by King Tuanku Syed Sirajuddin Putra Jamalullail.

Croatian ambassador to Malaysia Damir Perincic Sunday said Croatia was keen to cooperate in the airline and energy sectors and wanted Malaysia Airlines to resume flights to Zagreb.

Croatia also hoped to establish cooperation with Malaysian ports to serve as a gateway for each other's products and maritime transport to Southeast Asia, central Europe and the Meditteranean, he added.

The 68-year-old Croatian leader is also scheduled to tour the manufacturing plant of national carmaker Proton and the world's tallest office buildings, the Petronas Twin Towers.

On Tuesday, Mesic will fly to Sabah before leaving for Brunei on Thursday.

He has already visited Thailand and Indonesia.