Prime Minister Andrej Plenkovic on Thursday discussed the situation at the troubled Uljanik dock with the Uljanik Group's management board, company unions, and local authorities of the city of Pula and Istria county, telling reporters that the saving jobs and keeping the company working were top priorities right now.
“Those who, perhaps with their work, or by making mistakes, or via some other circumstances, brought the company into its current situation, are less important. What is important is the future, and that’s why we are here today, and that’s why we are seeking a solution,” Plenkovic said in Pula.
The government held a session in Pula on Wednesday, the northern Adriatic city where the indebted Uljanik shipyard is based in. Its mother company, the privately-owned Uljanik Group, which also owns the Rijeka-based 3. Maj shipyard, has been making headlines this summer after it had been hit with financial losses, blocked bank accounts, a worker strike over delayed salaries, and cancellations of ship orders.
“We talked very openly about the scenarios on offer before us. We will work hard on finding solutions, because none of us can dispose with taxpayers’ money in a way that would be inconsistent, illegal or unusual in such situations. I think the unions, like us, are aware of what we have done so far, and what we will try to do in the future,” Plenkovic said.
Plenkovic added that the government had supporting Uljanik Group in the past, saying that the company had received “a bailout guarantee in the amount of 716 million kuna in January, in agreement with the European Commission.”
“That money was channeled via commercial bank loans, and enabled the survival and functioning of the shipyards in Pula and Rijeka. Meanwhile, the company management was obliged, first and foremost, to draw up a restructuring plan, and find a strategic partner. I repeat, those were the company’s decisions and choices,” Plenkovic said.
Upon receiving the plan, the government felt it was not good enough for it to adopt, so it forwarded the plan to the European Commission, Plenkovic said. The European Commission had received the plan, drafted by Uljanik management, but had not yet issued an official reply on whether the plan complied with EU rules on state aid.
Under the plan, Economy Minister Darko Horvat said last week that Croatia’s government and any future strategic partner found for the shipyard would share the restructuring cost 60-40 percent, estimated to cost in total €584 million – meaning taxpayers would spend up to €352 million to save the shipyards.
Last week, European Commissioner for Competition, Margrethe Vestager, visited Zagreb, and said she could not set a final deadline for deciding on the restructuring plan for Uljanik.
“Last week we had talks with the relevant EU Commissioner (Vestager). There is good will to save the shipyard, to find ways to ensure viable shipbuilding in Pula and Rijeka. The Commission is completing its preliminary comments, but it was clear from the meeting that the plan needed additional work to be acceptable. The government has provided bank guarantees so that workers could get their wages. The wages for August have started arriving to workers’ bank accounts. Therefore, we did what we promised,” Plenkovic said.
The government had secured July and August salaries for the shipyard’s workers, which had ended their eight-day strike last month. Another 51 million kuna (€6.9 million) for August wages for 4,200 workers has also been secured, but it remains unclear how the shipyards would continue doing business into September.
Plenkovic said it was necessary to restore messages of optimism and trust in Uljanik’s survival and functioning, as well as in finding a solution to make shipbuilding viable.
“This trust and the restructuring must realistically correspond to what the strategic partner can bring, and how the government is allowed to participate. We are all aware of the good will and intentions of all the stakeholders,” Plenkovic said.