Croatian president to hold more coalition talks next month

September 28, 2016 6:21 AM EDT

Andrej Plenkovic, president of the Croatian Democratic Union (HDZ), reacts during a speech after exit polls in Zagreb, Croatia, September 11, 2016. REUTERS/Antonio Bronic

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By Igor Ilic

ZAGREB (Reuters) - The Croatian president on Wednesday completed a first round of talks with parliamentary parties on forming a new cabinet without nominating prime minister-designate, but said the new parliament would convene in mid-October.

The conservative HDZ party looks best-placed to work with the center-right, reformist Most party in a renewed coalition government.

Whichever party heads the new government, it will face the difficult task of pushing through the painful cuts and restructuring being urged by the European Union to boost the debt-burdened economy's modest growth.

"The consultations have showed that no one at the moment has sufficient majority backing ... I set the next round of talks for Oct. 10, while the new parliament will hold its inaugural session on Oct. 14," President Kolinda Grabar-Kitarovic said after meetings with chiefs of the parliamentary parties.

The HDZ won 61 seats in the 151-seat parliament in a snap election this month, leaving it short of a governing majority but well ahead of its Social Democrat rivals. Most, which means Bridge, won 13 seats.

The previous HDZ-Most coalition collapsed after a tempestuous five months of rows over appointments, but many believe HDZ's emollient new leader Andrej Plenkovic can assemble a more stable coalition.

After intra-party talks on Monday, the two parties' leaders said they hoped to wrap up a deal on an economically focused governing program in the coming weeks..

To be given the mandate by the president, Plenkovic needs the support of at least 76 lawmakers, a number he believes he can achieve with the backing of statutory parliament members representing Croatia's ethnic minorities.

He must form a government within 60 days - two attempts of 30 days - and if he does not achieve it within that time, a new prime-minister designate would be nominated.

Economists say Croatia needs to cut red tape and lower taxes as well as overhaul its pension and health systems while streamlining or shuttering many loss-making public firms.

(Reporting by Igor Ilic; Editing by Alison Williams)

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