Josipovic Wins Croatia Presidency

Bloomberg

1/11/2010

Ivo Josipovic will lead Croatia for the next five years after winning a run-off presidential election 
as the former Yugoslav republic strives to complete European Union entry talks and revive the economy.

Josipovic, with the support of the largest opposition party, the Social Democrats, garnered 60.3 percent of the 
people’s vote, results from the central electoral commission in Zagreb published on its Web site showed. 
Zagreb Mayor Milan Bandic got 39.7 percent of the vote in yesterday’s election.

“When I announced I would run for president, I said I wanted a European Croatia,” Josipovic, a law and 
music professor, said in an interview with broadcaster Hrvatska Radiotelevizija, after the results were 
announced. “Croatia will be one of the shining stars on the European sky.”

The country, which aims to complete EU entry talks by June, must eliminate corruption and overhaul the 
judiciary and the shipping industries to become the next Yugoslav nation after Slovenia to join the world’s 
largest trading bloc by 2012.

Josipovic will have a largely ceremonial role when he takes over from Stipe Mesic in February with limited 
powers over the economy. He will be “a good counselor” to Prime Minister Jadranka Kosor and will “contribute 
to a quicker accession to the EU as he will spur other institutions to do their homework,” according 
to political analyst Damir Grubisa.

Economic Growth

The Balkan nation of 4.4 million people aims to spur economic growth after the worst contraction since 
the fall of communism two decades ago.
Gross domestic product shrank an annual 5.7 percent in the third quarter from 6.3 in the previous three 
months as credit became scarce and consumption, as well as investment, faltered. GDP is set to expand 
this year as European demand rebounds, according to the government’s forecast.

Crobex, the country’s benchmark stock index of the 24 most- traded shares, rose the most since Dec. 
22, advancing 1.8 percent to close at 2112.17 points in Zagreb. The kuna was little changed at 7.2795 
after dropping as much 0.4 percent in earlier trading, Bloomberg data shows.

Kosor’s administration is considering setting up a 10 billion-kuna ($1.98 billion) fund to spur economic 
growth by helping companies most affected by the recession. Central bank Governor Zeljko Rohatinski expects 
exporters to lead the recovery, which the government sees at an annual 0.5 percent this year.