ZAGREB, November 14, 2018 - Croatian President Kolinda Grabar-Kitarović held talks with German Chancellor Angela Merkel in Berlin on Tuesday during a dinner given on the occasion of an economic conference organised by the Sueddeutsche Zeitung daily, after which she refuted Croatian media speculation that Franjo Varga, the main suspect in a fake texts scandal, was involved in her 2014 presidential campaign.

"We talked about the position of women in politics as well as many other topics in international politics, including US President Donald Trump and his relationship with Europe," Grabar-Kitarović told Croatian reporters after the dinner during which she also talked with Prime Ministers Katrin Jakobsdottir of Iceland and Ana Brnabić of Serbia.

She announced that in her speech on Wednesday, when the economic conference ends, she would talk about the Three Seas Initiative and the need to erase differences between old and new Europe.

She said that she would not talk about the Global Compact on Migration. "I said everything there was to say about it. Now it's up to the Foreign Ministry to continue the job."

Asked about her national security advisor Vlado Galić and the text messages scandal, the president said Varga had not worked on her election campaign and that Galić told her he had been in contact with Varga twice "during the campaign when various trolls and websites which promoted hate speech appeared."

"But Varga didn't work for the campaign. No services were asked of him nor did we create any trolls. Frankly, I was too busy with the programme at the time to think about logistics. I only know that I told my associates at the start of the campaign that I wanted everything to be clean, no dirty deals. As you know, during the campaign I never condemned anyone but talked about work and performance and I never let anyone be personally attacked," Grabar-Kitarović said, adding that she would discuss this matter with Galić again.

Nacional weekly speculates in its latest issue that Varga was involved in her 2014 presidential campaign because, by his own admission, he was brought to the ruling HDZ party, which nominated Grabar-Kitarović for president, by Galić, her current advisor on defence and security.

For more on the so-called fake messages scandal, click here.

Croatian President Kolinda Grabar Kitarović has officially opened the Meeting G2.4 conference in Zagreb. The fourth edition of the conference, aimed at developing business connections between Croatia and the diaspora, is being held at the Forum Congress Centre in Zagreb, with more than 150 business people from Croatia and abroad attending. More than 70 successful businesspeople from 19 countries have gathered to discuss the development of business relations with Croatia. The largest delegations are those from Australia and Austria, with more than 20 participants each.

At the opening, the president said: “A whole other Croatia lives outside the official borders of the Republic of Croatia, and the Meeting G2 makes an important contribution to linking Croats in Croatia with those living abroad. We must realize that people are the greatest treasure and an advantage and that they are building the future, which makes the investment in demographic renewal a priority. I am particularly pleased that this initiative came from returnees and I want the voice of businesspeople to be heard. Their suggestions and constructive criticism about the measures we need to take in the country for business development, as well as about activities we can do abroad, are something which we can all benefit from.”

The Meeting G2 conference began yesterday afternoon with the competition of eight Croatian start-ups, which had to present their innovative projects in front of the gathered investors in just 10 minutes. The jury consisting of business professionals and entrepreneurs from Croatia and abroad awarded the first prize to RioBot, a chatbot that functions on the basis of artificial intelligence and makes it easier to book and track scheduled appointments with various service providers. The winning project received EY’s consultancy services worth 15,000 kuna. Interestingly, the other seven projects – 3Dtech, Authland, ExRey, Good Game, MONAstays, Tinja and WePark – are also apps and various platforms, such as those for gaming, booking local tourist experiences, connecting solar panel installers with users, parking reservations and the like.

During the Who is Who in G2 session, each participant had an opportunity to present their business in one minute and say with whom they wanted to connect. This made it possible to quickly exchange contacts and create business connections immediately after the event. It was possible to hear, at one location and in less than two hours, about a number of successful projects – construction projects, financial projects, logistics, heavy industry, ICT, artificial intelligence, architecture, various consulting services and many others.

In order to better connect the diaspora with Croatia in the future, the Central State Office for Croats Abroad presented the project of developing the Registry of Croat Entities outside Croatia. By the end of the year, a pilot project will be implemented in three countries (Germany, USA, Argentina) which will gather data on physical and legal entities in these countries. Users will be able to express their interest for connecting with specific events and organizations. The idea is for the registry to function as a communication platform between all users.

Today, the conference will feature seven panels with more than 40 participants. The topics are the importance of chambers of commerce for exporters, innovative design in the wood industry, Croatian delicacies and their placement on markets around the world, real estate, non-traditional forms of tourism and blockchain in Croatia.

The meeting-g2.com website has all the detailed information about this year's programme and previous meetings, and all interested to join can sign up online.

For more on Croatian diaspora, click here.

The Croatian president, who was one of the biggest fans at the World Cup in Russia this summer where Croatia became finalists, presented the Croatia national team with medals for their contribution to sports and the promotion of Croatia.

ZAGREB, November 12, 2018 - The celebration of the 100th anniversary of the end of World War I, which was held at the Arc de Triomphe in Paris, was not only a commemorative event but it also served as an opportunity to look at the future, Croatia's President Kolinda Grabar-Kitarović said in Paris on Sunday.

After the ceremony in Paris, the Croatian president told the press that the commemorative events were important not only to pay tribute to those who gave their lives but also to look at the future.

She said that during her stay in France, she was received by French President Emmanuel Macron, and held meetings with several other world leaders.

Grabar-Kitarović said that the Paris Peace Forum was opened by French President Macron and German Chancellor Angela Merkel, who represented the countries which used to be on the opposite sides during the World War I and II, and that nowadays the two leaders were working together on the European Union project.

Threats facing the world such as terrorism, poverty, inequality, ignorance, climate change require our concerted action and no country can deal with it on its own, the Croatian president said.

After the central ceremony was held at Arc de Triomphe, President Grabar-Kitarović met with President Macron and other world leaders at Elysee Palace, and attended the plenary session of the Paris Peace Forum.

She told the press that she had done a lot of work on the margins of the commemorative events. In this context she mentioned her meetings with U.S. President Donald Trump and Russian President Vladimir Putin, and informed the press that she reiterated her invitation to Putin to visit Croatia.

Grabar-Kitarović presented as a gift "Judita (Judith)", an epic poem of Croatian writer Marko Marulić, to the library of the Paris Peace Forum.

The central celebration of the centenary of the end of the Great War was held in the French capital to mark 100 years since the armistice reached on 11 November 1918. The armistice between the Allies and Germany was signed in a railway carriage in a forest near Compiegne in northern France, marking the end of hostilities which began in 1914.

For more on the Croatian president, click here.

ZAGREB, November 11, 2018 - President Kolinda Grabar-Kitarović said on Saturday that the Ministry of Foreign and European Affairs should send someone to Marrakesh to attend an intergovernmental conference on adopting the Global Compact for Safe, Orderly and Regular Migration, adding that this was not the first time that she couldn't respond to an invitation and that she had cancelled her attendance at events for a variety of reasons before.

"I have estimated that in the circumstances that have emerged in the meantime and because of the theme of the conference itself, it would be better if someone else attended the migration conference, someone from departments that are directly involved in this matter, possibly the Ministry of the Interior or the Ministry of Foreign and European Affairs, which was in charge of the process of negotiation of this convention. Prime Minister Plenković has said that the government will discuss this and decide accordingly," Grabar-Kitarović told reporters in Paris, where she had arrived to attend a ceremony marking the centenary of the end of the First World War.

This week disputes emerged between the president and the government, notably the Ministry of Foreign and European Affairs, over the president's decision to cancel her attendance at the Marrakesh migration conference. The president had confirmed her attendance to the UN secretary general in August.

Grabar-Kitarović said in Paris that the cancellation of the trip was not the first or last time that she would refuse an invitation for some reason and that during her term in office she had cancelled her attendance at many events for a variety of reasons. "My assessment at this point is that it is better for someone from the relevant department to attend, and I should emphasise once again that this migration convention is not signed and is not binding. Any country can choose that part that suits its organisation. I don't want it in any way to be a matter of dispute either in Croatian society or in international relations," the president said.

She noted that she had made the decision on her own and that she had considered it since August. "As you could see, I publicly spoke about it in New York because I had reservations already then and I suggested to my advisers then that in their statements they should indicate that my opinion is that we should attend at department level, but the government will decide on that," Grabar-Kitarović said.

The main ceremony commemorating the end of the Great War will be held on Sunday and will be attended by many heads of state or government, including French President Emmanuel Macron as the host, US and Russian Presidents Donald Trump and Vladimir Putin, German Chancellor Angela Merkel and Turkish President Tayyip Erdogan.

"Unfortunately, Croats also fought in the First World War, defending the Austro-Hungarian monarchy which they didn't like. A lot of people were killed, and for us the end of the war is an event that should be celebrated. However, economic and political circumstances in Croatia didn't improve much after the end of the First World War, and the Second World War followed. Obviously, issues had not been resolved at international level," Grabar-Kitarović said.

The ceremony in Paris is symbolic and will unite a large part of the world in paying tribute to the war dead. It will also have a concrete dimension, primarily at the Peace Forum which has been launched by President Macron. A lot of resources and energy have been invested and it could result in good projects because people from around the world have been invited, Grabar-Kitarović said.

Also attending the ceremony will be representatives of international and non-governmental organisations, corporations, trade unions and religious groups. Introductory remarks will be made by Chancellor Merkel together with President Macron and UN Secretary General Antonio Gutteres.

Grabar-Kitarović began her visit to Paris by visiting Croatian photographer Davor Rostuhar's exhibition at the Louvre, entitled "Croatia, Full of Colours".

For more on the migrant crisis as it relates to Croatia, click here.

ZAGREB, November 11, 2018 - President Kolinda Grabar-Kitarović spoke favourably on Saturday of the set of tax reform bills which the government had sent to parliament for adoption, particularly praising the move to ease the tax burden on wages.

In addition to tax reforms, the government on Friday also proposed an increase in the total annual amount of non-taxable receipts, from 2,500 kuna (340 euro) to 7,500 kuna (1,000 euro) a year.

"I think we are going in the right direction. Any easing of the burden on taxes is very good and I welcome it," Grabar-Kitarović told reporters in Paris where she would attend a ceremony marking the centenary of the end of the First World War.

"I think it's much better to increase wages than to reduce VAT, because if wages are increased, people can decide for themselves what they will do with that money," the president added.

She expressed confidence that there would be further tax breaks.

"I would like us to catch up with those countries that bring in tax breaks to attract foreign and domestic investors and enable businesses to invest more of their profits in innovation, new products and the like," Grabar-Kitarović said.

For more on Croatia’s president, click here.

ZAGREB, November 10, 2018 - Attending a special session of the Vukovar-Srijem County Assembly in the eastern town of Ilok on Friday, President Kolinda Grabar-Kitarović said that over the past few years Croatia had lost twenty times more people due to depopulation crisis than it had in the 1991-95 Homeland War.

Addressing the assembly, Grabar-Kitarović called for the prosecution of war crimes, underscoring that it needed to be kept in mind that responsibility for a crime was personal and an individual's guilt must not be the cause for collective stigmatisation. "We have achieved progress in co-existence after reintegration and we have to continue building it, not just at the level of political rights, but primarily by building human relations and ensuring prosperity for everyone," she said.

The president added that these are important issues for the future, which is "threatened by depopulation." Croatia has lost at least twenty times more people due to depopulation than it did in the Homeland War, she said.

The president welcomed measures to amend the Citizenship Act which will facilitate obtaining citizenship for Croatian descendants born abroad, and added that it was necessary to create conditions for immigration from other countries as well.

She commended the Slavonia, Baranja and Srijem project and called for financial decentralisation and strengthening the role of counties in the absorption of EU funds. In a message to young people, she called on them to not give up on their ideals and to be resolute in building successful personal and business lives.

Regional Development and EU Funds Minister Gabrijela Žalac said that there was no more time for regret at the missed opportunities in Croatia's economic revival. She reiterated that so far projects valued at 2.3 billion kuna had been contracted for Vukovar-Srijem County alone, as part of the Slavonia, Baranja and Srijem project.

For more on Croatia's demographic crisis, click here.

ZAGREB, November 9, 2018 - Croatian President Kolinda Grabar-Kitarović will join world leaders in France this weekend to commemorate the 100th anniversary of the end of the First World War and attend the Paris Peace Forum, a new initiative modelled after the Paris climate-accord meetings of three years ago.

Grabar-Kitarović's office said in a press release on Thursday the president will attend Armistice Day ceremonies in Paris on Sunday to mark the end of the "war to end all wars."

More than 60 leaders are to take part in the commemoration, including French President Emmanuel Macron, U.S. President Donald Trump and German Chancellor Angela Merkel. On Saturday, Grabar-Kitarović will attend a dinner reception given by French President Macron.

During her stay in Paris, Grabar-Kitarović will visit an exhibition called "Croatie. Pleine de couleurs (Croatia, Full of Colours)" which was opened at the Louvre in October.

On display are 26 large-format photographs by Croatian photographer, traveller and adventurist Davor Rostuhar showing all Croatian regions, their nature, traditions, customs and people, with all colours of the seasons. They are part of his large project "Croatia from Above" which was published by National Geographic as its first photo monograph from Croatia.

For more on relations between Croatia and France, click here.

ZAGREB, November 7, 2018 - Addressing a traditional conference of the Croatian Economic Association in Opatija on Wednesday, President Kolinda Grabar-Kitarović expressed satisfaction with positive economic trends and praised the government for the reform measures it is taking, but she also warned about crucial problems affecting the national economy.

In her address, titled "Key Challenges and Preconditions for the Economic Development of Croatia", the head of state underscored a GDP growth rate of 2.9%, continued economic growth, a 3.5% increase in retail sales in the first eight months of this year and positive employment trends, as the biggest achievements in the period since last year's meeting of the Croatian Economic Association.

In addition, a surplus in the general government budget of 2.8 billion kuna or 0.8% of last year's GDP, plus a surplus of 1.6 billion in the first half of this year, were also underlined as successes. In her speech, the president pointed to a fall in the public debt-to-GDP ratio to 80.2% at the end of 2017 and further to 74.3% at the end of the first half of this year.

"The above-mentioned facts clearly indicate that we have made some headway in the context of increasing economic growth, reducing unemployment and bringing order to public finances. These results can satisfy us to a certain extent, but we must not rest on our laurels. They are just the first step and a sign of encouragement for us to accomplish our real goal, and that is an annual growth rate of 5%," the president said.

She praised Finance Minister Zdravko Marić for implementing tax measures that make an additional 6.3 billion kuna disposable to the business sector, and described this as an impulse for a more robust growth. She said that unlike his predecessors, the current finance minister had done a good job by easing the tax burden.

Grabar-Kitarović, however, called for a fairer income taxation system and proposed the introduction of "a synthetic tax system whereby the aggregate income would be taxed equally, regardless of the source of income."

Currently, income from work is taxed progressively, while income from the property rent is taxed with a preferential rate of 12%, which applies to only 70% of the base. "That, together with some other taxes, has turned us into a society of rentiers," she said. "We can change that and the tax policy can be conducive to such efforts," the president said.

President recommends strengthening of second pension pillar

In connection with the reform of the pension schemes, Grabar-Kitarović warned that the pension system in the present-day circumstances "is unsustainable and poses the biggest financial risk for the state". Therefore, reinforcing the second pillar for pension contributions is the only right way to improve the system in parallel to cost cutting and certain changes in the structure of investments by pension funds, she said.

Concerning demographic trends, gradually raising the statutory retirement age and encouraging workers to retire later can help efforts to make the pension system viable, she added, praising the efforts which Labour and Pension System Minister Marko Pavić has been investing in that regard.

The president said that she attached great attention to decentralisation and regional development and in that context welcomed the government's tax measures resulting "in positive headway towards intensified fiscal decentralisation, more effective fiscal balancing and more even regional development."

She called for the strengthening of administrative and financial capacities of local authorities for the absorption of EU funds, noting that 32 out of 127 towns and municipalities had failed to withdraw any money from EU funds since Croatia's admission to the EU in mid-2013.

In her comment on the latest Doing Business report of the World Bank that criticises Croatia for a low level of productivity of the state administration and a slow judicial system as well as a poor business climate, the president called for a reform of the state administration and legal system so as to reduce red tape and lessen legal insecurity.

Lack of clear vision, development strategy biggest problem, says president

Grabar-Kitarović said that the biggest problem of the national economy "is the lack of a clear vision and a development strategy", adding that "we have to decide what we want to present and with what we want to position ourselves on the European and global markets in the long run."

She underlined tourism in that context and warned that it was both "impressive and discouraging" that through its direct and indirect effects, tourism accounted for close to 20% of GDP.

The question is how long the current concept of tourism, based on the country's geographical features, can be sustainable, while the existing transport and local infrastructure is becoming more and more vulnerable to a growing number of visitors, the president said.

She added that she saw Croatia's agricultural sector as its comparative advantage. "It is amazing that the Dutch make polders to meet their needs for agricultural production... while we have very good and fertile soil that is largely not cultivated," she said. "Maybe it is true that the national farm sector was destroyed by excessive imports, but that means that we joined the EU unprepared and did not have a pre-accession strategy, she said.

"I believe that these two examples - tourism and farming - are sufficient to illustrate how problematic it is not to have a strategy and how much the lack of a clear vision and economic development strategy can also affect the segments where we are very competitive," said Grabar-Kitarović.

Croatia must work to change the structure of its economy towards the production of technologically more complex products with added value as well as create conditions for greater productivity and development of the private sector, notably small and medium businesses, without neglecting public companies, she said. "This is important primarily for the sake of our people who are disappointed and are emigrating. If we want to stop or reverse that trend, we must primarily ensure job creation and higher salaries," she said.

She warned that a clear vision and an economic development strategy were especially important "in the context of geopolitical reshuffling, in which Croatia must capitalise on its position in terms of geo-transport and energy routes, as well as ongoing business and technological changes" so that it could become a strong European transport and energy hub.

"I am a big optimist and can say with certainty that we can succeed in all our efforts. We have enough wisdom and competence but we need a little more resolve, a proactive approach and optimism," Grabar-Kitarović said.

For more on Croatian economy, click here.

ZAGREB, November 6, 2018 - Foreign and European Affairs Minister Marija Pejčinović Burić said on Tuesday that she still could not see what President Kolinda Grabar-Kitarović found disputable in the Global Compact for Safe, Orderly and Regular Migration and expressed regret at the nervous reactions from the Office of the Croatian President to this document.

Minister Pejčinović Burić, who was attending an international conference on building democratic security at the Mediterranean in Dubrovnik, responded to the criticism which President Grabar-Kitarović voiced against the foreign ministry accusing it of failing to do its part of the job concerning the Marrakesh document. "The Foreign and European Affairs Ministry has done its part of the job well. I, as the person at the helm of the ministry and somebody who has an insight in it, can say that the job in the negotiations has been well done," the minister said today.

The Global Compact is actually not a treaty and is not meant to be signed, it is not a legally binding document and enables each country to regulate the issue of regular migrants the way it sees fit, removing all insinuations that something could be imposed on Croatia, the minister reiterated.

"This is the first document since the establishment of the United Nations that is intended to regulate the important matter of migrations and regular migrations. It offers a catalogue of measures and best practices that can be applied and facilitates the efforts of countries to handle regular migrations," the minister said.

The point is that the document can enhance the communication and cooperation among countries so as to lessen migratory pressures. After the finalisation of the Global Compact document, Croatia can choose what corresponds to its national interests, the minister added.

She said that Croatia had been already implementing some of the measures from that catalogue and that it would like also to contribute to the establishment a better system to address the issue at the global level. "We are persistent in our position when it comes to this issue," the minister underscored, adding that countries that have scrapped the document, have done that for their specific reasons.

On Monday, the President said the foreign ministry that coordinated the negotiations, failed to do its job. "Instead of releasing my correspondence to the media, they had an obligation to inform the public what this is about. They did not do their job," Grabar-Kitarović said.

Although at first she, in her own words, had "enthusiastically" accepted the invitation of the UN Secretary General to take part in a Marrakesh conference on the adoption of the Global Compact in December, her position now is ambivalent. Grabar Kitarović said: "I neither support nor don't support the document."

During the Dubrovnik conference, Parliament Speaker Gordan Jandroković also commented on this topic saying that the disputes in the Croatian politics regarding this topic were not the first conflict of this kind. He said that he wondered who was generating those disputes. "First we had conflicts over the Istanbul Convention, that over the Vukovar rally, and now Marrakesh document, and all those matters are not meant to cause disputes," he said, warning that the topics on which social consensus should be made, seem to trigger off discussions from the ideological points of view.

Somebody is intentionally sparking off such conflicts and is trying to provoke disputes between the president and the government, said Jandroković.

Grabar-Kitarović's participation in the Marrakesh conference has caused a new disagreement between her office and the government after a controversial TV host published on his Facebook wall an alleged reply from the Office of the President saying that she would not sign the Global Compact for Safe, Orderly and Regular Migration in Marrakesh and that her office was not involved in talks on the document.

Prime Minister Andrej Plenković said this past Friday that the Global Compact regulated only legal migration and that he had been informed that President Grabar-Kitarović would go to Morocco in December for the ratification. He would not comment on media reports that the president would not go to Morocco, saying that, as far as he knew, she planned to attend the Global Compact ratification conference in Marrakesh because she was invited by the UN secretary-general.

Foreign Minister Pejčinović Burić told a news conference last Friday that she was surprised by announcements that Grabar-Kitarović would not attend the conference, and on that occasion cited Grabar-Kitarović's speech in the UN in which she expressed clear support for the Global Compact.

That prompted the Office of the President to say the president supported the completion of talks on the Marrakesh agreement but that she would not attend the ratification conference and that she had informed the Foreign and European Affairs Ministry of her decision.

To read more about the controversy, click here.