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September 7, 2018 www.intellinews.com I Page 3
as an outsider with few real ties to the Croatian right. Grabar-Kitarovic’s description in February of those protesting against the visit of her Ser- bian counterpart Aleksandar Vucic as “marginal” caused a stir, given that many were war veterans and war widows.
Those close to the president, however, say that she has a commitment to the country and a desire to change it that is absent in too many Croatian politicians — either ideologues squabbling over history or dull technocrats with little vision.
While Grabar-Kitarovic’s constitutional powers
in domestic policy are limited, she is seen as an activist president, and has been critical of the government of Prime Minister Andrej Plenkovic, despite them both hailing from the right-wing Croatian Democratic Union (HDZ).
Tensions between president and government have eased in recent weeks, however, and Grabar- Kitarovic praised the government’s handling of the crisis at Agrokor, the retail and food company that was put under state-run administration in 2017 after running up debts of HRK58bn ($9.1bn), around three times its current value. She was also upbeat on ongoing tax reforms.
Croatia’s recovery from a prolonged recession has been respectable, if not stellar. Regional bank Ad- diko forecasts GDP growth of 3.0% in 2018, follow- ing two consecutive years of 3.2% growth.
But while the country stands a respectable 51st in the world on the World Bank’s Doing Business rankings, the perception on the ground remains that Croatia has been sluggish in implementing economic reforms. Businesses complain about red tape, high taxes, and a lack of clarity in prop- erty rights, among other things.
“[The government is] taking the right path, and what I’d like to see continue is further tax reform aimed at reducing the cost of doing business for employers, and increasing the salaries of em- ployees,” Grabar-Kitarovic said. “But I’d like all of us to be a bit more ambitious in setting goals
not just for GDP growth but for overall develop- ment in Croatia. I think that we need to be a bit more self-assertive on the European and global stage in terms of promoting investment in Croatia, and promoting Croatia as a leader rather than a follower. And of course coupled with that is con- tinued reform of the state administration and the necessary measures to reduce bureaucracy to the lowest level possible.”
While the president’s influence over such slow- grind reform is largely limited to the bully pulpit, in July she presented a new initiative to tackle emigration. This includes tax reductions, pro-fam- ily measures, and changes to legislation to en- courage the integration of immigrants. According to figures used by the president, 80,000 Croats left the country in 2017 alone, and the country could see its population drop by 1.1m by 2051. This is putting further strain on an economy in which the ratio of people in employment to pensioners is already 1:1.
East-west convergence
Grabar-Kitarovic has been an advocate of the Three Seas Initiative (TSI), which seeks to strengthen the economies of CEE, particularly through improving interconnectivity in energy and transport. The Croatian president sees the TSI as a means to close the gap between the EU’s east and west, and reinvigorate the European project as a whole.
“The Three Seas Initiative is about convergence; it’s also about connectivity, cohesion, and the competitiveness of our businesses,” she said. “I believe that if we focus on improving lives and erasing the differences across the European con- tinent we will also move a lot closer to these com- mon values and upholding them together. The TSI is based on three pillars — building intermodal transport that exists in Western Europe but that we lack. Energy, which is a very important aspect of economic development, political independence, and political stability, and digitalisation.”
Looking east, Grabar-Kitarovic defended her re-