Croatian ruling party wins polls but not a majority

Croatia's long-dominant ruling HDZ party are preparing for difficult talks to form a coalition after winning a parliamentary election without a majority, and with a far-right party as potential kingmakers.

The conservative pro-EU HDZ (Croatian Democratic Union) won 61 seats in the European Union member state's 151-seat parliament on Wednesday, the latest preliminary results show, after 99.79 per cent of polling stations had been counted.

A coalition led by the opposition Social Democratic Party (SDP) came in second with 42 seats, a poorer result than expected after President Zoran Milanovic said he would run for the SDP as prime minister in a surprise move.

The HDZ took credit for Croatia entering the EU's Schengen free travel area and the Eurozone last year and denied opposition allegations of authoritarianism and graft after dominating politics since Socialist Yugoslavia broke up in 1991.

The far-right Homeland Movement took the third place with 14 seats, giving it a decisive role since the HDZ has ruled out working with the main opposition SDP.

Homeland has yet to come out with a clear choice which bloc it will join.

"I hope that we shall tailor the fate of Croatia in the days ahead," Homeland Movement Ivan Penava said, adding the party had pledged not to join either bloc but would consider options.

The party's main condition is not to join a government that would include the Serb minority party SDSS, and the coalition with green Mozemo party is a "mission impossible", Penava said.

Prime Minister Andrej Plenkovic invited all political parties that were not "exclusive" for talks on forming government, appearing to refer to the SDP.

Plenkovic said the HDZ could guarantee Croatia's stability in a challenging geopolitical environment.

The short election campaign was marked by rivalry between Plenkovic and Milanovic, whose disagreements include the conflict in Ukraine and relations with the European Union, with Plenkovic in favour of helping Ukraine and Milanovic against.