ZAGREB, March 30, 2019 - Prime Minister Andrej Plenković said on Saturday that Istrian Democratic Party (IDS) leader Boris Miletić's statement by that pushing Uljanik into bankruptcy the ruling HDZ party was trying to economically destabilise Istria.

"If the IDS wants to play the game of shifting responsibility, it should ask itself what it has done for Uljanik over the past 30 years and not the last 17 months," Plenković said on the margins of a meeting of the NATO Parliamentary Assembly's Standing Committee in Zagreb.

Last year the government made a change, "unlike the SDP-led governments, of which the IDS was a member and which issued guarantees for ships that were not built," said Plenković.

"We did the only right and possible thing, we gave rescue aid in line with guidelines from the European Commission and made it possible to start looking for a suitable restructuring partner," he said.

Asked about combat aircraft, Plenković said that Croatia was working on enhancing its air force's capabilities but he could not guarantee that new fighter jets would be bought by the end of his term in office.

Asked if the aircraft purchase would be agreed directly or a new tender would be advertised, he said that having more than one option would be responsible.

More news about the Uljanik crisis can be found in the Business section.

ZAGREB, March 29, 2019 - Istrian Democratic Party (IDS) leader Boris Miletić on Thursday criticised the government's decision not to endorse the proposed plan for restructuring the ailing Uljanik Group, and insisted that inaction by the Andrej Plenković cabinet was an attempt to destabilise Istria, which, Miletic says, is "the only Croatian region that has managed to resist the pernicious influence of the Croatian Democratic Union (HDZ)."

Miletić said in Pula that the government's indecisiveness and lack of action regarding the Uljanik Group "is an attempt to economically destabilise Istria."

He claimed that the government postponed the beginning of today's meeting, while waiting for a decision of the Rijeka-based Commercial Court on whether there were conditions for initiating bankruptcy proceedings for the Uljanik Group.

Social Democratic Party (SDP) leader Davor Bernardić today called for "halting the bankruptcy of Uljanik Group."

He accused the current HDZ-led government of having no idea on how to address the problems in the Uljanik and 3 Maj docks.

Another opposition politician, Ivan Sinčić of the Živi Zid party accused Prime Minister Plenković of being incapable of salvaging the national shipbuilding industry.

Commenting on the government's decision not to accept the proposed overhaul plan which might cause financial exposure, Plenković today recalled that in the period between 1992 and 2017 a total of 31.7 billion kuna was spent on bailing out the shipyards or in the form of state subsidies.

Of that amount 4.3 billion kuna went to the Pula-based Uljanik dock and 9 billion kuna was earmarked for the 3. Maj shipyard in Rijeka or a total of 13.3 billion kuna for the Uljanik Group. "That reflects the great solidarity of all Croatian citizens with the shipbuilding industry overall and in particular with Pula and Rijeka," Plenković underscored.

According to data he presented the state's total exposure to the Uljanik Group on 15 October 2018 amounted to 4.3 billion kuna and because the group could not settle its dues, contracts were cancelled and a total of 3.1 billion kuna was paid out of the state budget on March 11 for enforced state guarantees.

"All these payments were made with the consent and coordination of the State Prosecutor's Office. All those agreements were once again reviewed and endorsed. Once the state issues a guarantee of that kind, in this case guarantees for ships, there is no option than to settle those dues," the prime minister said.

He underscored that the government was working on the issue of Croatia's shipbuilding, it analyses the crisis in Uljanik and all the aspects involved - political, economic, financial, social, regional, structural.

The government is supposed to make a decision that is "responsible and defensible in all aspects," Plenković said.

More news on Uljanik can be found in the Business section.

ZAGREB, March 28, 2019 - The proposed restructuring of the ailing Uljanik Group cannot be accepted by the government, as that plan would entail a huge exposure of the state to this problem, however, the government is open to the search of additional solutions for the shipyards in Pula and Rijeka, Prime Minister Andrej Plenković said in Zagreb on Thursday.

Plenković recalled that last week the Croatian public was informed about figures and restructuring costs from the plan, which should be covered by the state budget.

The proposal of the recently selected strategic partner Brodosplit and its owner Tomislav Debeljak, means that the aggregate costs could reach 10.8 billion kuna, and could not be lower than 7.5 billion kuna.

In that scenario, the Croatian state would be expected to provide profuse aid which would mean "great financial exposure", which would be definitely a huge burden on Croatian tax payers, the premier told his cabinet.

Therefore, the viability of the proposed restructuring plan is uncertain, the prime minister said.

Rijeka Commercial Court on Thursday once again adjourned a hearing that should have determined whether conditions have been fulfilled to open bankruptcy proceedings at the 3 Maj dock, and the next hearing is scheduled for April 17.

Judge Liljana Ugrin adjourned the hearing with the consent of workers' representatives and the shipyard's Supervisory Board, the Uljanik company and the temporary trustee for that Rijeka-based dock. "If the government in the meantime decides that it won't be bailing out 3 Maj, a hearing can be convened by phone and there is no need to wait for April 17," she said.

Receivership for the dock, which is part of the Uljanik Group, was sought last year by the Fina financial agency because of overdue liabilities for a period of more than 120 days which then amounted to 72 million kuna. In the meantime, that amount increased and on March 12 the debt had grown to 91 million kuna, 18.7 million kuna of which refers to workers' wages.

The first bankruptcy hearing was originally scheduled for February 6 but shifted to February 26, then to March 12 and again for March 28. The rationale for the adjournment then was the same again with an explanation one should wait for a possible agreement on the payment of wages and the continuation of production.

More news about Uljanik can be found in the Business section.

ZAGREB, March 28, 2019 - President Kolinda Grabar-Kitarović met with representatives from the Uljanik and 3. Maj shipyards on Wednesday at unions' request, and they informed her of their demands from the government - an urgent solution to their agony, the approval and payment of a loan for interim financing, the adoption of a draft restructuring plan on healthy foundations, and a possible strategic partner that will secure the best bid.

The president expressed her complete understanding for the workers' endeavours to have this unsustainable situation resolved and a decision on the fate of shipyards to be made as soon as possible, her office said in a press release.

She said the main criteria for the decision on whether to go into bankruptcy or to embark on restructuring should be based on the sustainability and competitiveness of shipbuilding as one of Croatia's traditional and strategic export-oriented industries.

She underscored the importance of caring for the livelihoods of workers and their families. She believes that only a sustainable business model can preserve jobs and secure wages for workers.

She finds it is disheartening that, according to the workers' representatives, even after 3.7 billion kuna of state funds was invested in Uljanik and 9 billion kuna in 3. Maj, the docks are in such a difficult state, which indicates that the way they were managed until now was a mistake.

President Grabar-Kitarović expects the money that has disappeared to be traced and repaid into the state budget and that all those responsible answer for it. She called on everyone involved in making a decision on the docks' fate to once again consider all the arguments so that they can be sure they will make the right decision.

She expressed concern about the impact of the situation on the economy, the livelihoods of part of the population of Istria and the Kvarner area, on emigration, and on the drain of a workforce which is in short supply.

The president of the strike committee at the Uljanik dock, Boris Cerovac, told reporters they told the president that they want the Uljanik and 3. Maj docks to survive and that they received full support from her. He underscored that she promised that she would inform the government of everything and ask it to do what is best for shipbuilding and for workers.

I hope for a positive solution, he said. "We can't wait any more."

"Rijeka Commercial Court is expected to decide tomorrow whether we are going into bankruptcy or not, and the only way for that not to occur is for the government to adopt a decision that 3. Maj and Uljanik will undergo restructuring and on a loan needed for interim financing," he said.

Another shop steward, Đino Šverko, believes that the president can help a lot because she is the only one, in addition to Economy Minister Darko Horvat, who has said that she supports restructuring and not bankruptcy and she reiterated that today, he underscored.

"She isn't the one who can make that decision but as a moral authority, she can talk with the prime minister and request that he resolves this agony as soon as possible," he added.

More news on Uljanik can be found in the Business section.

ZAGREB, March 27, 2019 - Prime Minister Andrej Plenković on Tuesday declined to comment on the arrests of former executives of the Uljanik shipbuilding group made earlier in the day or say if he preferred restructuring or bankruptcy for Uljanik, saying only that the topic would be discussed on Wednesday.

"As Prime Minister I do not want to comment on any proceedings... police and prosecutorial authorities have been working on the case for several months, I believe they are doing their job very thoroughly in a case that is not simple," he said in a brief comment on the arrests.

Local police and prosecutors on Tuesday morning started an operation in Istria, searching homes and business offices in an investigation covering 12 former executives of the ailing Uljanik shipbuilding group.

Asked about criticism from opposition SDP party leader Davor Bernardić as well as the opposition Živi Zid party that state institutions acted on his request and that the arrests had occurred in the week when the government was expected to make a decision on Uljanik's fate, Plenković asked "Is that the same gentleman who criticises the Chief State Prosecutor's Office for not doing anything?"

"He is unworthy of my comment," he added.

Plenković also would not say which solution for Uljanik he preferred – bankruptcy or restructuring, saying only: "We will have the last discussion on the matter tomorrow and you will be informed accordingly."

Anto Nobilo, who is defending a former president of the management board of the Uljanik shipbuilding group, Gianni Rossanda, said after his client was questioned by the police in Rijeka on Tuesday afternoon that Rossanda doesn't consider himself guilty and that he refused to make a statement to the police.

Nobilo said that he could not release any details of the questioning as the police investigation under way was confidential. Due to the complexity of the case, Rossanda refused to make a statement but once we've examined the file, we will start presenting our defence, Nobilo said.

Nobilo believes that the investigation which led to the arrests of 12 people earlier in the day has achieved a political goal, adding that this week the government will announce that the Uljanik group and its shipyards have to file for bankruptcy, thus launching the campaign for European elections.

Asked by reporters whether that meant that the government had ordered the USKOK anti-corruption office to launch the operation, Nobilo said that that was obvious.

He said that the police were lying when they spoke about HRK 1.2 billion having been embezzled but would not say if the amount in question was lower or higher.

Rossanda will remain in custody until Wednesday, when he will be questioned at the Rijeka County Prosecutor's Office.

Maksimilijan Percan, president of the management board of the 3. Maj shipyard, which is part of the Uljanik group, was also brought to the police station in Rijeka this afternoon for questioning.

Union leader Juraj Šoljić of the 3. Maj shipyard said on Tuesday that he supported activities launched by the police and other state institutions in order to determine where the money of that Rijeka-based dock as well as funds for its restructuring had ended up, and he called on the government to make decisions that would enable the continuation of production at the dock.

Anti-corruption investigators in Rijeka have been investigating for several months possible unlawful activities in the Uljanik shipbuilding group of which 3. Maj is part and in cooperation with the Rijeka County Prosecutor's Office early on Tuesday morning they launched an operation in which 12 people were arrested on suspicion of defrauding the Rijeka shipyard and the state budget.

Šoljić said that union representatives in the shipyard welcomed the operation and expected it to help determine where budget funds for the shipyard, intended for its restructuring, had ended up. "We have heard media reports saying that the leading people of the shipyard's former and current management have been arrested. Two years ago, I left the shipyard's supervisory board as the workers' representative exactly because of such indications and because I didn't agree with the way the dock was managed and supervised," said Šoljić.

He stressed that 3. Maj was sold to the Pula-based Uljanik in 2013 and that at the time it was financially rehabilitated, while its collapse, in terms of both personnel and finances, happened over the past five years.

"I call on the government to redress that injustice. It should adopt a decision as soon as possible enabling the payment of 3. Maj workers' wages, redressing of the injustice done to the dock and the continuation of the dock's operations, with the state as its owner, that is, either through CERP (Restructuring and Sale Centre) or the Jadranbrod shipbuilding corporation," said Šoljić.

Asked about the amount the shipyard and the state budget had been defrauded of, Šoljić said that the state had provided 847 million kuna for the restructuring of 3. Maj.

More news on Croatian shipbuilding industry can be found in the Business section.

ZAGREB, March 26, 2019 - The Police Office for Suppression of Corruption and Organised Crime (PNUSKOK) on Tuesday morning started arresting former executive officers in the Uljanik Group, and according to unofficial information among those arrested are former management board president Gianni Rossanda, his predecessor Anton Brajković and members of the former management board Marinko Brgić and Veljko Grbac.

Earlier in the morning police raided the home of former management board president Anton Brajković, who was replaced by Gianni Rossanda in 2013.

Apart from Rossanda, the former Uljanik management board also included Marinko Brgić and Veljko Grbac. Two vehicles, assumed to belong to the Ministry of the Interior, were parked outside the building where Rossanda lives and the former Uljanik management board president was allegedly not at home.

"I believe that former executives and management board members are the targets of the criminal investigation. I noticed members of the riot police outside Uljanik this morning already. I did not at the time know what that was all about, but I am happy to hear that things have started happening...I hope that someone will be held accountable for the situation in the shipyard," the head of the striking committee, Boris Cerovac, told the press.

"Unfortunately, we are here because individuals in Uljanik did not do their jobs," Cerovac concluded.

According to information Hina obtained from the Interior Ministry earlier this morning, law enforcement and prosecutorial authorities were searching the homes and offices of 12 suspects covered by the operation in Istria County. Spokeswoman Marina Mandic said the 12 suspects "are believed to have been implicated in possible wrongdoing" during the restructuring of the shipyard in Rijeka.

Pula Mayor Boris Miletić and Istria County Prefect Valter Flego, both of the Istrian Democratic Party (IDS), said they were the first to call on the Chief Prosecutor's Office and other relevant state institutions to investigate absolutely every segment of Uljanik's business operations.

"We believe that it is exceptionally important, notably in the current uncertain circumstances in Uljanik, to remove every suspicion and establish the responsibility of all those that have brought Uljanik to the brink of disaster, including the inaction of the state," Miletić and Flego said in their joint press release.

They also said that today's police operation was the first time the state had reacted to Uljanik's business performance. “Unfortunately, this is a reaction and not a pro-active move of the state which could have probably prevented the situation that Uljanik is facing today," Miletić and Flego said.

Local opposition politician and Rijeka City councillor Hrvoje Burić said he was surprised the arrests had not taken place earlier. He supported the dock's workers, expressing confidence that after the bankruptcy, the shipbuilding industry wold continue to exist in Pula and Rijeka.

More news about Uljanik can be found in the Business section.

ZAGREB, March 22, 2019 - The situation at the ailing Uljanik shipbuilding group from Pula, whose workers on Thursday went on strike again, was calm on Friday, and the striking committee decided to send letters to the prime minister, the president and the parliament speaker and to the owners of a dredger and a polar discovery cruise ship that are being built at Uljanik, in yet another attempt to make the government finally make a decision on the shipyard's future.

"We have asked the prime minister to urgently hold a government conference call to make a decision on Uljanik. We have called on President Kolinda Grabar-Kitarović... to visit Uljanik and see for herself the workers' agony and on the parliament speaker to hold a parliamentary discussion on Uljanik and seek support for the shipyard," the head of the striking committee, Boris Cerovac, said.

He added that the striking committee had also written to Jan De Nul, owner of a dredger that was being built in the shipyard, to give up on its plan to take the vessel and have it completed somewhere else.

"We cannot accept that and believe that Uljanik workers are capable of completing the ship. It is a highly sophisticated vessel, the world's biggest dredger, and we are willing to complete it as soon as the government makes a decision that will be positive for us. We have also written to the Scenic group, owner of the polar discovery cruise ship, asking for patience. We are behind deadlines but workers cannot work if they are hungry," he said.

Cerovac stressed that decision-making on the shipyard's fate was taking too long, that workers were physically and mentally exhausted and they had lost dignity.

Union representatives said on Thursday that workers demanded that the government adopt a restructuring plan for Uljanik or obtain a loan to pay workers their wages which they haven't received for the past seven months.

More news on Uljanik can be found in the Business section.

ZAGREB, March 21, 2019 - Workers at the Uljanik shipyard in the northern coastal town of Pula once again went on strike on Thursday, welding the gates at two of three entrances to the dock in an effort to compel the government to urgently decide on the future of the shipyard and its workers.

"We are on strike again as of today as we did not get any positive information from the government or Uljanik's management," the chairman of the strike committee, Boris Cerovac, said.

He reiterated that workers demand that the government adopt the restructuring plan or obtain a loan to pay workers their wages which they haven't received for the past seven months. "Let the government make its decision as soon as possible. We don't have any more time to wait. We want an urgent decision today. We don't want ships to be pulled out of Pula, we want to finish them here. We started them and we want to finish them," Cerovac said.

"It is due to the state, that is, the government's negligence that we are losing a ship and paying unnecessary penalties and all that could have been avoided had there been a timely reaction. The gates to Uljanik will be blocked until further notice, until such time that a solution for the shipyard is found," he said, adding that they would not allow subcontractors working on a cruise ship to enter the shipyard either.

Cerovac added that the strike committee had informed the management of their demands and that they expected the strategic partner, Tomislav Debeljak, to help and to state his opinion on the most recent development.

"We are not planning to go to Zagreb yet, even though we are considering that option...We are waiting for a response from our colleagues at the 3. Maj shipyard and call on them to join us in showing our dissatisfaction together," he concluded.

According to Cerovac there are currently 2,740 workers in the Uljanik Group and 1,800 have left the Pula and Rijeka shipyards so far.

A union official in the 3. Maj shipyard said on Thursday that waiting for a solution to the fate of Rijeka's ailing dock had become extremely hard for workers and told those in charge to finally make a decision and end the months-long agony.

Speaking to the press in Rijeka, Juraj Šoljić said workers had been waiting for a solution for seven months and asked the government and the ruling coalition to show responsibility toward them. Workers are entitled to dignity and have been brought into the current situation because of the state's inactivity, he added.

Asked about a hearing on March 28 when the Rijeka Commercial Court is due to decide whether the dock will file for bankruptcy, Šoljić said he could not understand why bankruptcy might be postponed again.

Unionist Veljko Todorović called out the prosecutor's office for the delays and said managements were mainly responsible for the current situation, not just the state. "We expect some kind of salary, from bankruptcy, from liquidation, from whatever. Make a decision if you can," he said, adding that 3. Maj workers wanted to work and had asked only for material so they could finish the ships under construction. He asked Finance Minister Zdravko Marić why he had issued guarantees for non-existent ships.

Unionist Slađan Pejić told President Kolinda Grabar-Kitarović that she could come to 3. Maj and visit the workers, and not just when she was a ship's godmother. "We all know the decision on whether we file for bankruptcy will be made by Prime Minister Plenković," said unionist Predrag Knežević. "They devastated everything. They systematically and deliberately destroyed us," he said, accusing the management of the Uljanik Group, of which 3. Maj is a part of, and "all the governments," whose responsibility it was to have overseen everything.

More news about the shipyards can be found in the Business section.

ZAGREB, March 21, 2019 - Prime Minister Andrej Plenković said on Thursday, that while attempting to resolve the issue in Croatian shipyards, the government was taking into account the shipbuilding industry but also the effects that any of the measures could have on the fiscal consolidation policy, shipyard workers and regions where the docks are located.

"We are taking that branch of the economy into account, but we are also taking into account the overall effects on the fiscal consolidation policy and repercussions for the workers as well as the regional aspect of this issue," Plenković said at the start of a cabinet meeting.

He said the government was considering all the scenarios and options by talking with the newly selected strategic partner, the management of the Uljanik Group, the ministries of the economy and finance and that it was trying to get a clear picture of implications of any decision that would be adopted in a foreseeable future.

Additional consultation includes talks with the European Commission, given a possible state support, Plenković said.

Members of Croatia's ruling coalition at their meeting on Wednesday failed to decide on whether the Uljanik shipbuilding group would undergo restructuring or file for bankruptcy, delaying the decision for several days.

The head of the parliamentary group of the Croatian Democratic Union (HDZ) party, Branko Bačić, said that the data presented showed that restructuring would cost slightly over a billion euro, while the cost of bankruptcy would be about 557 million euro. He said that they needed to see what Uljanik's bankruptcy would mean for the Croatian shipbuilding industry and how it would affect supporting industries.

Members of Croatia's ruling coalition at their meeting on Wednesday failed to decide on whether the Uljanik shipbuilding group would undergo restructuring or file for bankruptcy, delaying the decision for several days, the head of the parliamentary group of the Croatian Democratic Union (HDZ) party, Branko Bačić, said. "We didn't reach a final decision on restructuring or bankruptcy. We were presented with all the data and we gave ourselves a few more days," Bačić told the press after the meeting.

More news about the shipbuilding industry can be found in the Business section.

ZAGREB, March 20, 2019) - The majority of political parties making up the ruling coalition with the Croatian Democratic Union (HDZ) said on Wednesday, ahead of a meeting focusing on the Uljanik group, that bankruptcy was a better solution than restructuring.

Croatian People's Party (HNS) leader Ivan Vrdoljak said that he wanted to see concrete figures as to what both bankruptcy and restructuring would mean for citizens as well as what the continuation of production would bring and whether it was possible in a bankruptcy.

Darinko Kosor of the Croatian Social Liberal Party (HSLS) warned that it was the government and not the coalition that would decide between bankruptcy and restructuring while the coalition partners could express their opinions.

Kosor said that he would ask where the 7-8 billion kuna siphoned out of Uljanik over the past 10 years had ended up, who was responsible for that and what the Interior Ministry had done in that regard.

Kosor also wondered who would pay a further 5-6 billion kuna which he believes is the cost of restructuring and whether that money has been secured in the budget and who will pay further guarantees for the construction of ships.

Asked whether he supported the option of bankruptcy, he said that "figures speak for themselves."

Petrinja Mayor Darinko Dumbović, who is a member of the Reformists, said that he favoured bankruptcy, based on the lessons learnt from the collapse of the Sisak ironworks and refinery and of the Petrinja-based Gavrilović meat industry, which had resulted in the loss of 30,000 jobs.

Kazimir Varga of Milan Bandić's Work and Solidarity Party and independent MP Ivan Mišić said that bankruptcy was the best option while Italian minority MP Furio Radin said that he had always advocated restructuring.

Branko Hrg of the Christian Democrats, too, said that bankruptcy was the only option for him.

According to Hrg, 15.5 billion kuna had been "pumped into the two shipyards (Uljanik and 3. Maj) and no one has answered for that."

The ministers of economy and finance, Darko Horvat and Zdravko Marić respectively, have different opinions on the fate of the Uljanik group.

Horvat said that initially numbers would show that bankruptcy was cheaper but that, in the long run, this was not certain.

Marić said taxpayers had the right to see how much had been paid for Uljanik so far and how much more had to be paid. "Things are very serious. We have paid hefty amounts so far. A few days ago, I said 3.1 billion kuna had been paid in enforced guarantees so far for the building of mainly non-existent ships," Marić said.

"The financial aspect has to certainly be taken into account because it is not small. I'm not just looking at the financial aspect but at the bigger picture - the significance, value and importance of the shipbuilding industry. We are all saying that that is a strategic branch, the statistical bureau's figures and some other figures shed a different light and that all has to be taken into account," Marić said.

More news about Uljanik can be found in the Business section.