Government’s Agreement with IBM Causes Controversy

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Some IT industry representatives say that IBM has been promised a privileged status in the Croatian market.

Earlier this month, the Croatian government signed a memorandum with IBM on the opening of the Cognitive Analytics Innovation Centre (CAIC) in Croatia. The memorandum defines the “operating model, a Go-To-Market model, including market definition, demand and sales generation, an organisational model and a management structure.” Also, in its agreement with IBM, the Croatian government says that the two sides will jointly consider “project financing,” reports on December 29, 2017.

However, part of the Croatian IT community is dissatisfied with this move by the government. Although they didn’t want to speak on record, they say they had tried to get an explanation on what exactly the government’s commitments mean, but they didn’t succeed, so they have turned to the media.

They say that it isn’t clear why the government is providing a privileged status to a foreign company, which is also a market competitor for some Croatian IT businesses. Local IT companies are particularly surprised by the fact that some of the provisions in the memorandum can be interpreted as a creation of a joint venture between Croatia and IBM, whereby the state is even obliged to take into account the financial viability of such a project, which is not a usual move in any industry.

IBM didn’t want to comment on why the new contract with the government goes into so much detail. Instead, the company praised the government’s role. “IBM welcomes the initiative in Croatia because we believe that cognitive technologies will help organisations in innovations, new business models, opening new markets and in global competition,” IBM said.

An explanation as to why the new IBM contract was so detailed in regard to implementation and financial structure was not provided by the government either. The government just confirmed that at its 64th session it had adopted conclusions about the Memorandum of Understanding between the Government of the Republic of Croatia and IBM Croatia.

They deny allegations that the government has taken on obligations towards IBM, adding that the memorandum has a section which explicitly rejects any and all obligations. The government emphasises that the agreement only defines “the platform for talks aimed at the possible opening of the Cognitive Analytics Innovation Centre in Croatia.”

Translated from


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