Published in Nacional number 751, 2010-04-06

Autor: Marko Biočina

Josipovic puts pressure on both the HDZ and SDP

Business elite flocking to Pantovcak

Croatia's most respected business people are trying to win membership in President Josipovic's economic council, demonstrating thereby that they believe that he could initiate economic change in the country

THE PRESIDENT'S ECONOMIC FORUM Atlantic Group CEO Emil Tedeschi and Croatian Employer's Association chairman Damir Kustrak at a meeting of the economic advisory council to President Ivo JosipovicTHE PRESIDENT'S ECONOMIC FORUM Atlantic Group CEO Emil Tedeschi and Croatian Employer's Association chairman Damir Kustrak at a meeting of the economic advisory council to President Ivo JosipovicThere is currently a massive interest among Croatian business people for participation in Croatian President Ivo Josipovic's economic council, who will, as a result, probably be forced to increase the number of people that make up the body. Over the past few weeks, Josipovic has been approached in this regard by a dozen respected Croatian managers and entrepreneurs who wish to actively participate in the work of his economic advisory board.

As Nacional has been told by a respected Croatian business person, this advisory board could soon become the most important economic forum in the country. "In Croatian business it has become a matter of prestige to be a member of the President's council. After it became clear that the top people of respected Croatian firms such as the Atlantic Group, Pliva, Vindija, the Nexe Group and Croatian Telecom would be sitting on Josipovic's board, even those who did not initially bear sympathies towards Josipovic can no longer afford to sit apart from the debate that will be led there. On the other hand, there is no doubt that there is among business people, in general, an enormous amount of dissatisfaction with the economic and political situation in the country and that many of them see participation in the work of the advisory board as a good platform from which to vent this dissatisfaction, even though it has no executive powers.


If this trend continues, the President's advisory board could soon become the premier economic forum in Croatia, since neither Government, or any of the political parties, or the Croatian Chamber of Economy, is able to pool that many business people in one place. What is more, some of the people in Josipovic's advisory board have in the past openly rejected offers to join Government advisory bodies, and it comes as no surprise then that Prime Minister Jadranka Kosor and her aides have not cast a favourable eye on the Josipovic initiative. On the other hand, when the country is in the midst of economic crisis and Government is not offering any solutions, it is natural for business people to tie up with the opposition, but the SDP, unlike Josipovic, has done nothing to formalise these ties."

From these words from Nacional's source it can be concluded that Croatian President Ivo Josipovic has become a new centre of power on the Croatian political scene just a short month and a half since his inauguration. In this short period of time Josipovic has achieved what Zoran Milanovic, the leader of the strongest opposition party, has not succeeded in doing for years, and that is to establish himself in the public eye as the torchbearer of an entire set of groups in society that are dissatisfied with the current state of affairs in the country and with the policies being led by the HDZ-led ruling coalition. The President's Office, even though it lacks concrete political authorities, is now the central meeting place for the representatives of these groups and the point of reference for the presentation of concrete political and economic initiatives.

This has shown the forecasts made ahead of the presidential elections, to the effect that Ivo Josipovic would, as President, toe the line drawn by Zoran Milanovic, to have been entirely off the mark. Precisely the opposite has, in fact, happened. Josipovic has set as much distance between himself and Milanovic and the Social Democratic Party (SDP) as he could, and is creating his own policies, independent of party lines, and is now increasingly an independent political force that is seriously threatening the relevance and authority of the SDP as the leader of the opposition in Croatia. What is more, an SDP victory at the next elections for Parliament could depend directly on the support of President Ivo Josipovic, and it is to be expected therefore that the President will in the future become the key political factor on the Croatian political scene.

The basis of the growth of Josipovic's influence was his decision, unlike his predecessor Stipe Mesic, to lead an active policy and to also use his authority as President in sectors such as the economy in which he has no concrete authorities. But Josipovic's activities in resolving the economic woes at this point in time bothers the SDP even more than it does the ruling Croatian Democratic Union (HDZ). In fact, some SDP members are openly complaining that it is inadmissible for Josipovic to have usurped the favour of employers, given that some of the members of Josipovic's advisory board have traditionally been close to the SDP, while Emil Tedeschi is a school buddy and close friend of Zoran Milanovic's.

And, the word off the record in the SDP is that Milanovic has frequent contacts with eminent Croatian business people, and lunches regularly with Ivica Todoric, and it is unclear why the party has not tried to formalise these contacts, as Josipovic has done. What is more the SDP presented its economic programme a month and a half ago, penned by the party's chief economic strategist Branko Grcic.

BRANKO GRCIC (left) penned the SDP economic programme, which did not win the approbation of business people (in the photo with SDP president Zoran Milanovic)BRANKO GRCIC (left) penned the SDP economic programme, which did not win the approbation of business people (in the photo with SDP president Zoran Milanovic)And while the programme cited many measures that suit employers, like a reduction in contributions, labour taxes, parafiscal levies and the privatisation of state property, practically not a single of Croatia's most respected business people supported it, while, on the other hand, the SDP was faced with the criticism of unions and a significant part of the public, who said that the party had betrayed its fundamental social democratic principles in the document. As a result the SDP gained practically no political benefit from its initiative, unlike the Josipovic initiatives, which enjoy significant support from business people.

And, because of the massive interest among employers for the President's advisory council, Josipovic will change the way it works. The first session of the council was held last week, and some business people that had not initially been in its membership took part, like Bozo Prka, the top man at the PBZ bank, Kras procurator Marica Vidakovic and the owner of the Tehnix company, Duro Horvat. They were allegedly invited to join the advisory council later on, after having expressed their willingness to participate in its activities in discussion with Josipovic.

The President's Office allegedly received dozens of these requests, but initially Josipovic and his aides were exceedingly selective in their approach to these requests, fearing that the work of the advisory board could be hampered if it had too many members. But, in time the conviction grew in Josipovic that it would not be opportune to reject offers of cooperation, and he allegedly promised those who were disappointed with the fact that they had not been invited to the first session of the economic advisory council that he would meet with them at a later date.

The President has also begun to consider work methods for the advisory council with which he could get all those interested involved. And so in the future his advisory council would meet in smaller groups, the participants would be invited based on predefined topics of discussion, and practically the only permanent participant of the meetings would be the President's economic advisor Boris Cota, who will try to shape the many ideas into concrete initiatives he would then submit for consideration to the other presidential advisors and to Croatian Government. Josipovic and his aides are convinced that in this way they will be able to get as many people as possible involved from all of the key sectors of the economy.

If the President's economic advisory board does work as it was conceived, it could in the future prove to be very bothersome for the SDP, and for Government. And while Josipovic and some of the members of the advisory council like Emil Tedeschi have in the past on several occasions said that they would not politicise the work of the advisory council, and that they would use it only as a forum at which to discuss constructive economic initiatives, its political aspect cannot be ignored. Through the council Josipovic has the opportunity to, practically on a weekly basis in an informal setting, contact with the heads of the dozen most successful privately owned companies in Croatia. There is no doubt that Josipovic will use the opportunity to secure support among business leaders for some of his broader social initiatives, not pertaining solely to the economy, such as, for example, the issue of legalising medically assisted fertilisation or the publication of the register of Homeland War veterans. In fact, Josipovic has succeeded via the other advisory boards in which he has gathered respected veteran's associations and civil society associations to over a very short period of time brand these initiatives as his own, even though they originated from the SDP.

PRESIDENT IVO JOSIPOVIC with the business people gathered at a session of the economic advisory council at the President's Office on Pantovcak Street held on 29 MarchPRESIDENT IVO JOSIPOVIC with the business people gathered at a session of the economic advisory council at the President's Office on Pantovcak Street held on 29 MarchIf Josipovic's activities are at this moment a bigger problem for the SDP than for the HDZ, it is quite certain that the ruling party is in much greater fear of it that the parliamentary opposition is. With the legitimacy of Josipovic's backing business people will certainly make stronger demands of Government. What is more, it is to be expected that the Josipovic advisory council will be very quick in presenting Government with a package of concrete economic measures. In these circumstances Government will find it much harder to reject the demands of business people, as it would unavoidable be interpreted as a conflict with the President. As a result it is to be expected that Government will endeavour to prevent the opening of a conflict with Josipovic, and that some of the initiatives that will be proposed by his advisory councils will be accepted. This turn of events could lead to further negative consequences to the SDP's political rating, and practically the only way for the SDP leadership to consolidate its status as the leader of the opposition is to, in as short a period of time as possible, wrap up the negotiations on the formation of a coalition for the next elections for Parliament. If they fail to do so, the success of the SDP could depend on the engagement and support of Ivo Josipovic, and it is an open question whether Josipovic is willing to do so.

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