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Croatia – progress report

Plenary Speech - Wednesday, 9th April 2008

Mr. President

I think this report is too optimistic by half.

Last year, I spent a very intensive week in Croatia in meetings with diplomats, academics, lawyers, businessmen, chambers of commerce and the media. I got a very clear picture of a country that does not have a proper market economy and a country that has far too much government engagement in the judiciary, in the media and in business. It is what we describe as crony capitalism. The Government expends more than 50% of Croatia’s GDP. It is simply not a free market in the sense we understand.

They need to implement transparency in government contracts, which are subject to graft. They need to implement full disclosure of interest in planning decisions, which, at the moment, just provide income for officials. We have a short window of opportunity to urge reform on Croatia before accession. I am not convinced that we are using it adequately.