Croats Vote as Political Deadlock Stalls Economic Repair

  • Social Democrats lead in polls, may fall short of majority
  • Two main parties poised to vie for support from upstart Bridge

Croatians are voting in a snap general election that, with polls signaling no party will secure a majority, may fail to resolve a political crisis that has derailed measures aimed at overhauling the economy after a record recession.

Former Prime Minister Zoran Milanovic’s Social Democrats, looking to retake power after less than a year in opposition, hold a tight lead over the ruling Croatian Democratic Union, known as HDZ. Ballot stations close at 7 p.m. on Sunday, when exit polls will be published. If voting resembles pre-election polls, one of the big parties will be forced to ally with the other to lead a government or team up with a third partner, such as the smaller Bridge party, whose ruling coalition with HDZ collapsed in June after just six months.

Zoran Milanovic, casts his ballot in Zagreb on Sept. 11.

Photographer: Stringer/AFP via Getty Images

“The fundamental scenario is unpredictable and very turbulent,” said Velimir Sonje, an independent analyst with Arhivanalitika in Zagreb. “People are talking about a grand coalition between the two biggest parties, but they’d only do that if there’s no other option.”

Weeks of political wrangling may ensue, potentially leading to an unstable coalition or a third general election in a year. Prolonged turmoil would complicate efforts by any cabinet that emerges to address Croatia’s substantial public debt burden and follow through on an economic program to nurture the economy after a six-year recession wiped out more than a tenth of gross domestic product. Turnout was 19 percent at 11 a.m., the State Electoral Commission said.

The Social Democrats are set to win 55 seats, with HDZ in second place at 53, according to a survey by Ipsos Puls published by Nova TV. Bridge, which has pledged to fight waste and corruption and to shrink the state administration, was projected to win 12, seven fewer than in last year’s election. The Aug. 16-Sept. 4 survey, conducted among 4,200 respondents, looked at 140 of parliament’s 151 mandates, excluding the remainder that are allotted to minorities and diaspora. It had a margin of error of 4.8 percent.

“I voted for one of the small parties, because I’m tired of the two big parties which have brought us to this chaos where we are,” said Tomo Cikota, an unemployed 32-year-old textile technician, as he prepared to cast his ballot in Zagreb.

After losing power last year, Milanovic is promising to cut income tax, reform the judiciary and reduce state spending in the Adriatic state of 4.2 million people. The Social Democrats, ousted in 2015 despite pushing through measures to forgive the debt of Croatia’s poorest and forcing banks to pay almost 1 billion euros ($1.1 billion) to ease payments for Croatians who had taken Swiss franc-denominated loans, are also pledging to improve the business climate and lure foreign investors with tax holidays.

Newly appointed HDZ leader Andrej Plenkovic has also pledged to reduce income tax, as well as cutting public debt, now at 87 percent of gross domestic product. He is trying to shore up support for HDZ, a conservative party supported by the Catholic church, after it was censured for corruption earlier this decade and former leader Ivo Sanader was convicted of bribery and abuse of power in cases that are being retried. Plenkovic replaced Tomislav Karamarko, who torpedoed his own government with a June no-confidence vote while he was facing conflict-of-interest allegations tied to state refiner INA Industrija Nafte d.d.

For more on Mol and INA’s role in Croatian politics, click here

Plenkovic said this week he may seek a new coalition, if needed, with Bridge, whose leader Bozo Petrov said he will work with either of the bigger parties if they agree to his conditions. The HDZ leader proposed leading such a tie-up if his party wins more seats, however, a potential sticking point for negotiations. While Plenkovic said his political force would reject a grand coalition with the Social Democrats, some analysts see that as a potential outcome if the election doesn’t produce a clear winner.

“No party will have an easy task in trying to form a government,” said Nenad Zakosek, a political science professor at the University of Zagreb. “How well each of the two bigger parties will do hinges on to what extent the people are still reeling from the Karamarko scandal and how successful Plenkovic has been in applying damage control.”

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