Croatia in a Hundred Troubles: We Present a Detailed Plan on How Not to Squander 10 Billion Euros from the EU

Truman’s eggs have remained in the collective consciousness as a synonym for aid shipments after World War II that literally fell from the sky. Packages dropped by parachutes contained, among other things, powdered eggs that were mixed with water before use and literally saved people from starvation.

These were just crumbs of the real Marshall Plan through which the USA initiated accelerated post-war development in 16 Western European countries with about 13 billion dollars, which today would be equivalent to just over one hundred billion. Since then, there has not been such a large package, so the current proposal of the European Commission for addressing the consequences of the pandemic, NextGenerationEU, is referred to by many as a new Marshall Plan. The second connection is in politics. America then asked European countries to cooperate and come up with a joint recovery plan. From today’s American perspective (personified in Donald Trump), it sounds illogical, but about 70 years ago, it was a move that halted the Russian, communist advance into the West and simultaneously laid the foundations for today’s Union. However, the new Marshall Plan still needs to navigate the strait between Scylla and Charybdis – between European unity and particular interests. 

Thus, Croatia continues to fear that the ‘frugal’ countries – Denmark, Sweden, Austria, and the Netherlands – will block the program that would provide Croatia with an additional ten billion euros to address the consequences of the corona crisis; of that, more than seven billion would be non-repayable, and the rest would be a loan to be repaid from 2027 to no later than 2058.

For comparison, ten billion euros is just slightly less than the total EU funds that have been available to us for the current seven-year period ending on December 31. The Ministry of Regional Development and European Union Funds expects another ten billion from the ‘regular’ part of the new multiannual financial framework (MFF) 2021 – 2027.

Particularly in focus is the new ten billion euros. This is approximately one-fifth of this year’s Croatian GDP (according to government projections), or even 63 percent of the planned revenues of the current Croatian budget.

And what does the package intended for the new generation (as it is called in the Commission), which this generation will open and spend, actually contain? First and foremost, it is a mechanism that is integrated into the MFF and will not be a mere ATM for the ruling party (whoever that may be after July 5). Funds will be approved according to the logic of the current EU funds.

The Commission has, after all, already prepared drawers in which 750 billion euros will be available for use. The largest drawer is for ‘cohesion and values’ amounting to 610 billion euros, which is more than 80 percent of the fund, and the most is in the compartment with money for recovery and resilience (560 billion euros). The single market, innovations, and the digital economy will be financed with 9.3 percent (70 billion), and the third large drawer is intended for money for natural resources and the environment, which includes agriculture (six percent, or 45 million euros). When we mapped the European distribution of 750 billion to Croatia’s ten billion, we obtained an estimate of how and for what purpose Croatia will be able to utilize the ‘corona euros’, which we present in a special table.

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In addition to health and preventing new threats according to a similar pattern, European money is primarily intended for green and digital transition. Investment in key sectors and technologies, from 5G technology to artificial intelligence, from clean carbon to energy from renewable sources at sea, is crucial for the future of Europe, explains the Commission its recovery plan proposal. Clean transport, sustainable food systems, smart circular economy, and sectors such as tourism and culture are also in play. In all of this, Croatian entrepreneurs can also find their place.

However, if we remembered ‘Plan M’ (Marshall’s) by Truman’s eggs, what will we remember ‘Plan MM’ (Merkel-Macron)? What is the situation on the home front with the basic development formula of ‘dual transition’ towards a green and digital Europe, which applies for the entire mandate, including for the new fund? The forced digitalization of public administration is already being quietly dismissed in unofficial conversations from government circles as a forced anti-epidemic measure, so with the normalization after corona, a return to the old, cumbersome, slow, expensive, inefficient, bureaucratized state can be expected at many state and local counters. And Croatia best illustrates its aspirations towards green and renewable sources with the recent arrests of high officials from three ministries due to suspicions of favoritism in the wind farm business. Thus, we are still far from Merkel-Macron’s digital and green eggs.

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