Croatian Ambassador
I welcome everyone back to the European and External Relations Committee. We move swiftly on to agenda item 4, which is our final agenda item today, under which we will hear from the Republic of Croatia’s ambassador to the UK, his excellency Dr Ivan Grdešic.
Ambassador, we are delighted to have you along, following such a successful reception for you in the Parliament last night. Certainly, the feedback that I had from the consular corps this morning is that people very much enjoyed your contributions to the event last night. I believe that you have an opening statement for us before we move to questions.
Dr Ivan Grdešic (Ambassador of the Republic of Croatia to the United Kingdom)
Good morning to all of you and thank you, honourable McKelvie, for the opportunity to be here this morning. It is a pleasure, an honour and a privilege to talk to the representatives of Scottish people here in the seat of democracy in Edinburgh. My task today is briefly to outline how the Croatian accession process went and then to answer—or not—your questions or comments about our experience of the process.
We like to say that Croatia is an old nation and a young state. We have been a nation since the fourth or fifth century, when the Slavs came—do not worry; I will not dwell on all those centuries—but we lost our independence some 10 centuries ago when we joined the Hungarian empire and had a common crown. In 1990, following the fall of communism and the collapse of the Berlin wall, there was a great opportunity for change for all those communist countries and Croatia took that opportunity very seriously.
We started our independent path with elections in 1990. What better way to start independence than through electoral decision, whereby every private citizen can go into that curtained box and mark his preference? The next morning, we found ourselves, not formally but politically and in real-life terms, in an independent country. Imagine our surprise at what we could do with independence, which was a sort of blank board on which we could write anything to define our country. Was it going to be a monarchy or a republic? What kind of republic would it be—parliamentary, presidential or both? That was a great opportunity to design, constitutionally and in many ways, what we wanted to be in the future, what we wanted to do and how we might use our independence for the benefit of our people and our neighbours.
One thing that was certain was that we wanted to be in Europe. At that moment, we did not think about European Union membership or sitting at a table such as this, but we wanted to return to Europe, which our history taught us we belonged to. We always thought that our future would be there. That electoral decision and everything that transpired after that was marked by three decisions: yes to Europe, no to communism and no to Yugoslavia. On the two noes—no to communism and no to federal Yugoslavia—we managed to succeed, but the war and the post-war situation meant that, unfortunately, the decision to say yes to Europe was an on-going project. However, that turned from a civilisation dream of return to the practical work of membership accession, which started in 2000.
In 2001, we signed the stabilisation and association agreement, which was a sort of kindergarten for full membership. We had to fulfil all the obligations and there was a process of learning how things would look in the future. The year 2000 was also important because that was a threshold year in Croatia’s democratic development, when the winners over communism lost to the reformed communists. Everything went smoothly after that, but that was a test of democratic stability and it was a turning point in our European story, which really started moving on from that point.
In 2002, we received candidate status as a country seeking EU membership. Negotiations started in 2005 and ended in 2011, so it took 10 years from the stabilisation and accession agreement to the signing of the accession treaty.
During those 10 years, many things happened in the accession process. All aspects of politics and life have been marked by efforts to reform, change and adapt. Sometimes, the obstacles were internal. We were not ready to give up some things and the vested interests in the economy and in politics were strong enough to deflect the reforms and postpone them.
As you all know, our co-operation with the international war crimes tribunal in The Hague was an issue for our accession. It was difficult to overcome some of our own political issues in surrendering accused generals to The Hague tribunal, and that postponed the process in a way. Also, some things are difficult to reform in a short period of time, such as the judiciary and public administration. It takes a generation of change to move such institutions. We could pass laws that were very European but that would not be implemented in a European way. You cannot expect people who have trained for 30 years under communism to become independent judges overnight, so those reforms took some time to develop.
Some of our neighbours thought that they could use their membership to advance their interests in the negotiation process, and it took us two years to resolve that. We resolved the issue by postponing it, which is a very political thing to do. In that sense, the process was marked by a lot of obstacles that we had to deal with internally.
In my view, the realisation of the need for political consensus on European Union membership among all political parties was a must. Another essential requirement was that we had to stop thinking that our reforms were demanded by Brussels and that we had to fulfil them because Brussels asked us or told us to do so. We had to realise, with the necessary political leadership, that the reforms were for our own sake. Even without EU membership we needed to make those reforms because they were for the benefit of our economy, people, democracy, human rights and everything else in that sea of rules.
Most of those reforms were things that we had to do anyway, and in the framework of European Union accession the process was structured, timed, benchmarked and put to the test. Once we realised—I should say, once political leaders started sending the message to the public—that it was not for Brussels but for us to act, things started to move in a better direction. We managed to finish the more demanding negotiation process with Romania and Bulgaria during those 10 years. You could say that that was too long, but maybe it was not.
The European Union is an exclusive club that a country must be ready to join; it cannot join and then get ready, as can happen with the United Nations, which takes a country in first and then everybody suffers. The EU is a voluntary club, so if a country has made a voluntary decision to join it, it must do everything that is asked of it. We did not have to join because somebody told us to do so; it was a mission for this nation and for this generation to secure democracy and prosperity, and I think that we are on the right track.
It is now more than four months since we became a European Union member. We are observing how the club members behave and are learning on the spot from that behaviour. We still need to realise that we are no longer a candidate and that we have the full rights of a member state, because we are sometimes timid about expressing them. It is now time for us to formulate our own interests. At the table of 28 members, what are we going to contribute to economic development and the image of Europe? We are a small nation, but I think that we fit nicely into the puzzle of European Union nations and that without that little block there would be a piece missing in the European picture.
On that note I shall stop. I hope that I will be able to answer your questions.
Thank you very much. As a history buff, I would have been interested in hearing about the 10 centuries of Croatian history, but we will keep that for another day.
I was interested in your comment that being a member of the EU is something that you want to do, that you are not being coerced, forced or pushed into it and that it is the right thing for your nation. Can you tell us about the benefits to Croatia of being a member of what you have called the European club?
There are three broad benefits to membership, the first of which is that we belong to that shared civilisation. We cannot live outside our own values; instead, we must recommit to, support and live those values. We cannot have a split personality and sit outside the environment in which we historically belong.
Another broad benefit is development. Croatia has a better chance of developing its economy and everything else as part of the EU. For Croatia, EU membership is an answer to the world’s global challenges. We cannot fight Brazil, Russia, India and China—the so-called BRIC countries—America and everyone else on our own, but as a member of the EU we have a better chance of surviving the pressures of the globalised world or of finding a way to protect or advance our interests.
The third benefit is stability. Membership of the EU and NATO alliance creates political, economic, military and historical stability that allows us to dedicate ourselves to the development and benefit of our people without fear of having our existence threatened by hostile forces, be they terrorism, the kind of war that we recently experienced, new threats such as transboundary crime and corruption or even geographical catastrophes such as earthquakes. The stability and security provided by EU and NATO arrangements are certainly beneficial.
Those are three broad benefits that will count historically and in the long term. In 1990, we voted yes in the referendum to be an independent country. The referendum that we held in 2012 on European Union membership was, I think, about securing our independence within that new environment. Had we not voted yes, we would have stayed a small fringe country that people might or might not visit or trade with, which is a dangerous position to be in.
It is really refreshing to hear such a positive view of EU interaction, given the growing negative view of that in the UK. In Scotland, we have a different attitude and rail against such negative views. I find it really refreshing to hear that your nation and your nation’s population were full square behind the politicians.
You are absolutely right that stability is the key element in all of this. In the previous evidence session, we discussed with the cabinet secretary the issue of climate change and the fact that we have to live interdependently in an interdependent world if we are to tackle that problem. The same issue will clearly affect your own country.
I open the session up to committee members who wish to ask questions. Jamie McGrigor has a supplementary question.
10:45
I congratulate you, ambassador, on everything that you have done so far.
Although it is true that you joined the EU voluntarily and for all sorts of good reasons, did the financial crisis in the eurozone impact at a later stage on people’s attitudes to joining the euro? I am afraid that that will not be a voluntary decision for you, unlike the position that we have in this country, where Scotland, as part of the UK, is allowed to keep its currency for the time being. Will your population be against joining the euro? I notice that the president of your bank has said that you should join it as quickly as possible, but I understand that polls show that the population of your country is not of that opinion.
We joined the European Union at its worst moment—in the middle of the economic and political crisis and the crisis with the euro—but we sustained a positive decision in the referendum and kept a positive attitude. Of course, there are people and important voices in society and the media, and in some political parties, who think that we are joining a club that soon will not be around any more. There was a similar story with NATO. People asked why we were joining NATO when there was no threat from Russia any more and when NATO was going to change. They said that we would be joining a club not knowing how it would look the next year. Well, NATO is still around and it is still important. I believe that the situation will be similar with the European Union.
There is disillusionment with some elements of the European Union. Some of our economy will be hurting because of the stronger and competitive industries in other member states. We will have to adjust, as we are already doing in shipbuilding and agriculture, and that will probably be economically expensive. We hope that we will be smart enough to redevelop industries that have an advantage in other European markets, so that we can sell in them and compensate for that loss. We will certainly have to adapt to that.
The euro crisis is not good news for Croatia. It has thrown us into recession for the past three years and we are having difficulty in getting back into positive numbers. We depend heavily on the euro. We hope that the recovery of the nations with which we trade the most, such as Italy, Austria and Germany, will have a spillover effect on our economy and that we will pull out of recession. Right now, we are at the end of our austerity measures because if we keep on going with them that will prevent any growth or investment. For us, the growth part of that equilibrium is very important because without it we will stagnate in a recession for another year.
We are not ready for eurozone membership, as we do not meet the criteria. Even if everything were blossoming and rosy in the eurozone, we could not join it because the numbers on our balance sheets are not good enough. We are smart enough to wait and see what will happen with the eurozone. We would like to join it because that would reduce the operating costs to our export and import industries and it would get rid of the exchange rates for mortgages and credit lines, which are expensive for us right now. In that sense, we are eurozone ready, but we will join once we are able or when we want to do so.
Good morning, Dr Grdešic, and welcome to Scotland. I understand that your portfolio is UK-wide, and I hope that your visit to Scotland will be one of the finest moments of your stay in the UK.
I congratulate you and your nation on achieving what you have done to date. I appreciate the challenges that you face. There are similarities to what might or might not happen in Scotland, so there is room for learning for us. Smaller states need to be more proactive in negotiating and co-operating with one another—that is important, because the two giants at the heart of Europe have, historically, more or less enjoyed a free hand, and that needs to change to reflect the real Europe that we want.
I wish you well in your endeavours. Thank you for joining us and bringing us up to speed on your work to date.
Thank you.
Good morning, ambassador. I, too, congratulate your country on its achievements. I am so impressed with your positive words about the journey that you have been on, despite the most difficult of circumstances.
Hanzala Malik alluded to the similarities between your country’s journey and Scotland’s forthcoming referendum, albeit that our referendum on independence is happening under very different circumstances to your own independence. The convener also mentioned growing scepticism about Europe. Scotland does not share that view with the rest of the UK but, if we remain within the UK, we will potentially face an in-out referendum on European membership.
Within that context, our country is—for reasons that are similar to the ones that you mentioned—examining our values, what we might put into a constitution and what kind of country we want to have. How did you go about building your constitution? How did you engage the people to ensure that they contributed to how it would look?
As I have mentioned, we had a historical opportunity to design the constitution in the way that we wanted. Of course, that may not always be how one would like it to be but, rather, how the powerful forces want it to be.
At the beginning, we looked around and took—not copied—elements of the French constitutional system, with an elected president, a Parliament and a Government that is responsible to the president and the Parliament. At the beginning of a state’s creation—this is an important lesson that other post-communist countries similarly learned—if there is a political leader as strong as the one that we had, they can mould institutions to follow their political interests and their opinions on how things should be. The first constitution was very much modelled on the position of President Tudman as a very strong, popular elected leader, which was similar to how President de Gaulle led France after the second world war.
That was the position in our country for the first 10 years. It was probably useful—or opportune—for a country at war that needs to concentrate on defending itself to have a pulpit of power that people can look to and identify as the symbolic seat of Croatian power and understand where that power comes from. When a country is at war, there is not too much opposition in Parliament: everyone is patriotic and less minded to bother with some minor human rights or press media freedom issues because those can be resolved later on. However, those issues must be resolved right away, even in the middle of a war effort, because the consequences that we suffered later on were not pleasant.
When there is a strong political leader in a strong political party, that almost becomes a national movement and there is little space for democratic modelling or correction. In 2000, in a way we elected a new set of political ideas, leading to the reconstruction of our constitution. We no longer have such a strong president. Although a president is still elected, the position is more symbolic. Our hope was that the power would shift to the Parliament. It has probably shifted more to the Government, but the power is not in the hands of one person—the president—and his advisers. We removed the powers of veto of the legislature and to make ministerial appointments, so the president is almost like a queen—well, not really; the president is at least elected.
Those 10 years were a period of learning. Constitutions are not Bibles; they are there to serve people and must adapt to the realities and necessities of life. At that time, it was about European Union membership, the opening of the country, democratic change and everything that we hoped to have at the very beginning.
Constitutions should not be regarded as strict—they are instruments. The communist constitution described a vision of the perfect situation under communism, whereas democratic constitutions are there to help us through everyday life and to create a rule-ordered society that we can enjoy and protect. Our lesson is that we should treat constitutions seriously but not as things that are not prone to change or adaptation.
I have a final comment. I was delighted to attend last night’s event and I want to thank you for what you said about your position in giving a helping hand to other countries that are still in the process of applying for accession to the European Union. Thank you very much—your comments were very much appreciated.
Thank you.
Good morning, ambassador, and welcome to the committee. Congratulations on Croatia’s accession to the European Union.
In your opening remarks, you said that 30 years or more of communism cannot be changed overnight. That message is shared by people from other countries who have come to talk to the committee from time to time. I am thinking of countries such as Macedonia, Montenegro and Kosovo. They have told us that their countries need help to establish systems of democratic accountability, initially to get rid of years of corruption but also to offer their people systems whereby they can hold their Governments to account. Did Croatia experience that kind of process on the journey towards independence or post independence? How did you deal with that?
Yes, we did. There was a lot of interest in helping among non-governmental organisations, the neighbouring countries, the Council of Europe and the European Parliament. That was useful, especially in dealing with procedure. A country does not need to rediscover hot water, but there are things that have been tested that it is beneficial to use and adapt, as necessary, to a country’s environment.
However, sometimes it is not smart just to copy. For example, we took some of the Austrian legislation but then found out that Austria is a federation whereas Croatia is not, so the federal element that we wanted to use did not work in Croatia. Such help is useful in dealing with the technical aspects of democratic life, but in my experience it should be left to a country’s people to decide on the values and the basic institutional arrangements.
Something else that I have found useful everywhere in Croatia is outside monitoring. It is good to have somebody watching over you in the beginning, telling you that what you are doing is all right or asking why you are doing something that is not in the interests of democratic development, to put it broadly. Outside monitoring was useful for Croatia, as it makes you aware that people are interested, are watching and can help.
However, it is a peculiar position to be in. Young nations are sensitive—they are like teenagers. You cannot tell them what to do; they want to make their own mistakes. They must be smart enough not to repeat others’ mistakes, but they must have the liberty to do things on their own and feel that they have decided for themselves. There is a fine balance to be struck between aid, consultancy and the opportunity for the countries to be proud and to create their own nations.
11:00
I think that your response about nations acting like teenagers is wonderful.
But they do. They are very sensitive.
I can certainly sympathise with that.
I have another question to ask.
Before you do so, I have to say that I think that a nation’s strength is very often to be found in its capacity to laugh at itself—to take criticism, enjoy it and say, “That’s really funny.” If you cannot do that, you are not mature enough to understand your weaknesses and strengths. There are so many good ways of responding to what you think might be a wrong criticism; you could, for example, simply say, “This person is probably just not informed” and you could either try to educate them or just laugh about it. The ability to make a joke at your own account is a great strength.
From that response, I think that Croatia is already bringing a degree of wisdom to the puzzle of Europe that the ambassador mentioned earlier.
Now that Croatia is part of the European Union and its systems and processes, what do you think has been the impact on your neighbouring countries that are not yet EU members but are perhaps on that journey? Do you think that, for example, your immediate neighbour Bosnia, which is lining up to join the EU, will be assisted in joining sooner by your participation in and membership of the EU, or will it be disadvantaged for a period of time?
This comes back to Clare Adamson’s question about what we as a member can do to help our neighbours. As I said last night, we joined the EU with a mission to help our neighbours; after all, we share the same experiences of a previous life. As we can communicate well in all our languages, there is no need for translation. Actually, we offered translations of all the key documents to Montenegro and Serbia so that they could speed-read through them.
There are several things that we can do. First of all, we have set the basic positive example that this piece of state business can be done with commitment from the political leadership and the political elite to do it together and that they can mobilise support in that respect. I do not like to think of Croatia as the leader of the region or any kind of regional superpower; instead, we just want to be a good neighbour that can offer handy hints.
It is in Croatia’s interests to ensure stability and progress in Bosnia, Serbia and Montenegro on our eastern borders, and we think that the job of European enlargement will be finished once they are in the EU. After all, there cannot be a Europe in which Greece, Romania, Bulgaria, Hungary and Croatia are in the EU and then there is a black area covering the countries of the western Balkans that are not members. The issue has to be resolved, but it will take time. Let us face it—this is not going to happen soon. It took us 10 years and, although it is not wise to talk about numbers in political life, it will probably take them as long.
I realise that, with enlargement fatigue in Europe, the eurozone crisis and so on, enlargement is not a high priority any more, but we would like Commissioner Füle in Brussels to commit to it. Only the good clubs take new members, but there must be something that brings in both sides. The carrot still has to be juicy for these countries to aspire to EU membership, and they must feel that they are being rewarded for their progress. The situation is very frustrating: you might be carrying out your reforms but you are still just grinding away and not moving anywhere, while the decision on membership gets postponed as a result of one condition after another. Our purpose is to tell those countries what can be done quicker and to help them.
Of course, some things have changed. For example, the border rules for European Union members are different and stricter. At the moment we are an external border country for the countries in question but, in two or three years, we might well be a Schengen country. That will create new conflicts, but also new opportunities. It is our important mission to see how we can help those countries, and it is expected from Croatia in Brussels in relation to Bosnia in particular, as we have constituent people there, that we will be creative in providing support in its European membership path.
That is very encouraging.
In my best Croatian I say, “Hvala lijepa”—thank you very much.
You have talked about possible problems. I understand that Croatia will have to abandon the multilateral agreement on free regional trade due to the new EU commitments, so regional trade with the rest of the Balkan countries that are not in the EU will have to rely on the bilateral trade agreements between those countries and the EU. Will that prove difficult for you? It might be seen that Croatia will have to change its relationships with its neighbours because it has become a member of another organisation. Do you think that that might prove to be aggravating, especially in respect of free trade?
It is true that there will be some economic costs on both sides. There is a transition period, and we are asking Brussels to extend that to see how we can create a special arrangement with our previous regional free trade agreement partners so that our exported and imported goods are not taxed in a way that they will be.
The way in which we will make the change and our economy will adapt to it is certainly a challenge. Some of our businesses are already opening factories in Bosnia and moving production there to offset it. We do a lot of business with our neighbours in Serbia and Bosnia, and we own industries there. That is an important part of our economy.
There will probably be a cost in one segment. Perhaps once the countries really start the negotiation process and sign a stabilisation and association agreement, as we did, they will have beneficial import and export rates with the European Union and us. That is a little bit into the future. We had beneficial rates with the European Union in the stabilisation period, and that can be arranged with the other countries once they have signed the agreements. They have not signed them all, so we will just have to suffer through it. That is a problem now, especially for businesses that export a lot to Bosnia.
Thank you.
I want to follow through on the Bosnia-Herzegovina point. I think that I am right in assuming that it has not yet reached the stage of being a candidate country for accession, so it is some way behind in its ability to join the European Union. I think that I am correct about that—you are nodding your head.
I am nodding my head, but I am not the ambassador of Bosnia-Herzegovina and it would not be appropriate to comment on a situation in a neighbouring country. However, we have an interest in seeing Bosnia-Herzegovina as a stable state with a stable and sustainable economy for economic reasons and because there is a substantial Croatian population that is a constitutive part of that republic.
It is important for us that we see good development, and we are offering good services in that respect. Recently, our Prime Minister visited Bosnia-Herzegovina and said, “We cannot tell you what to do, but we can help you once you decide what to do.” We are a little bit cautious, and we are not interfering. We do not want to be seen as an obnoxious neighbour; rather, we want to be a helpful neighbour and to let Bosnia-Herzegovina primarily decide what it wants to do. We will then see how we can help.
Bosnia is a very important country for us, and its progress towards joining the European Union is very important for us. However, that is its job.
The European Union is providing €40 million for enhanced border controls. What does that mean in real terms for people trying to get between Croatia and Bosnia-Herzegovina?
All border passes must now be categorised. On some, you can no longer carry out trade because special screening is required of trucks going in and out. Some passes are just for local businesses, to enable people to go across the border and work in their fields on the other side of the border. The system is now regulated and the border crossing facilities—roads and things like that—need to be upgraded.
Our biggest problem with border crossings is connecting the whole of Croatia. As you know, Bosnia-Herzegovina borders the Adriatic along the southern Croatian coast, separating Croatia in two at that small section and leaving Dubrovnik and the southern region disconnected territorially from the rest of Croatia. That means that a part of EU territory is disconnected from the rest of the EU territory, and we need to connect it.
Right now, probably the most important investment opportunity is to build a bridge or find some other way of connecting the two parts of Croatia, to allow continuity of EU territory down to Dubrovnik and the southern Croatian border. However, there is a bit of a dispute about that with Bosnia-Herzegovina, as it does not like the idea of us building a bridge. It thinks that big ships will not be able to pass under the bridge or that it will somehow violate the country’s territorial waters.
The decision is pretty much in Brussels’s hands. We could build a bridge alone, but we want to be a good member state and do what is good for the European Union as a whole. We are hoping to get some funds to do it, as it will be a rather expensive project.
What has your accession meant to your relationship with Slovenia and to movement between Croatia and Slovenia?
The situation is better now than it was two years ago. As I mentioned, we have postponed the issue of the bay and the maritime border for arbitration. We now have three judges involved and recently shipped boxes of documents to the British judge who is going to read them. We have agreed to regard the outcome of that arbitration as valid and to obey it.
There are so many connections and there is so much potential for co-operation between the two countries that they overshadow any political disagreements of previous, current or future Governments. I often meet my colleagues in Ljubljana and we do not mention anything, not because we do not want to embarrass each other but because we think that there is already a life going on outside the political debate that involves all kinds of co-operation. A major Croatian company recently bought a Slovenian company. It was not an easy process because a lot of money was involved, but it was an economic process that will eventually benefit all consumers and producers. Under EU membership, we will first equalise our starting positions as two member states at the same table and we will then talk as adults.
Thank you. I omitted to congratulate you on your membership of the EU—let me do so now. I wish you well for the future.
Thank you very much.
There are no further questions for you, ambassador. Thank you very much for your evidence this morning. We are delighted to have had you here. You have shone a bright and warm light on Croatia’s process of accession and its relationships with Europe and the wider world. You have also raised a lot of further questions that we may investigate on our journey towards our Government’s white paper and the inquiry that is coming up about Scotland’s place in Europe. We are scouting the world over for examples of extremely good practice, and you have given us some today. I like the idea of our countries being teenagers who should, nevertheless, discuss things as adults.
On behalf of the committee, I wish Croatia well. Please take our good wishes and good will back to Croatia. I also wish you good luck in Brussels and hope that you enjoy the rest of your visit to Scotland—please come back soon.
Thank you very much. I invite you all to visit Croatia. Come in the summer—it is a good place to visit. I will see you there or back here in Edinburgh or somewhere else in beautiful Scotland.
Thank you very much.
I remind members that we will have a brief extra meeting next Thursday morning to discuss a technical issue that we need to deal with as an urgent matter. I thank everyone for attending today.
Meeting closed at 11:15.