In the first six months of 2020, Croatia holds the Presidency of the Council of the European Union with the motto ‘A strong Europe in a world of challenges.’ When elaborating on these challenges, the Croatian Ambassador to Hungary, Dr. Mladen Andrlić tells Diplomacy&Trade that “we are talking about the overall international scene, which is quite trembling nowadays. We are coping with a number of questions with or without full answers. The European Union, which is by far the most secure democratic alliance in European history, is trying to find answers.”
He stresses that the Croatian Presidency is concentrating on the actual situation, keeping in mind the common European interest and, at the same time, the interests of the individual member states as well as those of other global actors. The Presidency focuses on ‘deepening and widening’, “which is the shortest explanation of what each and every country within the EU is dealing with. By ‘deepening’, we mean the better functioning of the EU itself, internally and externally while ‘widening’ means better communication, particularly with the closest neighbors that are on the road to EU membership, that is those
interested in becoming members and forging stronger relations with the EU.” This would also include the EU enlargement, which is a specific additional task of the Croatian EU Presidency, dealing primarily with the Western Balkans countries and those of the Eastern Partnership. On this issue, Croatia is planning two summits in May 2020.
Four basic goals
The first of the objectives of the Croatian EU Presidency is ‘The EU that grows’. “It means that we would like to see the EU growing in a balanced, sustainable and inclusive way. ‘Balanced’ means that we favor a growth based upon a common understanding by all EU member states, and lowering the differences between North and South or East and West. Sustainability is according to our possibilities and not according to our needs, unfortunately, while inclusive means that the growth should tackle all the issues regarded as important by each and every member state,” he explains.
‘The EU that connects’ includes a number of ways but three are crucial from our point of view, he says: transport infrastructure, energy policy and digitalization – within the EU and with other global actors. “Also, we deal – as much as possible – with issues that connect the EU to the outside world.”
He adds that ‘The EU that protects’ has at least two levels: internally and externally – protecting citizens’ rights throughout the European Union as well as outside the EU. “All this requires further communication.” ‘The EU that is open’ means that the Union should be open to its immediate neighbors and also globally. “It should function in global terms in relation to other global powers and also with different integrations with our neighbors. The EU approach is also of particular importance for countries that are leaning to become member states, the ones that accept the EU rules and objectives for their own benefit and for the better development of the EU as such,” he says.
As to how much relations with Hungary have strengthened since Croatia has been an EU member in 2013, Ambassador Andrlić is of the view that “it was a new start in our relations. After almost a century, Hungary and Croatia once again became members of the same community of nations, this time the European Union. Interestingly enough, the Croatian accession talks to become a full-fledged member of the EU concluded during the Hungarian EU Presidency in 2011. Within the European Union, as well as NATO or the Council of Europe, for example, these two neighboring states are enjoying more opportunities to achieve their objectives within this integration structure – in economic, cultural and other terms. It is an improved climate for both of us.”
He mentions cross-border economic cooperation as a fine example. These projects are not of the biggest magnitude but very important for the locals on ‘both sides of the river’, as the Ambassador puts it, referring to the fact that most of the CroatianHungarian border is constituted by rivers of Mura, Drava and Danube over which building bridges is symbolical of EU-supported projects.
He characterizes economic relations between the two countries as dynamic and intensive. “Given the difference in the size of the two countries’ economies, the trade balance is in favor of Hungary but this is somehow balanced out from the other side by services like tourism. Economic cooperation is successfully implemented in a number of sectors such as trade, investment and tourism. Trade exchange in goods in 2018 reached a record high of EUR 2.3 billion. That trend continued in 2019 as Croatian exports increased by 17,4% compared to same period of 2018 and were worth EUR 376.82 million, while imports amounted to EUR 1.442 billion (+24,9%). All in all, Hungary is the 6th biggest importer from Croatia.
In the first two quarters of 2019, Croatia received EUR 97.6 million from services provided to Hungary, while in the same period, EUR 30.7 million was paid to Hungary for services. In 2018, Croatian income from services provided to Hungary amounted to EUR 449.4 million; while EUR 76.9 million was paid to Hungary. Most of both revenues and expenditures are generated from tourism. The Ambassador is especially pleased with the growing number of tourists from Hungary. “Around 630,000 Hungarian tourists visited Croatia in the first ten months of 2019. It was 3% of the total number of foreign tourists in that period. Hungary is Croatia's 8th largest tourist market. There are also Hungarian investments in tourism in Croatia, so Hungarian tourists may find Hungarian hotels there.” One attraction he mentions is the Advent market: the one in Budapest was Europe’s No.1 in 2018, while the one in Zagreb was voted the best in the previous three years in a row.
With EUR 2.72 billion of investments (1993–2019), Hungary is the 6th biggest investor in Croatia. Ambassador Andrlić highlights the energy industry as the most important area. “Energy security is of utmost importance, and Croatia and Hungary have a very dynamic collaboration in this field through intergovernmental agreements and corporate activities.” The Croatian oil company INA has become part of the Hungarian MOL Group. “This cooperation is going well and the past two years have been among the best years of INA ever since this merger started,” the Ambassador notes, adding that there are further plans for this cooperation. He also calls attention to a particular segment between the two countries in the field of energy, which is the liquid natural gas (LNG) terminal on the island of Krk, which will be completed by the end of 2020.
The role of SMEs
The Ambassador highlights the importance of small and medium-sized enterprises in bilateral economic relations. “There are already many of them working as contributors or suppliers to to the operations of companies in the other country – forming part of the bigger process, either in Hungary or in Croatia. So, there is interest on both sides to accomplish bigger projects that these SMEs can contribute to.
One can see effective cross-border functioning when dealing with the certain entrepreneurial activity.” He mentions as an example that on November 15, 2019, a biomass plant, mostly with Hungarian technology, was opened in Virovitica, just 20 kilometers from the Hungarian border with a dozen people employed in managerial positions – half of them Hungarians and the other half Croats, some of them Croats from Hungary. The idea was born less than five years ago and the actual construction took less than two years. The project is fully co-financed by Croatian and Hungarian development banks. “There is a lot of cooperation going on. Not as much as we would like to but these examples show that we can successfully work together,” he points out.
Some of these projects are supported by minorities living on both sides. Ambassador Andrlić says it is obviously an additional value for both sides contributing to the fact that things are going smoother than they otherwise would. It is not only the question of language, but also of culture, the issue of living together for centuries in such a fine setting that you can always achieve more.
“Just recently, there was a Croatian Hungarian business conference in Nagykanizsa, SW Hungary, with people from counties on both sides of the river Drava attending. More than a hundred people altogether had the opportunity to get to know each other, as they co-operated on a daily basis on different issues like roads, transport and the sale of goods. I really witnessed a vibrant communication, particularly while listening how these people make the border ‘disappear’ in with their cooperation.”
Croatia is well featured on the cultural scene of Hungary. During the Croatian EU presidency, there will be a number of additional cultural events in Budapest just as in other EU capitals as we also try to present our culture over this period. An exhibition about ties between Zagreb and Budapest over the centuries will open in the first days of April 2020 in the Hungarian National Museum, containing pieces of fine arts spanning 800-900 years. Prior to that, there will be another Croat exhibition in Budapest from the works of Miroslav Kraljević, one of the founders of modern art in Croatia, in the late 19th and early 20th century. “Last year, Zagreb held a Rippl-Rónai exhibition and, as reciprocity, a Kraljević exhibition will be in Budapest in midMarch. In January, a very famous Croatian opera by Jakov Gotovac will be played here and there will also be a very interesting ballet performance ‘Death in Venice’ with well-known and award winning performers. This December, we had a splendid full-house Baroque gala concert at the Italian Institute in Budapest through a collaboration of Croatian and Italian artists, which is now a traditional annual event,” the Ambassador highlights.
Let the ball roll!
“I hope our EU Presidency will support a smooth transition and introduction of a new Multi-annual Financial Framework (for 2021-27). We hope to bring closer the sometimes not so close standpoints of the different EU member states to a more common understanding regarding the priorities of this new seven-year deal. We will try to complete the procedure of this very complex and sensitive issue, which is the backbone of the overall functioning of the EU for the forthcoming period. I believe all the member states will contribute to this as we are all in the same boat. Our Presidency starts now, so, let the ball roll!” Ambassador Andrlić concludes.