US embassy cable - 03ZAGREB1674

C O N F I D E N T I A L  ZAGREB 001674 
 
SIPDIS 
 
 
E.O. 12958: DECL: 07/24/2013 
TAGS: PREL, PGOV, HR, War Crimes, Regional Issues, Refugee, Political Parties/Elections 
SUBJECT: PM RACAN TO AMBASSADOR: EAGER TO IMPROVE TIES WITH 
U.S. 
 
 
Classified By: Ambassador Ralph Frank, for reasons 
1.5 (b) and (d) 
 
Summary 
------- 
 
1.  (C) During their first meeting, on July 23, Prime 
Minister Racan said he wanted good ties with the newly 
arrived U.S. Ambassador.  He alluded to sometimes rocky 
relations in the past, and stressed that it would be 
important to keep in regular contact, both formally and 
informally.  Racan was optimistic about upcoming elections in 
Croatia, indicating he expected more or less the same 
coalition to return to power -- although he suggested that he 
may be ready to step aside as Prime Minister.  Racan 
underscored Croatia's role in the region as a source of 
stability.  That included Croatia's role in the war on 
terrorism, which his government takes very seriously.  He 
said that Croatia remained committed to overcoming its 
wartime legacy, including by cooperating with ICTY.  End 
Summary. 
 
Racan Wants Strong U.S.-Croatia Relations 
----------------------------------------- 
 
2.  (C) PM Racan opened his July 23 one-on-one meeting with 
Ambassador Frank by saying that the U.S. had special 
importance for him; while he usually lets the President and 
the Foreign Minister deal with foreign diplomats, he wanted 
to maintain regular contact, formally and informally, with 
the U.S. Ambassador.   It was a positive theme that dominated 
the one-and-half-hour introductory meeting.  Both the 
Ambassador and Prime Minister agreed to look to the future, 
to build on what the Ambassador described as a very good, 
solid bilateral relationship.  Racan wanted to ensure that 
the interests of the U.S. in Croatia were well taken care of, 
and he would view acts of anti-Americanism as acts against 
Croatia.  He said Croatia was with the U.S. in the fight 
against terrorism. 
Force of Stability 
------------------ 
 
3.  (C) Throughout the discussion, Racan stressed the 
importance of stability, both for Croatia and the region, 
both of which had only recently emerged from war.  He saw 
Croatia as a force of stability, and saw it as the country's 
"duty" to play that role effectively.  He contrasted 
Croatia's role with that of Bosnia next door, where the 
"Islamic lobby" figured more prominently.  To  illustrate 
this, Racan referred to his recent visit to Sarajevo and his 
initiative for Croatia to help build a highway in Bosnia 
along the European 5C route.  He said he made the proposal 
despite knowing he was touching a  "hornet's nest."  He said 
BiH authorities had already secured capital for the project, 
and suggested the influence of "Islamic capital" could 
destabilize Bosnia and the region.  Racan referred to the 
fact that as many as 150 mosques had been built in recent 
years in Sarajevo, which he did not mind as a religious 
phenomenon, but he did mind if this upset the balance of all 
religious/ethnic groups in Bosnia. 
 
4.  (C) Racan cited a number of recent GOC initiatives as 
examples of Croatia's role in improving regional stability, 
including suspending visas requirements for SAM citizens, and 
its costly decision to compensate ethnic Serb returnee 
holders of tenancy rights.  The Prime Minister emphasized  -- 
sometimes implausibly -- that the GOC always had in mind the 
wider regional situation, even when making decisions that 
might result in differences with the U.S.  He argued that the 
GOC decision to sign the Vilnius Group declaration -- which 
was  generally supportive of the U.S. position on Iraq -- was 
made out of a desire to preserve regional stability.  When 
the GOC subsequently back-pedaled on the  declaration, and 
stated Croatia's opposition to the war in Iraq, Racan said he 
was upset to have his "leadership" questioned.  This was not 
about leadership,  Racan argued, but rather about preserving 
stability in the country.  Anti-war sentiment, about 80 
percent of the population, could not be ignored. 
 
U.S. and EU Share Views on Croatia 
---------------------------------- 
 
5.  (C) The Ambassador noted that the U.S. and Croatia had 
sufficiently good relations that the two could disagree 
privately -- not in the press -- on some subjects while 
maintaining many common goals.  The Ambassador stressed the 
importance of regional stability, U.S. support for Croatia's 
accession to Euro-Atlantic institutions, and the importance 
for Croatia to press ahead on  economic reforms and job 
creation.  He added that both the U.S. and its EU  partners 
shared the same goals with regard to Croatia, including full 
cooperation with ICTY, the return of refugees, and the full 
normalization of relations with its neighbors.  The 
Ambassador stressed that these issues, which emerged from 
 
 
Croatia's wartime legacy, remained critical and could not be 
ignored. 
 
Elections 
--------- 
 
6.  (C) The Ambassador asked the Prime Minister to comment on 
the upcoming elections.  Racan replied that he did not expect 
great changes, unless the coalition made some big mistakes. 
Although Croatians are still dissatisfied with things this 
government has failed to do (i.e. prosecute corruption in 
privatization and reform the judiciary and state 
administration), they do recognize the government's 
achievements: general economic progress, including low 
inflation; stronger regional cooperation; substantial 
movement on NATO and EU accession; and road building and 
railroad modernization.  The positive trends will continue if 
the current coalition stays in power.  The return of  the HDZ 
would probably mean a return to the Tudjman era  -- which 
voters do not want.  As for possible changes in the make up 
of a new government, Racan somewhat unconvincingly suggested 
he may not want to be Prime Minister again.  He was 
exhausted, he said. 
 
HDZ: New and Improved? 
---------------------- 
 
7.  (C) Speaking about the main opposition party, Racan said 
that, although the HDZ leadership might be "new and 
improved," the party base remained more or less the same -- 
one reminiscent of Tudjman times.  The HDZ can complete its 
transformation only if it loses elections.  If it wins, the 
current opposition phase of transformation would merely be 
perceived as a temporary halt before the return to the same 
kind of rule under Tudjman.  Racan encouraged the Ambassador 
to maintain contact with the HDZ leadership, if only because 
such contact may encourage the reformers.  But reform of that 
party, he added, was a long way off.  Racan noted that the 
more reform-minded leaders of HDZ in Bosnia told him on his 
recent visit that they would like to see Racan's government 
-- rather than one led by HDZ -- win the next election. 
 
Comment 
------- 
 
8.  (U) A pragmatic -- if sometimes phlegmatic -- politician, 
PM Racan came across as somebody who wants improved relations 
with the U.S.  He will be busy in coming weeks preparing for 
elections and cajoling his government to move forward on 
Croatia's EU requirements, but he told the Ambassador that he 
wanted to meet regularly.  Racan suggested getting together 
again at the end of August.  As for Racan's hint that he may 
be ready to step aside as Prime Minister, this was not 
conveyed with Shermanesque certitude; few other such rumors 
have circulated, and we suspect that, as of now, it should 
not be taken seriously.  Racan waited in the wings for years 
to get to power.  Assuming the ruling coalition wins, he will 
want to remain Prime Minister a good while longer. 
FRANK 
NNNN