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Newsline - April 9, 1997


President Boris Yeltsin yesterday assailed the government's persistent wage arrears and tax collection problems during a partly-televised meeting with Prime Minister Viktor Chernomyrdin. In a later radio address, Chernomyrdin said the government is making progress on paying wage and pension arrears. He promised that state employees would receive all back payments within two months and all pensioners would be paid by mid-July. Chernomyrdin told ITAR-TASS that wage arrears in the military have dropped from 1.1 trillion rubles ($192 million) and would reach 284 billion rubles ($49 million) by the end of April. He also warned that companies who are in debt to the Pension Fund would be forced into bankruptcy.


Yeltsin has issued yet another decree to fight corruption and reduce government spending, Russian news agencies reported yesterday. Under the decree, companies will be required to bid competitively for government contracts. In an interview with RFE/RL's Moscow bureau, Yabloko leader Grigorii Yavlinskii praised the idea of mandating competitive bidding. However, he said the vague wording of the decree would leave a "huge loophole" for corrupt officials who wished to continue to deal only with favored companies.


First Deputy Prime Minister Boris Nemtsov sharply criticized the management of the energy monopoly Unified Energy System (EES) for charging artificially high prices and increasing the company's staff by 40% at a time when output has dropped by 22%, Russian news agencies reported yesterday. Nemtsov said the government will not split the utility into regional companies but will carry out a strict audit and strengthen the government's role in managing EES, which is 51% state-owned. RFE/RL's Moscow bureau reports that the government has named six representatives to the managing board of the EES, including Minister without portfolio Yevgenii Yasin and First Deputy Finance Minister Aleksei Kudrin.


Nemtsov told reporters yesterday that by the end of this year, electricity tariffs for enterprises would be reduced by 13%. Yeltsin issued a decree yesterday that will gradually increase the cost of electricity for domestic consumers over the next three years, RFE/RL's Moscow bureau reported. Yavlinskii told RFE/RL that he expects the measure to worsen the non-payments crisis in Russia. Citizens who are not receiving their wages or pensions will be unable to pay higher electricity prices, he noted. Moscow Mayor Yurii Luzhkov supported the idea of reducing energy tariffs for enterprises in an interview yesterday with ITAR-TASS. However, Luzhkov questioned the government's other economic priorities, arguing that more emphasis should be placed on increasing domestic production rather than improving tax collection.


The State Duma Council has refused to include on today's agenda a speech by First Deputy Prime Minister Anatolii Chubais on budget fulfillment during the first quarter of 1997, RFE/RL's Moscow bureau reports. Instead, the council invited Chernomyrdin to report on the budget on 23 April. However, government spokesman Igor Shabdurasulov told RFE/RL that the government still intends to have Chubais deliver the budget address to the Duma. Opposition leaders in the parliament have repeatedly demanded Chubais's dismissal. Meanwhile, plans by the government to halt some non- essential spending because of revenue shortfalls are likely to meet with opposition in the lower house. First Deputy Duma Speaker Aleksandr Shokhin told ITAR-TASS yesterday that non-essential spending in some areas will have to be cut by 70-80%.


Yeltsin described the Duma's work as "unprofessional" during a meeting yesterday with Duma Speaker Gennadii Seleznev, RFE/RL's Moscow bureau reported, citing presidential spokesman Sergei Yastrzhembskii. Yastrzhembskii said the Duma routinely passes resolutions that violate constitutional norms or refer to issues beyond its area of competence. Seleznev told Yeltsin that Duma deputies have been unable to pay their assistants for three months because the Finance Ministry has not allocated funds to the lower house, ITAR-TASS reported. Also on 8 April, Yeltsin vetoed the law on opposition political activities, which was passed last month. He said the law violates the constitutional separation of powers.


Deputy Prime Minister Oleg Sysuev has confirmed that he will head the Labor Ministry following the resignation last week of Gennadii Melikyan, RFE/RL's Moscow bureau reports today. Yeltsin has accepted the resignation of Fuel and Energy Minister Petr Rodionov, ITAR-TASS reported yesterday. Rodionov told the agency he will probably become deputy head of the board of the gas giant Gazprom. Aleksandr Samusev, vice president of the Rosprom-Yukos company, has turned down the fuel and energy portfolio, citing unspecified medical problems. Following the appointment of Sergei Ignatev as first deputy finance minister, there is widespread speculation in the Russian media that First Deputy Finance Minister Andrei Vavilov is next in line for dismissal.


Foreign Minister Yevgenii Primakov said yesterday that Moscow is concerned about "NATO infrastructure advancing toward Russia's borders," Reuters reported. He called on NATO to pledge not to build military facilities in new member countries. After meeting with his French counterpart, Herve de Charette, and Prime Minister Alain Juppe in Paris, Primakov told reporters that the main sticking point in negotiations over an agreement between Russia and NATO is Russia's demand that NATO not build facilities in new member states that would allow the deployment of the alliance's forces. Juppe expressed hope that Russia and NATO could sign a charter in May. Primakov noted that Russia remains strongly opposed to NATO expansion but believes a charter could minimize the adverse consequences of expansion for Russia.


At a meeting yesterday with Rafik al-Hariri, Yeltsin expressed concern about "flare-ups of confrontation" in southern Lebanon and about Israeli construction in Arab-inhabited East Jerusalem, according to presidential spokesman Yastrzhembskii. On 7 April, Al-Hariri, the first Lebanese prime minister to visit Moscow, called on Russia to help restart the stalled Middle East peace process. Foreign Minister Primakov promised that Russia will soon advance new proposals on a Middle East settlement. Also on 7 April, Al-Hariri and Prime Minister Chernomyrdin signed accords on trade and economic and scientific cooperation, while Russian and Lebanese finance officials signed an agreement on avoiding double taxation.


Moskovskii komsomolets and Komsomolskaya pravda have both accused First Deputy Prime Minister Chubais of misappropriating millions of dollars, but government spokesman Igor Shabdurasulov told ITAR-TASS yesterday that the reports are based on forged documents and other fabricated materials. Meanwhile, Izvestiya has apologized for reprinting an article from Le Monde suggesting that Chernomrydin has accumulated $5 billion while in office. Le Monde has since said its article incorrectly cited CIA and FBI officials as making the claims about Chernomyrdin's wealth. Kommersant-Daily argued yesterday that the orchestrators of an "anti-Chernomyrdin campaign" fed the material on the prime minister's alleged fortune to Le Monde because Russian media were afraid to "test the premier's strength" themselves.


For the third time, Yeltsin has nominated his legal adviser Mikhail Krasnov to the Constitutional Court, Russian news agencies reported yesterday. The Federation Council rejected Krasnov twice in late 1994. The court's former chairman, Vladimir Tumanov, stepped down in January, having reached the mandatory retirement age of 70. Last month the Federation Council rejected Mikhail Fedotov, Russia's representative to UNESCO, who was Yeltsin's first choice to fill the vacancy.


Aslan Maskhadov met with a Georgian parliamentary delegation yesterday to discuss bilateral relations and the ongoing conflicts in Abkhazia and South Ossetia, Nezavisimaya gazeta reported. Georgian President Eduard Shevardnadze has been pursuing closer ties with Chechnya for several months. Meanwhile, Maskhadov has named Ruslan Kutaev, leader of the Chechen National Independence Party, as his special aide with responsibility for state policy, strategic defense, and diplomacy, ITAR-TASS reported yesterday. Maskhadov is scheduled to leave Grozny today on the first of seven Saudi-financed flights transporting 650 Chechen pilgrims to Saudi Arabia.


Trade between Russia and Turkey in 1996 totaled $15 billion, a senior Turkish diplomat in Moscow told Interfax on 7 April. This is $11 billion more than the official figure. Tanzer Guven said that shuttle trade by Russians, construction, and tourism explain the discrepancy between the two figures. He also noted that, even based on the official $4 billion figure, Russia is Turkey's third most important trade partner, after Germany and Italy, and has "no rivals as a trade partner among Russia's neighbors." He predicted that Turkish investment in Russia would expand significantly once the political and economic situation there stabilized.


Armenian forces opened fire on four unidentified men trying to cross the border from Azerbaijan earlier this week, AP reported yesterday. Two men were killed, while the others retreated. Although there are exchanges of fire along the Armenian- Azerbaijani border almost every month, this is the first time in over a year that casualties have been reported. Meanwhile, the Azerbaijani parliament has sent a letter to the CIS Inter- Parliamentary Assembly arguing that Russia's policy of clandestinely supplying arms to Armenia shows it cannot be an impartial mediator in the Karabakh conflict, according to Interfax yesterday. Addressing a news conference in Yerevan yesterday on the OSCE-mediated Karabakh talks in Moscow last week, Armenian First Deputy Foreign Minister Vartan Oskanian said the Azerbaijani negotiating position has hardened, making progress unlikely.


Kyrgyz President Askar Akayev and his Kazak counterpart, Nursultan Nazarbayev, have signed agreements on military cooperation, avoidance of double taxation, cooperation in attracting foreign investment, environmental protection, and agricultural reforms, RFE/RL correspondents in Kazakstan reported. The two ministers were meeting in Almaty yesterday. Of particular importance for Kyrgyzstan was a deal to receive annually 1 million tons of Kazak oil. Kazakstan has agreed to have uranium refined at the Kara-Balta plant in Kyrgyzstan, while Kazak specialists will help in the construction of a hydro-electric project in the Pamir Mountains.


President Saparmurat Niyazov told the government on 7 April that it is has 1,000 days to make far-reaching improvements in several sectors of the economy, RFE/RL's Ashgabat bureau reports. Niyazov's program envisages 10% annual growth in GDP through increased natural gas and oil exports, the completion of pipeline projects, and an increase in cotton production, which he wants to reach 2 million tons annually by the year 2000. Several ministers were shuffled after the announcement, most notably those responsible for natural gas, oil, and pipeline construction.


Following his meeting in Minsk yesterday with Belarusian President Alyaksandr Lukashenka, Yevgenii Primakov told Interfax that the Belarusian-Russian union involves only "deeper integration between two sovereign states." But he added that the extent of the union will be determined by the peoples of the two states in the future rather than now. The draft of the union charter was published today in the official Russian and Belarusian press for public discussion. Lukashenka told reporters that opponents of integration are making a mistake by insisting on a discussion of the document. He said "the charter only specifies but does not develop the idea of Russian-Belarusian union." While in Minsk, Primakov told an international conference on the creation of a nuclear-free zone in CENTRAL AND EASTERN EUROPE that one of Russia and Belarus's main tasks is "minimizing the impact of NATO's eastward enlargement."


The U.S. Embassy in Minsk says the U.S.-based charity CitiHope is suspending its humanitarian aid activities in Belarus because the authorities have seized nearly $350,000 from the bank account of its partner, Nadezhda Express, and is refusing to return it, Belapan reported. The embassy says the seizure is a clear violation of a U.S.-Belarusian assistance agreement. CitiHope says it has delivered millions of dollars worth of food and medicaments to needy Belarusians and regrets the government's action. Belapan reports that if the government returns the money, CitiHope will consider restarting its program.


Ukrainian President Leonid Kuchma has appointed commercial bank chief Serhey Tihipko as a deputy prime minister, Reuters reported. Tihipko replaces Viktor Pynzenyk, who had been in charge of economic reforms until his resignation last week. Presidential spokesman Dmitro Markov said the decree appointing Tihipko does not outline his duties.


State Nuclear Committee Deputy Chairman Vasyl Katko says Ukraine's nuclear power plants will be unable to afford annual repairs this summer because energy consumers are not paying their bills, RFE/RL reported. Katko estimates that Ukraine's five nuclear stations can undertake only 30% of the necessary repair work. Interfax quotes Environment and Nuclear Safety Minister Yuri Kostenko as describing the safety situation at the country's nuclear power plants as "unsatisfactory." He told the parliament yesterday that the safety of the concrete sarcophagus covering the fourth reactor at Chornobyl has deteriorated because of moisture buildup, insufficient monitoring, and inefficient contingency plans for a chain reaction. The ministry's nuclear control administration says the number six reactor at the Zaporozhye atomic power station was switched off yesterday because of a malfunction in the reactor unit, UNIAN reported.


Latvia has proposed to Lithuania that the two countries build an oil pipeline between Mazeikiai in Lithuania and Ventspils in Latvia, BNS reported yesterday. Janis Blazevics, president of the state oil terminal Ventspils Nafta, told reporters that Lithuania has not yet responded to the proposal. Meanwhile, Ventspils Nafta is ready to reach an agreement with Western companies on prospecting for oil in the Latvian sector of the Baltic Sea, according to Blazevics. The Latvian government signed an agreement in October 1995 with the U.S. oil concerns AMOCO and OPAB on prospecting for oil in the Baltic Sea. The parliament has ratified the document, but it can take effect only after Latvia and Lithuania have agreed on their common sea border.


Lithuanian parliamentary speaker Vytautas Landsbergis told RFE/RL in Washington yesterday that he has urged senior U.S. officials to support his country's application for NATO membership. Russia, Landsbergis said, is the "only obstacle" to Lithuania's admission to the Western alliance. He added that if Lithuania is not included in the first round, he hopes the U.S. will provide expanded bilateral as well as multilateral guarantees. So far on his U.S. tour, Landsbergis has spoken to Lithuanian Americans in Chicago and met with Secretary of State Madeleine Albright and Vice President Al Gore.


President Aleksander Kwasniewski has been assured of Italy's support for Poland's entry into NATO and the EU, RFE/RL's Warsaw correspondent reports. Italian Foreign Minister Romano Prodi told journalists after his meeting yesterday with Kwasniewski that he would like "to clarify once and for all that Italy's position is in favor." Poland is expected to be invited to begin negotiations on NATO entry at the alliance's July summit in Madrid. Meanwhile, Polish Foreign Minister Dariusz Rosati said after his talks with Vatican officials yesterday that Poland's ratification of the 1993 Concordat with the Vatican "is very likely."


ECONOMIC GROWTH? Prime Minister Vaclav Klaus's economic advisers have blamed the Czech National Bank for the slowdown in economic growth, a rising foreign trade deficit, and budgetary difficulties. Martin Kocourek and Jiri Weigl said on Czech TV yesterday that the CNB's restrictive monetary policy last year was "premature" and "excessive." That policy aimed at reducing currency in circulation and suppressing inflation. Klaus told Czech Radio that the March annual inflation figure of 6.8% is a "very good result" but said he would never give priority to a single indicator at the expense of all others.


The Slovak Foreign Ministry has recalled its ambassador to Prague in connection with the dispute over recent comments by Czech President Vaclav Havel, TASR reports today. In an interview last month with the French daily Le Figaro, Havel had said that Slovak Prime Minister Vladimir Meciar was "paranoid" in his belief that Slovakia is being discrimated against in NATO expansion. The Slovak government yesterday called on Havel to apologize to Meciar, saying his remarks were a "gross violation of the basic rules of decency." Slovakia is unlikely to be among the first wave of countries invited to join the alliance. Havel is currently on vacation in the Italian Alps. His spokesman says it is unclear how he will respond to the Slovak government's demand.


Laszlo Kovacs says Hungary is not seeking protection from NATO but rather the benefits of belonging to an expanded zone of stability, Hungarian media reported. Kovacs was speaking yesterday at a meeting with representatives of civic organizations. A recent Gallup poll shows that only 47% of the Hungarian public supports NATO membership. Support among the military, however, stands at 57%, according to the poll. Meanwhile, Kovacs also said the scandal over anti-Semitic remarks made in the parliament by Smallholders Party Deputy Chairwoman Agnes Nagy Maczo sheds poor light on Hungary. He added that the main problem is that she is defended by her own party, while "other opposition parties failed to clearly distance themselves" from her comments.


The Italian government faces a tough test today when the lower house of the parliament votes on a proposal to deploy an Italian-led security force in Albania. Italy's upper house yesterday approved the plan, but Romano Prodi's government does not have a majority in the lower house. His allies there, the Refounded Communists, oppose Operation Alba as colonialist and as aimed at propping up the government of President Sali Berisha. The center-right opposition approves of the force in principle but has introduced its own bill with the aim of forcing Prodi to resign.


In Rome yesterday, Prodi and Italian Deputy Foreign Minister Piero Fassino distanced themselves from Fassino's earlier remarks that Berisha should resign. The Albanian Foreign Ministry in Tirana sent two protests to its Italian counterpart. One note slammed Fassino's statement as interference in Albanian affairs, while the other demanded a clarification of the remarks. The Italian deputy minister had openly criticized Berisha in hopes of winning the Refounded Communists' backing in the lower house for Prodi's bill on Operation Alba. The communists welcomed Fassino's remarks against Berisha but said he did not go far enough.


A Greek government spokesman said in Athens yesterday that most of the more than 700 Greek troops for Operation Alba will go to Tirana. At least 100 soldiers will head for the port of Vlora in the south, which has been a hotbed of lawlessness. Greeks troops will not be deployed in southern regions with a large Greek minority.


A State Department spokesman said in Washington yesterday that eastern Slavonia's Serbs should vote in the 13 April elections to ensure a stake in Croatian political life. He noted that this is the first post-war vote in which the region's Croats and Serbs will cast their ballots together. But in Vukovar yesterday, the local Serbian assembly put off its decision on whether to participate in the elections. The Serbs are holding out for more political concessions from the Croats. The UN has often told them to be satisfied with the package of rights promised by Zagreb for when the area rejoins Croatia in July.


Amid much military pomp and circumstance, Croatian President Franjo Tudjman yesterday opened the Maslenica bridge, near Zadar, to link northern and southern Dalmatia. He told the crowd that they have his Croatian Democratic Community (HDZ) to thank for Croatia's achievements, Vjesnik reported. Serbian shells destroyed the original bridge in 1991, but the Croatian authorities quickly replaced it with a pontoon structure. In Croatia, the bridge has come to symbolize national unity and defiance of the Serbs. Novi list, for its part, accuses the HDZ of using misleading TV advertisements to suggest that the Roman Catholic Church backs that party. Polls suggest that the HDZ is in trouble, and the party is making use of national symbols to try to regain popularity.


Milo Djukanovic in Podgorica yesterday defied orders from President Momir Bulatovic last week to sack three ministers who had openly criticized Serbian President Slobodan Milosevic, RFE/RL reported. Djukanovic admitted that Deputy Prime Minister Slavko Drljevic, Culture Minister Goran Rakocevic, and security chief Vukasin Maras should have been more careful in their public statements. But he stressed that it is he, not the president, who determines the government lineup. The row between the president and prime minister mirrors tensions in the governing Democratic Socialist Party and in society as a whole over Montenegro's relations with Milosevic and Serbia. Many politicians charge that Milosevic's policies have brought economic hardship to the tiny mountain republic, which depends on tourism and shipping for its livelihood.


Zajedno coalition leader Vesna Pesic told her colleagues Vuk Draskovic and Zoran Djindjic yesterday to stop feuding lest their fighting hurt the opposition politically, RFE/RL reported from Belgrade and New York. Djindjic blames the regime for stirring up the feud and says that he never challenged Draskovic's plans to run for the Serbian presidency. Djindjic also called for an end to public squabbling among opposition leaders. Draskovic had earlier accused Djindjic of trying to split the coalition. The three have just wrapped up their visit to the U.S.


Caretaker Prime Minister Stefan Sofiyanski has warned members of the United Democratic Forces (ODS) not to be complacent about winning a big enough majority in the parliamentary elections scheduled for 19 April, Reuters reported yesterday. Sofiyanski said the ODS should work hard to win a majority large enough to form a government and continue reform policies. He added that one of the new government's first tasks would be to pass the legislation needed to set up the IMF-proposed currency board. A Bulgarian delegation in Brussels continues discussions today with the G-24 group of industrialized countries on additional support to accompany an IMF stand- by loan. Bulgaria and the IMF reached agreement on the loan last month.


The Bulgarian interim government and representatives of the Russian Gazprom company have initialed an agreement on constructing gas pipelines that will transit Bulgarian territory and on Russian gas supplies to Bulgaria, RFE/RL's Sofia bureau reported yesterday. The Bulgargas company will be the owner and financer of the new pipelines, while the Bulgarian- Russian joint venture Topenergy will finance and build them. The Bulgarian government and the Russian delegation agreed "in principle" that some Russian gas supplies will be paid for by Bulgarian goods. Bulgarian caretaker Prime Minister Stefan Sofiyanski and Russian Prime Minister Viktor Chernomyrdin are scheduled to sign the agreement in Moscow later this week.


Poul Thomsen, chief IMF negotiator for Romania, says he is satisfied with the government's fiscal, budgetary, and monetary policies, RFE/RL's Bucharest bureau reported. Thomsen said after his meeting with Premier Victor Ciorbea yesterday that he is confident inflation will begin to drop in the near future. But Radio Bucharest later quoted Thomsen as saying it is "premature" to asses the success of economic reforms to date. Thomsen is in Bucharest for a final round of discussions on a new stand-by loan for Romania. The IMF is scheduled to take a decision on the loan later this month.


George Paunescu is under investigation by the Prosecutor-General's office. In an interview with RFE/RL's Bucharest bureau yesterday, Prosecutor Gheorghe Mocuta said Paunescu was suspected of having bought shares in a bank using credits from another bank, which is illegal under Romanian law. He has not yet been charged with any crime. Paunescu is known for his ties to leading officials in the regime voted out of power last autumn.


Petru Lucinschi says the country's army will given a "non-political, neutral" status, Interfax reported yesterday. Lucinschi was speaking at a meeting of the state commission in charge of drawing up and implementing military reform. As head of state, Lucinschi is also army commander in chief. Lucinschi instructed the commission to draw up a reform concept based on the models of Austria, Switzerland, Slovenia, and Slovakia. According to Interfax, Moldova has some 10,000 servicemen, but their number is expected to be reduced.

Bosnia Five Years On
by Patrick Moore

This week marks the fifth anniversary of the start of the war in Bosnia-Herzegovina. The Bosnian Serb forces launched that war in close coordination with Belgrade, if not on direct orders from the federal Yugoslav military and political leaderships. Their goal was to destroy the multi-ethnic community that had existed for centuries and take the lion's share of the land and riches for a Greater Serbia. Their means were not just conventional warfare but also a systematic policy of "ethnic cleansing" to force people who had lived together in relative harmony into three mutually antagonistic, ethnically based statelets. To this end, the Serbs appear to have had at least a tacit understanding with the Croatian nationalist leaderships in Zagreb and in Herzegovina.

The aggressors also had the de facto assistance of the international community, which refused to intervene before the partition of the country was more or less complete. The foreigners talked themselves into inaction by repeating mantras that claimed the war was the inevitable result of "ancient ethnic hatreds" and that all parties were equally to blame. This was the accepted truth particularly in West European capitals. But neither in Europe nor in the U.S. was public opinion willing to support armed intervention to stop aggression--despite the fact that all major powers had experts in Yugoslav affairs, who could have cleared up the myths, and despite what the 1930s had taught about the dangers of ignoring or appeasing aggression.

A change did not come until 1995. That year, NATO's use of air strikes and the no-nonsense Rapid Reaction Force in response to Serbian atrocities combined with a joint Croatian- Muslim ground offensive to destroy the myth of Serbian invincibility. Bosnian Serb troops were sent reeling and Serbian lines crumbled. Meanwhile, economic sanctions had taken their toll on the Serbian economy. Serbian President Slobodan Milosevic, the architect of the destruction of Tito's Yugoslavia, decided to go to the conference table under the effective prodding of U.S. Assistant Secretary of State Richard Holbrooke.

The result was the Dayton agreement, which the three parties signed in December 1995. Its military provisions were clear, and NATO was determined to enforce them. Accordingly, major fighting stopped, the forces disengaged, and NATO launched a program to register and monitor the respective armies' weapons. The U.S. also dismissed European worries about helping any of "the warring parties" and began to build up the armed forces of the shaky Croatian-Muslim federation to deter future Serbian aggression.

But if Dayton was clear on military issues, it was very woolly on civilian ones. There was, in fact, a possibly fatal contradiction from the very outset. On the one hand, Dayton recognizes the principle that Bosnia-Herzegovina is a united, multi-ethnic country. On the other, the treaty provides no teeth for enforcing this point, so that nationalists have been able to consolidate their hold in the areas under Serbian, Croatian, and Muslim control.

Thus, virtually no refugees belonging to any one ethnic group have gone back to their homes in areas controlled by another ethnic group. In another clear violation of the Dayton agreement, freedom of movement across the inter-ethnic boundaries remains, at best, a joke. Thugs of all three nationalities continue ethnic cleansing unpunished, and major and minor war criminals are still on the loose, often holding good jobs and remaining in public view. Elections last September returned the three nationalist parties to power in their respective fiefdoms and thus only served to reinforce the divisions along ethnic lines. Moreover, the central institutions that Dayton set up have proved as weak and vulnerable to nationalist sabotage as were their Tito-era predecessors.

But beyond that, the nationalists face big difficulties, starting with economic ones. True, some powerful people on all three sides made fortunes in war profiteering, and the political, military, and criminal worlds often overlap. But unemployment is a problem everywhere, and the Republika Srpska is so impoverished that its per capita income is just $35 per month.

Each side has political problems as well. The Serb leadership is split by a series of internal feuds centering on power and money rather than on ideology. The Muslims are divided between leaders who would prefer a small but "pure" Islamic state and those who argue that the Muslims' only future lies in a large multi-ethnic community. And among the Croats, some groups are happy to withdraw into their ethically homogenous Herzegovinian heartland, which borders on Croatia. Others favor cooperation with the Muslims lest the Serbs some day divide and rule the Croats and Muslims, who fought a short but bitter war against each other in 1993.