Croatia will clear shipyard issue before EU entry

Croatia is confident it will resolve the key issue of its heavily subsidised shipyards before joining the European Union in July 2013, the deputy prime minister in charge of EU affairs told Reuters on Thursday. Croatia has five major shipyards but only one makes a profit without state aid.
The other four have survived the past decade only through hefty subsidies, which are not allowed in the EU.
The European Commission urged Zagreb in a progress report on Tuesday to speed up efforts to resolve the issue of ship-builders, one of the last major obstacles for membership.
The new centre-left government decided last month to close the smallest and oldest yard, Kraljevica, and to sell one based in the southern town of Split to a private local firm.
It said a solution for the remaining two would be found before the summer.
"We are looking for new investors, without a new public tender, who would take over the two docks (yards). There are potential investors, the (public-private investment) funds, other local and foreign investors, the talks are ongoing," Neven Mimica said in an interview.
Unless the shipyards are sold by the time Croatia joins, they would have to return more than 1 billion euros worth of subsidies to the government, which Mimica said would effectively mean bankruptcy for both.
"But at the moment, it is much more likely that we will complete this sale," Mimica said.
Zagreb signed the accession treaty last December and is set to join on July 1 next year if all 27 member states ratify the treaty by then. "I see no serious obstacles, on our side or on the EU side, that could threaten the entry date or prompt some member states to delay the ratification. After passing the most detailed process of meeting EU standards ever, there is no reason to doubt our ability to complete this process," Mimica said.
He said Croatia had started talks with Brussels to integrate a CEFTA free trade agreement Zagreb has with Western Balkans countries, which are not EU members, in the bloc's trade regime. "CEFTA is one of the few regions with which we have a trade surplus and 60 percent of our food industry products are exported there, worth more then 600 million euros a year."