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SERBIA & MONTENEGRO


 

REPUBLICAN REFERENCE

Area (sq.km) 
102,136

Population 
10,677,290

Capital 
Belgrade 

Currency 
New Dinar

President 
Vojislav Kostunica

Private sector 
% of GDP 
40% 

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Background:
The Kingdom of Serbs, Croats, and Slovenes was formed in 1918; its name was changed to Yugoslavia in 1929. Occupation by Nazi Germany in 1941 was resisted by various partisan bands that fought themselves as well as the invaders. The group headed by Marshal TITO took full control upon German expulsion in 1945. Although communist in name, his new government successfully steered its own path between the Warsaw Pact nations and the West for the next four and a half decades. In the early 1990s, post-TITO Yugoslavia began to unravel along ethnic lines: Slovenia, Croatia, and The Former Yugoslav Republic of Macedonia all declared their independence in 1991; Bosnia and Herzegovina in 1992. The remaining republics of Serbia and Montenegro declared a new "Federal Republic of Yugoslavia" in 1992 and, under President Slobodan MILOSEVIC, Serbia led various military intervention efforts to unite Serbs in neighboring republics into a "Greater Serbia." All of these efforts were ultimately unsuccessful. In 1999, massive expulsions by Serbs of ethnic Albanians living in the autonomous republic of Kosovo provoked an international response, including the NATO bombing of Serbia and the stationing of NATO and Russian peacekeepers in Kosovo. Blatant attempts to manipulate presidential balloting in October of 2000 were followed by massive nationwide demonstrations and strikes that saw the election winner, Vojislav KOSTUNICA, replace MILOSEVIC. 

Update No: 071 - (27/03/03)

The assassination of premier Zoran Djindjic on March 12th has plunged Serbia into a grave crisis, at a time moreover when it has only a caretaker president. The politics of violence are back; a revenge killing by Milosevic hitmen of the leader who sent their hero to the Hague.
Djindjic was one of those many leaders, such as Gorbachev and Thatcher, far more popular abroad than at home. He was widely thought to be complicit with the whole culture of corruption that characterised the Milosevic years. Doubtless not without some reason. It would have been difficult for somebody to have rid Serbia of Milosevic without using some of the underhand methods of the dictator himself.
The key compromise he made was with Milorad Lukovic, who was probably behind the plot to murder him. He sowed the seeds of his own assassination in planning the overthrow of Milosevic, who went in October 2000. The reformers knew that they needed the support of Milosevic's own special police forces if they were to succeed in toppling him. Djindjic approached Lukovic, the head of the Special Anti - Terrorist Unit, which would have been better named the Special Reign of Terror Unit, and offered him immunity for any past misdeeds if he cooperated in ensuring the departure of Milosevic. This he duly did, but then felt betrayed by Djindjic's recent drive against corruption.
A poor showing in the polls in September had convinced Djindjic to move against the numerous gangsters, still lurking about in Belgrade. Lukovic retaliated by blowing up a factory owned by a government ally in December. On February 1st an assassination attempt was made on Djindjic by a lorry as he drove in his limousine; the lorry-driver had mafia links. But this time they got him.

The arch-reformer
Djindjic was the politician who gave impetus to the whole reform programme. He was decisive in forethought, determined in execution and intrepid in following up the consequences. Unfortunately these have included losing his life. He knew he was running great risks and riling the gangsters was always likely to prove fatal.
Serbia has made great strides forward since October 2000, largely thanks to Djindjic's efforts. The economy is turning around, inflation has fallen to low single figures, the banks have been reformed, state firms have been sold off and the country opened up to foreign investment. 
The big crooks have been deprived of their stranglehold of the economy, some being sent to the Hague, others fleeing to sanctuaries abroad. But many are still in the country. His power was extraordinary, but so was its nemesis, and his successor will have much 'house cleaning' to continue.

What next for Serbia?
The fragile Serbian democracy has lost a genuine leader. Can it find another as effective? Can it survive? Are the politics of violence back again?
These are questions on everyone's lips throughout the country. There has been a great outpouring of revulsion against the crime especially among the young. Djindjic has left behind a widow, Ruzica, and a young daughter, Jovana. There is naturally an upsurge of sympathy for them. Unpopular though he was in life, Djindjic is now being judged anew. There is a widespread desire to vindicate his achievements and to continue and to consolidate the legacy of liberal democracy. That Serbian politics should be stormy is not so surprising; it was always so, but its hard-won democracy should survive.

Successor emerges
The man to succeed Djindjic is none other than his interior minister, Zoran Zivkovic, who is a vice-president of Djindjic's Democratic Party. He was mayor of the southern town, Nis, which he turned into a bastion of resistance to the Milosevic regime.
The perpetrators of this murder may find it backfiring badly on them. Half a million marched in mourning at the funeral. Zivkovic said; "the mafia killed the greatest reformer we have." He vowed to combat the gangsters and bring them to justice.
As interior minister, Zivkovic has tried hard to root out the criminals and the corrupt figures complicit with them in the security forces, but clearly it is an uphill task. The ease with which the assassination was carried out right outside the prime minister's office is not a great reflection on security arrangements there, ultimately under Zivkovic's authority.
The new premier is obviously overhauling all such arrangements and also extending the search for his predecessor's killers. He will get whatever help he needs from Interpol, Scotland Yard and other top police forces world-wide. Some 200 people are being held for questioning, including Jovica Stanisic, Milosevic's secret police chief, and Frank Simatovic, Lukovic's predecessor as the head of Serbia's notorious Red Berets Special Operations Unit. Of Lukovic himself there is no trace. He is almost certainly abroad.
There is going to be cooperation with the Hague over surrendering suspected war criminals. Indeed a continuation of pro-Western policies is certain. Whether Zivkovic has the political skills that Djindjic displayed is another matter. At only 42, he will be one of the youngest prime ministers anywhere and has time to grow into the job.

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ARMAMENTS

Serbian company to take part in international arms fair in Abu Dhabi

Jugoimport SDPR will take part in the international fair of arms, military equipment and technology index 2003 in Abu Dhabi on 16th-20th March, Jugoimport said on 10th March, Tanjug News Agency has reported. 
At one of the world's most important fairs of arms and military equipment, Jugoimport will exhibit the development programmes of about 20 special-purpose enterprises from Serbia and Montenegro. 
Jugoimport has paid special attention to arms and ammunition, anti-nuclear, anti-chemical and anti-biological devices, components belonging to complex systems and programmes of military technology modernization. 
More than 200 most renowned producers from about 80 countries will take part in this year's fair.

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AVIATION

Montenegro assumes ownership of Tivat, Podgorica airports

Montenegrin Airports Public Enterprise Manager, Milovan Djurickovic, and Yugoslav Airlines (JAT) Deputy Manager General, Miodrag Todorovic, signed in the Montenegrin town of Tivat, a contract on the transfer of ownership of the Tivat and Podgorica airports, Tanjug News Agency has reported. 
"These are infrastructure facilities and they are a basic prerequisite for a further development of Montenegro, creating new communications with the world and paving the way for the arrival of foreign investors," Djurickovic said after the signing of the contract, which the JAT representative described as the beginning of good future cooperation. 
Under the takeover agreement, which was signed by Montenegrin Deputy Premier, Branimir Gvozdenovic, and Serbian Transport Minister, Marija Raseta Vukosavljevic, in late December, Montenegro will pay Serbia 10 million euros.

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FOREIGN INVESTMENT

Political uncertainties hamper foreign investment

Political problems in Serbia discouraged foreign investment last year, Cristoph Greussing, the Belgrade chief of Germany's Hypovereinsbank, said recently, New Europe reports. "The political situation triggered some uncertainty," Greussing said at a conference of the Foreign Investors Council (FIC), which groups 33 major firms working in Serbia and Montenegro. A series of failed presidential elections in Serbia and other problems had no direct impact on business, but it sent a message to investors outside, he said. "These are signals of the kind. there is an element of uncertainty," Greussing told reporters. 
Serbia attracted about US$500m in foreign direct investments in 2002, while neighbouring Bulgaria and Romania drew about twice as much. The FIC made recommendations that would improve the investment climate in the country, including a more transparent commercial procedures and more flexible regulation of the banking industry. The group also recommended introduction of a value-added tax.

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SHIPPING

Sava reopens for international river traffic after 13 years

The longest river in the former Yugoslavia, Sava, opened for international traffic after 13 years, the Tanjug News Agency reported. The Serbian ship Raska ferried 2,500 tons of grain from Romania to the Bosnian port of Brcko, completing an international transport on the river for the first time since Serbia, Croatia, Bosnia and Slovenia signed a memorandum to open the Sava to traffic. 
Tanjung said that since the outbreak of violence in the former Yugoslavia, only one Croatian shipper was using a part of the once busy, 945km river that begins in Slovenia and meets the Danube at Belgrade. Under the auspices of the Balkans Stability Pact, the four countries of the former Yugoslavia agreed to set up a joint commission managing the river in December.

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