Today we are joined, at the invitation of this committee, by a parliamentary delegation from the Foreign Affairs Committee of the Parliament of the Republic of Croatia. I had the pleasure of meeting the members of the delegation at the airport when they arrived on Sunday. I met them again yesterday at a reception at the Croatian Embassy. They will spend about an hour and a quarter with us today, as they have a meeting with the Ceann Comhairle and the Cathaoirleach of the Seanad at 3.30 p.m. I welcome the chairman of the committee, Dr. Zdravko Tomac, and his colleagues to Dublin on behalf of the joint committee and on my own behalf. Perhaps he would like to introduce his colleagues to members of this committee, which is comprised of Members of Dáil Éireann and Seanad Éireann.
Croatian Parliamentary Delegation: Presentation.
Chairman, I wonder if we could explain to members of the Croatian delegation, as a matter of courtesy, that Senators may have to leave this meeting early because the Seanad is meeting at 2.30 p.m. I apologise in advance for our departure, which should not be read as a sign of discourtesy.
We are not being rude, but we will have to go.
Dr. Zdravko Tomac
I would like to thank the committee for its hospitality, which mirrors the hospitality we have received since we have been in Ireland. The entire delegation is delighted to have made so many friends and to have heard so many positive things about Ireland's experience of EU membership. I extend special thanks to the Oireachtas, which is the second European parliament to have ratified Croatia's stabilisation and association agreement with Europe.
I would like to introduce my colleagues, who are all members of the Foreign Affairs Committee of the Croatian Parliament. I am the Vice-President of the Croatian Parliament and the chairman of the Foreign Affairs Committee. I am a member of the Social Democratic Party, which is the largest party in Croatia's ruling coalition.
Ms Vesna Skare-Ozbolt is also a member of the committee and she is deputy chairperson of the Democratic Centre. She has played an important role in Croatia's political life throughout the last 12 years. She was the adviser to the then President of Croatia, Franjo Tudjman, during the war. Between 1995 and 1997, she led the team that completed the peaceful re-integration of the occupied Croatian territory in the east of the country.
Mr. Luka Bebic is a member of the Croatian Democratic Union, the strongest Opposition party. He has also been quite important in the political life of Croatia during the last 12 years. He was a Minister during Croatia's most difficult times. He was once the Minister for Defence of Croatia. Mr. Anto Dapic is the chairman of the Croatian Party of Rights, which is the oldest party in Croatia. Its members played a significant role during the war and in the defence of the country.
Dr. Ivo Slaus is one of the leading members of the Social Democratic Party. He is a famous scientist and a member of the Croatian Academy of Science and Arts. Ms Marina Plodkinjic is the adviser to the Speaker of the Croatian Parliament. She also assists with translation. Mr. Milovan Petkovic is secretary of the Foreign Affairs Committee. The chargé d'affaires and the second secretary of the Croatian Embassy are also present.
Most of the members of the committee who are present are from the Opposition. This is not an accident, as the committee was keen to demonstrate that there is complete consensus in Croatia, among members of all parties, in relation to our application for EU membership. I would like to explain briefly why members of the committee are in Ireland and why we are asking for Ireland's support. We are not asking for any privileges, but we would like the committee to understand why we are here. On 18 February in Athens, Croatia will submit a formal application for EU membership, based on the unanimous decision of the Croatian Parliament. We have fulfilled more than 50% of the obligations stemming from our stabilisation and association agreement with the EU and we hope we will fulfil the remaining obligations by the end of 2004. We would like to obtain candidate status to allow us to open negotiations with the EU and we are hoping to join Romania and Bulgaria in the next round of enlargement. We ask that because in terms of economic development, Croatia would rank fourth in the group of ten countries which are set to join the EU next year. Croatia's per capita GDP is three to four times higher than that of Bulgaria, which is, for the time being, a candidate country.
According to other standards such as growth rate, stability and human rights, Croatia is far more advanced than the remaining countries of the western Balkans. We are convinced we can fulfil the remaining obligations by the end of 2007 and we do not believe that there is any reason Croatia should share the destiny of the region's unstable countries of Bosnia Herzegovina, Albania, Macedonia, Serbia and Montenegro. We acknowledge the importance of regional co-operation and we are firmly committed to its establishment, however, we do not want to share the destiny of those countries which will not be eligible for EU membership for perhaps 12 to 15 years.
We have discussed these matters in detail with this Parliament's Committee on European Affairs and I am pleased to note that we received support from all parliamentarians in attendance. This is a historic moment for Croatia. If we fail to join Romania and Bulgaria in the next process of enlargement, our prospects of EU membership will become closely related to the instability in the region and to those countries which will not be able to apply for membership in the next 15 years.
We are at the disposal of the committee with regard to any questions members have. I thank the Chairman for setting out the programme for this meeting which confirms the friendship between the Irish and Croatian peoples, even though we have not had the opportunity to meet very often.
I thank Dr. Tomac for his comments. The Croatian delegation is very impressive and comprises parliamentarians of great experience and skill. I congratulate them on their win yesterday in the handball world championship, an achievement for which they deserve great credit. Croatia is represented in Ireland by its Chargé d'Affaires, Mrs. Bernadica Maksijan-Anic, who has been very helpful to us and with whom we have had very good relations. Mrs. Maksijan-Anic and her staff are very welcome to the committee.
We are very pleased with Croatia's recent progress and we welcome its Government's programme for the way forward which includes provisions for the judiciary, further co-operation with the international criminal tribunal for the former Yugoslavia and the development of good relationships with its neighbours, in which it has succeeded very well. Provisions are also being made for the return of refugees. Since the terrible events which followed the break-up of the former Yugoslavia, Croatia has made quick and extraordinary progress. We applaud the developments which have taken place thus far and offer our full support. We look forward to Croatia's membership of the EU, in which regard we are happy to note that it has signed a stabilisation and association agreement with the Union. We are also pleased to note that Ireland was one of the first member states of the Union to ratify that agreement. Croatian membership is fully supported by domestic public opinion and is viewed positively by Ireland, which hopes Croatia will be able to meet the acquis communautaire, including its human rights requirements.
The Croatian economy has a solid rate of growth which was estimated to be 4.3% in 2002 and it is our hope that this continues to be the case. Trade relations with Ireland are good and we should build on them. I note that some of our public and private companies are assisting in the development of Croatian industry and I hope this trend will continue. Our countries are fairly similar in terms of size of population and we have much in common.
Dr. Tomac
Please continue. I do not speak English very well, but we understand what the Chairman is saying.
Dr. Tomac asked about the rate of growth in our economy and expressed an interest in discovering whether Croatia could learn from our experience. There are many reasons for our economic development. Ours is a very open economy within the EU, we have invested heavily in education, for a long time we have sought inward investment and we have tried to maximise our comparative advantages. Our education system is free to graduate level and represents a long-term investment which has paid off immeasurably. In addition to the arts, we have also paid considerable attention to higher education in business and technical fields in an attempt to integrate our education system with our business and industrial needs. In recent years we have invested heavily in science and technology.
We negotiated unique social partnership agreements among Government, trade unions and other economic partners such as farmers and business interests. These agreements, successfully put together over a number of years, have been the basis of our economic stabilisation and have been central to our economic competitiveness. Social partnership puts in place agreements on increased productivity, caps and guarantees wage increases and promises tax reductions. That process helped us to stabilise cost increases and guaranteed our industrial harmony. These agreements are not easy to negotiate, but they are based on trust and the full involvement of the partners. I am aware that Croatia also takes a partnership approach and that, along with investment and the support of the EU during the initial stages of membership, will ensure a fine future for the country within the Union.
Does any committee member wish to ask a question?
I have to attend the Seanad so I must leave soon. I endorse the welcome of the Chairman. I was a member of the delegation of the Committee on Foreign Affairs that went to Croatia two years ago and I have happy memories of Zagreb and of meeting many of Dr. Tomac's colleagues. It was enlightening and, I would like to think, a mutually informative visit. Will Dr. Tomac outline briefly his opinion on the current political circumstances in south-east Europe? We are aware that he stressed the anxiety of Croatia to be treated as a western European country rather than a Balkan country. In light of that visit and the development of the stability pact, how does Dr. Tomac feel about the political and economic developments in south-east Europe in so far as they relate to Croatia and his political agenda?
Dr. Tomac
The Republic of Croatia wants an individual approach and does not want to share the destiny of the rest of the countries in the western Balkans. Unfortunately, the circumstances in the other countries of the western Balkans are not good and are deteriorating to a certain extent. Bosnia Herzegovina is functioning as a protectorate of the international community. National divisions are actually returning to the previous point since the recent elections. Some leaders from Yugoslavia say the Republic of Serbska is only a part of Bosnia Herzegovina temporarily and that it is necessary to find a permanent solution, which opens up new problems.
Kosovo is a protectorate that is only formally within Serbia. If Kosovo leaves Serbia, it is possible that it will require some kind of compensation. It will ask the Republic of Serbska to become an integral part of Serbia. Macedonia is also a protectorate to some extent because the relations between Macedonians and the Albanians cannot function without the international community. Montenegro also wishes to become independent and the union of Serbia and Montenegro is actually becoming a confederate area.
In those countries, the unemployment rate is about 40% and the GDP is about one third of that of Croatia. Therefore, we are sensitive when we hear certain ideas about creating some kind of mini-European Union in the Balkans. There are ideas that those countries should first establish links between themselves and then join the EU as a whole. If Croatia received candidate status based on its achievements so far, it could perhaps contribute to changing the circumstances in the neighbouring countries because they would see that it actually pays off to adopt democracy and progress.
Does Croatia wish to process its application for EU membership independent of the other states in the Balkans? What progress has been made in terms of co-operation with the international criminal tribunal for former Yugoslavia? Will Dr. Tomac comment on the former commander-in-chief of his armed forces? What progress has been made in eastern Slovenia with the return of refugees? A basis exists for a multicultural, liberal democracy. I understand there is still a significant Serbian minority in Dr. Tomac's country and there are also minority groups that represent smaller percentages.
There must be difficulties in respect of the re-establishment of property rights when refugees return. How is that being addressed? Is there a proactive policy to encourage refugees to return? These questions are relevant to Croatia's policy on becoming part of the EU and I would like Dr. Tomac to address them.
Dr. Tomac
Croatia will submit an application for EU membership. It is based on the unanimous decision of the Croatian Parliament and we have good arguments for it. I believe there are no problems when it comes to our co-operation with international criminal tribunals for the former Yugoslavia. Croatia has never questioned its co-operation with the tribunal. We try to use all available opportunities, defined in the rules of procedure of the tribunal, to simply dispute certain elements of the indictments. Our co-operation was never disputed. After we had explored all available opportunities, we actually fulfilled all the obligations that stem from the rules of procedure of the tribunal. The indictment against the former commander of the Croatian armed forces was forwarded to the county court. A team of doctors came to Croatia from The Hague to establish if Mr. Bobetko can receive the indictment and travel to The Hague to stand trial because his state of health is, for the time being, quite difficult being 84 years old. As for other matters, Croatia has actually achieved full co-operation with the tribunal. We do not think this problem will influence the relationship between the European Union and Croatia.
What was actually resented by the population of Croatia is that certain parts of the indictment disputed the liberation actions of the Croatian army and treated them as a genocide against its Serbian citizens. Milosevic is now in The Hague and it has already been proved that a civil war was not going on in that region of the former Yugoslavia but that it was planned aggression against Croatia in order to achieve territorial gains. Croatia was actually leading a liberation and defensive war and certain individual crimes were committed on the Croatian side as well. We firmly advocate the view that those who committed the crimes should be prosecuted. At this point in time we have a process against General Norac, who is one of the heroes of the homeland war. He is charged with committing certain crimes. The indictment against General Bobetko was raised because he led the Croatian armed forces, not because he committed those crimes. That is why Croatia has objected to the indictment.
Nobody in Croatia claims that there were no crimes on the Croatian side. We want those who have committed crimes to be put on trial, both in The Hague and in Croatia. However, we cannot accept the allegation that those liberation activities were planned as a genocide - there is general consensus on that in Croatia. As for the process of return, about 100,000 Serbs have returned to Croatia so far. We have adopted a constitutional law and a series of other laws that regulate the repossession of property and the Republic of Croatia is investing enormous funds in the reconstruction of destroyed housing facilities. The Republic of Croatia is the only country in the former Yugoslavia that has enabled the process of return. For the time being, there is no political resistance in this respect and we have ensured all the necessary material preconditions for this process.
The process of return in guaranteed even to those who have participated in the armed rebellion against Croatia because the Croatian Parliament adopted a law on granting general amnesty to them.
I welcome the delegation. Is the ratification and necessary domestic law complete for the International Criminal Court? In relation to the preparation for admission to the European Union, a number of the applicant countries have reported changes they have made in the nature of neo-liberal market reform. Usually, we hear of the destruction of the state sector, privatisation, foreign investment and so on. How do members of the delegation see the balance being achieved between the neo-liberal market reform that has been put in place and social protection such as floors for housing rights, pension rights, health and so on? What is their vision of the EU, which they aspire to join and which is in the middle of an enormous debate as to whether it will be characterised by a social economy or neo-liberal markets of unqualified adjustments? To which does their Government aspire, a social economy model or a neo-liberal market model? The first part of my question was technical about the International Criminal Court.
Dr. Tomac
I thank members for their questions which are very important and which I believe we could discuss all day. Croatia has ratified the statute of the International Criminal Court. We have actually criticised the United States for its view that its forces should not be covered by the statute. We believe it is quite a tremendous event for the world to create such a court and that all those who have been committing crimes know they will be under its jurisdiction.
As for the question of the social or market economy, we are under great pressure from the International Monetary Fund, the World Bank and other world institutions which want us to be merciless and create a market economy without taking into account social problems. As a social democrat, I oppose this view; however, our Government did not have a choice. We were forced to conduct liberal policies - I would even say policies of the 19th century - in order to transfer all the problems of the process of transition to workers and all those who have lost their privileges.
Croatia is facing regular elections, which will probably take place at the end of this year. There is growing resistance to this kind of policy in the country. We must take into account our national and social interests. The public also wants us not to blindly implement the requirements of international organisations. These are the most difficult problems on the Croatian political scene for the time being which I believe will have a decisive effect on the results of the forthcoming elections. We had a chance to hear something about Ireland's experience as well because there is great pressure to privatise everything we own. There is an ongoing debate in Croatia about whether there is a need to privatise the hotels on the island of Hvar. Should they be sold to foreigners or not?
Is Dr. Tomac asking DeputyHiggins that question? I think I know the answer he would give.
I am familiar with Professor Sachs's prescriptions for the region which are disastrous and have been rejected by many countries. How does Croatia find the European Union - this is a question Dr. Tomac might take up with our Government - in relation to this choice that has to be made? Does it find it on the side of the IMF and the World Bank or on the side of the social model Dr. Tomac favours?
Dr. Tomac
The European Union is not unique in many aspects and its standpoint is very often a compromise between various others. Croatia is very oriented towards the European Union which has a share of about 60% of our foreign trade. Croatian banks are almost completely owned by people from the European Union. European capital has a share of about 90% of all investments in Croatia so far. Almost nobody outside Europe is investing in Croatia. About 400,000 Croatian citizens, about 10% of its population, work in the European Union as guest workers. Therefore, Croatia is practically integrated with the European Union. Today I met some young Croats who recognised me and they told me they came to Ireland to find a job. We will follow the policies of the European Union, we have no other choice, even the controversial elements.
I note that there is social partnership in Croatia between the trade unions and business. How is that functioning? It is one of the ways in which we have attained a degree of social balance and we are interested in it in terms of Croatia's development. I also note that there is 21% unemployment. We had similar figures some years ago.
Dr. Tomac
When we met the Chairman at the airport, he told us of the situation in Ireland and spoke of the importance of maintaining this dialogue of employers and workers. We managed to establish social partnership but it has been falling apart in recent months. The Government mainly accepted the criteria set out by the International Monetary Fund when framing the budget but the trade unions opposed it and are now threatening to call a general strike. Doctors and teachers are already on strike. We have decided not to give in to demands for wage increases because we would then lose the chance to become stable and join the EU in 2007.
Dr. Ivo Slaus
We have invested much in building partnership between trade unions, employers and the Government but it is falling apart primarily over the new laws for workers. The essential issue is a tough one. How much time should be given to a firm if it wants to lay off workers? It is a serious problem and we still have not discussed it in parliament but I will give my opinion.
The numbers working in agriculture are decreasing, as are the numbers in industry and the armed forces. Therefore, people will have to work less and less but they will have to study for longer. Rather than trying to solve this problem, the tendency among trade unions is to call for permanent jobs without anyone ever being laid off. The idea, however, is no longer of a job for life but that in the course of our lives we will change our employment several times and become educated in the process.
The strike is about permanency and Deputy Higgins's question about the safety net is related. There is no doubt that the safety net became weaker. As a social democrat, I do not so much believe in the safety net but rather that human resources are the only true resources we have so we cannot afford to weaken them. If people cannot develop fully there will be trouble.
At the moment the doctors are on strike, and the teachers had a short strike that did not resolve the issue in question. Now a general strike is looming over job permanency and we hope to solve it through education. I do not know if we will succeed but permanent jobs without education are not an option.
We agree that education, training and alternative opportunities are particularly important. Ireland also saw a rapid decline in agriculture and traditional industry. The creation of new industries and the linkage with education is crucial.
Ms Vesna Skare-Ozbolt
The committee has asked questions of the chairman, who is head of the ruling party in Croatia. We in the opposition party would like to ask some questions. The Irish Government has made serious promises to support our application for membership of the European Union. What is the position of the committee and other politicians? Does the committee have any suggestions for us about how to lobby for our application?
All members here agree that we will support the Croatian application and we are happy to do that. We have had the opportunity to ask questions on issues of concern to our members and we are glad those issues are being tackled and are happy to assure the delegation of our support.
Dr. Tomac said to Deputy Higgins that the answer to his question was long, but the answer to the question on lobbying in Europe is even longer. It is important that one develops the capacity to lobby, represent one's position and get what is there from Europe. It was there for us, and we were good at winning support in Europe. Most independent commentators would recognise that. It is particularly important in the areas that were mentioned by the members here, where you must deal with the problem of the numbers engaged in traditional industries and agriculture and of providing interim measures and arrangements and getting support for the training programmes necessary. Education is terribly important but the training programmes are crucial, and they have been very valuable to us.
I think all the members here would advise you very strongly to ensure that in any arrangements that are made, you get good assistance from the European Union in the early stages. It is a matter of doing the appropriate homework then and making sure that is delivered upon. That was crucial to us, crucial to achieving the balance that Deputy Higgins mentioned.
It is very important that I personally welcome Croatia to the European Union as a contributing partner in helping to bring about the evolution of a social economic model. That would be very valuable. The United Nations Economic Commission for Europe's examination of the economies in the region tends to show that those countries that have opted for slower growth while retaining social protection have done better than those that have gone for quick fix adjustments and unprotected labour markets. Unprotected labour markets with short-term growth are proving disastrous in a number of countries. The lesson is that Croatia should seek from those who will welcome it into the EU support for resistance to crude and outdated 19th-century economic models such as might be advanced by the IMF or World Bank. The World Bank has attacked the IMF through JosephStiglitz's recent book, so even internally within the World Bank, people are abandoning some of these simplistic models.
As it affects Croatia, it is interesting to look at this issue from outside. Stiglitz's views seem conservative to a socialist, but he said that retained social protection on modulated, slower growth rates in the medium term has produced social cohesion. The strong aspect of Croatia's application is surely social cohesion and the transition to democracy. These are imperilled by the kind of quick fix solutions advanced by people like Jeremy Sachs and others whose views are now, thankfully, being discarded around the world.
We will have to leave the rest of that debate until this evening, when we meet our guests for dinner because their next engagement is coming up shortly. We look forward to seeing you again this evening and hope you have found it useful to meet the members of the committee. It has certainly been very enlightening and helpful for us, and we again assure you of our full support and offer to help in any way we can.
Dr. Tomac
Thank you, Chairman, and members of the committee.
The joint committee went into private session at 3.16 p.m. and adjourned at 3.50 p.m. until12 noon on Thursday, 13 February 2003.