Strengths and weaknesses of Croatia after Presidential Elections

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At midnight of the 10th of January, the Electoral Commission punctually announced that Mr. Josipovic, the Social Democrat candidate, won presidential elections stating that Josipovic had obtained 60.29% of the votes cast outdistancing his rival of more than twenty points. Milan Bandic gathered 39.71% of the preferences. Josipovic’s victory was not a surprise considering that he has been practically always given for favoured by all polls since the time when he presented himself for the competition. Furthermore, Josipovic won the first round by beating 12 other candidates with a valuable 31.42%, while his rival Bandic took the second place with 14.83%.

At the run-off ballot, Bandic was inevitably led to adopt a more aggressive strategy. As reported by the website of the Observatory on the Balkans, “ignoring the fact that since a few months ago they have been members of the same party, Bandic began to accuse Josipovic of pushing Croatia back to Communism”. Moreover, the same source revealed that “during the election campaign he has also appealed to the associations of veterans of the so called Patriotic War, accusing Josipovic  of having handing over the Croatian generals as one of the authors of the law on the cooperation of Croatia with the Hague Tribunal”.

These arguments have been rejected by a country which is aware of the decisive steps needed for its future. Indeed, the challenges that Croatia is faced with go well beyond an anachronistic nationalist rhetoric. European Integration, the neeeded response to the economic crisis and the fight against corruption and organised crime are objectives that now tend to converge towards a single direction: the complete normalisation of the country.

Combating organized crime and corruption: the possibility of a more vigourous action

“The vote for me in this election has recognised the need for us to unite in the fight against corruption and crime which are the greatest threats to economic development or any other kind of social progress in general,” he proclaimed in front of jubilant voters for his victory. This sentence sums up the battle for the rule of law that the Social Democratic candidate has perpetrated during the electoral campaign.

In fact, in 2008, Croatia has witnessed a series of Mafia murders and, in 2009, it has assisted at the rise of unclear intertwinings between political and economic environments. Although the repressive response to these events has not been slow and despite the strengthened security apparatus, additional cases of real or alleged corruption involving high ranking officials have plagued the political scene.

Mr. Polanec, the vice premier, was the focus of a case that has touched the country’s largest food industry also known abroad for the production of the product “Vegeta.” In essence, it was a complex and shadowy financial arrangement which had as ultimate aim the control of the majority package of shares of Podravka, the company in question. Although not formally charged, he was morally accused and put under investigation by the judiciary. In fact, Polanec, as Minister of the Economy, was in charge of the 20% of the total shares of that firm and, according to many, he could hardly not realising what was happening.

More recently, the former Prime Minister Sanader, who had previously resigned for no evident reason, was accused of having pocketed money in the form of commissions from an Austrian Bank. In addition, during the same period, the former President Stjepan Mesic has openly called for the intervention of the judiciary to investigate Sanader in the sale of shares of the oil company INA to the Hungarian MOL.

The result of the presidential election is thus hardly surprising considering that they have been conducted by the winning candidate primarily on the issue of legality. Besides being stated as top priorities by Josipovic, fight against corruption and organised crime have been strongly advocated by Brussels, as well. As in the case of Romania and Bulgaria, the EU has attempted to use all its conditionality on these topics. Croatia is indeed in the pre-accession period, and, although an official date has not yet been established, the year 2012 continues to be a realistic forecast.

As a result, the President of the Republic, with the support of EU institutions, will dispose of a large driving force that could have a decisive impact on the life of the country. At this point, it just remains to be empirically verified what concrete results will be obtained, this time with justified positive expectations.

Response to economic crisis: deficit and welfare as top issues

In March, Standard & Poor’s has decided to reduce the rating of Croatia because of the high indebtedness of the country and it has presaged a further aggravation of the situation in 2009. Subsequently, two other agencies, Moody’s and Fitch, even though not having taken the same hard-line of S&P’s, have strongly advocated a restrictive fiscal policy. In other words, leading financial agencies have relentlessly emphasised the vulnerability of Croatia for the high level of foreign debt and for the persistent deficit in the balance of payments.

The year 2009 was indeed very hard from this point of view. The country closed with a decline of about 6% of its GDP and growth forecasts for 2010 are not negative, but very low. Obviously, the country suffers from the global recession, but this is not the only cause.

Like many of its neighbours of the former Yugoslavia, Croatia still feels the weight of the events of the nineties. The war veterans, for example, receive welfare benefits without having contributed financially to the pension system and the reduction of population growth certainly has not helped to heal this problem. In addition, it is nedded to take into consideration that Croatia is still partly a country in transition and it has been used to very high welfare standards. In the light of these streams, the resentment of Croatian citizens towards corruption scandals becomes evident.

The newly elected President has often argued that Croatia is spending more than what it earns and that the current financial architecture is not sustainable. The explosion of foreign debt, which now has surpassed 36 billion euros, is increasingly difficult and costly for Croatia to maintain because the country is no longer able to access new loans to pay off old borrowings. Surely this is the most difficult problem that Zagreb will face in the near future. Cut in governmental spending can arise the opposition of unions and increase the risk of social conflicts.

The global recovery and the economic boost that usually accompanies the full membership of an EU candidate are factors which favour the President and the government, but the path is yet to be pointed out. Anyhow, Croatia has clearly sent a positive signal to the Union. The outcome of the presidential campaign seems having made emerge the maturity of a country which is playing its cards to be finally and unarguably part of the EU family.

Source by Massimiliano Gobbato

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