E.U. plan to rebuild Yugoslavia's economy

By Batuk Gathani

BRUSSELS, APRIL 3. Following the arrest of the former Serbian leader, Mr. Slobodan Milosevic, there is speculation in the European Union about the future of Yugoslavia.

The Balkan country is still rated as a key power in the region. With Yugoslavia's democratic institutions reformed and liberalised, Belgrade's membership of the E.U. and NATO is considered a probability.

Many Europeans are wondering if Mr Milosevic will ever face the International Court in Holland to answer charges of ``war crimes''.

It is also argued that ``pragmatists'' in the Bush administration and the E.U. appear to have won the day, with simultaneous announcements in Washington and Brussels of plans to continue economic aid to Yugoslavia.

The American and European aid packages have been approved on the premise that the elected Government of Yugoslavia ``keeps its democratic record clean'', amid E.U.-American pressure for extradition of the Serbian leader to the International Court. For diehard Serbian nationalists and members of the former Yugoslavian Communist or Socialist party, this issue evokes strong sentiments about their country's sovereignty.

The Yugoslavian President, Mr. Vojislav Kostounica, is not likely to ``hand over'' Mr. Milosevic to the International Court, at least not in the immediate future.

To start with, the Serbian prosecutors are preparing their case on the premise that the former President, his family and allies who ruthlessly ruled Yugoslavia for 13 years, could be charged with corruption, abuse of power, inciting violence and resisting arrest. The trial is slated to be the most dramatic and longest in Yugoslavia's history.

The European Commission is preparing to release a fresh $ 133- million aid package for Yugoslavia. This is rated as an ``emergency aid'' following the arrest of Mr. Milosevic. According to E.U. officials, Serbia is also due to receive euro 240 millions in aid this year. The European officials are simultaneously working on a plan to restructure Yugoslavia's $ 12-billion plus debt owed to international institutions and commercial lenders. Yugoslavia stopped repaying its debt in 1992.

Ten years of ethnic war has left the country's economy in ruins. Yugoslavia's public debt to GDP ratio is currently 175 per cent and it needs to have large chunks of debt written off if it is to regain economic health.

Mr. Milosevic fell from power after the general elections on September 24. Most of the Opposition parties then endorsed the candidacy of Mr Kostounica, leader of the single largest Opposition party.

The present day Yugoslavia, with a population of just over a crore, consists of two republics - Serbia and Montenegro. Tension has been rising between Belgrade and the pro-Western Government of President Djukanovic of Montenegro who refused to take part in the September general elections. Mr. Djukanovic has argued that recent changes in the Yugoslavian Federal Constitution have provided Serbia with an unequal clout in terms of political and economic power.

The Western world was in a quandary as the U.S. and its NATO allies, often wondered whether Mr. Milosevic can be rated as part of the solution in Kosovo or alternatively he was a major part of the ethnic problem. Such a debate was both emotive and divisive.

Kosovo, which is a `province' of Serbia, is currently ruled by U.N. peace-keepers. Many Albanians in Kosovo are now demanding full independence from Belgrade, as Serbia accuses Albania of fuelling the ethnic war in a quest to create a ``greater Islamic Albania''. Traditionally, Russia and Greece are rated as ``real allies'' of the Serb nation. Senior Russian officials and Ministers visit Belgrade regularly and Greece eased the burden of international blockade on the country. The U.S.- initiated NATO air strikes against Yugoslavia two years ago were bitterly opposed by Russia, France and Greece. Moderate NATO allies like Germany, then had ``second thoughts'' about launching air strikes.

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Section  : International
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