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Balkan Report: February 1, 2002

1 February 2002, Volume 6, Number 7

MACEDONIA HAS A NEW LAW ON LOCAL SELF-GOVERNMENT, BUT... After months of intensive discussions, the Macedonian parliament approved a new law on local self-government on 24 January (see "RFE/RL Newsline," 22, 24, and 25 January 2002). The breakthrough came after the leaders of the four main political parties agreed -- at the urging of President Boris Trajkovski -- to pass the law in parliament.

The major points at issue included the possibility that neighboring municipalities could form a common administration under the provisions of the draft law. Ethnic Macedonians feared that this could ultimately lead to a federalization and partition of the country. The provision in question has now been replaced by one saying that municipalities are allowed to form joint administrations only in certain branches, such as education or health.

Other controversial points included the status and financing of local health care. Here, a compromise was found leaving basic health care to the municipalities, while control over health-insurance remains with the central state administration.

Most Western diplomats like the European Union's Javier Solana or German Foreign Minister Joschka Fischer hailed the adoption of the law as a major step toward a lasting peace in Macedonia. Some other Western observers suggested that the most important thing about the adoption of the new law is that it shows that the peace process is still alive and well.

Domestic politicians were less enthusiastic. While the reform went too far for many ethnic Macedonian politicians, some Albanian politicians wanted to grant even more rights to the local authorities. "There is no ideal law, but the one agreed upon represents a new willingness to decentralize the country," the spokesman for the ethnic Albanian Party for Democratic Prosperity (PPD), Zahir Bekteshi, told AP.

The so-called Block of Macedonian Parties from Tetovo asked the Constitutional Court to examine the autonomy law. Macedonian politicians from that chiefly Albanian town fear that the minority rights of Macedonians there are not protected by the new law.

Elsewhere, the Association of the Units of Local Self-Government -- the umbrella organization of the municipalities -- welcomed the legislation. But at the same time it added: "The law on local self-government is only the first in a whole set of laws that will follow,... especially the law on financing the municipalities."

Together with the above-mentioned law, there are about 30 laws slated to be adopted by the parliament in the near future. Many of them have to be modified as a consequence of the Ohrid peace agreement, and it is unlikely that legislators will pass all of them before the parliamentary elections, expected later this year.

The most important of these laws is the amnesty law. Many Albanians believe that the current amnesty decree issued by Trajkovski is not enough. During Solana's last visit, Prime Minister Ljubco Georgievski promised that there will be an amnesty law. The question is when and how it will come into effect. (Ulrich Buechsenschuetz,

ETHNIC ALBANIAN PARTIES IN MACEDONIA FORM COOPERATION COUNCIL. Iso Rusi, the editor in chief of the Albanian-language weekly "Lobi," published an article at the beginning of January calling for cooperation between the various ethnic Albanian political parties in Macedonia. Shortly after the article appeared, Rusi's vision materialized with the launch of the Coordination Council of the Albanians.

For many observers, this came as a surprise. Before the outbreak of violence in February 2001, the main ethnic Albanian political parties in Macedonia -- the Party for Democratic Prosperity (PPD) and the Democratic Party of the Albanians (PDSH) -- hardly spoke to each other. As was the case among their ethnic Macedonian counterparts, the parties were divided along ideological lines.

While the PPD cooperated with the former communists of the Social Democratic Union (SDSM), the more radical and anticommunist PDSH formed a coalition with the Internal Macedonian Revolutionary Organization-Democratic Party of Macedonian National Unity (VMRO-DPMNE) of nationalist Prime Minister Ljubco Georgievski.

The insurgency of the ethnic Albanian rebels of the National Liberation Army (UCK) led to a reshaping of the Albanian political landscape. A new political party was formed: the National Democratic Party (NDP) of Kastriot Haxhirexha. For some weeks, Macedonian media treated the NDP as though it were the legal arm of the UCK -- similar to Sinn Fein in Northern Ireland.

At the same time, both the PPD and the PDSH tried to take credit for the international community's pressure on the ethnic Macedonian politicians to end the crisis by granting more rights to the Albanian minority.

In August 2001, U.S. and EU mediators brokered a peace accord aimed at ending the armed insurgency. During the following weeks, NATO soldiers collected arms from the rebels. The UCK, for its part, declared its dissolution as of the end of September.

Very soon after the UCK disbanded, its political leader, Ali Ahmeti, announced that he was willing to take over an important role in politics. Opinion polls showed that he had the backing of large parts of the Albanian minority. But the polls also showed that Haxhirexha's party had replaced the PPD in second place after the PDSH, which is led by the charismatic but ailing Arben Xhaferi.

Ahmeti's plan to become a politician has so far been thwarted by the government's failure to pass an amnesty law. Such legislation would certainly enable him and other former UCK members to enter public life with greater confidence.

But the Albanian parties still feel Ahmeti's political presence. And it was Ahmeti who invited the party leaders to his stronghold, the village of Sipkovica, to form the Coordination Council.

Whether the main aim of the council -- the coordination of all political activities of the Albanian parties -- can be achieved depends on whether the party leaders can put aside other political agendas. As Rusi pointed out in his article: "If [UCK] structures take over organizational matters, there is room for optimism -- if for no other reason than because at first nobody believed that the [UCK] would ever become a political and military winner." (Ulrich Buechsenschuetz,

'NEW OPPORTUNITIES' FOR MONTENEGRIN INDEPENDENCE. Montenegrin parliamentarian Aleksandar Djurisic of the governing Democratic Party of Socialists (DPS) told a recent RFE/RL briefing audience in Washington, D.C. that the fall of Yugoslav strongman Slobodan Milosevic has offered his state "new opportunities" to gain full independence as a means of preserving Montenegro's heritage, freedom, and culture. At the same time, Djurisic emphasized Montenegro's interest in maintaining good relations with all of its neighbors, including Serbia (see "RFE/RL Balkan Report," 23 January and 14 December 2001).

Djurisic downplayed polling data that seems to indicate a lack of support for Montenegrin independence, citing polls by the Damar Agency in November and December that found that between 55 and 58 percent of the people in Montenegro favor independence. Djurisic also noted that opponents of a proposed referendum on independence -- who want Montenegro to maintain its current status as a member of what remains of the Federal Republic of Yugoslavia -- seek not to encourage supporters to vote "no" but rather to boycott the referendum altogether. "That's the only way [referendum opponents] can control their electorate," Djurisic said. "They don't trust their supporters" to vote against independence once they get to the polling station.

Djurisic argued that securing the economic viability of an independent Montenegro will be the job of its government, not its legislature. However, he noted that "no one has yet claimed that remaining in the [Yugoslav] federation would improve Montenegro's economic situation. Even if such a promise were made," Djurisic continued, "few Montenegrins would believe it."

Djurisic added that "the price was too high" in the early 1990s for Montenegro to follow Bosnia and Croatia in declaring independence from Milosevic and Yugoslavia. However, the image of Montenegro as a supporter of Milosevic was largely created by the media at that time, according to Djurisic. "Montenegro had only one state-owned television station, one state-owned radio station, and one state-owned newspaper" in addition to Serbian-based media, Djurisic said. He noted that this situation has changed dramatically over the past three to four years with the creation of 12 independent television channels and dozens of independent radio stations and publications throughout Montenegro. (RFE/RL News Release)

ALBANIA'S ECONOMY PROVES SLOW TO JUMP-START. International financial institutions have played a key role in Albania during its difficult transition decade. The World Bank has granted Albania loans totaling $400 million in support of 22 priority projects. These loans constitute 18 percent of all the international assistance that Albania has received since the fall of the communist regime in 1991.

In addition, the World Bank mission in Tirana disbursed $125 million to help Albania shelter hundreds of thousands of refugees from Kosova during Milosevic's crackdown in 1999.

The World Bank's mission chief in Tirana, Eugen Scanteie, praises the attitude of the Albanian government to date. "We are generally satisfied with the implementation of the portfolio of projects that the World Bank finances in Albania. And we are generally satisfied with the policy measures that the government is taking. Of course, we always have some problems. There is never [a time] without problems, but overall the assessment is favorable."

The governor of Albania's central bank, the Albanian State Bank, Shkelqim Cani, credits his country's economic successes to the polices of the World Bank and International Monetary Fund (IMF). He says Albania's administration is to blame for any possible failures. "In Albania, the two institutions' policies have been successful so far. Of course, the Albanian side knows the reality better, and it is an Albanian's obligation to better serve the specific needs of the Albanian economy."

Others take a more critical view. Gafur Muka is an Albanian consultant to a German assistance project, GTZ, and a former Albanian trade attache in Germany. Muka says the World Bank and IMF have not been able to activate the inner mechanisms of the local economy in Albania. "I guess that the problem in relations between our country and international [financial] organizations is the lack of [adequate] funds to mobilize economic domestic resources. Any action taken until now has been purely financial [rather than investment]."

Muka says these institutions have all but ignored Albanian experts. And he adds the databases on which policies were formulated have not been realistic and have failed to reflect actual priorities. Muka stresses that Albania's needs could best be met by establishing a Ministry of Economy. Domestic economic development is currently handled by the Ministry of Finance. "It's easy to observe that in all fields the living standard is declining, along with voices calling for economic growth. I think that globalization policies in certain countries should be implemented in accordance with the specific developing conditions."

Muka believes Albania's willingness to heed international advice is declining. In his opinion, this is a hostile reaction to the so-called "diplomacy of encouragement," a term international financial institutions use as they help a country overcome an economic crisis, such as the wave of anarchy that engulfed Albania in 1997. That crisis was sparked by the collapse of pyramid schemes, in which the regime of then-President Sali Berisha had encouraged Albanians to invest.

Bardhi Sejdarasi is an economic analyst and editor in chief of the Albanian financial magazine "Monitor." "Generally, the policies of international institutions in Albania have been efficient," Sejdarasi says. "But there are exceptions as well. Let me remind you of a recent report issued by independent experts of the European Union in Brussels, together with the European Commission office in Tirana. This report considered the international economic aid program implemented in Albania in the last 10 years a fiasco."

The International Monetary Fund's resident representative in Tirana, Volker Treichel, says the IMF is not responsible for Albania's economic policies but only aims at improving their quality. "We advise the government in the drafting process of financial economic policies. Generally speaking, the successes have been numerous, but there's still much to do."

Treichel notes that international financial institutions have not accepted any responsibility for Albania's economic collapse in 1997 as a result of the pyramid scandal. "The attitude of the IMF regarding this case has been extremely clear. We warned the government of the pyramid crisis in due time, but no proper reaction followed. We should admit in fact that our warning, considering the gravity of the situation, should have been stronger, tougher, faster -- and I might say, more efficient."

Sejdarasi claims the collapse of the pyramid schemes was not the unique failure of international assistance to Albania. "I would say that international institutions lost 10 years before they realized that Albania needs a development strategy. The first steps towards a strategy for the reduction of poverty and for economic growth have just been taken. Fulfillment of this goal is not yet visible beyond the efforts of the government infrastructure to implement this strategy."

Central bank Governor Cani stresses that Albania should improve many factors, starting with statistics. "It is nothing new to say what the Bank of Albania has declared -- that what Albania lacks is data. To make decisions, one should have some data. One should know the situation and then make a decision.

"It is nothing new to say that Albania has not yet elaborated detailed and clear strategies. The Albanian authorities are to blame. We came to life in 1991 and are talking in 2002. Ten years make us look relatively young. Therefore, it is natural to have shortcomings in growth. But on the other hand, 10 years are not so few."

Scanteie says that, independent of its share of errors, the World Bank has tried to respect the priorities of the country. In the early 1990s, the World Bank supported mass privatization, which he says is not something it would support today.

Scanteie, a Romanian-Canadian, says the World Bank mission in Tirana has adopted a new approach of broad consultation with the government and civil society on the content and orientation of its programs. Nevertheless, he says the Albanian economy's weaknesses remain significant. "If you look at the numbers, the growth of the Albanian economy is good -- 7 to 8 percent a year. But this growth is not what I would call a sustainable growth, in the sense that it is largely generated by construction and certain services which do not provide permanent jobs and incomes. We would like to see a lot more investments in agriculture, in agro-processing, in manufacturing, and in export-oriented activities."

World Bank and IMF officials say they will try to help Albania, and its private sector in particular, examine these questions. The World Bank notes that 70 percent of those with jobs in Albania are in fact underemployed. (Alban Bala)

QUOTATIONS OF THE WEEK: "This was a classic example of a dysfunctional parliamentary majority, and this issue has to be resolved." -- Dragoljub Micunovic of the governing Democratic Opposition of Serbia (DOS) coalition. He was speaking in Belgrade on 29 January after the lower house of the Yugoslav parliament failed to approve the government's nominee for finance minister (see "RFE/RL Newsline," 30 January 2002). Quoted by Reuters.

"The Croats' experience with the single Yugoslav People's Army [JNA] was painful, and we do not want that history to repeat itself." -- Niko Lozanic, a member of the presidency of the Herzegovinian Croatian Democratic Community (HDZ). Quoted by Hina in Mostar on 24 January. He was arguing for a Bosnian army "with three components" rather than a unified army.

"The longer I'm here, the more I'm convinced -- unless Karadzic ends up in The Hague, people will not be able to turn the page on the war and look towards the future. Eventual reconciliation will be impossible." -- High Representative Wolfgang Petritsch. Quoted by Reuters in Sarajevo on 24 January.

"The U.S. effectively claims that it has jurisdiction over everything, everybody, everywhere in the world and does not care what anybody says. The United States has no jurisdiction over these [six Algerians extradited by Bosnia]." -- Mark Wheeler of the NGO International Crisis Group. Quoted by AP in Sarajevo on 26 January (see "RFE/RL Newsline," 23 January 2002).

"We'll see about that." -- EU security policy chief Javier Solana, commenting on Montenegrin plans to hold a referendum in the spring on independence. Quoted by AP in Belgrade on 25 January.