Croatia’s HDZ takes unexpected lead in September 11 general election

Croatia’s HDZ takes unexpected lead in September 11 general election
By Akin Nazli in Croatia September 12, 2016

The Croatian Democratic Union (HDZ) has claimed victory in the September 11 general election, defying expectations that the Social Democratic Party (SDP)-led People’s Coalition would take the largest share of the vote. 

Preliminary results with 99% of the votes counted show that the HDZ is set to take 61 seats in the parliament. This means that the HDZ would be close to a majority in the 151 seat parliament with the support of the Bridge of Independent Lists (Most). It is not certain that the two parties, whose first coalition collapsed earlier this year, will manage to strike a deal on a new government, but an HDZ/Most coalition now looks likely. 

Data from the State Electoral Commission (DIP) shows that the People’s Coalition is likely to get 54 seats, Most 13 and the anti-establishment Zivi Zid eight, according to About Croatia.

Among the smaller parties, the Istrian Democratic Party (IDS) won three seats and the Coalition For the Prime Minister led by Zagreb Mayor Milan Bandic two, while the Croatian Democratic Alliance of Slavonia and Baranja (HDSSB) and Zeljko Glasnovic will take one each, About Croatia reported.

The HDZ has already claimed victory in the election, and its leader Andrej Plenkovic said in his victory speech early on September 12 that work to form a new government would start “from tomorrow”

“We are open to cooperation with those parties that are close to our programme and worldview,” Plenkovic said, according to a party statement

“I guarantee you that the next Croatian government will be stable, for the benefit of Croatian citizens and European oriented … starting tomorrow we go into specific agreements for Croatia to gain a new, stable government - led by the HDZ.”

Forming a stable government is an important issue given the rapid collapse of the last government, which forced Croatians back to the polls just 10 months after the November 2015 election. Indicating disillusionment with their political options, only 60.2% of Croatia’s approximately 3.8mn voters  voted on September 11.

Option polls in the run-up to the election had consistently shown the SDP with a lead of a few points over the HDZ, though neither party was expected to take enough seats to form a government without Most’s support. 

The HDZ is ideologically closer to Most, which should make it easier for the party to form a government than for its main rival the SDP. “There is a greater chance of HDZ-Most coalition talks than between the SDP and Most. However, Most is a tough negotiator, and does not support the (populist) demands by (traditional) leading parties,” said a September 9 analyst note from Raiffeisen. 

Raiffeisen analysts forecast that HDZ and Most could find it easier to strike a coalition deal this time around, now that Most has had experience in government and with a new HDZ leader - Plenkovic - in place. “Discussions between HDZ and MOST could take less time now as MOST is now much better prepared (with a clear economic programme and aims),” they wrote. 

Other analysts also expect an HDZ/Most coalition. “Given that Most has poor relations with the SDP and that many of its members are conservative or even former HDZ members, and Andrej Plenkovic's replacement of Tomislav Karamarko as leader of the HDZ, the Economist Intelligence Unit expects that another HDZ-Most government is the most likely outcome,” Maximilien Lambertson, research analyst, Europe, at the Economist Intelligence Unit, said in an e-mailed comment in advance of the election. 

However, Lambertson did not discount the possibility of an SDP-led government or a new election. He added that he did not expect a grand coalition between the SDP and the HDZ.

Most leader Bozo Petrov speculated on September 7 that the country’s two main political forces would rule together in a grand coalition after elections. However, both Plenkovic and SDP leader Zoran Milanovic have ruled out the possibility of a grand coalition many times.

Petrov also said on September 7 that Most would reach out to both of its bigger rivals after the elections to form a coalition government.

The People’s Coalition includes the SDP, the small but influential liberal-left Croatian People’s Party (HNS), the Croatian Pensioners' Party (HSU) and the Croatian Peasants’ Party (HSS), which was a member of the HDZ-led right-wing coalition before the November 2015 elections. HDZ, Most and the Labour Party went to the polls alone. Zivi Zid went to the polls with Let’s Change Croatia Party, which was founded by three former Most deputies, while the Reformist Party and the Bandic Milan 365 Party have also formed an election coalition together with other smaller parties.

Despite the political turmoil in the country following the government's collapse in June, macroeconomic data for Croatia is still promisingexcept the ongoing deflation, while the EU and International Monetary Fund (IMF) anchors play their role to keep public finance figures under control. GDP growth in Croatia accelerated from 2.7% y/y in Q1 to 2.8% y/y in Q2.