Central Europe Review: In mid-May, the new Government will have worked 100 days. What is your general assessment of the Government’s work in this period?
Goran Granić: I have mixed feelings. In one sense, we've done quite a lot, and in the other, we've done too little. That paradox makes sense when you consider the number of difficulties Croatia is facing. One can do a great many things in a short period of time; however, objectively, it still may not be enough. The economic crisis lasted for too long, and all those measures we are undertaking are not enough to prevent negative trends. It seems to me as if three years have passed and not three months.
CER: The Government started its work at the moment when it was necessary to pass the budget...
Granić: Passing a budget at the beginning of any government is clearly a very big problem, and in our case, the situation was even worse. Every member of the Government and the Government as a whole needed some time to realise what the problems really were to understand where the money really needed to go. We needed basic information - we did not know people in various ministries, we did not know the budgets in place in those ministries, etc - all that made our starting position quite difficult.
Furthermore, we had to pass a budget that was very restrictive: we had to reduce expenditure, because Croatia had started to spend more than it could afford. We had very little room for manoeuvre. Nearly one third of the budget is dedicated to the salaries of state employees. In some ministries, that goes up to 85 per cent of all expenditure. That blocks nearly all development projects.
For example, at the Ministry of Defence the budget was cut by ten per cent, and with that reduction, there is no opportunity for spending on new technologies. Only a cut in the number of employees would allow that.
We have too many state employees - in the police, the army, the state administration... We have to reform the entire system of state administration. In addition to that, the former Government started some projects that were not based in the budget.
On top of that - and unique among the transition countries - we have war damage, both material damage and the damage to human potential. Five per cent of the budget goes directly to war veterans.
CER: One of the most notable election campaign promises of the current ruling coalition was the review of privatisation. It was even promised that it would be on the agenda of the first session of new Parliament. That, as we know, did not take place. What is the current state of that process?
Granić: It is wrong to believe that the review will be only one measure or one law. The review of privatisation has started through the Privatisation Fund, and responsible state bodies will be informed if there are suspicions that criminal acts were committed. Furthermore, a special government body, led by Deputy Prime Minister Linić, has been established. Finally, the Government will send the new law to the Parliament next month. The review requires hundreds of small steps; this law will only complete that process.
CER: What is the relation between the Government and the trade unions? Before the elections, the parties of the ruling coalition singed agreements with them, but now, some trade union leaders are not happy with the new Government’s policies. How will the Government handle potential protests from that side?
Granić: We have not given up on our partnership with trade unions; however, some trade union leaders seem to have ambitions to engage in politics. We, of course, can not prevent such ambitions.
The Socio-economic Council has so far not been treated equally by both partners: only one partner is expected to meet its commitments, while others are not. If this situation remains, the Council will become unnecessary. Trade unions do not want to take responsibility for their part of the agreement, and their leaders are putting politics above the interests of their membership. The Government will not give way to any pressure; it will implement its policies whether trade union leaders like them or not.
We warned everyone that this year would be a difficult one. No one can expect the type of social security that existed before 1990; in market economies you do not have such things. Everyone now has to bear risk, both politicians and workers.
Successful companies will survive; the others will not. We know of some large companies in which up to 25 per cent of employees are on sick leave, demanding benefits from the state. It is clear that such companies cannot function competitively.
Workers, management and trade unions must understand that the state has no money and no right to take from those who are successful and responsible and give those who do not want to work.
CER: Let us turn to the international position of Croatia. It seems there is a lack understanding as to what the integration of Croatia into the European Union really means. Many seem to think Croatian membership in the EU is just a matter of political good will in Brussels and not a very long and comprehensive process of adaptation.
Granić: You are right, but there is a "but." Yes, verbal support for Croatia is absolutely there in Brussels. For Europe the changes in Croatia are one of the most positive events in this region in recent years, especially since I think that they almost started losing hope that changes could ever take place here in a normal, legal and democratic way rather than being imposed by them, as in Bosnia-Herzegovina and Kosovo. It was for them a pleasant surprise, and they are not hiding that.
Membership in the EU is a motivating factor for Croatia. If we were as developed as the EU, we could discuss if membership is a good thing or not, like Norwegians do. However, for us the EU means imposing high criteria for changes, that is, these criteria can mobilise a nation that has to change in many respects. I perceive the EU as bringing changes and rules of the game that we have to accept as soon as possible to become their partners and in order to offer to our citizens what they want.
For 50 years, citizens have been wishing and waiting for better times to come. I think they deserve it, and the introduction of certain standards means brining Europe to Croatia.
CER: Will the relationship between Croatia and its neighbours in Central and Eastern Europe change? The co-operation with Visegrád countries (except partly with Hungary), CEFTA, etc has been meagre thus far, but it seems Croatia has many things to learn from these countries. Do you think that the level of co-operation with these countries, not only economic but also political, should be increased?
Granić: Yes. But that was not a mistake only of Croatia, but of all countries in transition, who, after the break of communism, turned towards the West, searching for their future there. In my view,
|the perception here is that the rich West will help the poor East, and that is completely wrong|
Central Europe is large market, and there is a natural linkage within that market. I believe that countries in transition should co-operate more closely, because that is the only way to establish proper relations with the West. The perception of the West, including here in Croatia, is that the rich West will help the poor East, and that is completely a wrong assumption.
There are some lessons we can learn from each other, but the experience of each country is very different, as are its chances. The key to everything is the size of the country. Poland, which is eight or nine times as big as Croatia, has entirely different prospects. Croatia has to develop its own philosophy of development.
CER: Croatia singed the Stability Pact, but unlike in some other countries of the Pact, in Croatia the Pact does not appear to be an important part of the public debate. It is rather seen as a way for Croatia to show that it is ready for EU membership. Do you think that Pact is really serving that purpose, or is it rather a way to pacify the Balkans? Are these two tendencies linked?
Granić: We in the Government are not sceptical towards the Stability Pact; we will take part in it to the best of our abilities. I do not see anything bad in it, but I also do not see it as a magic formula. Many international initiatives have been started, often with the best of intentions, but they were not always sufficiently prepared and developed and were often without a clear vision of the future.
The previous Government was somewhat sceptical about regional co-operation; it was afraid of the re-establishment of some past form of integration. We are not afraid of that, and we believe that Croatia cannot be integrated into some new Yugoslavia. It's a waste of time to even consider it; constitutional provisions are very clear in that respect.
It is in our interest that this region becomes part of our market. We do not have any political
|it is in our interest that all our neighbours are successful, democratic states|
However, developments in Serbia will be determined by Milošević, and not by the international community, and until he steps down from power, there is no chance for development of relations. As far as we are concerned, we will trade with every country in the region. If the West can trade with Serbia, we can do that as well.
CER: How will Croatian position itself in the event of armed conflict in Montenegro?
Granić: That is the last thing we would want; the stability of Montenegro is in our interest. Croatia is tired of Milošević’s wars and their consequences, and I hope that this frenzy will stop. We would have to be neutral, of course, but we would fully morally support Montenegro in defending the democratic processes that have started there. It is in our interest that all our neighbours are successful, democratic states.
CER: Back to Croatia. Can you comment on the proposal of the expert group for constitutional changes? What will be the Government commission’s proposal like? Will this problem be resolved soon?
Granić: I think that a single commission will be established which will resolve all dilemmas. That is actually not a real problem. Our six parties have the majority in the Parliament, and they can adopt any type of constitutional change they wish. It is in our interest to have both a successful President and a successful Government with everyone looking after his own area of responsibility. It often happens that some people want more authority and more responsibility but are not even looking after those they already have.
For my part, I want as little authority as possible; what I have already is too much. I would give some of my tasks away to someone else without hesitation.
CER: There was some negative reaction to the Government's decision to dismiss the assemblies in Zagreb and some other towns in Croatia. Was the way in which that was done really optimal?
Granić: Mass dismissals of assemblies are not good and the Government does not support it.
CER: But it was the Government which dismissed them...
Granić: Yes, we had to do so, because we were obligated by law. We acted only as mailman who has to deliver a message. When resignations are on the table, when an assembly is blocked or when no budget has been passed, then we have to make decisions and to offer a way out. The only solution is elections.
CER: The impression remained, however, that in the Zagreb case some resignations were forced...
Granić: I respect those people who signed resignations, and out of that respect I will not comment that. I think these people have to be protected from such accusations. They gave Croatia too much to have their names now appearing in the media in a very unsuitable context.
CER: Certain criticisms have been raised that the Government is too "soft" in replacing certain people who were put in their positions under the previous system. Others have complained that the Government is too "tough" and replaces everyone according to party affiliation. Do you not think that it is dangerous to identify politics with personnel policy?
Granić: I think that some things could have been done faster, yes. On the other hand, an unacceptable atmosphere has been created in the country, in
|in my opinion, half of the people in state administration should be fired|
I think that political motivation has not been decisive in personnel matters. After all, we have three ministers in the Government who are not members of any party - and some deputies and assistants, as well. Some new people have come in, but no one was fired.
In my opinion, half of the people in state administration should be fired - at least 20 or 30 per cent are certainly superfluous. I am not sure, however, that we will be able to do that. The problem is in the structure of administration.
The HDZ also had the same problem, so they did not fire anyone, but they brought in new people. If we now bring in new people, the state administration will be too huge.
I believe that many people in the state administration do not meet certain criteria of quality; party affiliation is not a problem. Those who were put into their positions by a certain brand of politics have to understand that they have to leave when their politics has lost the elections. That includes ministers, deputy ministers and directors of large state-owned companies. That is not a tragedy.
CER: How will Croatian politics look in four years?
Granić: At the last elections, the people voted for a democratic Croatia, and the processes of democratisation are now unstoppable.
But no government in the transition countries has had strength to resolve every problem, and there is a pendulum effect in all those countries. In Croatia that was just slowed down because of the war, but I believe that Croatia will follow that model as well. It would be too nice to think that we will resolve all problems of Croatia; however, realistically, the problems are just too big.
I believe though that we will have made a good, honest part of the job and that the new Government, in four years, will start from a much better position than ours today. I am an optimist.
Interview conducted on 26 April 2000 by
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- Interviews with:
President of the Republic Stipe Mesić
President of the Croatian People's Party Vesna Pusić
President of the Liberal Party Vlado Gotovac