Croatia - a small country for a great plunder

IssueMarch - May 2001
Feature by Drazen Simlesa

Several years ago the Croatian Department of Tourism led a big marketing campaign to try to attract the long dreamed about tourists who were still afraid of the instability in the region. The Department promised a small country for a great holiday. The only thing left out of the entire advertising trick is in the title of this article.

The minister who devised this tourism slogan subsequently had to step down from government due to being exposed for nepotism, after hiring his wife who applied for a job in his department under her maiden name. To make things even more tragicomic, the minister tried to justify his actions by claiming he didn't know his wife's maiden name. Oh, modern love...

This is just a small example, but it shows, quite vividly, the corruption of the former right-wing government, led by the ex-general, Franjo Tudjman, who hasn't lived to see the total collapse of his followers during the general election just over a year ago.

The regime that hid plunder and murder behind national interest left the Croatian population with a foreign debt four times larger than before taking office (now equivalent to US$ 2200 per head), and a one-way ticket to emigration for about 250,000 young people (including the exiled Serbs).

Selling the family silver

Todays Croatia meets the conditions necessary to be given the status of a highly indebted country, as the ratio of debt in the GNP has risen to 57% and the risk limit is set at 30%. Along with additional loans owed to the IMF and the World Bank, both governments (Tudjman's and the new) have been trying to settle the foreign debt through selling off the state-owned companies (HT, HEP, INA, banks, hotels...), for a pittance privatising them. What neither government seems to have considered is how they will return the loans when there is nothing left to privatise.

At the beginning of year 2000 Croatia elected, roughly speaking, a social-liberal coalition of six parties (yes, they did translate Giddens's The Third Way) which announced a change in direction from the former, and dangerous, policy of isolationism. Unfortunately, the changes that had been promised have ended up in the embellishing of the facade, while the foundations continue to decay. The Croatian population was left crushed between two false alternatives, both with their basis in an identical violence, since neither provide a real choice. The only choice is between a hundred rich families controlling the country's entire property and asset base, or a complete sell-out to foreigners for a pittance. If you are against the first choice, you will be accused of being a traitor of the homeland, and if you are against the latter choice, you are against Croatia's integration with the rest of the world. With more and more debts, the country's main problem which has been swelling quietly all these years and momentarily reached its peak in the new millennium is the money flowing out of Croatia. Foreign banks make up 87% of the banking market in Croatia, and all the money leaves the country, while there are very few real investments actually made in Croatia.

Granting monopolies

With all this, the number of unemployed, now approaching 400,000 (the equivalent of more than 20% of total labour force), doesn't come as a surprise. Even the leaders of the present government expressed disapproval with the huge profits being drawn out of Croatian Deutche Telekom (which holds 35% of shares in Croatian Telekom) which resulted in a criminal investigation conducted by the police department into certain irregularities during the process of privatisation. And people in Croatia will feel the consequences of the affair with the energy corporation Enron, for a long time to come as in India, Egypt, Bolivia and other countries where this corporation has violated human rights and polluted the environment. Enron was supposed to serve as a lobbyist to the former government to ensure Tudjman's visit with Clinton, and Croatia's entry to the WTO, so the government signed a contract guaranteeing that Croatia will buy electricity from Enron's power plant, at the highest prices in Europe, regardless of Croatias demands during the next 20 years!

Those who disputed the Enron contract, citing the unfavorable terms for the Croatian population, signed an even more unfavorable contract with Enron last year after being elected to office. At first the new government tried to break the original contract. But after being pressurised with all kinds of blackmail about further help (with what?), primarily through the protests of the US ambassador to Croatia, William Montgomery, and with the unfavorable effect it would have in the business world, the government caved in.

With great ceremony they signed a new contract including an agreement to pay damages to the corporation because of the delay in the construction of their plant. Now Croatia is obliged to buy electricity from the sole supplier, Enron, for a price 90% higher than usual in the European market, until Enron's expenses are covered.

The free-trade myth

Not long after signing the contract and thus ensuring the monopoly, not only in Croatia but also in the entire region, Enron issued an advertisement in almost all the mass media. In this they hypocritically informed the population that in future, through the liberalisation of the energy market, they would be able to choose from whom and at what price they buy electricity. So, after protecting itself from any surprises in the market, Enron declared that energy is a product just like anything else, and gave us, in the most cynical way of all, a manifestation of the free trade political dogma.

Tudjman's dream to be officially invited to visit Clinton remained an unfulfilled wish; but the new president, Stipe Mesic, and Prime Minister Ivica Racan, had the honour last August. So, guess which corporation paid for the business lunch of the representatives of Croatian government and the executives of certain US corporations in the American Chamber of Commerce? At the end of August last year Enron's CEO had announced a 25% increase in the price of electricity, which took effect in October 2000.


The next example reports on Croatia's involvement in global affairs. Bad ones, unfortunately. Not long after the newspapers had reported on extremely poor working conditions ($0.22 per hour) and the violation of human rights (child labour) in McDonald's toy factories in China, the report on the extremely disrespectful attitude of McDonald's towards their employees in Croatia was published. Thirteen cases of violations of work safety had been discovered. The stories from the employees themselves range from unpaid overtime to not being allowed to keep tips. McDonald's spokesperson for Croatia, also in charge of human resources, rejected all accusations, claiming that all complaints can be delivered to her personally, that all employees are allowed to engage in union activities in their free time (but that the workers themselves refused to do so), and that the atmosphere in McDonald's is ideal, everybody is on a first name basis so there is no apparent hierarchical structure. Like in every other greenwash story, to show its human side, McDonald's donated $7000 for the medical treatment of a sick child.

Partnership for Peace

Soon after the change of government Croatia became a member of Partnership for Peace. This has resulted in closer collaboration with NATO and by the end of the last year their army exercise was carried out at a military range in Slunj near the Plitvice National Park. Croatia's Ministry of Defense has refused to give information on the costs of this exercise.

An even more tragic fact is that the petition against the military exercise organised by local environmental groups was only signed by 125 people, which only pointed to the vast amount of work ahead for the environmental movement in Croatia. Often local people themselves comment on the destruction of the environment by army exercises, but excuse it with comments like man, these soldiers order 100 pizzas in my restaurant. These short-term advantages dominate over long-term strategies based on environmental sustainability.

An ultra right-wing group, best known for raising a monument to a notorious fascist World War II war criminal, also protested against the NATO exercise, but they protested with their ever-present racism and warnings against bad imperialists from the USA, expressing the need for isolationism from western decadence. This is why activists from the environmental groups had to be very careful and emphasise their antimilitarism and environmental consciousness. Generally speaking, when violent and right wing groups fall from power the problem is not solved. Sometimes we end up with the impression that they were less violent before they lost power, because Tudjman's government kept them on a short leash. This kind of collaboration with the government no longer exists, so alongside verbal threats there are more and more terrorist actions. Bombs are not just for destroying monuments with anti-fascist symbols, but also for the killing of unwanted opponents which is what happened to one of the witnesses in a war-crimes case taking place at the International Tribunal at the Hague. The perpetrators of these attacks have not yet been found.

Right-wing reactions

Because of the possible extradition of one of the Croatian military's generals for war crimes against civilians during the 1990s, Croatia is under a real siege by right-wing groups who call for a coup and who spread nationalist and other kinds of hatred. At a rally in Split, in February, there were 150,000 people waving pictures of this general, like some Orwellian scene, identifying with him. Once again the concept of the mass is gaining momentum in this sad Balkan tale.

Anti-war, anti-militarist, and other civilian initiatives have sent out an appeal condemning all crime, regardless of motive or nationality. We also refuse to be put under a uniform and unified collective umbrella, with no regard to ideology, and we will therefore keep emphasising the need for the appreciation of variety and uniqueness in this world. Regardless of the few positive steps that have been taken in the new millennium, facing our own responsibilities and the crimes that were committed during the war, still remains a problem that needs to be worked on in this region. No matter that there is, fortunately, no more real danger of war. The moment we forget how to laugh and enjoy life, the language of hate and fear, like that spread and encouraged in Split, will be without obstacle.