Government’s “Lex Agrokor” Under Fire

By 25 March 2017

Opposition parties oppose government’s plans to help Agrokor.

The government on Friday announced that it is working on a law which would provide help to systemically important companies which are unable to repay their debts. However, not everybody agrees that such help is appropriate in the case of privately-owned companies, including Agrokor, whose recent financial problems are clearly the reason why the government decided to propose the law in the first place, reports Večernji List on March 25, 2017.

HNS president Ivan Vrdoljak said on Saturday that he would do all he could so that Croatian citizens would not pay for someone else's debts. “If someone thinks that that the state and the government should appoint management teams and manage companies, and that Croatian citizens would then repay the debts incurred by Agrokor, that will not happen and Parliament will not support such law”, said Vrdoljak. He added that he welcomed anyone who believed that the process should include suppliers, partners, bankers and creditors.

Vrdoljak said that the government should answer the question of who will repay the debts and whether it talked with creditors, bondholders, suppliers and partners about their role in the whole affair. “Many times in these four months, ruling parties have shown that they like to send ‘trial balloons’ before agreement within the government, about the tax and curricular reforms, the situation with INA, gas issues, HEP, and now ‘lex Agrokor’”, he said.

Commenting on the same issue, Siniša Hajdaš Dončić, member of SDP presidency and an MP, said that Agrokor was a case of “crony capitalism which emerged during the privatization process”. “The fact that the economy is so much exposed to a single company is a consequence of privatization. It started with the same party which now has a problem and does not know how to solve it”, he said on Saturday.

“The proposed model is unacceptable to us. We are interested in an active role of the state, not to be the dominant lender, but to be a lender which will protect workers, suppliers and the rights of the state”, he said.

He called on Agrokor’s owner Todorić to publicly explain what is happening with Agrokor, how he intends to resolve the problem, and what is his position on restructuring. He said that SDP advocated for a completely different model, with the state as a partner and with three key factors – how much is the debt towards small suppliers, how much are workers’ salaries, and how much is company’s debt with regards to the VAT.