ZAGREB (Reuters) - Croatian Deputy Prime Minister Tomislav Karamarko, who heads the conservative HDZ party, said on Wednesday he was ready to step down if two other key players in a government dispute, including the prime minister, also quit the cabinet.


The HDZ, the biggest party in the center-right coalition, filed a no-confidence motion on Tuesday against technocrat Prime Minister Tihomir Oreskovic over his handling of a row between Karamarko and Bozo Petrov, leader of junior coalition party Most ("Bridge").


Oreskovic had earlier demanded Karamarko's resignation.


"It would be good if we all left, Oreskovic, Petrov and me, and the HDZ to provide a new prime-minister designate. We will do everything to find a solution as soon as possible," Karamarko told reporters. "It would be the best solution to refresh the leading positions in the government."


The HDZ helped install Oreskovic less than five months ago, but has since fallen out with him over an alleged conflict of interest related to the business ties of Karamarko's wife.

Karamarko spoke after some HDZ members suggested the party rethink its decision to seek a no-confidence vote as it could prove difficult for the HDZ to find a new majority in parliament and avoid a snap election.

The HDZ accused Oreskovic of trying to boost his own political power instead of tackling economic priorities. Croatia is the EU's newest member and has one of its weakest economies.

Oreskovic dismissed the criticism, saying Karamarko had proven a burden for the government.

A vote on the HDZ's motion against Oreskovic is expected to take place late next week.

Petrov's Most wants Karamarko to leave the government because of an alleged conflict of interest arising from his wife's business ties with a lobbyist for Hungarian energy group MOL, majority owner of Croatian utility INA.

The government in Zagreb and MOL are in dispute over management rights and investment strategy at INA. Analysts have said Karamarko's idea of forming a new parliamentary majority without Most is likely to fail, while Petrov said on Wednesday his party would favor an early election if the HDZ insisted on Oreskovic's removal.

Most has long insisted that Croatia's prime minister should not be affiliated with a political party, suggesting it may not be willing to accept an HDZ candidate.

(Reporting by Igor Ilic; Editing by Mark Heinrich and Catherine Evans)