engleski

AGROKOR – A CASE OF CONTROLLED COLLAPSE

At the beginning of 2017, Agrokor, the largest privately owned Croatian corporation, was caught in a crisis due to the inability to meet its financial obligations. At the time of the crisis, Agrokor encompassed more than 50 companies in retail, food and agriculture, agricultural commodities trading, IT services and energy production sectors and employed 60, 000 workers in 6 countries, of which 40, 000 in Croatia. Agrokor's business audit, conducted on the order of a special administrator named by Croatian Government, and published in October 2017, showed that the total debt to banks and suppliers at the end of 2016 amounted to 56.28bn. kuna, which is HRK 14.5bn. more than the company's capital. The case of Agrokor is significant not only because of its importance for the Croatian economy, but also because it represents the archetype of the Croatian model of capitalism nominally based on the free market and free competition, but in fact being a sort of crony capitalism that evolved during the 1990’s from the basis of Yugoslavia's nominal self-managing socialism and the so called negotiated/consensual economy that in the real life soon turned into its crony variety. This paper aims to explore how it was possible, without any previous restrictions and reactions, for Agrokor to reach such proportions of concentration on the national market, from primary production to retail distribution of food, but also in a number of related and completely unrelated industries, that its crisis represents a serious threat to the stability of the national economy (mainly based on the same business model), how the controlled collapse of this Agrokor is facilitated by the government, and which institutional and technical issues are opened in this process.

Agrokor, crony capitalism, political economy, privatization, transition

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