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ZAGREB, Croatia – Following pressure from the opposition and the media and a warning from the European Commission, the Croatian government had to back out of a deal with the powerful U.S. company Bechtel. It announced on 4 August that a public tender would be held for the construction of a 37-kilometer-long section of a future highway in southern Croatia that had previously been contracted to Bechtel.

For two weeks, Prime Minister Ivo Sanader and his ministers had persistently been trying to persuade voters that their hands were tied by the previous government's deals with Bechtel, but to no avail. The public showed little understanding for the government's arguments, reacting instead like a bull to a red rag to any hint of fraudulent deals involving the ruling Croatian Democratic Union (HDZ), a party that was synonymous with widespread corruption in the 1990s.

The popularity of the HDZ has slumped in polls despite its undeniable successes in foreign policy, notably achieving the country’s EU-candidate status in April. A survey by the Puls agency found that support for the party had fallen from 32 percent in April to 27 in July, although it remains the most popular of Croatia’s political parties.

Only a few months after facing fallout from a major privatization scandal involving a tourist company on the island of Hvar, the government was forced to backtrack again. But the Bechtel case has even more powerful reverberations since it involves the project of building a highway network across Croatia. The project was given top priority by the previous coalition government.

(TOL 06.viii.04)

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