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Croatia’s shipbuilders struggle to stay afloat

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Late wages, mass strikes, scrapped contracts — Croatia’s once-thriving shipbuilding sector is sinking, in one of the last gasps of the region’s communist-era industrial giants.


The towering cranes looming over Pula port have been frozen still for weeks as an eerie silence hung over the shipyard, where hundreds of workers from Croatia’s biggest shipbuilding group Uljanik have been on strike for most of the past two months.


They took to the streets in October for a third time this year after not receiving September’s wages, but trickled back on Monday after announcing a temporary “pause” in their latest walkout to help out unhappy clients.


“The situation is bad, wages are late, people are leaving,” Orce Stojkovski, a 48-year-old shipfitter, said from the port on Croatia’s northern Adriatic coast. “We are nearing a moment when there will be no one left to protest, let alone build a ship,” he said, showing photos of an August demonstration and pointing out the former colleagues who have since quit. About a quarter of Uljanik’s 4,500 workers, split across two docks, have packed their bags since January, mainly to seek work abroad.


Meanwhile, clients from Canada and the Cayman Islands have cancelled contracts for nine ships this year, deepening the woes of a debt-laden firm on the brink of bankruptcy.


The cancellations were over Uljanik’s “inability to deliver... in line with contract terms”, according to statements published on its website. It has been a painful unravelling for a company at the heart of an industry that used to be a source of pride for the whole of former Yugoslavia.


During their heyday in the 1980s, Croatia’s shipbuilders were a venerated group whose business was ranked third on the global market. But the 1990s independence war that helped spur the collapse of Yugoslavia, followed by a tough transition from a state-controlled to a market economy, took its toll.


Overstaffing, outdated technology, poor management and lack of an overall industry policy have added to the dysfunction.


It is a familiar story across the Balkans, where state-run industrial giants in former Yugoslavia, from metals plants to car builders, have struggled to privatise and sunk into debt.


Croatia now ranks 13th in the world order book with 0.6 per cent of the market — a tiny sliver compared to the 80 per cent market share controlled by China, South Korea and Japan.


An industry workforce of more than 21,000 during its peak has now shrunk down to 6,000 spread across the four main construction docks: Uljanik, 3. Maj (also owned by Uljanik), Brodosplit and Brodotrogir.


Restructuring Croatia’s shipping industry was a key plank in the country’s entry into the EU in 2013. But analysts say its four main shipyards have failed to adapt to market trends as business shifts from Europe to Asia. — AFP


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