Books on Croatia
Update No: 126 - (03/12/07)
Parliamentary elections leave no clear winner
Croatia held elections to parliament at the end of November, with an
Croatia's president began consultations on November 29 with the country's
parliamentary parties about the formation of a new government after inconclusive
The precise make-up of the new government will not be known until mid-December
at the earliest. President Stipe Mesic is waiting for one of the top
vote-getting parties from the November 25 election to gain the support of a
majority in parliament before granting one of them a mandate to form a
Mesic, an old Yugoslav veteran known as a safe pair of hands, also wants to wait
until the results are declared final, which is expected to happen around
December 12, before naming a prime minister-designate.
The parliamentary election produced no clear winner. Prime Minister Ivo
Sanader's conservative Croatian Democratic Union won the most votes, but fell
short of an outright victory.
The opposition centre-left Social Democrats, which came in second, insist they,
too, can muster enough support to form a government with help from smaller
allies in the legislature, which may yet turn out to be the case.
The opposition Social Democrats decided to change their candidate for prime
minister on November 30 and go with the party's leader, in an apparent attempt
to woo allies to form a new government with them. Initially, the SDP named the
party's economics expert, Ljubo Jurcic, as candidate for prime minister during
campaigning before the election. But party officials have now decided to go with
their leader, Zoran Milanovic.
President Stipe Mesic said he would give a mandate to the party that proves it
has the support of the majority in the chamber.
Into the EU?
Whoever takes over has a clear task ahead of them. Croatia is the only outside
country with a realistic chance of accession to the EU in the near future.
As a candidate country it has engaged in accession talks with Brussels and is
generally viewed as maintaining its good track record on strengthening democracy
and the rule of law, as well as meeting the political criteria of membership.
The Slovenian angle
Its chances may seem to have been enhanced by the coming assumption of the EU
presidency by Slovenia. The forthcoming president of Slovenia, Donald Tuerk (he
assumes office on December 22, after a stunning 68% victory on November 11), is
generally favourable to the accession of former Yugoslav states to the EU.
One European Commission condition, however, in the case of Croatia, is the
resolution of a dispute over ownership of the waters of Piran Bay, which it has
made into a fishery, denying Slovenia direct access to the Adriatic.
"Croatia's fishery zone contravenes an agreement made with the EU several
years ago and with the U.N.'s Law of the Sea convention. In that sense these are
no longer bilateral issues. They concern the EU as a whole, which is very
faithful to pacta sunt servanda [respect for contracts] and international
If Croatia continues with this, against the EU and Italy and Slovenia, then
troubles are likely to come. The fishery zone is unacceptable to Slovenia
because the Croats defined the border unilaterally. It is to be hoped that it
can be settled bilaterally because an arbiter or conciliator would be much more
Tuerk admitted he did not know that Slovenia voted against Croatia in a vote for
a temporary seat on the U.N. Security Council at the end of October. "In
1997 I was ambassador for Slovenia at the U.N. and led the campaign to join the
Security Council and frankly did not know about voting behaviour. These things
are irrelevant." Maybe to him, but if ambassadors and top politicians
don’t know about their nations UN voting behaviour – then who does?
The critique by Brussels
A more fundamental criticism comes from the horse's mouth itself, the European
Commission. A recent report is basically positive and clearly welcomes Croatia's
application, both its application to join and its application in its pursuit to
qualify for it.
“However there is considerable scope for further improvement in the judiciary,
in public administration and in the fight against corruption”, the latest
Brussels report on the subject says. Zagreb has made limited progress in
reforming public administration, while the system remains inefficient. “The
civil service continues to suffer from high staff turnover and a lack of
qualified personnel as well as undue political influence at all levels. Further
sustained efforts are needed”, the report says.
Although Croatia has introduced some legal reforms, the Commission says that
“little progress has been made with regard to improving the accountability,
impartiality, professionalism and competence in judiciary”.
Implementing the rationalization of court network has also been slow, while war
crimes proceedings need further improvement. “Bias against Serb defendants
still needs to be fully addressed, as does witness protection”.
In contrast to several other western Balkans countries, Croatia has notched up
some successes in the fight against corruption, but the problem remains
widespread and the Commission considers that there is a need for greater efforts
to prevent, detect and prosecute graft. “No indictment or verdict has been
issued in any high-level corruption case”, the report says, adding that the
concept of a conflict of interests is little understood in Croatia.
The position of minorities poses a serious problem for Zagreb. “Croatia needs
to encourage a spirit of tolerance towards the Serb minority and take
appropriate measures to protect those who may still be subject to threats or
acts of discrimination, hostility, or violence”. The report observes that
while the Serb minority faces particular difficulties in employment, the Roma
have to contend with difficult living conditions and widespread discrimination.
While Croatia has continued with full cooperation with The Hague Tribunal,
Zagreb is criticized for its attitude towards some important aspects of ICTY
indictments against Croatian citizens.
The report also argued that the negative thrust of the public debate on the role
of the ICTY affects the ability to impartially prosecute war crimes at home.
Concerning regional issues, the report concludes that Croatia has made little
progress in finding definitive solutions to various bilateral issues with its
neighbours, particularly as regards the demarcation of borders, which has
affected relations with Slovenia.
Croatia’s economy has registered strong and accelerating growth, and the
country is praised for maintaining macroeconomic stability, including low
inflation. Croatia is considered to be a functioning market economy. But the
report warns that external imbalances may affect macroeconomic stability.
“Croatia has improved its ability to take on the obligations of membership.
Preparations for meeting EU requirements are moving forward at a steady pace and
alignment with EU rules is high in some sectors,” the report concludes.
Inflation Rate To Rise In 2007, CB Governor Says
Croatia's inflation rate will likely rise in 2008 to 4.5 percent, from 2.8
percent in 2007, the country's Central Bank governor said on November 13.
Governor Zeljko Rohatinski was quoted by state-run HRT TV as saying that the
country's gross domestic product will grow by 5.9 percent in 2007. Rohatinski
was reported as saying that GDP growth will likely slow down to some 5 percent
Croatia, formerly part of the now defunct communist Yugoslavia and now a
candidate for European Union membership, has enjoyed steady 5-percent growth
since 2001, mainly driven by state investment, personal spending and tourism.
The International Monetary Fund has warned that the country's growth is
unsustainable over the longer run and has called on the authorities in Zagreb to
reduce Croatia's external vulnerability.
According to the report Rohatinski said the Central Bank will "continue to
keep the lid on credit expansion." He also announced that the Bank will
"continue with its restrictive monetary policy" in 2008.
Rohatinski said foreign debt is expected to stabilize at around 85.5 percent of
GDP in 2007 and to drop to 85 percent in 2008.