Croatian parliamentary election gives no clear winner, results show

Both sides in Croatia's close-fought parliamentary elections began talks to form a government Monday, but the ruling conservatives appeared better equipped to muster a coalition to lead the ex-Yugoslav country into the European Union.

Both Prime Minister Ivo Sanader's Croatian Democratic Union and opposition center-left Social Democrats fell short of the estimated 77 deputies required for a majority in parliament in Sunday's election and began wooing allies on Monday.

Both leaders claimed they would make it but analysts believe Sanader's party has more chance.

Sanader's party, known by its acronym HDZ, was to get 61 deputies and the Social Democrats 56, the state-run Electoral Commission said with 99 percent of votes counted.

HDZ is likely to add five to six seats won by Croats living abroad, HDZ's traditional voters' base, giving him 66 seats.

The Social Democrats, or SDP, could get a total of 66 deputies as well with its two certain leftist allies, but that alliance would require some deals and concessions.

President Stipe Mesic said he would give a mandate to the one that provides "convincing evidence" that it has a majority in parliament.

Croatia's pro-Western course is not at stake and the new government is expected to lead the ex-Yugoslav nation into the EU by 2010.

The EU official in charge of the bloc's enlargement, Olli Rehn, said: "I trust the future government will strive for EU membership and work on fulfilling the necessary criteria" required for membership.

Sanader declared victory around midnight and his spokesman, Ratko Macek said the HDZ has "greater coalition capital. We should get a mandate."

The HDZ said European and regional leaders, including German chancellor Angela Merkel and Rehn, congratulated Sanader.

The Social Democrats, or SDP, was not giving up. Its leader, Zoran Milanovic, said Monday the party "started gathering support for forming a new government."

The kingmakers are the eight deputies of the third-strongest coalition of Liberals and the Peasants Party and 13 others from various small parties.

Political analyst Davor Gjenero believes Sanader is an experienced negotiator more skillful at sealing coalition deals.

"He is no longer Mr. Hyde, as in the pre-election campaign," when he alienated smaller parties, Gjenero said. "He's Dr. Jekyll again, a fine gentleman who negotiates with gentlemen."

Most Croatian newspapers say that HDZ is likely to win the mandate.

Whoever leads the new government will have the tough task of delivering on pre-election promises: to overhaul the economy to reduce the 14-percent unemployment and raise the average monthly wage of 4,900 kuna (euro670; US$980).

It will also have to tackle corruption _ a problem the EU says it must resolve before joining the bloc.

The new government would also need to speed up reforms needed to reach EU membership in three years and be invited next year, as expected, to join NATO.

President Mesic said late Sunday that whoever wins, "it would have a strong opposition, which is good for democracy."

Sanader's party _ then run by nationalists _ ruled for a decade until the Social Democrats seized power in 2000 to turn Croatia to the West. In 2003, the HDZ returned to government, with Sanader transforming the party to continue Croatia's pro-Western makeover.