Favourites at Court

AIM Zagreb, 20 June, 1999

After a three-week trial, the district court in Split pronounced a sentence to the so-called "Maglov's group", named after colonel of the Croatian Army and former commander of the 73rd company of military police, for stealing and smuggling cars and sugar from Neum to Split. Colonel Maglov was sentenced to two years in prison (the whole group the total of 11 years and five months), but he would have fared much worse if his war merits and successful schooling in America had not been taken into account. This is the first case in Croatia in which a high officer, a war hero, was convicted, but it also proves that Croatian Army is not immune to crime. Moreover, all the members of the group defended themselves that they were working by orders from Zagreb, that is, that they thought that the army command was informed about the transfer of expensive cars from Croatia to Herzegovina. Judge Josip Cule rejected such defence, "because a soldier is not obliged to carry out an order if it is a crime, but to inform his superior officer about it". That is how the judge involuntarily admitted that the indicted had been connected with much bigger fish and that crime in Croatian army is self-understood and a normal phenomenon.

At approximately the same time while the sentence was being read to "Maglov's group", deputy prime minister of the Croatian government and minister of finance Borislav Skegro had to admit to the Croatian state assembly that crime was not the specialty of the army, but that like an octopus it wound around all structures of the society, especially banking. The most disliked Croatian minister informed the public that almost one billion kunas had been taken out of the country through four bankrupt banks (Zupanjska, Komercijalna, Glumina and Dubrovacka). In these banks, 169 criminal acts were committed, and 75 indictments were issued against 109 persons.

Bankruptcy of these banks is one of the reasons for the need to increase the budget because the state must pay the citizens about 1.2 billion kunas of their savings. But, the most irritating in the whole story is that the government acts as if it knew nothing about business operation of these four banks and as if anything could have been done without its silent blessing and knowledge of the central bank. The Croat Democratic Community (HDZ) acts as if the indicted were certain unknown persons, although in fact they were their favourites and chosen persons. It sounds even more cynical when they claim that the increase of the budget is necessary primarily because of the damage done by NATO attacks against FR Yugoslavia.

Every day news come out in the open about an increasing number of cases of "impropriety" of the chosen big and small tycoons, but the peculiarity is certainly the court appeal of Miroslav Kutle against prime minister Matesa and governor of the national bank Skrebo. Kutle who has become a synonym for plunder and "tycoonization" of Croatia, suddenly decides to blame those who had made him and helped him to take who knows how much money out of the country. Kutle obviously knows a lot, but he is in fact a sacrificed man and he has already been expelled from HDZ, so it should not be surprising if instead of Matesa and Skrebo, he will be tried.

In Croatia, this change has happened very swiftly (the elections are in sight), so that even crimes and scoundrels in the ranks of HDZ are now publicly discussed. At the same time, the triumphant rhetoric has disappeared about great success and miracles, so for instance the minister of the economy Porges admits that in Croatia it is not roses all the way. For him, causes for this are the process of transition, the war circumstances, loss of market and obsoleteness of technology. All these arguments can be accepted, but not always and not in the sense Porges offers them, especially as concerning problems of transition, because as known economist Branko Horvat recently declared, all the aims of transition, in the manner in which it was conceived, have in fact been accomplished.

Besides, Croatian regime was forced to admit that this year there will be no growth of the gross national product, but that indeed it would drop by one to two per cent which puts Croatia in the group with Russia, Ukraine and Romania. Croatia will also register big losses in dealing with the world, there will be no foreign investments which have so far amounted to about 2.2 billion dollars, and the possibility of loans will also decrease. Negotiations with IMF about a loan of 200 million dollars will probably fail because the government does not wish to reduce public expenditures, that is, the salaries of those who are financed from the budget. And refusal to cooperate with the IMF may have disastrous effects especially for the stability of the kuna because of insufficient inflow of foreign currency from tourism.

The HDZ government is cornered - on the one hand it is shaken by scandals, and on the other, it is not capable of offering a serious program of consolidation of the economy. Instead, they are trying to patch up the gaps in various ways: by selling Croatian Telekom, Croatia insurance company and large banks, the rise of the price of cigarettes and fuel. But, this money will not be used for revitalisation of the economy, but for the need of public expenditures, especially to pay debts to the health and retirement fund. All things considered, as one of the opposition deputies declared, this year will be a year of complete recession, and the next one will be a year of general bankruptcy. And that this is true is confirmed by the statement of the Republican commercial court that about 17 thousand enterprises are ready for bankruptcy. In the end of April, because of 21.6 billion kunas of obligations that have become due the accounts were blocked of 30032 enterprises with 205880 workers, which is in comparison with March 20.4 per cent more.

The assembly is incessantly in session and this will continue until the end of June, but HDZ voters simply do not wish to see what all the others do. So while in the circumstances of criminal and intelligence scandals the opposition is trying to win the best possible positions in order to arrive at a compromise on the election law, HDZ is just patching up jobs. But although there is no money, it does not wish to give up on financing the Croat Defence Council (HVO) with 600 million kunas, nor does this prevent minister of defence Miljevac to make an agreement with the Americans about 100 million dollars for purchase of new radar equipment. All this is passed without approval of the assembly.

HDZ is preparing a big celebration of its tenth anniversary, and it is quite certain that the aged and ailing president Tudjman will try to repeat his parrot-like speech about great success, but even ordinary citizens increasingly wonder: where is Croatia heading? Even if they do see salvation in new authorities, what are they objectively capable of doing and how long the recovery will last?

GOJKO MARINKOVIC