The Chinese interest in Croatian projects is continually growing, or so it seems, and there is now room to dare when it comes to the potential Chinese rescue of Uljanik and 3 Maj at the eleventh hour.

As Marija Brnic/Poslovni Dnevnik writes on the 2nd of May, 2019, the Chinese CSIC representatives currently visiting Croatia to see the state of Croatia's ailing Uljanik (Pula) and 3 Maj (Rijeka) shipyards have expressed clear interested in new projects with Croatia's shipyards, but only if the Croatian state covers the cost of what has already failed, there have also been mentions of the diversification of production, but they don't want guarantees.

If there is an agreement between the Croatian Government and the Chinese CSIC about reviving Uljanik and 3 Maj, it will be done so with regard to a combination of the models which were discussed with the previous two strategic partners, Darko Končar and Tomislav Debeljak.

According to the explanation given by Minister of Economy Darko Horvat after the final talks and the three-day visit of CSIC's representatives, the Chinese are indeed interested in starting with new projects, while the state should cover the cost of old, failed projects, meaning it will need to take place on a clean slate. It's also more than likely that the sites of today's Croatian shipyards will see other projects developed there, that is to say, the diversification of activities will occur.

"If they don't see the possibility of continuity of shipbuilding at this time, we want other industries to take place here, and not just those exclusively involved in shipbuilding," Minister Horvat stated. Therefore, unlike Danko Končar's initial idea, Chinese diversification would not be a real-estate business, but would involve some sort of other, new production aside from shipbuilding. And the clean starting position the Chinese have indicated that they want, which is similar to what Tomislav Debeljak sought but is unlike his idea, almost certainly means declaring the bankruptcy of the two shipyards.

"We don't expect them to finance failed attempts to build ships that haven't been completed. The starting position means new projects,'' stated Horvat in reference to the wishes of the Chinese.

The continuation of construction in Pula and Rijeka in partnership with CSIC would in any case have a completely different financing philosophy. The Chinese say, after the talks, that they are completely astonished at the reliance of state guarantees for shipbuilding. To repeat what Finance Minister Zdravko Marić stated recently, it's much too early to talk about exactly what changes might occur in this context following their entry into Uljanik and 3 Maj. Over the next few weeks, CSIC's senior people will analyse the collected information and determine whether or not, and indeed in what form they're interested in entering into the structures of Croatia's enfeebled shipyards.

At this moment in time, Darko Horvat has merely announced that any form of Chinese entry would involve a new way of financing, with different sources, a different way of drafting project documentation, and would involve no state guarantees. After the final talks at Zagreb Airport, Horvat didn't provide any more specific information, nor the deadlines within which he expected to receive feedback from the Chinese, but he did appear to try to leave the impression that he was optimistic about the whole situation. The Chinese representatives themselves, however, didn't give any media statements.

Make sure to follow our dedicated business page for more information on Chinese-Croatian business relations, Chinese projects and investments in Croatia, doing business, working and investing in Croatia and much more.

Click here for the original article by Marija Brnic for Poslovni Dnevnik

ZAGREB, May 1, 2019 - Economy Minister Darko Horvat said Wednesday during a break in a meeting with a Chinese delegation touring the Ulljanik and 3. Maj shipyards, that it was indicated during the talks that there was a possibility for the continuation of production in Pula and Rijeka, which does not have to be entirely related to shipbuilding.

Horvat who met with a China Shipyard Industry Corporationa (CSIC) at Zagreb's Airport, said that both locations were offered to the Chinese, not only for shipbuilding but also for other forms of production as well.

Several CSIC representatives arrived in Uljanik already on Monday to see the plants and make an unofficial assessment of the shipyards production capacities.

Uljanik's workers and unionists said they were not sceptical about the Chinese but about the Croatian government and its promises.

Union representatives are not included in the talks with the Chinese executives, at least for the time being.

Prime Minister Andrej Plenković said on Monday that the talks with CISC representatives about the Uljanik and 3. Maj docks were very substantive and open and that after it visits the two shipyards, the Chinese delegation is expected to consider the possibility of cooperation or partnership.

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

As Poslovni Dnevnik writes on the 30th of April, 2019, Croatian Finance Minister Zdravko Marić said on Tuesday that he still needs to see if there really is specific interest from the Chinese shipbuilding company, whose representatives are visiting the ailing shipyards in Pula (Uljanik) and Rijeka (3 Maj), saying that it's too early to be able to say anything and that we "need to be completely realistic".

When aked by a journalist about the expectations of the Croatian Government, given that a delegation from the Chinese shipbuilding company China Shipbuilding Industry Corporation (CSIC) has visited the Uljanik and 3 Maj shipyards, Marić said that first of all, we should be realistic and after CISC's representatives get a proper look at the state of affairs with those shipyards and answers to the questions they are interested in, we will need to wait and see what their response to all of it will be.

At this point, it's still too early for that, he added, recalling yesterday's introductory meeting between the Croatian prime minister, his ministers and the aforementioned Chinese delegation at Banski Dvori in Zagreb, where everything was transparent and very clearly presented.

"A really high level team from the perspective of that company has arrived, but on the other hand, we need to be completely realistic. So, today they will spend all day in both Rijeka and Pula and then after that, of course, we can't expect it immediately but within a reasonable time frame, they'll determine what they saw, state what they think about it, and whether or not there is a certain level of interest,'' said Marić when answering journalists' questions after attending the annual European Investment Bank (EIB) press conference.

The CSIC delegation, headed by Hu Wenming, arrived at the enfeebled Uljanik on Tuesday morning, where talks with the members of Uljanik's management board and its supervisory board took place. Assistant Minister of Economy Zvonimir Novak has also been participating in these talks.

Several representatives of the aforementioned Chinese company arrived at Uljanik as early as Monday afternoon, where they viewed the plants and made an unofficial assessment of the capabilities of the Pula shipyard's production facilities, ie, they got better acquainted with its technical capabilities, the processes that take place there, the technology and its general capacities.

What will coe of the visit is anyone's guess so far, but despite suspicion from some, an injection of Chinese money could truly be Uljanik's very last hope.

Make sure to follow our dedicated business page for more information on Chinese-Croatian business relations, Chinese projects and investments in Croatia, working, doing business and investing in Croatia and much more.

ZAGREB, April 30 (Hina) - A delegation of the China Shipbuilding Industry Corporation (CSIC) talked with members of the management and supervisory boards of the Uljanik shipbuilding group for four hours on Tuesday, showing interest in the technology and special-purpose vessels, a member of Uljanik's supervisory board said after the meeting in the northern coastal town of Pula.

"I am glad to see that there are people who are interested in both shipyards, considering the situation we are in. The talks focused on the past, present and future of the shipyards in Pula and Rijeka, on shipbuilding and technology," Samir Hadžić told the press.

Expressing his satisfaction with the meeting, Hadžić said that the Chinese had primarily shown interest in the technology and special-purpose ships which Uljanik had built until now. He added that they did not discuss money or any kind of interim financing.

Hadžić noted that the Chinese asked for concrete answers, analysing each item, "and when they will make their final decision, only they know."

"We cannot force anyone to make a final decision in a short time. It's a process, but I hope it won't take much time, because the workers in Pula and Rijeka have no more time to wait," he said.

The high-level Chinese delegation was led by CSIC CEO Hu Wenming, and the meeting was also attended by the Croatian Assistant Minister of Economy, Zvonimir Novak.

After Pula, the Chinese delegation travelled to Rijeka to visit the 3. Maj shipyard which together with the Pula-based Uljanik forms the backbone of the Uljanik shipbuilding group.

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

If the China Shipbuilding Industry Corporation (CSIC) gives up, it will be difficult to find another candidate for the ailing Croatian shipyards Uljanik (Pula) and 3 Maj (Rijeka) which is in the shipbuilding industry and is also a strong and respected player. Could a Chinese investment be on the cards?

As Poslovni Dnevnik/Suzana Varosanec writes on the 29th of April, 2019, after yesterday's meeting with Prime Minister Andrey Plenkovic and his government ministers, Hu Wenming, Chairman of the Board of China's largest shipbuilding company China Shipbuilding Industry Corporation (CSIC) confirmed that they are indeed moving towards serious consideration regarding the enfeebled Uljanik and 3 Maj shipyards, which have undergone months of turmoil.

''The prime minister gave us a very serious and detailed presentation of the whole situation,'' Wenming said, adding that they saw that these two shipyards were a very important topic for the Croatian public. "Not only did we bring people from our company - they're in charge of planning, we've already called on lawyers and investment banks, so we will outline what their views on the matter are after visiting the shipyards," Wenming stated.

With that, a key ''tour'' begins, because if CSIC ends up actually not being interested in putting its money into the situation, it will be a hugely difficult task to find another candidate in shipbuilding, which is a big player and has an interest in joining the European shipbuilding industry. Otherwise, this would be the first case of a Chinese takeover of a foreign shipbuilding company, so it is speculated that extensive calculations are being made, and of course whether they even want to have their first European shipyard is being considered. The CSIC is looking at the situation deeply and from all possible angles.

This event all began with the recent announcement of the arrival of the CSIC in Croatia with the aim of visiting the troubled shipyards in Pula and Rijeka. As was then announced, the CSIC chairman contacted Chinese Prime Minister Li Keqiang during his stay in the Republic of Croatia where he attended the summit "16 + 1" and after talking with the Croatian PM about the dire state of Croatian shipbuilding.

As things currently stand, the general belief is that the Chinese decision won't take long to come - it will be a simple and express "no" or "yes", while the third option, more specifically an unconditional "yes", will likely need to be waited for a little longer.

What the outcome of the potential Chinese presence in the Croatian shipbuilding industry is anyone's guess, and while some remain very suspicious of Chinese motives in Croatia in general, despite them already working on the long-awaited Pelješac bridge down in southern Dalmatia, whatever comes of their potential entry has got to be better than the current situation, especially for Uljanik.

Make sure to follow our dedicated business page for more information on Chinese-Croatian business relations, Chinese investments and projects in Croatia, doing business and investing in Croatia and much more.

Click here for the original article by Suzana Varosanec for Poslovni Dnevnik

ZAGREB, April 29, 2019 - A delegation of China Shipbuilding Industry Corporation (CSIC) that was briefed about the situation in the Uljanik and 3. Maj shipyards at a meeting with Croatian Prime Minister Andrej Plenković on Monday, said they would voice their opinion about the docks after touring them.

The chairman of the CSIC Board of Directors, Hu Wenming, said PM Plenkovic presented the situation in the two docks in detail.

"We will tour the shipyards and we will give a serious thought to it" Hu said after the meeting, adding that they realise the two shipyards are an important topic in Croatia.

Hu also said the CSIC delegation also included lawyers and investment bankers.

Croatian Economy Minister Darko Horvat said the talks with the Chinese delegation were very constructive, adding however that details had not been discussed. "We will have an opportunity to discuss details after Wednesday," Horvat told the press when asked about today's talks. Asked if he was optimistic, the minister said he had been optimistic for the past year.

Uljanik Management Board president Emil Bulić said today's meeting was aimed at getting to know potential investors in Croatia. "The prime minister presented the situation thoroughly and in detail. In a way, it was an introduction meeting," Bulić said.

Earlier this month, Plenković announced that executives from a Chinese shipbuilding company will visit two Croatian shipyards to explore possibilities for cooperation.

The announcement came after a high-level Chinese delegation, led by Premier Li Keqiang, visited Croatia earlier in April as part of the summit of 17 Central and Eastern European countries and China in Dubrovnik.

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

There has been much talk, both positive and negative, about the potential for Chinese investment in Croatia. They're already building the long awaited Peljesac bridge down in Dalmatia and have since expressed great interest in the Port of Rijeka and in constructing a railway line linking Rijeka to Karlovac. 

Many believe that the apparently huge interest of the Chinese (and their money) is a bad omen, and that Croatia will end up trapped by yet more debt it can't pay off in the end. Others see it as a welcome move, despite their suspicions. Whatever the truth behind China's interest in Croatia is, the EU aren't too pleased with it, especially in the case of Peljesac bridge. Peljesac bridge is one of the most important strategic projects in the history of the country, and it has been financed mainly by European Union funds, the fact that a Chinese company has been chosen to construct it hasn't filled the European Union, nor the Commission, with much joy.

What will be the situation with one of Croatia's most pressing issues of late, its ailing shipyards? As Uljanik's dire situation continues to worsen, could the already suggested investment from China be its saviour at the eleventh hour? Maybe.

As Poslovni Dnevnik writes on the 29th of April, 2019, a delegation from China's largest shipbuilding company, China Shipbuilding Industry Corporation, headed by Hu Wenming, the head of the company, will arrive in Zagreb on Monday, as N1 reports.

The Chinese delegation will first be welcomed by Prime Minister Andrej Plenkovic and his government ministers at Banski dvori in the heart of the capital city. After exchanging all of the usual diplomatic pleasantries, they will discuss the burdensome issue of Uljanik (Pula) and 3 Maj (Rijeka), which the Chinese guests will visit on Tuesday.

At today's meeting between the Croatian premier and the Chinese delegation from CSIC, the bosses of Uljanik and 3 Maj, Emil Bulić and Edi Kučan, will present, as was confirmed to N1 by the Croatian Government.

Will the giant Chinese company actually agree to invest in Croatia's ailing shipyards, however? The answer to this question could be known definitively in as little as ten days, Economy Minister Darko Horvat announced last week.

Concerning the potential interest of the Chinese for the Uljanik and 3 Maj shipyards, Minister Tolušić said that this really is "probably the last chance to do something." If there is any possibility whatsoever that the Chinese will enter into some sort of investment arrangement to rescue the shipyards, they'll enter. If there's no possibility, they won't. We'll leave it up to them.'' stated Horvat.

Make sure to follow our dedicated business page for more information on Chinese-Croatian business relations, Chinese investments and projects in Croatia, doing business and investing in Croatia, working in Croatia, and much more.

ZAGREB, April 26, 2019 - Istrian Democratic Party (IDS) leader Boris Miletić and his deputy Valter Flego said on Friday they were deeply disappointed with the government's treatment of Istria County, stressing that all governments led by the Croatian Democratic Union (HDZ) had discriminated against that county but that no government had shown as much arrogance towards Istria as the incumbent government.

"It is sad that the Prime Minister will arrive today in big style with the transport minister to inspect work on the Istrian Y motorway and open a super luxury ACI marina in Rovinj, while 30 kilometres away, in a ghastly empty Uljanik shipyard, workers are waiting for someone to tell them what will happen with them," Flego told a news conference in Pula.

He accused the government of stalling and delaying a decision on the Pula dock until after the elections for the European Parliament, describing its conduct as inhumane, irresponsible and harmful.

"To visit the posh ACI marina and completely ignore Uljanik workers... is unbelievable," Flego said, adding that this was the first time the government officials were visiting Istria for a ceremonial event to which local political officials had not been invited.

"A year and a half has passed and we do not have a single answer as to what the state thinks about industrial production and shipbuilding, people have been left without any income. The government is not showing an iota of sympathy, moreover it is utterly arrogant and lacks manners," said Miletić, who described as positive reports that a Chinese delegation interested in Uljanik would soon visit Pula and Rijeka.

More IDS news can be found in the Politics section.

Next week, a delegation of eighteen people from the largest Chinese shipyard, the China Shipbuilding Industry Corporation, are set to visit Croatia's ailing Uljanik.

As Poslovni Dnevnik writes on the 26th of April, 2019, this is the second day is the National Economy and Entrepreneurship Consulting conference, organised by the Ministry of Economy and Entrepreneurship in Vodice. Economy Minister Darko Horvat told N1 televizija that the Republic of Croatia ''wants to become a country of investment and development, even if it isn't there yet".

"What I do dare to say, and with full certainty, is that Croatia has an innovative network, we have to make every effort to create positive trends, but we can't expect a big boom in just one or two intensive years, but the trends are changing. What makes me happy is that our own accumulation which has been earned by entrepreneurs is slowly returning back into circulation, that this money is no longer sitting in banks, in accounts. This gives us the encouragement that we'll gain that momentum this year, too,'' Darko Horvat stated.

How much have the problems with Uljanik slowed the economy down?

"They stopped any acceleration. Given the fact that so far, we've spent nearly three and a half billion kuna on guarantees,'' Horvat said.

The Dredging and Maritime Management company, owned by the Jan De Nul Group, requires Uljanik to refund all advance payments plus interest on a dredger which is being built in the Pula shipyard, whereby a refund of part of the advance has been secured by state guarantees. Such an outcome could cost the Croatian state almost one billion kuna.

"The contracted period is seven days, but I'm not sure that will happen in that time because Uljanik has no liquid funds and we'll have to continue talks and negotiations with Jan De Nul. And Mr. De Nul is aware that these talks end up going nowhere if he decides on the forcible charging of advances, he's aware that the shipyard in Pula isn't ready to complete that vessel. 

If the Chinese do decide to invest in Uljanik, then there are two variants, Horvat said: "to enter as a strategic partner, or to buy one shipyard, and the other, and become the 100 percent owners."

The court decision in Pazin has, for the third time, postponed the bankruptcy hearing for Uljanik. 

"Regardless of the court's decision, we'll continue talking with the Chinese," Horvat said.

Make sure to follow our dedicated business page for more on Chinese investments in Croatia, Chinese-Croatian business relations, Chinese projects in Croatia and much more.

ZAGREB, April 25, 2019 - A luxury polar discovery passenger vessel, Scenic Eclipse, the first of its kind in the world which the Pula-based Uljanik shipyard is building for Australian shipowner Glen Moroney, left the Uljanik shipyard on Thursday morning to be docked in the Rijeka-based Viktor Lenac shipyard.

According to sources in Uljanik, this is a regular procedure in the final stage of building a ship and docking is necessary to carry out checks and supervision of underwater works and to paint the vessel.

In normal circumstances, this would be good news because it would mean that the dock is a step away from delivering another ship. However, given Uljanik's current dire situation, it is feared that the vessel will not be returning to the Pula-based dock.

According to information from Uljanik, however, the ship is expected to return to Pula in two weeks.

The liner, named Scenic Eclipse, will be able to accommodate 409 people, including crew, and is built for sailing on all seas, including polar and tropical regions, for which it is specially equipped, Uljanik said. It is specially "strengthened" to navigate in harsh weather conditions and frozen seas, and satisfies the requirements of high environmental standards. It also has a mini submarine for underwater adventures as well as two helicopters for exploring inaccessible areas.

Uljanik signed the contract for the ship with a company in the Scenic Group in November 2015.

When completed, the vessel will be 165.70 meters long, 21.50 m wide and will be able to reach a speed of 17 knots. The number of passengers is limited to 237, with 172 crew members. The ship is intended for the highest class of passengers who will enjoy 114 luxury cabins, while there will be 138 no less luxurious cabins for the crew.

In the meantime, Finance Minister Zdravko Marić on Thursday said ahead of a cabinet meeting that the government was attempting to "save" the guarantee for a ship that the Uljanik shipyard is building for the Belgian Jan De Nul company.

The company has asked for a refund of advance payments that the government has partially covered with guarantees, namely in the amount of 124 million euro, while the total amount of advance payments is 158 million euro.

Responding to reporters regarding the impact the situation in Uljanik could have on the budget, Marić reiterated that guarantees that were paid out last year amount to a little more than 2.5 billion kuna and that "the wish, will and intention still exists to save guarantees for the dredger." That amount, he said, has already in some way been calculated in the public debt. He added that it will be necessary to invest certain funds so that most of the guarantee can be saved.

Asked whether the amount in question is 150 million kuna, Marić confirmed that that is about right.

As far as enforced guarantees for this year are concerned, Marić said that he expects that to be about 600 million kuna and that in the next few weeks it will be necessary to pay out 400 to 500 million kuna and, he added, "a good portion of that has been calculated in the budget."

More Uljanik news can be found in the Business section