CROATIAN ACCESSION to the EUROPEAN UNION Economic and Legal Challenges CROATIAN ACCESSION to the EUROPEAN UNION Economic and Legal Challenges
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CROATIAN ACCESSION TO THE EUROPEAN UNION Economic and legal challenges CROATIAN ACCESSION TO THE EUROPEAN UNION Economic and legal challenges Editor Katarina Ott Institute of Public Finance Friedrich Ebert Stiftung Zagreb Publishers Institute of Public Finance, Zagreb, Katanèiæeva 5 http://www.ijf.hr Friedrich Ebert Stiftung, Zagreb, Medvešèak 10 http://www.fes.hr For publishers Katarina Ott Rüdiger Pintar Editor Katarina Ott English translation Graham McMaster Cover design Vesna Ibrišimoviæ Copies 1000 Design and Print Gipa Zagreb d.o.o., Zagreb, Magazinska 11 CIP - Katalogizacija u publikaciji Nacionalna i sveuèilišna knjinica - Zagreb UDK 339.923(497.5:4-67 EU)(082) 061.1(497.5:4-67 EU)(082) CROATIAN accession to the European Union : economic and legal challenges /editor Katarina Ott ; <English translation Graham McMaster>. - Zagreb : Institute of Public Finance : Friedrich Ebert Stiftung, 2003. Izv. stv. nasl.: Pridruivanje Hrvatske Europskoj uniji. ISBN 953-6047-30-6 (Institut). - ISBN 953-7043-05-3 (Zaklada) 1. Ott, Katarina I. Europska unija — Hrvatska — Gospodarska prilagodba 430314079 CONTENTS Authors vii Foreword xii Acknowledgements xiv Abbreviations xv 1. Croatian accession to the European Union: economic and legal challenges 1 Katarina Ott 2. Macroeconomic aspects of Croatia’s accession to the European Union 25 Dubravko Mihaljek 3. Banking and financial matters on Croatia’s road to the European Union 67 Velimir Šonje 4. Comparison and harmonisation of the Croatian tax system with the tax systems in the European Union 89 Hrvoje Arbutina, Danijela Kuliš, Mihaela Pitareviæ 5. State aid in the European Union and Croatia 113 Marina Kesner-Škreb, Mia Mikiæ 6. The European Union as determinant of Croatian trade policy 139 Ana-Maria Boromisa, Mia Mikiæ 7. Premises for the inclusion of agriculture in the process of Croatian accession to the European Union 159 Ramona Franiæ, Tito imbrek 8. Energy in the European Union and in Croatia 181 Ana-Maria Boromisa 9. Employment and unemployment in the Republic of Croatia 201 Predrag Bejakoviæ, Viktor Gotovac 10. Croatian accession to the European Union: the transformation of the legal system 223 Siniša Rodin 11. The non-governmental sector and the government: a dialogue for Europe 249 Igor Vidaèak 12. Equality between men and women: challenges to Croatian legislation 273 Snjeana Vasiljeviæ Glossary 291 List of useful web addresses 299 Index 301 vii AUTHORS Hrvoje Arbutina, DSc, took his first, master’s and doctoral degrees at the Faculty of Law, Zagreb. He is Associate Professor at the Department of Financial Law and Financial Science at the Faculty of Law in Zagreb. Before his current employment, he worked in the insurance company Croatia osiguranje. He has published many papers and books in the area of the law relating to public finances, published at home and abroad. He has also taken part in a considerable number of scientific research proj- ects. Predrag Bejakoviæ, DSc, took his doctorate from the Faculty of Econo- mics in Zagreb and now works in the Institute of Public Finance in Zagreb. He has been a Scholar of the Kingdom of Denmark in Copenhagen, a Fulbright Scholar at the University of Wisconsin, Madison, and a British Council Scholar at the universities of Essex and Bath. He has taken part in a number of projects such as The Underground Economy in the RC, The Development of the Tax Administration in Croatia and Pensions Reform and a Sustainable Budget of the Institute for Public Finance, and the Employment Policy Programme of the gov- ernment of the Republic of Croatia. He has published in scientific and professional journals such as Financijska teorija i praksa, Èasopis za društvena istraivanja and others. He has co-authored a number of books in the area of economics, public finances and labour economics. Ana-Maria Boromisa, MSc, took her first degree at the Electrical Engineering Faculty in Zagreb, and took a master’s in European Studies, College of Europe, Natolin, Poland. Since 2001 she has been a member of the Croatian Energy Regulatory Council, where she is currently employed. Previously she worked in the Institute for International Relations and in Zagreb Airport. She has written many articles published in Croatian and foreign publications; the areas of her professional interest include the enlargement of the EU to the states of Central and Eastern Europe, particularly the economic criteria for accession, sectoral reform in the applicant states and the possible effects of the enlargement of the EU to the states of SE Europe. Ramona Franiæ, DSc, took her first (1990), master’s (1994) and doc- toral (1999) degrees at the Faculty of Agriculture, Zagreb University, her dissertations being related to topics of agricultural policy. Since 1991 she has been employed in the Agricultural Faculty, University of viii Zagreb. She has taken part in a number of research projects and in domestic and international projects in the area of agricultural econom- ics and policy as well as of sustainable rural development. Viktor Gotovac, MSc, took his first degree at the Faculty of Law in Zagreb (1998) and then a master’s in the Law Department of the Central European University in Budapest (1999). Since 2001 he has been Assistant in the Chair for Labour and Welfare Law of the Faculty of Law, Zagreb, and before that was a legal intern. Alongside the de- velopment of his academic career, he has been engaged as a consultant in the USAID Tripartite Dialogue Project and as an external consultant for the Social Partnership Office of the government of the Republic of Croatia. He is a member of the Managing Council of the NGO Transparency International Croatia. He has published several articles on legal topics. Marina Kesner-Škreb, MSc, took her first and master’s degrees in the Faculty of Economics, Zagreb. She is currently employed in the Institute of Public Finance, and has also worked in Zagrebaèka banka and the Institute for Macroeconomic Analysis of the Republic of Croatia. She has specialized in the University of Pittsburgh, Depart- ment of Economics, and at the Joint Vienna Institute of the IMF. She has published in domestic and foreign journals. She is the editor of sev- eral publications of the Institute of Public Finance. Her special inter- ests include taxation and tax policy as well as the problem area of state intervention. Danijela Kuliš took her degree from the Faculty of Economics in Zagreb. She has been employed in the Institute of Public Finance since 1993. She has written many articles in the area of the taxation system published in Croatian journals and publications and in encyclopaedias. She is the editor of several of the professional publications of the IPF. Her areas of interest include the tax system and the position of the artist and artistic occupations in the tax system. Dubravko Mihaljek, DSc, is economic analyst of the emerging mar- ket economies in the Bank for International Settlements in Basle. Between 1990 and 1999 he worked in the IMF in Washington, charged with various IMF activities in the former Czechoslovakia, Hong Kong, Japan, China, Germany, the former USSR, Sri Lanka and Vietnam. He started his professional career in 1982 as Assistant in the Institue of ix Economics, Zagreb. He received a doctorate in economics from Pittsburgh University in 1990; he took his master’s in Minnesota University in 1986, and his first degree in the Foreign Trade Faculty, Zagreb, 1981. He has authored over 60 papers in macroeconomics, fiscal theory and policy, monetary and exchange rate policy, economic devel- opment and banking. Mia Mikiæ, Professor, DSc, teaches international economics at the Faculty of Economics, Zagreb (since 2001); she is an associate researcher in the National Centre for Research on Europe in Christchurch, New Zealand. She taught international trade at the University of Auckland, New Zealand (1988-2001). As guest research fellow, she was invited to the University of Oxford (1999). She is the author of the textbook International Trade (Macmillan, 1998), as well as numerous articles and other publications. Her research interests include trade policy, regional integration, EU enlargement to the countries of CEE, and trade policy for transition. She is a consultant for trade policy for UN/ESCAP and the Secretariat of APEC. Katarina Ott, DSc, was educated in Croatia and Slovenia, and did post- graduate work in the USA; she is director of the Institute of Public Finance, editor of the journal Financijska teorija i praksa, trustee of the Prof. Dr. Marijan Hanekoviæ Foundation, Associate Professor at the post-graduate studies of the Faculty of Economics in Zagreb. She heads projects and publishes papers in the wider area of public sector econom- ics. Her main area of interest is the relationship between government and the economy, above all the underground economy, the budget, public sec- tor reform, local finances and in particular public sector transparency, accountability and citizens’ participation. Rüdiger Pintar, dr.rer.pol., studied economics and sociology at the uni- versities of Cologne and Munich, graduated in 1969 at the University of Cologne. Employed at an institute for social research at the same univer- sity, dealing with research on occupational retraining programmes and labour market. 1974 Ph.D. in economics and social sciences at the University of Cologne. Since 1978 employed with the Friedrich Ebert Stiftung (FES): 1978-1984 in Tanzania as adviser to the Ministry of Manpower Development in Dar es Salaam; 1984-1988 working at the headquarter of FES being in charge of projects in Eastern and Southern Africa; 1988-1992 representative of FES in Tunisia and Algeria; 1992- 1999 again back at the headquarters of FES, responsible for projects in x South-Eastern Europe; since 2000 head of the regional office of FES in Zagreb, in charge of projects in Croatia and Bosnia and Herzegovina.