Kroatien: EU bedauert Rücktritt des Ministerpräsidenten[en] 

During the French EU Presidency, Slovenia blocked the opening of nine out of ten negotiating chapters with Zagreb due to an unresolved border dispute (EurActiv 18/12/08). 

The Czech Presidency failed to make any progress in the negotiations. A huge mediation effort on behalf of the Commission also failed to deliver. Indeed, the EU recently postponed an accession conference after the two countries had failed to show any sign of conciliation (EurActiv 19/06/09). 

In the meantime, hopes have died for Croatia's objective of wrapping up accession talks by the end of the year with the aim of joining the bloc in 2010. 

The border dispute between Slovenia and Croatia concerns small pockets of land along the Adriatic coast, which could prove important if accompanied by exclusive access rights to deep-sea zones. 

Presenting his country’s priorities as EU president, Swedish foreign minister Carl Bildt warned he will not engage in solving bilateral problems including the Croatia-Slovenia border dispute, as he said the two sides needed “a period of reflection” (EurActiv 23/06/09). 

Swedish foreign minister Carl Bildt, an expert on the Balkans, said on behalf of the EU Presidency that Sanader’s resignation was "a loss," adding that the Croatian politician was an important figure in EU integration.

A champion of Croatia's European Union entry drive, Sanader suffered a blow last month when the bloc's executive called off accession talks for the third time this year after a failure to resolve a border row with EU member Slovenia. 

He said he would not run for president of the republic later this year, and dismissed speculation that he was quitting because of bad health. "Thank God, I'm not ill," he said. 

Sanader proposed his deputy, Jadranka Kosor, to take over the government. He did not give a reason for his resignation. 

His government had been beset by economic woes, including a rapidly slowing economy, plunging budget revenues, and speculation by some analysts that Zagreb may have to turn to the IMF for a bailout. 

Asked by reporters whether his decision could be linked to delays in Croatia's EU accession negotiations, Sanader admitted he could not say there was no connection. "I certainly had that on my mind when thinking about the resignation. Certainly, the EU and the project of the European integration, which I have repeatedly stated over recent months, stand no chance if the principle of blackmailing is accepted as a principle for negotiating," Sanader said. 

Saying he did not rule out a return to politics, the outgoing Premier however refuted allegations he was withdrawing because Croatia was in a difficult economic situation. In this context, he stressed that he never shunned responsibility and added that he always perceived engagement in politics as serving Croatian citizens.

After Sanader decided to quit politics, Croatia's president Stjepan Mesic said that he would consult leaders of parliamentary parties before giving the mandate for the new government to Jadranka Kosor. 

"I'm suprised by Sanader's timing, as Croatia is experiencing a difficult economic situation and EU entry negotiations are blocked by Slovenia. In such circumstances, a government crisis will not help in stabilising the country," Mesic added. 

(EurActiv with Reuters and HINA.)

A research team of Raiffeisen Bank stated that the latest increase of political uncertainties might lead to additional pressures on the credit rating's decrease. "The resignation of the prime minister will delay adjustment of the fiscal policy... and therefore we see little chance for another budget revision before autumn […] 'Additional risks arose from the fact that currently the EU negotiation process is in an extremely difficult phase and the resignation of the prime minister might put on hold negotiations between the European Commission, Slovenia and Croatia," the expert team further wrote.

It added that the new prime minister will have to tackle serious problems in the domestic economy and will have to implement unpopular reforms mostly aimed at controlling public expenditures. A crucial issue will be the strength of the ruling coalition after the resignation of the former prime minister in these tough times, the Raiffeisen team concluded. 

Davor Butkovic, editor at the Croatian daily Jutarni List, said that Sanader had suffered several failures including on EU talks, the economy and a poor showing at local elections. He added that he appears to have lost the support of his party for enforcing serious democratic policies.

"This is a big defeat for [Sanader's centre-right party] HDZ. The party will swing to the right, but the HDZ without Sanader does not stand a chance at the next elections. The ultimate consequence could be that the party could fall apart […] Also, I think early elections would be necessary now. This HDZ has nothing to do with the party that won the elections in 2007," Butkovis said.