Filipović – another Minister of Energy, not Industry?

It is time to start monitoring and analyzing the work of Davora Filipovića, the new Minister of Economy and Sustainable Development in the Government of the Republic of Croatia. This should be done, as much as possible, without prejudice. Filipović did not come to the ministerial position with a good image. He lost his good reputation due to indiscretions during the campaign for Mayor of Zagreb. And then the media eagerly awaited his story about not crossing the street for 20 minutes in the USA because he did not know about the button at the traffic light.

Image does not have to be truth, but it is a fact. And the 22nd Minister of Economy since Croatia’s independence (on average, their mandates lasted less than a year and a half) now has an opportunity for a retake.

From what has been publicly recorded in recent days, Filipović, a Doctor of Economic Sciences who taught at the Faculty of Economics in Zagreb in the Department of Organization and Management, was with Prime Minister Andrej Plenković at a conference in Davos, discussed with investors in Italy about expanding the steelworks in Sisak, and also met with the Hungarian Minister of Foreign Trade and Foreign Affairs.

Ministry – a strange platypus

During this period, he did not have a single gaffe that would give the media material for a continuation of the series. One can hope that the new minister will no longer provide grounds for ridicule. However, that is a minor part of the challenges. The bigger problem is that Davor Filipović has moved into a ministry that resembles a strange platypus. For reasons completely incomprehensible to the public, Prime Minister Plenković has again merged the Ministry of Energy with the Ministry of Economy. And then, to be in line with the fashion trends being worn in Brussels, he named it the Ministry of Economy and Sustainable Development. Which means everything and nothing.

Like his predecessors, Filipović falls into the trap of dedicating most of his time to energy, while industry remains sidelined. This is already evident from the first interview he gave (to Večernji list). In which he specifically talks only about energy. Especially about the news launched by Prime Minister Plenković that, in the context of sanctions against Russia due to the war in Ukraine, Croatia could become an energy “hub”. Filipović speaks about positioning Croatia as an important supplier of energy for several countries in the region “and that we should be one of the points in the EU that guarantees supply security”.

Until a year ago, the long-standing mantra of all Croatian governments was the idea that the Port of Rijeka would become a “hub” for the entry of Chinese goods into the European market. Now that is no longer popular, but the obsession with positional rent-seeking has erupted in another form. It is okay to utilize the LNG terminal and Janaf, but exhausting innovation solely on that will not yield significant results. Especially if the Croatian side does not know how to get something in return. And in that, our politicians have not exactly excelled.

General phrases about the economy

In the aforementioned interview, when questions related to the rest of the economy were posed, one could read only a series of usual phrases: productivity, competitiveness, simplification of procedures, abolition of parafiscal levies, utilization of EU funds, creating a favorable investment climate.

It is correct to give the new minister 100 days and see if he intends to deal with the dangers and opportunities shaking the world in the phase of deglobalization. Tectonic changes are occurring in supply chains. Remaining with a neoliberal approach of merely creating equal conditions for all entities, and letting the market determine what will happen, in these circumstances when all countries intervene in cooperation with domestic entrepreneurs, seems surreal.

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Recently, it could be heard from the ministry that an industrial strategy is being prepared, which will be based on the reform of the judiciary and education. Knowing Filipović’s views as a professor, we will particularly monitor whether he dares to oppose such a tragicomic and reality-conflicted approach. In all serious EU countries, new industrial strategies are being rapidly developed, looking at which good parts of the industry can seize the opportunities opening up in a bipolar political, military, and economic world.

The assessment of the next two years of Filipović’s mandate will not be made based on what he will do in energy, but on his (non)contribution to strengthening industry. It would be best if the Prime Minister admitted the mistake and left sustainable development (energy and ecology) in one ministry, while finally forming a separate Ministry of Industry (or Foreign Trade). Since it seems unlikely that he will do so, it is to be expected that Filipović will also spend time on energy, leaving industry aside. Of course, it would be great if the assessment is wrong and a miracle happens.