Monday, December 28, 2009

Croatian Presidential Vote Heads to January Run-Off

By Boris Cerni  |  Dec. 28  09  | Bloomberg 

Croatian opposition Social Democrat candidate Ivo Josipovic (picture) will face Zagreb Mayor Milan Bandic in a Jan. 10 presidential run-off election that will determine who leads the Balkan nation into the European Union.

None of 12 candidates in yesterday’s first round won the majority needed for an outright victory, according to the electoral commission in Zagreb. Josipovic, a 52-year-old law professor, took 32.4 percent, while Bandic, an independent, garnered 14.8 percent, the commission said on its Web site.

The new head of state will succeed President Stipe Mesic, who is completing his second five-year term in the largely ceremonial office and is barred from running again. The former Yugoslav nation of 4.4 million aims to become the 28th member of the European Union in 2012 and is set to complete negotiations with the bloc next year.

“I call upon all voters to cast their ballots in two weeks and choose justice as we need a better and more just Croatia,” Josipovic, said in an interview with the national broadcaster Hrvatska Radiotelevizija. Results were announced after midnight.

Corruption and the effect of a recession, which marked the election campaign, are likely to dominate the debate for the second round. The Balkan country is struggling with its worst economic slump since independence in 1991 as consumption, investments and exports tumbled.

GDP Forecast

The government forecast gross domestic product to expand an annual 0.5 percent in 2010 as demand in the EU rebounds. The pace of economic decline slowed in the third quarter when the economy contracted an annual 5.7 percent compared with 6.3 percent in the previous three months, the Statistics office said today. GDP is set to shrink about 6 percent this year, according to the central bank.

“The influence of the president over the economy is minimal, but the most important thing is that none of the relevant candidates were opposing EU membership,” said Zdeslav Santic, the chief economist at Societe Generale SA’s unit in Zagreb, in an e-mailed comment today.

Crobex, the Croatian benchmark index of 24 most-traded stocks, gained 0.5 percent to close at 1997.13 points in Zagreb. The country’s currency kuna dropped 0.12 percent to trade at 7.3171 versus the euro at 4:10 p.m. in Zagreb.