Monday, 7 January 2019

Israel to Announce on Wednesday It Can't Complete F-16 Sale

ZAGREB, January 7, 2019 - Israel will not be able to complete the F-16 sale which was signed with Croatia last March, following Washington's restrictions on the sale deal, Yent, the online edition of Israel's Yedioth Ahronoth daily, said on Sunday.

Israel's Defence Ministry Director-General Udi Adam is scheduled to visit Croatia on Wednesday and inform the Croatian Defence Ministry that the deal is cancelled, Ynet said.

Adam plans to apologise to Croatian authorities because Israel cannot complete the deal.

Israel and Croatia signed the 500 million dollar deal for 12 F-16 Barak aircraft, modified Israeli versions of US-made fighter jets. The US, however, approves the transfer to a third party only of aircraft without the Israeli upgrades. Croatia would not agree to that and gave Israel until January 11 to say if it can honour the deal as it was agreed.

More news on the attempted acquisition of the fighter jets can be found in our Politics section.

Saturday, 5 January 2019

With No F-16s, What’s Next for Croatian Air Force?

At midnight, the deadline given by the US State Department to Israel to formally send its reply to its demand to remove all non-American technology from planes supposed to be sold to the Croatian Air Force expired. According to Israeli sources, Israel will probably not even send its reply to the Americans, reports Večernji List on January 5, 2019.

Sources believe that the issue was largely closed after Israeli Prime Minister Benjamin Netanyahu met with US Secretary of State Mike Pompeo in Brazil at the inauguration of the new President Javier Bolsonar and said that Israel was not prepared to remove from the F-16s Israeli equipment, de facto confirming that he could not deliver to Croatia the configuration it wanted.

Although no one expects any miracles that would change the US position, the government will formally wait for the deadline given to Israel, which is that by next Friday, January 11, it should inform Croatia whether it can deliver a combat squadron which won the Croatian tender for the purchase of multi-purpose combat aircraft in March 2018.

Croatia will not delay the formal annulment of the tender. This step is necessary so that it can be decided relatively quickly what to do next. The failure of a deal with Israel is not just a matter for Defence Minister Damir Krstičević, but for Croatia, which now has to find another way to save the Croatian Air Force.

Due to 15-year delays in the acquisition of a new squadron and the unsuccessful overhaul of the current MiGs 21s in Ukraine, the Croatian Air Force (HRZ) today has on average just three to four fully functional aircraft, which is a minimum. If the HRZ's capacity is further impaired, Croatia will have no other choice but to notify NATO's command of its inability to control its skies and request that the responsibility is taken over by the air force of one of the neighbouring member states.

The government will have to decide whether to announce a new tender or negotiate directly. It is estimated that the process of public competition would take a minimum of one year for a new decision to be reached. Realistically, the contract could not be signed before the end of 2020. Given that the US government supports the modernisation of the Croatian Air Force, it is expected that the USA could offer alternative solutions that would be relatively fast and would be affordable to Croatia.

More news on the Croatian military can be found in our Politics section.

Translated from Večernji List (reported by Davor Ivanković, Sandra Veljković).

Friday, 4 January 2019

F-16 Fighter Jets Procurement Plan to Probably Be Cancelled

ZAGREB, January 4, 2019 - Prime Minister Andrej Plenković said in an interview with the national broadcaster (HTV) on Thursday evening that his cabinet would very probably scrap the plan for the purchase from Israel the F-16 fighter jets it chose because of the problems that have come up between Israel and the US.

The Defence Ministry has asked Israel to officially notify it by January 11 if it could deliver the fighter jets Croatia chose transparently in an international tender, saying that if Israel could not, Croatia would cancel its decision on the choice of multipurpose fighter jets.

The ministry reiterated in a press release that Israel had the obligation to obtain the US administration's approval for the delivery of the jets to Croatia in the appropriate configuration. "When the State of Israel officially notifies us regarding the matter, we will inform the Croatian public in a timely fashion," the defence ministry stated.

Plenković said that it was only recently that Croatia got information about Washington's objection to the delivery of the above-mentioned jets, and underscored that now Zagreb was waiting for Israel's answer.

It is almost certainly that Croatia will cancel the tender, if it cannot obtain what it has chosen during the bidding procedure, according to Plenković.

Plenković told the HTV that his cabinet's plan was to improve Croatia's credit rating to the investment level until the end of this new year. During 2018, the world's three leading rating agencies – Standard&Poor, Fitch and Moody's – revised upward their ratings or their outlook on Croatia.

S&P and Fitch now keep Croatia's rating one notch below the investment level, while Moody's keeps it two notches below the investment level.

Fitch has a positive outlook on Croatia, while Standard&Poor's and Moody's outlook on Croatia is stable.

More news on the purchase of F-16 planes can be found in our Politics section.

Friday, 4 January 2019

Croatian Defence Minister Defends F-16 Barak Acquisition

ZAGREB, January 4, 2019 - Defence Minister Damir Krstičević said on Thursday it was Israel's responsibility to secure final permission from the US for Croatia to sign a contract on the purchase of F-16 Barak fighter jets, adding that neither he nor his team had done anything against Croatia's interests.

"Regarding responsibility, I think that neither I nor my team, with any action, have done something against Croatia's interests," Krstičević told reporters when asked if he still had Prime Minister Andrej Plenković's confidence.

Krstičević said he was willing to step down any time if his resignation would help Croatia in the purchase of the multipurpose fighter jets.

He said it was Israel's responsibility to secure final permission so Croatia could sign the contract. "How could I have known? They put in the papers and all the documents that it's their responsibility. Should I now be responsible for the action of a third party?" he said, adding that he was willing to resign.

Asked to comment on Plenković's statement that it was necessary to establish responsibility and examine details before adopting decisions, Krstičević said he agreed that, after this process was over, it was necessary to make analyses, see which lessons were learned and review all the circumstances.

"I believe that after this, the government, with me or someone else in it, will continue to look for a solution. Croatian pilots and Croatia's skies deserve multipurpose fighter jets. Sooner or later these planes, whether new or old, will be in Croatia. I believe this process has contributed to that."

Krstičević said that after receiving a more thorough statement from Israel, he would inform the public. He recalled that as the seller, Israel undertook the obligation to obtain the US administration's approval for the transfer of the fighter jets to Croatia. "That's solely Israel's obligation."

More news on the Croatian military can be found in our Politics section.

Thursday, 3 January 2019

Croatia Requests Israel's Official Statement on F-16 Fighter Jets

ZAGREB, January 3, 2019 - Prime Minister Andrej Plenković said on Thursday he expected final and clear responses from Israel and the United States on the delivery of multipurpose F-16 fighter jets, after which the government would decide on the fate of this tender.

"We expect final and clear responses from Israel and the US, after which we will decide accordingly. The government firmly stands by its decision that we can only conclude the offer as was accepted and proposed by the Defence Ministry team of experts. Everything else will require our decision to cancel this process, and after that we will decide on further steps," Plenković said at the start of a cabinet meeting.

He recalled that there were differences between Israel and the US regarding approval for the transfer of technologies to a third party, in this case Croatia. "Contrary to the information that we have had during this entire process over the last almost two years, certain problems have now arisen where the US has reservations about the transfer of technology which is originally American but has been upgraded with Israeli technology," Plenković said.

"In any case, we are not glad that this happened, but now we are trying to identify the causes of this problem, and after that we will make appropriate decisions," he concluded.

The Defence Ministry on Thursday asked Israel to officially notify it by January 11 if it could deliver the F-16 fighter jets Croatia chose transparently in an international tender, saying that if Israel could not, Croatia would cancel its decision on the choice of multipurpose fighter jets.

The ministry reiterated in a press release that Israel had the obligation to obtain the US administration's approval for the delivery of the jets to Croatia in the appropriate configuration. "When the State of Israel officially notifies us regarding the matter, we will inform the Croatian public in a timely fashion."

If Croatia cannot buy the aircraft it chose because of disagreements that have come up between Israel and the US, the Croatian government will cancel the decision of 29 March 2018 on the choice of multipurpose F-16 fighter jets.

Croatia ran this very complex project systematically, professionally and transparently, guided only by national interests, the ministry said.

Parliament Speaker Gordan Jandroković too confirmed that a new tender for the aircraft would be advertised in case Israel, due to US objections, was not able to deliver the F-16 Barak aircraft it offered Croatia.

"If the planes don't correspond to what we agreed, the deal won't be realised and a new tender will be advertised," he told reporters. "Either the planes will be those that were negotiated or there will be a new tender."

More news on the Croatian army can be found in our Politics section.

Wednesday, 2 January 2019

USA and Israel Fail to Agree on Sale of F-16 Fighter Jets to Croatia

US Secretary of State Mike Pompeo and Israeli Prime Minister Benjamin Netanyahu did not find a solution for the sale of Israeli F-16 fighter jets to Croatia at their meeting in Brazil on Tuesday, report Večernji List and Jutarnji List on January 2, 2019.

Diplomatic sources close to Israel says that Pompeo and Netanyahu did discuss the topic, but that the agreement was not reached.

Americans remain firm in their position that Israel can only sell to Croatia the original version of the F-16 aircraft, without any upgrades which were added by Israel in the meantime, which is, on the other hand, unacceptable to Croatia.

According to a senior Israeli official, the sale of aircraft to Croatia was the only disagreement Pompeo and Netanyahu did not solve during their meeting. "The matter is stuck in deep bureaucracy,” the Israeli official said.

On December 27, the US State Department sent a letter to Israel with more than ten conditions which need to be met in order for the US government to allow the sale of US-produced aircraft to Croatia. They all boil down to the same - Americans demand that the aircraft, which the Israelis have modernised with 17 modifications, must not have anything on them that is not American.

The deadline for Israel’s final reply expires on Friday, but some saw the meeting between Pompeo and Netanyahu in Brazil, where both of them attended the inauguration of the new Brazilian president, as a possibility for an agreement to be reached. This option does not exist anymore.

It is expected that Croatia will annul its decision to buy the Israeli aircraft and will annul the tender for the purchase of combat aircraft.

The news was first published by the US website Axios, which has extensively covered the issue of the sale of the aircraft to Croatia in recent weeks.

More news on the sale of the aircraft can be found in our Politics section.

Saturday, 29 December 2018

Croatia to Cancel F-16 Acquisition If Planes Are Modified?

ZAGREB, December 29, 2018 - The Defence Ministry will propose to the government not to sign the agreement with the Israeli government on the purchase of 12 F-16 fighter jets should they be modified as requested by the US government, because in that case they would no longer be F-16 Barak aircraft with which Israel won the Croatian tender, Defence Ministry official Davor Tretinjak said in a television interview on Friday evening.

"If the whole equipment is changed, both the Israeli and American, and modified with state-of-the-art American equipment, then it's no longer the F-16 CD Barak," Tretinjak told the HTV public television service commenting on the latest media reports that the US was making the sale of the US-made Israeli aircraft conditional on the removal of the Israeli equipment built into them.

In that case, the Defence Ministry would have to propose to the government not to conclude the government to government agreement with Israel and to suspend any further talks, he added.

Asked if that meant that a new tender would be issued, Tretinjak said: "We will see with the government what a Plan B would be and what further steps to take".

The US news website Axios said on Thursday, citing an unnamed Israeli official, that the sale of US-made Israeli fighter jets to Croatia was practically "dead" after outgoing US Defence Secretary James Mattis refused to soften the US terms for the transfer of the aircraft.

To approve the deal, the US demanded that Israel remove the Israeli systems installed in the F-16s and return the jets to their original condition before transferring them to Croatia. HTV said that Israel should respond to the US demands by January 4.

Tretinjak said that Israel had built its own equipment into the F-16 CD Barak and that these modifications were decisive for its selection. "This plane satisfies our needs," he said, adding that Croatia and Israel had been given a guarantee from the US approving the sale of such modified aircraft.

In September, the US State Department sent approval to Israel, which in turn forwarded it to Croatia, giving it permission to sell the F-16 CD Barak aircraft, modified with Israeli equipment, to Croatia. "That letter is filed both in Israel and in the Croatian Defence Ministry," Tretinjak said.

Asked what had changed in the meantime, Tretinjak said he did not know. "We expect this matter to be resolved in the coming days, because so far there has been no mention of replacing the entire equipment of the F-16 Barak with American equipment. In that case it would no longer be a government to government agreement, but several agreements would be required. The Defence Ministry has not been authorised by the Croatian government to conclude such an agreement on the government's behalf nor would it manipulate others. We would bring into question our own transparency, the transparency of the entire procedure," he said.

Social Democratic Party (SDP) leader Davor Bernardić said on Friday that Defence Minister Damir Krstičević should make an "honourable and soldierly move" and step down if the purchase of 12 F-16 Barak fighter jets from Israel fell through.

"We should wait and see whether the purchase will go through. If the deal fails, it will be a major international embarrassment for Croatia. I think in that case General Krstičević, who took part in the (1991-1995) Homeland War, will make a responsible, honourable and soldierly move," Bernardić told reporters during a party gathering in Nedelišće, about 100 kilometres north of Zagreb.

The US news website Axios said on Thursday, citing an unnamed Israeli official, that the sale of US-made Israeli fighter jets to Croatia was practically "dead" after outgoing US Defence Secretary James Mattis refused to soften the US terms for the transfer of the aircraft.

More news on the Croatian army can be found in our Politics section.

Friday, 28 December 2018

US Congress Approves F-16 Sale to Croatia, Final Decision Still Unclear

ZAGREB, December 28, 2018 - The US Congress has okayed Israel's sale of F-16 fighter jets to Croatia, whereby the whole procedure has been returned to the State Department for consideration, Večernji List daily said on its website on Thursday. The paper says that members of the House Committee on Foreign Affairs did not state, within the legal deadline of 15 days, any objections to the F-16 sale to Croatia, whereby Congress formally approved the proposed transfer of US weapons to a third country.

The paper says this is an important step in the sale but that it does not mean the transfer has been approved. Under the law, Congress approved the sale of the original jets, as they were when the US delivered them to Israel, without the Israeli modifications, and their value was 135 million dollars.

Earlier this month, the US Axios portal said the US was blocking Israel's sale of 12 US-made F-16 Barak jets to Croatia that were about 30 years ago, which Israel upgraded and which would cost Croatia 2.9 billion kuna over a ten-year period.

The US transfers US-made military equipment to partners via the Foreign Military Sales programme, as part of which the buyer commits to requesting Washington's permission in writing before changing the end use, modification or further sale, as regulated via the Third Party Transfer process.

Israel upgraded the old US aircraft with advanced Israeli-made systems in order to persuade the Croatians to buy the jets, Channel 10 has said, adding that the Americans have accused Israel of unfair conduct and making money at America's expense and that, according to Washington, Israel cannot sell to third parties without US approval.

Senior Croatian officials have emphasised several times that they will insist on all the terms of the agreement on the purchase of F-16s with Israel being honoured or a new tender for the purchase of new aircraft will be issued.

US ambassador to Croatia Robert Kohorst said earlier this month that Israel needed to accept the technical requirements so that the US could approve the sale of the 12 fighter jets, adding that this was about who owned the technology and intellectual property rights. "The Israelis need to accept the technical requirements and as soon as that's done we can move forward and the sale can go through," Kohorst said then.

According to Kohorst, "the United States has consistently said what the technical requirements are for more than two years and everyone should have known that these are the technical requirements and so it's a bit of a surprise to me that there is this slowdown right now."

He also explained that "the debate is who will pay for the conversion because the USA and its contractors Lockheed Martin have to do the work because they're the ones who own the technology and intellectual property."

Kohorst said he is sure Israel made its offer in good faith, adding that Croatia, the United States and Israel are "great allies" and will resolve this problem.

More news on the relations between the United States and Croatia can be found in our Politics section.

Thursday, 27 December 2018

Croatian Politics 2018: A Year in Review

Years pass, but some things never change in Croatian politics. The year which is about to end has again been full of drama and scandals, and just occasional good news. Remarkably, many of the same issues which you will read about here have featured prominently in our reviews for 2016 and 2017 as well, which just shows that most problems in Croatia are just swept under the rug and never solved. What follows is Croatian Politics 2018, a review of events which will be remembered from the past year, as reported by TCN.

The year began with tensions in the Bay of Piran, part of the Adriatic Sea which Croatia and Slovenia both claim. In late 2017, Slovenia decided to implement the decision by arbitration tribunal which awarded Slovenia most of the bay. However, Croatia has refused to accept the decision, saying that the arbitration process was compromised by Slovenian government representatives who were in collusion with a supposedly independent arbitrator. The tensions raged for a few weeks, with MEPs proposing military solutions and war veterans talking about organising a rather provocative regatta. Eventually, reason prevailed, and the tensions died down. However, the issue is still unresolved, despite assurances to the opposite, with Croatia calling for negotiations and Slovenia insisting on the implementation of the arbitration decision. You are sure to read about this dispute in our 2019 review as well, particularly given Slovenia’s decision to file a lawsuit against Croatia.

Relations with Serbia are always in the focus of interest, and this year was no exception. In January, the government was surprised to hear that President Kolinda Grabar-Kitarović had invited Serbian President Aleksandar Vučić to visit Croatia officially. After a short argument over who is really leading Croatia’s foreign policy, Vučić arrived in Zagreb. While the visit mostly went well, the relations between the two countries deteriorated steadily throughout the year and the debate about whether Vučić should have been invited at all continued. Another turn for the worse took place in April when a Croatian parliamentary delegation’s visit to Belgrade was cut short after an incident in the Serbian parliament caused by a notorious Serbian MP and war criminal Vojislav Šešelj. Tension rose again in August when the anniversary of Operation Storm is traditionally celebrated, marking Croatia’s liberation of previously occupied territories in 1995. Serbian President Vučić gave a series of provocative statements, including comparing Croatia to Hitler.

As for the economy, January brought the first worrying signs about the future of Croatian shipyards, a low number of new orders, and about the government’s apparent unwillingness to continue to cover shipyards’ losses. Later in the year, the crisis in the Uljanik shipyard in Pula and its 3. Maj branch in Rijeka would feature prominently in our reporting. Workers spent months striking due to unpaid wages. As the year ends, the situation is still dire and “strategic partners” which the government hopes to find are nowhere to be seen.

“Reforms” is one of the most popular words of Croatian politicians. Every year in January we can hear officials saying that the year ahead is “the year of reforms” which will make Croatia much more prosperous. Needless to say, these promises are never fulfilled, and 2018 did not disappoint. The issue served the president well since she was able to attack the government for lack of reform efforts whenever it suited her.

Ideological debates and historical revisionism attempts continued in 2018 as well. In February, the government-appointed historical commission published its recommendations on issues related to the authoritarian regimes from Croatia’s past, but the conclusions did not satisfy anyone, except for the prime minister, who likes to pretend that the recommendations have solved the problem.

The year which is about to end has again brought us the problem of censorship, questions about media freedoms, warnings about the rise of the far right, separate commemorations held in Jasenovac, the parliament refusing to sponsor anti-fascism events, people destroying flower beds because they reminded them of communism, historical revisionism on the public television, assaults on journalists, satirists receiving death threats, “suspect” politicians being assaulted, photos of Tito slipping from under Croatia’s coat of arms, former prime ministers being sentenced for corruption, and media regulators receiving death threats.

The Catholic Church is undoubtedly part of the political life in Croatia, so it is no wonder that rumours about changes coming to its leadership draw considerable attention. While nothing has been confirmed, it is expected that the Archbishop of Zagreb, Cardinal Josip Bozanić, could be replaced in the new year. In the meantime, the church has continued to receive vast amounts of money from the state budget, meddle in politics, as well as advise the government on the new abortion law, 

The demographic crisis continued, with high emigration and low birth rates bringing down the number of inhabitants. The president and the government argued about who and what was to blame. The president even presented her measures to solve the problem, which were soon forgotten, and demanded a special session of the government, which never took place. Proposals were presented on how to convince people not to move, as many sectors faced a lack of workers, while many schools started closing down. The extent of the crisis was such that even Serbian President Vučić became "worried." The only “good news” came at the end of the year when reports claimed that the emigration wave was calming down because everybody who wanted and could have left already did.

One of the issues we write regularly in these annual reviews is the construction of Pelješac Bridge, which will connect the Dubrovnik area with the rest of Croatia without the need for travellers to pass through a short stretch of Bosnian territory. After many years of delays, the project has finally moved into the implementation phase. Early in the year, a decision was made to award the tender for the construction to a Chinese consortium, despite protests made by Bosnia and Herzegovina that the bridge could not be constructed before the border between the two countries in the area is defined. The decision to award the contract to a Chinese bidder also brought about a marked change in relations between Croatia and China, which were later further improved by high-level meetings and visits.

Another perennial issue is the future of INA, Croatia’s national oil company, which is owned jointly by the Croatian government and MOL, Hungarian national oil company. In 2016, the prime minister announced that Croatia would buy back MOL’s share of INA. Two years later, nothing has changed. Earlier this year, the government selected financial advisors for the buyback, but the contract with them was never signed. One of the main issues is the future of the INA refinery in Sisak. While in January the relevant minister said he was optimistic about the refinery’s future, by the end of the year he apparently changed his opinion. Another issue is Croatia’s arrest warrant for MOL’s CEO, which Hungary does not want to implement.

Another year has passed, and the supposedly “strategic” project of an LNG terminal on the island of Krk has again gone nowhere. Multi-year delays have continued. The government announced two tenders trying to find out who would be interested in using the terminal once it is built (if that ever happens), but the results were dismal. Just two government-owned companies applied, presumably after receiving a nudge from officials to send their applications and help the government avoid a total disaster. While the project receives verbal support from foreign governments, no one seems to be interested in sending binding offers to use its capacity.

One piece of good business news was the apparently successful conclusion to the worst part of the crisis in Agrokor, one of Croatia’s largest and most important companies. The agreement between creditors was concluded, thanks mostly to Russian banks, although not without an accompanying scandal about high fees paid to consultants, some of whom actually took part in the secretive process of writing the special law which the government adopted to save the company from collapse. The scandal took out Deputy Prime Minister Martina Dalić and government-appointed commissioner Ante Ramljak, who had to resign under pressure. E-mails were published which showed that the prime minister knew more about the dealings than he initially admitted, but he managed to escape more or less unharmed. Agrokor’s former owner Ivica Todorić, who fled earlier to London to avoid arrest, was extradited to Croatia late in the year, after multiple delays and court proceedings. Even Tony Blair’s wife could not help him. He has since been released on bail and is currently awaiting possible indictment. The legal proceedings are expected to last for many years.

Good economic news brought us the first upgrade in Croatia’s credit rating since 2004. Unemployment numbers were also down, although more due to mass emigration than to economic revival. Good tourism results, especially in the pre-season and post-season, helped Croatia achieve planned economic growth for 2018 (still among the lowest in the EU). Slightly more moderate growth is expected in 2019, with the lack of reforms being the main culprit. The budget recorded another good year, with spending and revenues being more or less balanced, while the public debt has continued to decline. The year ended with another round of tax cuts and pension reform. Croatia has also announced plans that it will adopt the euro as its currency. The process is expected to last many years.

The ratification of the convention on preventing violence against women, the so-called Istanbul Convention, somewhat unexpectedly turned into a crisis for the government in April when a large group of HDZ MPs decided to vote against the proposal, despite prime minister’s insistence that it should be ratified. While the convention was easily adopted thanks to opposition support, it turned into another attempt by HDZ’s right wing to weaken or possibly topple Plenković as party leader and prime minister. Just like several other similar attempts, it did not succeed.

A national security issue which has drawn a lot of media attention throughout the year is the acquisition of military fighter jets. The decision was first delayed for years, then it was supposed to be made in 2017, but again delayed first to early 2018, and then beyond. After much lobbying, the government finally decided to buy 12 F-16s from Israel. The questions about the deal persisted, with many asking why Croatia was “rejuvenating” its air force with ancient aircraft. By the end of the year, the contract for the deal has not yet been signed, amid disputes between the United States and Israel about what equipment Israel can legally sell to Croatia. Grand plans about “strategic cooperation” with Israel also appear to be on hold. Defence Minister Damir Krstičević has invested a great deal of personal effort in the deal, but the acquisition is still in question, and its final fate is yet to be determined.

As expected, the political circus took a break in June due to the World Cup in Russia. While the break was initially expected to last just a couple of weeks, until the Croatian national team is eliminated in the first phase of the competition as usual, its spectacular success extended the political break to a full month and more. Of course, leading politicians did not miss this opportunity to travel to Russia and have their picture taken with footballers and fans. Needless to say, even this occasion, which was supposed to unite the country, brought divisions, primarily due to an appearance by a controversial singer at the homecoming ceremony, which was attended by hundreds of thousands of people.

The Istanbul Convention ratification prompted one of this year’s two referendum initiatives to be launched. The other effort involved proposed changes to the election laws, which would substantially reduce the rights of national minorities to elect their MPs. The government was against the referendums, while the president seemed to be of a different opinion. While both initiatives claimed they had gathered enough signatures for the referendums to be held, the government checked the signatures and conveniently found enough irregularities to lower the number of accepted signatures below the required threshold. This was just one of several attempts to pressure the government from the right.

One of the rare reforms which have begun, at least nominally, is the reform of Croatia’s education system, the so-called “curricular reform.” The issue has caused conflicts between coalition partners, with HNS repeatedly threatening to leave the government if their proposals are not accepted. Their threats were not taken seriously by anyone since it is clear that early parliamentary elections would probably bring about an end for the party.

A scandal broke in September whose consequences are still unclear at this time. A ministerial driver was arrested under suspicion that he had informed a suspect about a police investigation against him. Interestingly, the driver is a close friend of Milijan Brkić, HDZ deputy president and Prime Minister Plenković’s chief intraparty nemesis. While Brkić has denied having any role in the scandal or leaking the information about the investigation, he has been conspicuously absent from public affairs in recent months. Other scandals involving Brkić have also resurfaced, prompting allegations that his opponents were trying to eliminate him politically. On the other hand, some potentially embarrassing documents about him suddenly disappeared. The scandal has even reached the president’s office, with the national security advisor resigning in December under still unclear circumstances.

Relations between Croatia and Bosnia and Herzegovina, as well as the connected issue of the status of Croats in the neighbouring country, were at the forefront of Croatia’s foreign policy efforts in 2018. With October elections looming, the year began with Bosnian Croats warning that the election law was unfair and that it could lead to a Croat representative in the Bosnian presidency being elected by more numerous Bosniaks. That is precisely what happened, with candidate Željko Komšić winning the post, although he apparently did not have the support of the majority of Bosnian Croats. This prompted Croatia’s government to launch a campaign within the EU to pressure Bosnia into changing its election law, which then brought accusations about meddling in internal affairs of the neighbouring country.

One of the potentially most explosive events of this year was a war veterans’ protest held in Vukovar in October. The veterans complained about the lack of prosecution of persons suspected of committing war crimes against Croats in the Vukovar area in 1991, which was a problem which they discussed earlier in the year as well. However, many believed that the protest was actually just a guise for a right-wing attempt to bring down the government led by moderate Prime Minister Andrej Plenković and replace him as HDZ president with a more extremist candidate. Plenković and his team appeared at first worried that the attempt might succeed, but with time they managed to limit its consequences. Once held, the protest passed without incident and has been more or less forgotten, except when occasional arrests in the area do happen, which then draw condemnation from local Serbs who say the police is arresting then just to satisfy the Croat war veterans. In the meantime, tensions in the town continue.

Throughout the year, rumours about impending ruling coalition reshuffle and/or early parliamentary elections continued. However, unlike in 2017, which brought about a change in the ruling coalition composition, with MOST being replaced by HNS, this year the government was more or less stable. One potential candidate for another reshuffle was Zagreb Mayor Milan Bandić, whose parliamentary group somehow manages to “convince” previously opposition MPs to switch parties and cross to his side. Numerous legal proceedings against him have not made him any less desirable patron. The substantial Zagreb city budget which he controls probably has something to do with it. In two years, he has managed to increase the number of his MPs from 1 to 12, with additional expansion of his parliamentary group expected early in the new year. The fact that people did not vote for his party did not discourage him at all. There are rumours that Bandić will use the increase in the number of his MPs, who are crucial for the parliamentary majority, to demand several ministerial posts in the new year.

As for the opposition, turmoil in SDP continued, with several attempts being made to topple the party president and “the leader of the opposition” Davor Bernardić. Fortunately for SDP opponents, these attempts have been unsuccessful, so Bernardić remains in his seat while his party’s popularity continues to plummet, with the latest polls showing it dropping to the third position, behind HDZ and Živi Zid. An increasing number of SDP MPs are leaving the party, with some of them joining the government ranks.

The migrant crisis continued, particularly on the border with Bosnia and Herzegovina, with the police employing ever harsher measures to control the borders and NGOs publishing increasingly critical reports about the alleged police violence and irregularities. The police have repeatedly denied any wrongdoing, despite video evidence to the contrary.

The migration issue also brought us another controversy, this time with the signing of the Global Compact for Migration in December. President Kolinda Grabar-Kitarović, who this year marked three years in office, initially supported the agreement, but then suddenly changed her mind, announcing she would not travel to Marrakesh where the UN conference was held. The government immediately said that Croatia would support the declaration nevertheless, which caused protests from right-wing circles. In the end, the non-binding resolution was supported by Croatia, but no-one really expects it will be implemented.

The final few days of the year brought us another major scandal, whose consequences will become clear in the following months. The president decided to dismiss her domestic policy adviser Mate Radeljić, who many believed had influenced the president to take a more critical position towards the government. After he was dismissed, Radeljić said he was threatened by a Security-Intelligence Agency (SOA) official not to try to damage the president politically after being dismissed. He was allegedly told that the agency was ready to run into him with a car if necessary. The president’s office and the SOA issued statements saying they had acted legally, but interestingly they did not outright deny all of Radeljić’s claims. It is expected that Radeljić’s dismissal will result in better relations between the president on the one side and the government and HDZ leadership on the other, just in time for the presidential elections next year.

Another exciting political year is ahead of us. It will include at least two elections (for European Parliament in May, and for president probably in December), and there is always a possibility the early parliamentary elections might take place. Stay with TCN for all the latest political and business news.


Monday, 17 December 2018

Israeli Prime Minister Netanyahu Comments on Croatian Fighter Jet Sale

The sale of Israeli military aeroplanes to Croatia has been one of the main topics in the media for the last ten days. Croatia has decided to buy 12 F-16 Barak aircraft from Israel. However, since aircraft were produced in the United States, the sale demands US permission, which is where it gets complicated. The planes were built in the 1980s, and the Israelis have done many changes in the meantime. The question is whether the US will allow such a sale to proceed. On the other hand, Croatia has said it only wanted Israeli aircraft F-16 Barak, meaning the modified planes. The deal is in question, and Israeli Prime Minister Netanyahu has now commented on it, reports on December 17, 2018.

He said it was too early to say anything, as reported by Barak Ravid, an Israeli journalist who about ten days ago first published the news about the US decision not to allow the sale.

“There are negotiations between the countries, and I am personally involved. It is too early to make a statement. We are working on this," Israeli Prime Minister Netanyahu said, referring to the negotiations between Israel and the United States. Netanyahu allegedly talked about this problem with Croatian President Kolinda Grabar-Kitarović last week.

In the meantime, President Grabar-Kitatović told the media that Croatia had to get the planes it ordered. “We considered absolutely all aspects and all the offers, based on the recommendations of the expert committee that has dealt with it and said that the Israeli bid was the best,” the president said. “We have accepted that opinion and have recommended to the government to proceed with the job. Of course, the final decision is up to the government. It is important to emphasise that the aeroplanes we have agreed on must be the ones delivered to Croatia,” concluded Grabar-Kitarović.

Defence Minister Damir Krstičević defended the deal last week and told reporters that Croatia, as an ally and a friend of the United States and Israel, would wait as long as needed for them to agree. “You know there was a public tender. Croatia must receive the planes which it ordered. The experts defined what kind of planes we need to ensure that Croatia can protect peace and security, and the state of Israel has given its offer,” said Krstičević.

He did not want to say whether Israel had deceived Croatia if Croatian negotiators were not told that Israel did not have a US sales permission. "The process is underway, we will see," he said.

More news on the relations between Croatia and Israel can be found in our Politics section.

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