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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
Update No: 069 - (28/01/03)
The Serbs are feeling that they are still being put upon by the international community. They bear out the idea of being predatory victims, along with the Israelis and the Armenians.
Certainly, the arraignment of Slobodan Milosevic in the Hague is encouraging a martyr complex among Serbs nationalists. To hear him being accused of war crime after war crime makes them feel targeted as the eternal miscreants. Now outgoing president, Milan Milutinovic is also to be tried at the Hague, having given himself up voluntarily.
Even the liberal Serbs have a grievance against the way the outer world is treating Serbia. The Serbian prime minister, Zoran Djindjic, for instance, a liberal and pro-Westerner, is aggrieved that the UN administration running Kosovo province, still de jure part of Serbia, is allowing the creation of an independent state to occur, which puts his own government in a poor light. "An independent state is being created in Kosovo. It will be much harder to stop that process in two years than it is today," he says.
In fact Kosovo is de facto a separate state, with virtually no Serbs left, except those in mixed marriages. The Battle of Kosovo of 1389, which the Serbs lost to the Turks, has been lost again - to the West.
Without an elected president
As Milutinovic steps down there is a vacancy, which will be occupied for the moment by Serbia's first woman president, the head of parliament, Matsela Micic. She is to act as a caretaker president until the issue of elections is resolved.
So far there have been two elections for the presidency, which were nullified by low voter turn-out. The most popular politician, President Vojislav Kostunica of Yugoslavia, won most votes, but to no account. The most powerful figure in the country, Djindjic, disdained to field a candidate, speaking of the elections with contempt. Kostunica and Djindjic have long fallen out; their quarrel may now lead to parliamentary elections this year, and at a most unfortunate time. The impasse may harm Serbian reform and damage the country's fragile credibility, just when it was being accepted as now a 'normal' state once again, Washington, for instance, recently releasing all frozen assets of its citizens in the US.
Kostunica will shortly be out of a job as the federal state of Yugoslavia turns into a looser alliance between Serbia and Montenegro. Within three years either can hold a referendum to terminate it, something the Montenegrin leader, Milo Djukanovic, is likely to want to do and likely to win it for secession.
Kostunica still has the aura of toppling Milosevic and somehow or other he is unlikely to just fade from the scene, even if that is exactly what Djindjic wants. Djindjic is the favoured politician of the West and his government is the recipient of the first tranches of what will be a three-year credit of US$860m, agreed in May. The IMF says that reform is on track. A World Bank official has also praised the reform course of the government; "key fiscal and pension reforms were passed, a state treasury was introduced and aggressive privatisation and banking reforms continued."
There are still certain blemishes. Not all war criminals have been handed over. But the surrender of Milutinovic, after that of Milosevic, means that the two top figures of the old regime are now at the Hague, a third figure, Milosevic's wife, Mira, the Lady Macbeth of the previous regime, somehow eluding the attention of investigators, perhaps for chivalrous reasons.
Two more of the 1999 Kosovo indicters are in custody, the former Yugoslav army chief General Dragoljub Ojdanic and Milosevic's former aide for Kosovo, Nikola Salvanic. The former Serbian police chief, Vlajko Stojiljkovic, shot himself on the steps of parliament April 2002 rather than be handed over.
A scandal over arms sales to Iraq that come to light in November shows that there are still remnants of the old regime lurking in the upper echelons of the defence sector, while crime and corruption, even among the police force, are rife. For all that there is a genuine regime and a genuinely democratic one in power. The Serbs have turned the corner there; revival of the depressed economy is next on the agenda.
Serbia comes alive again
The obsession with territory and ethnic cleansing is giving way, especially among the young, to a desire to improve living standards wretchedly poor after ten years of bitter conflict and wars with neighbours.
Serbia was always potentially a rich and prosperous country. In the Roman world it was reckoned to be a prize province, the home of several emperors including Diocletian and Constantine.
Its character was of course dramatically changed by the Slav settlements in the might of the Roman Empire. Freed from the encumbrance of the rest of Yugoslavia, Serbia's future as the mainstay of the Balkan region looks secure.
National bank chief: Successful firms should not be sold to foreigners
"It is very important for us not to sell all domestic banks and all enterprises to foreigners in the privatisation process, since this is what our tradition, culture and interest call for," one of the leaders of the newly formed G17 Plus party, Mladjan Dinkic, who is also National Bank of Yugoslavia governor, has said.
"Foreign investors have to be attracted to invest their profit in Serbia, rather than just take it out of the country. That's why we, at G17 Plus, believe that a number of successful and efficient enterprises and banks should not be sold to foreigners," Dinkic told the Belgrade daily 'Politika ekspres.'
He quoted the mineral water producer Knjaz Milos of Arandjelovac, the Toza Markovic of Kikinda, Polet of Becej and Sintelon of Backa Palanka enterprises as well as the Vojvodjanska and Komercijalna banks, and added that "these enterprises and banks could partly enter joint ventures with foreign partners, but foreigners must never become their majority owners."
Greek central bank signs MoC with Yugoslav institution
A memorandum of cooperation (MoC) was signed between the Bank of Greece and the National Bank of Yugoslavia in Belgrade, by Nikolaos Garganas and Mladan Dinkis, respectively the two directors of the banks. The memorandum of cooperation between the central banks of Greeece and the Federal Republic of Yugoslavia, concern reciprocal exchange of information, New Europe has reported.
It also foresees support for the supervisory authorities of Yugoslavia for the meeting of credit institutions to be founded in the country, in the form of a branch or representation office. Thus a full picture of how Greek banks will function in the Balkan state, and how Yugoslavian banks will function in Greece, has been obtained. The key extension of Greek bank's activities to Balkan countries is accompanied by the signing of appropriate agreements, as has already happened with Bulgaria and Albania, while such agreements are expected to be signed with Romania and Turkey.
Yugoslavia to award Russia contract for new station
Yugoslavia's Deputy Prime Minister, Mirolub Labus, who recently returned from Moscow, said the question of settling his country's US$250m debt for Russian gas would be resolved in 2003. He told journalists that the contract to reconstruct the Dzherdap 1 hydroelectric power station on the Danube would be awarded to Russia as a means of paying off part of the debt. The contract's value is estimated at US$100m. Deliveries of natural gas to Yugoslavia will take place regularly until March 1st, to which end the Petroleum Industry of Serbia has signed a contract with Gazprom, New Europe reported. In the near future, Labus noted, an agreement regarding gas supplies to the end of 2003 will also be signed. The next session of the Russian-Yugoslavian intergovernmental commission on economic cooperation is due to be held in March or April 2003.
Serbian finance minister hopes for US$1bn of foreign investment in 2003
Serbian Finance Minister Bozidar Djelic expects greater investments from abroad for this year, amounting to as much as US$1bn, BKTV has reported.
The year before the past year, foreign investments in the country amounted to US$162m. In 2002, this figure was between US$400m and US$500m whereas for this year, investments worth around US$1bn or euros are expected, the Serbian finance minister has asserted. Prompted by the reduction in tax rates from 20 to 14 per cent starting 1st January this year, he said that this was the lowest tax rate in Europe except for the Bosnian Serb Republic. "We wanted to attract foreign capital and engage domestic capital by reducing taxes on company profits and taxes on businessmen and craftspeople. The very suggestion of these measures convinced several big companies to begin considering the possibility of investing in Serbia very seriously," Djelic said. "Serbia now has a fresh chance because Hungary, the Czech Republic, Poland and Slovenia are going to join the European Union in 2004, and these are Central and Eastern European countries which attracted the greatest share of foreign capital throughout the 1990s. We should provide for an incentive which would attract investors and we should fight for a central place in Southeast Europe competing with Bulgaria, Croatia, Bosnia and Romania," the Serbian finance minister said.
FOREIGN LOANS & AID
EU announces further financial assistance to Serbia, Montenegro
The first 30-million-euro tranche of EU assistance to Yugoslavia represents just one part of a 130-million-euro package that the EU granted to Serbia and Montenegro in November 2002, Tanjug News Agency has reported.
According to the European Commission report, out of the 130 million euros, 75 million will be sent in the form of donations and the remaining 55 million euros will be loans.
Under a fixed policy of Southeast European countries' accession to the European Union, five of the western Balkan states - Albania, Macedonia, Yugoslavia, Bosnia-Hercegovina and Croatia - should receive funds from the CARDS [Community Assistance for Reconstruction, Development and Stabilization] programme, aimed at strengthening democratic and institutional structures and achieving social reconstruction and development as well as regional cooperation.
The assistance is realized through the European Reconstruction Agency and a total of 4.65 billion euros are planned to be set out in the 2000-2006 period. In the past two years, Yugoslavia received 630 million euros of this amount, according to the latest European Commission report.
According to the report, Yugoslavia was also granted 345 million euros, with 125 million euros of this amount in the form of donations.
The first 260-million-euro tranche of this amount (consisting of 225 million euros in the form of loans and a donation of 35 million euros), arrived in October 2001. The second 40-million-euro tranche, in the form of a donation, arrived in January 2002 and the third in August.
Serbian government reaches accord to buy Italian share in Serbian Telekom
The Serbian government has confirmed that it has reached an agreement with Italian Telecom to purchase all 29 per cent of shares that it holds in Serbian Telekom for 195m euro, following which the government will own 80 per cent of the capital in the Serbian telecommunications company, Beta News Agency has reported.
Serbian Prime Minister Zoran Djindjic said at a news conference that this is the best deal that Serbia had made in years. As he said, the sum which will be paid to Italians also comprises a debt of 100m euros.
The majority owner of the Serbian Telekom, PTT [Post, Telegraph, Telephone] Serbia, will pay the money to the Italian Telecom over the next six years.
Djindjic further explained that the payment of the biggest sum of 120m euro will begin in January. This sum will be paid in four equal monthly instalments, while the rest of the money will be paid after three years, during which no interest will be charged...
PTT Serbia Director General Srdjan Blagojevic, said that the purchase of 29 per cent of shares for 195m euro was a major coup because the Italians had paid US$997m for them some four or five years ago...
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