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SERBIA & MONTENEGRO


 

 

Key Economic Data 
 
  2003 2002 2001 Ranking(2003)
GDP
Millions of US $ 19,176 15,555 10,900 70
         
GNI per capita
 US $ 1,910 1,400 930 112
Ranking is given out of 208 nations - (data from the World Bank)

Books on Serbia & Montenegro

REPUBLICAN REFERENCE

Area (sq.km) 
102,350

Population 
10,825,900

Capital 
Belgrade 

Currency 
New Dinar

President 
Boris Tadic

Private sector 
% of GDP 
40% 



Update No: 109 - (29/06/06)

Serbia, Montenegro establish diplomatic relations
The republics of Serbia and Montenegro on June 22nd established full diplomatic relations following Montenegro's declaration of independence from the state union of Serbia-Montenegro earlier in the month. A protocol on the establishment of diplomatic relations was signed in Belgrade by Serbian Foreign Minister, Vuk Draskovic, and his Montenegrin counterpart, Miodrag Vlahovic. 
Draskovic said ahead of the meeting with Vlahovic that Serbia and Montenegro would remain committed to common historic values. "These relations have a historic meaning and it is quite certain that both states will be committed to cherishing numerous common historic values of Serbs and Montenegrins and Serbia and Montenegro," Draskovic said in a statement. 
Vlahovic paid his first official visit to Serbia since Montenegro declared independence on June 3rd, after 55.5 per cent of its voters opted for independence from the union with Serbia in a referendum on May 21st. On June 15th the Serbian government adopted a decision to recognize Montenegro.

Security Council recommends UN membership for Montenegro
The UN Security Council recommended on June 22 that the General Assembly admit Montenegro, with a population of 620;000, as the 192nd member of the United Nations. 
The council passed a presidential statement unanimously at a formal meeting presided over by Danish Foreign Minister, Per Stig Moeller, whose country holds the council presidency for June. 
"The Security Council has decided to recommend to the General Assembly that the Republic of Montenegro be admitted as a member of the United Nations," the statement said. "The council notes with great satisfaction the Republic of Montenegro's solemn commitment to uphold the purposes and principles of the Charter of the United Nations and to fulfil all the obligations contained therein," it added. 
The council discussed Montenegro's request for a UN seat on June 21st and referred the matter to its Committee on the Admission of New Members. 
The Security Council's recommendation on Montenegro's application will be forwarded to the General Assembly for action. Montenegro's request for admission came in a letter to UN Secretary-General, Kofi Annan, from its president, Filip Vujanovic. 
The outcome of the May 21st referendum ended an 88-year partnership with Serbia, completing the break-up of the former Yugoslavia. Serbia inherited the UN seat left by the union it formed with Montenegro. 
The latest country to gain membership in the United Nations was East Timor, which became the 191st UN member in September 2002.

Crucial step for Montenegro 
Montenegro was also accepted on June 22nd as the 56th member of the Organisation of Security and Co-operation (OSCE). With the agreement of the other 55 members, Montenegro's representative, Vesko Garcevic, took his seat in the Vienna-based OSCE Permanent Secretariat, the organisation's highest decision-making body. 
Outside and inside the OSCE chambers in the Vienna Hofburg Palace, the Serbia-Montenegrin flag was replaced by the two flags of Serbia and Montenegro. 
Serbia on its own, as legal successor to Serbia-Montenegro, is automatically an OSCE member. 
Garcevic, up till now Serbia-Montenegrin ambassador to OSCE, said his new country's acceptance into the organisation was of great importance. He said the process of "restoration of sovereignty" had been calm, democratic, and in accord with international standards. He pledged Montenegro would be a constructive and active partner in OSCE. 

Fears for Kosovo
Belgrade has every reason to fear that Kosovo will now follow suit. It is de facto as independent as Montenegro was, with its own governmental structures and separate institutions. It must now be highly likely that it will go independent de jure too.
This is hardly a disaster for the Serbs, looked at in a sane light. Montenegro has invaluable assets, a coastlines and oil reserves in the Adriatic, both of which Serbia coveted. They will still have access to the former.
Kosovo has nothing equivalent and is more than 90% populated by Albanians. There are, it is true, some historic churches there dear to the Orthodox. There is no reason why they should be damaged if the Albanians get their way. Given the religious and ethnic divide, the Serbs would be really better off without them.

Serbia seeks help to get war crime suspect 
While Montenegro is being welcomed on all sides in international assemblies and the like, Serbia is still being shunned by the main forum and organisation to which it wishes to belong, the European Union (EU). The EU cut off association talks with Serbia early in May after Prime Minister Vojislav Kostunica failed to keep his promise and arrest Mladic by April 30.
Serbian Foreign Minister, Vuk Draskovic, said Prime Minister, Kostunica, would like to meet German Chancellor, Angela Merkel, to see what the German secret service could do in apprehending the two fugitives, the EU observer reported on June 22nd. 
Draskovic told the German Freie Presse newspaper that Serbia's government was planning to ask help from the Germans to arrest Bosnian Serb political leader, Radovan Karadzic, and his military leader, Ratko Mladic, both sought by the U.N. tribunal in The Hague on genocide and crimes against humanity charges. 
Mladic's charges include the massacre of 8,000 Bosnian Muslim boys and men at Srebrenica in 1995. 
Karadzic was believed to be hiding in Bosnia-Herzegovina, while Belgrade officials have said Mladic was hiding in Serbia until last year.

Croatian premier to visit Belgrade in July
Croatia has the top priority for Serbia among former Yugoslav states. It is imperative to maintain good relations between these two former adversaries in the tragic wars of the early and mid 1990s.
Croatian Premier, Ivo Sanader, and Prime Minister, Koštunica, will be opening a border crossing in Bajkovo on July 13th, which was built with the help of the European Commission. European Union Enlargement Commissioner, Olli Rehn, is expected to be in attendance as well.
This will be Sanader's second official visit to Belgrade since Koštunica made a trip to Zagreb. Some of the most important issues between Serbia and Croatia are the missing persons cases that remain after the war, economic cooperation, and the exchange of experiences regarding Euro-Atlantic integration and association. 
The two prime ministers reached an agreement during Koštunica's visit that the two would be meeting on a more regular basis, because it is very important for the region for Croatia and Serbia to maintain good relations, especially in the light of the independence of Montenegro.

Bulgaria and Serbia work on new economic co-operation programme 
Spurned by Montenegro to the west, Serbia is turning to closer co-operation with Bulgaria to the east. Bulgaria and Serbia will receive nearly 28 million euro through a new operational programme for economic co-operation. 
The programme is similar to PHARE and the two programmes will function simultaneously from 2007 to 2013, Bulgarian National Radio reported. 
The common Bulgarian-Serbian budget of the programme will be managed by a single committee in Bulgaria, including representatives from both countries. The programme will be executed with the help of the Bulgarian Regional Development Ministry and the Serbian international economic relations ministry. 
Serbia approved the common funding system, Serbian international economic relations minister, Gordana Lazarevic, said. The governments should develop more similar projects, she added. 
Until recently Serbia did not have sufficient means to co-operate effectively with Bulgaria but now the two countries could work on projects of common interest, Lazarevic said. Previous business projects were hindered by the complicated money transfer procedures. The new common fund would increase the success rate of common projects, Lazarevic added. 
Deputy Regional Development Minister, Iskra Mihailova, said that the new programme was a way of improving living standards in both Bulgaria and Serbia and the relations between the two neighbours. 
*****

The following is an assessment of Serbia's new predicament by an independent observer:-

Serbia's choice
William Montgomery
Eight months ago, both the European Union and the United States were openly discouraging a Referendum on Independence in Montenegro. There were several reasons for their uneasiness.
First of all, it was a question of Face for Javier Solana, who had negotiated the Belgrade Agreement designed to keep the two Republics together. Secondly, it would create a new, small state challenged to be economically viable and potentially setting a precedent for other situations in Europe. Thirdly, particularly in the case of the United States, there was concern that the turbulence surrounding the Referendum could adversely impact on the process underway in Kosovo. Fourthly, given the passionate and relatively split views on the question of Independence in Montenegro itself, they were worried about political stability there and even the possibility of violence. And finally, they were concerned about the impact of independence in Montenegro on Serbia itself and on the Republika Srpska. 
For all these reasons, the European Union deliberately set a high bar (55% of the voters had to approve in the Referendum) for Montenegro to successfully achieve its independence. Ironically, the opposition in Montenegro were so convinced that the number could not be reached, they embraced the concept far more easily than the government of Prime Minister Djukanovic and the pro-Independence forces. Some political leaders in Serbia itself, who made their antagonism to independence very clear, shared their optimism. The outcome, therefore, was a severe shock. While many of the initial concerns about the impact of a successful Referendum may turn out to be exaggerated, some are real and are now coming out. 
Montenegro's decision was another psychological blow to the people of Serbia in general, because no matter how it is framed, it means that a majority of the voters in the Republic closest to them throughout history had decided that they were better off as an independent country. It was a particularly bitter defeat for Prime Minister Koštunica, whose relationship with Prime Minister Djukanovic has been severely strained for years over this question. Kostunica and his supporters certainly believe that the European Union's decision to break off negotiations on the Stability and Association Agreement (SSA) with Serbia and Montenegro exactly in the midst of the Referendum campaign directly led to the Referendum's narrow victory. They believe that it was either done deliberately by the EU to help the pro-independence forces or at the very least, the EU knew the damage it would do and if it wanted to do so, could have delayed taking the step for a couple of months. Therefore, in their eyes, they have been betrayed by the European Union. The Prime Minister's curt refusal of the EU's offer to help mediate the terms of the break-up reflects these feelings. The EU's overall relationship with Prime Minister Kostunica perhaps will never recover. 
The Serbian political scene has gotten even more convoluted with radically different positions taken by the leading politicians on Montenegrin Independence, as well as conflicts over the Ministerial changes arising out of the break-up and the resignation of Deputy Prime Minister, Labus. While most of these differences have been present all along, the results of the Referendum have served as a catalyst to bring them out and to aggravate them. It has shifted the focus from other issues to questions of a new Constitution, personnel changes, and new Parliamentary elections. The viability of the governing coalition is shakier than ever. 
The contrast in approach taken by President Tadic and Prime Minister Koštunica on Montenegrin independence could not be starker. Tadic has taken every step to be gracious, to make the split as "velvet" as possible, and to encourage the closest possible future relationship. This is exactly what the European Union hoped and expected to see from a candidate member of its organization and fully in keeping with the example set by the break-up of the former Czechoslovakia. Prime Minister Koštunica, on the other hand, was visibly and vocally against Independence and has yet to make any gestures to encourage a close relationship with the Montenegrin government. 
This immediately raises once again the perennial question of how these two parties can expect to work together productively in any coalition government. As the assumption is that in this Parliament or any one in the foreseeable future, the only way to avoid a Radical/Socialist Party government would include a coalition of at least the DS and DSS, it is a discouraging prospect. 
In case anyone in Serbia or the International Community was trying to convince themselves that a Radical government would not be such a bad thing, the Radicals showed their true colours in an attack by one of their deputies in a session of Parliament on the G17+ nominee for Deputy Prime Minister. The nominee is an ethnic Croat living in Serbia and the deputy called her and her family "Ustashi," bringing back memories of the violence of the past decade. Both the Radicals and the Socialist Party have also been overtly hostile to Montenegrin Independence. 
This all raises several questions. Given the percentage of support for the Radicals and Socialist Party in particular - and their totally unreconstructed policy views - will the European Union accept that Serbia is a true candidate to join it? Do Serbs who support the Radicals and Socialist Party understand that the openly stated policies of the parties are not compatible with those of the EU? Does the Serbian government realize or care that its image in the West has been significantly damaged by its reaction to the Referendum? Unfortunately, the percentage of Serbs disillusioned with the EU and the International Community in general and very willing to adopt policies of non-cooperation with it is significant and destined to rise even further in the months ahead. 
President Tadic in a letter to the Washington Post expressly linked his positive and statesmanlike response to Montenegrin Independence with the expectation that traditional Serbian concerns on Kosovo will be fully respected in any decision. What he is really doing in the letter, however, is conveying an elegant, subtle warning to the West. He is saying "Be careful what you do in Kosovo, because it is a choice of working in the future with moderates who want to move towards Europe or dealing with unreconstructed Radicals still using the rhetoric of nationalism and extremism." 
While this will certainly give diplomats and others knowledgeable about the Balkans significant reason for concern, it is unlikely to significantly change the dynamic of the Kosovo situation. The United States in particular remains determined to come to a decision on future status this year and have made it clear, as have other countries that the only real option that they see on the table is conditional independence. If there is any flexibility at all, it probably is only in the exact timing of the decision. An announcement of a firm date in the coming months for Serbian Parliamentary elections, for example, could lead the International Community to delay the decision on Kosovo status for a few months. 
The end result of the Montenegrin independence, however is that it has increased Serbian anger at the International Community and a feeling of isolation. This in turn is likely to lead to less cooperation from the Kosovo Serbs and a more aggressive Serbian response to any decision on conditional independence for Kosovo itself. It has also led to calls for a future referendum in the Republika Srpska. In sum, just when the International Community will be looking to Serbia to show maximum flexibility and cooperation in the face of the decision on the future status of Kosovo, the attitude in Serbia is probably the most negative it has been in the post-Milosevic period.

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TOURISM

Hundreds of millions to be invested in tourism 

Montenegro announced it will invest hundreds of millions of Euro in its tourist market, the B92 news agency reported.
Canadian millionaire, Peter Munk, plans on building a hotel complex, golf course, gallery and museum around Tivat for an investment expected to be about half a billion Euro.
Montenegrin Prime Minister, Milo Dukanovic, said that the basic message he is sending to investors is that a better standard is not possible without further development, and that development is not possible without investments, and investments are not possible without trust. Officials of the US Chamber of Commerce have shown interest in entering the Montenegrin market with several US funds as well, showing the greatest interest in the Plantaza and Telecom companies and the Budva Riviera.

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