Croatia - Domestic policy

Croatia has an executive and judiciary that are difficult to separate, which makes the transition to democracy harder in this somewhat authoritarian government. To correct this situation, Mesic has discussed his intention to limit the power of the presidency, with the exception of supreme command of the armed forces and the ability to disband Parliament and call early elections. Early in 2000, Mesic called meetings with top advisors to help create the transition from the semipresidential system to a parliamentary system, with a balance of power between the executive, legislative, and judiciary systems.

Mesic's administration has inherited the challenge of a weak economy stemming from years of communist mismanagement and the effects of civil war. Seeking ways to lower unemployment (23%, 2001 estimate) and to provide opportunities for foreign investment capital are high priorities in Mesic's domestic policy. The administration has focused on pursuing further privatization of the Croatian economy. In 2002 the government sold a 25% stake in a major oil and gas group. Political bickering has slowed the country's reform process though. In 2002, Prime Minister Ivica Racan resigned briefly, ending a five-party governing coalition and asking for a mandate to establish a new government in the hopes of excluding the HSLS. Almost immediately, Mesic reappointed Racan to the prime minister's post.