Uljanik Crisis to Cost Taxpayers Billions

Total Croatia News

ZAGREB, October 17, 2018 – Finance Minister Zdravko Marić said on Wednesday that the activation of a state guarantee for the Pula-based Uljanik shipyard would undoubtedly have an impact on state finances and that it would amount to 2.5 billion kuna by the end of 2018, with the shipyard’s total debt amounting to 4.25 billion kuna.

“The financial impact in the period until the end of the year will be 0.6% of GDP or 2.5 billion kuna. Potentially, that impact may be slightly higher given the Eurostat methodology,” Marić said ahead of a government session when asked by reporters if some of the government’s projects might be jeopardised considering “the four billion kuna debt it has to pay.”

Commenting on a reporter’s remark that Uljanik would probably be liquidated and asked what that would mean for the state budget in the context of the state guarantee, Marić said: “It means that we will have to pay.”

“According to our calculations and information available to the Finance Ministry, 2.5 billion kuna will definitely have to be paid by the end of the year,” Marić said, adding that it was possible the remainder of the debt would have to be settled already this year. “The total debt amounts to around 4.25 billion kuna, of which one segment refers to a vessel that is at a high stage of construction… while everything else is practically uncertain,” said Marić.

Asked to explain if bankruptcy with restructuring was still a possible scenario for Uljanik or was contrary to European Commission rules and if the shipyard would be liquidated if the rescue aid programme failed, Marić said that he would not comment on possible options and that that question should be put to someone else. “I can speak about the guarantees, and I will propose that the government issue a public report on the total amount and individual items,” he said.

Asked if Uljanik’s case had revealed that something should be changed in the policy of state guarantees, Marić said that laws should be complied with and that, with regard to guarantees, the question should be put to those who had issued them. He said that one should compare the amount of guarantees issued per year to determine whether issuing so many guarantees had been reasonable.

Someone must have provided arguments for that and supported it in the context of shipyards’ prospects, “and today the situation is as it is,” said Marić. He added that in his capacity as minister he had to protect the institute of state guarantees, which were issued to provide for situations such as the current one.


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