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Meet the New Government, Same as the Old Government?

vlada_republike_hrvatskeNot by a long shot. Croatia finally has a new government, less than a year after the last one was sworn in. This time, although the Government is again mostly HDZ with several old names from Most, it seems to be far more stable. And it also seems to be less controversial. So what happened?

The last Government, led by a politically anonymous PM Orešković, was a rag-tag collection of fringe characters, inexperienced protest-wave surfers from Most and an occasional technocrat. However, its main characteristic was a strong nationalist overtone promoted by HDZ and its smaller right wing partners, revisionism and other extreme positions that led to its almost universal isolation. On top of that, most of the ministers were inexperienced to the extent that made it impossible for them to actually move their portfolios during the short life of that government. Net result, if any, is hard to estimate, and whatever there was is buried in almost a thousand-page handover report of former PM Orešković to Mr Plenković.

In contrast, the new government is a collection of experienced HDZ technocrats, all of them with many years of experience in the public sector, for most of them at the “almost” level except the HDZ ministers from the Orešković government. The main actors are polite, soft-spoken Christian democrats that could fit in any European conservative government. But most of them haven’t had any real political exposure in Croatian politics and their political prowess is hard to estimate right now. The remainder of ministers are Most, which led to some questions because Most got their seats in spite of the fact that other parties and minorities already provided the HDZ with enough votes to confirm the government.

Initial statements were general enough, but two things have happened so far that could provide some small insight into things to come.

First, the Government presented its main project for this year, the Comprehensive Tax Reform package. This was presented as its first major project, something that the entire Government stands behind. But it turned out it was not such an easy thing to do. Not only did it draw strong criticism from various groups that could be negatively affected by its provisions, but Most also opted for a cautious “this is just a proposal, let us review it”. This could indicate several things – that the package was not as carefully prepared and negotiated as the new PM led to believe, that the internal dynamics within the coalition are far from simple, and that generally the new cabinet might still be somewhat high on adrenaline after the unexpected victory. In addition, the package seems to include some controversial proposals, such as raising the VAT on tourism from 12% to the full 25%. As tourism accounts for about 18% of the GDP, this move alone could have far reaching consequences should it push the industry over the fence. Income tax brackets also drew criticism from various groups, as did other VAT adjustments etc. The end game for now includes the MFIN giving up on at least some of the proposed tax increases under pressure from Most, leading to questions where the money will come from in the end? Also, the process seems far from over as Most is again saying they would propose amendments once the package reaches the Parliament. This is somewhat unusual behaviour for a partner in the sitting government but it might be a part of the process of growing up. So the would-be showcase project seems somewhat stuck on technicalities and may end up being somewhat less spectacular than initially planned.

Then, as PM Plenković ended his first bilateral visit to BiH, Zagreb was shook by news of the arrests of ten former HVO (Bosnian Croat military) members, all of whom also hold Croatian passports. They were arrested on order of the Bosnian special prosecutors on charges of war crimes. In itself, this would be nothing remarkable. However, the reactions of the Croatian Government did make this incident worthy of note. First both position and opposition claimed that this was done intentionally and that the arrests were politically motivated. Then, the PM claimed he did not know that this was going to happen, and that Croatian secret services did not “have that information”. The MFA Stier led the Government response basically saying “we are members of EU and NATO, you can’t do this to us”, various veterans’ associations got involved claiming innocence of the arrested, the government promised all kinds of help – legal, financial and political, and so on. Last, the MOD Krstičević cancelled his trip to BiH, officially saying that he is busy with the budget but the public story is that “his safety cannot be guaranteed”.

All of this raises almost too many questions. First, both the President and the new PM chose BiH as their first destination, indicating a strong interest in Bosnia and at least the President met with Bosniak politicians frequently. Also, HDZ as a party has exceptionally strong ties in BiH. Finally, visits on that level are meticulously prepared and all details carefully screened. So to say “we did not know” indicates either a very serious problem if true, or a dangerous political spin if not. If true, and former President Josipović already said publicly he was briefed about the case, either the Croatian civil service or the BiH political leadership decided to spring a fast one on PM Plenković. Possible, but highly unlikely as neither is done in normal societies. Unless there is some Karamarko curse calling for revenge of the spies no civil servants have a reason to do this, and for BiH politicians it is virtually unthinkable to do so unless they are planning for war.

So what is left is an intentional spin on the case. And this we see as extremely dangerous if true. Before PM Plenković left for Bosnia, Croatian media was full of stories about Croats being outvoted, outmanoeuvred and generally depraved of their political rights in Bosnia and Herzegovina. This in particular in the Federation, because Zagreb seems to have given up on the RS a long time ago, and therefore all that ails the Croats lies in Sarajevo. Zagreb is clearly aware of the perceptional dangers of the requests for a “third entity” and formally this is not on its agenda. But it seems to be there in everything but the name, and that could be perceived by the partner side in less than favourable terms. This incident basically provides Zagreb with an opportunity to threaten Sarajevo unless the “Croat position in the Federation improves”, and this was done over the past week in no uncertain terms. So the Bosniaks reacted predictably, and the RS leadership came out on top basically asking what all the fuss was about. But the story moved on in an interesting direction, as one of the main Serbian dailies carried the news of RS filing indictments against a number of active and retired Croatian generals. For now there are no official confirmations on either side, but for the Croatian policy position it almost does not matter if this story is true or not. Its main result is boxing Zagreb between the rock and the hard place, with no elegant way out whatever the truth may be. Plenković’s government is now facing a real possibility of being labelled a difficult and unreliable partner when it comes to processing of war crimes, which is a topic where Croatia expected to make life difficult for Serbia in accession talks. Now this will be much harder regardless of the actual outcome.

Whether this was an accident or not, or whether there is a plan behind this remains to be seen in the weeks to come. For now, the only net result is an increase in tensions and the benefits of that are somewhat hard to discern.

It is still early days of the new Government, and it might take some time for all the dust to settle. For now the Plenković cabinet seems to still be looking for its sea legs and the question is whether it will ever find them. The cabinet is full of professional administrators, so the mere machinery of the government should not be a problem in the long run (although there were some questionable decisions already made, such as not respecting deadlines or consultation requirements). But the politics of the bigger picture for now remain unseen, and here is where experience really counts. We will continue to watch from a cautious distance as these stories unfold.

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