Balkan Report: April 24, 2001

THE BALL IN BELGRADE'S COURT. The Montenegrin parliamentary elections of 22 April indicate that the ethnic Montenegrin electorate is split almost evenly between those favoring independence and those wanting to maintain links with Belgrade. Since President Milo Djukanovic failed to get the ringing endorsement for independence that he wanted, attention now centers on what inducements the Belgrade leadership will offer Montenegro to maintain the joint state.

The parliamentary elections have given Djukanovic's Victory for Montenegro coalition a less than two-point lead over its rival, Together for Yugoslavia. Djukanovic will be able to form a majority government only with the help of the often strong-willed, pro-independence Liberal Alliance and of ethnic Albanian deputies.

One item on the new parliament's agenda will be to call a referendum on independence and set the rules for such a ballot. But Djukanovic may now be in no hurry to press ahead on that issue. Given that polls had suggested that he would do much better in the parliamentary election than in any referendum, the chance for success of a referendum now seems less likely than it did before the 22 April vote.

Another thing that the polls suggested about a referendum was that the wording and options it contains will be crucial to its success or failure. What kind of options Montenegro now faces -- with or without a referendum -- now largely depend on what Belgrade is or is not prepared to offer.

The crux of the problem has been that, to maintain a joint state, Djukanovic has insisted on the full equality of what would be two independent states, which would agree on setting up certain joint institutions. But no Serbian politician can agree to full equality, given that Serbs outnumber Montenegrins by something like ten-to-one. Serbian Prime Minister Zoran Djindjic recently said, moreover, that if Montenegro wants independence, then it must take independence and not expect to negotiate any special links with Serbia.

Indeed, Djukanovic has not always been clear about what arrangements he would be prepared to accept with Belgrade, if any, to maintain a joint state. (In fact, in recent months he has increasingly stressed the need for independence.) At times the Montenegrin leadership has said it would agree to a joint foreign policy, but Podgorica also insists that both Serbia and Montenegro receive international diplomatic recognition and have their own seats in the UN. Djindjic and others have called this unacceptable. Podgorica has spoken of the possibility of a joint army with Belgrade, but has attached a series of conditions such that in practice it would have its own national army under Montenegrin command. And as to finances, there can be no serious talk of any joint financial arrangements so long as Serbia uses the dinar and Montenegro has the German mark as its currency.

With the Montenegrin electorate evenly split over its age-old dilemma regarding their mountainous republic's relationship to Serbia, the time seems to have arrived for creative, statesmanlike offers from Belgrade aimed at tipping the balance. Many politicians in the Serbian capital have been telling visitors that regional stability and Serbia's prosperity require the unity of Serbia and Montenegro. Well, now a situation seems to have arisen that calls for Serbian leaders to show what they can offer Montenegrin voters in order to carry the day.

The circumstances call for a positive and conciliatory approach. Attempts to humiliate Djukanovic could prove counterproductive for Belgrade in the eyes of the Montenegrin electorate. The same could be said about attempts to create a climate of fear, as Yugoslav President Vojislav Kostunica did in recent weeks in his frequent suggestions that Montenegrin independence would lead to a wave of perhaps violent attempts to set up new, small states across the region.

Those remarks were aimed primarily at winning the sympathy and political support of the international community, which seems to have developed something of a phobia about the emergence of new states in the region. This is despite the fact that Montenegro has a very old tradition of statehood and that, as a federal republic of the still disintegrating former Yugoslavia, it has just as much a right to independence as Slovenia, Croatia, Bosnia, and Macedonia -- or Serbia. And this is also despite the fact that, regardless of what may or may not happen in Montenegro, the overwhelming majority of Kosovars have already made it clear that they want nothing more to do with Belgrade.

Immediately after the 22 April Montenegrin elections, some observers began suggesting that time has come for the international community to drop its recent talk about using "leverage" on the Montenegrin leadership not to make "hasty" moves toward independence and instead stress bringing Belgrade and Podgorica around to serious talks about the future.

German Foreign Minister Joschka Fischer said that "Belgrade and Podgorica are now called on to begin serious talks about their joint future immediately, with the goal of renewing relations based on democratic principles in accordance with the existing constitutional order and heeding regional stability." London's "Financial Times" quoted an unnamed EU diplomat as saying that "we really should be as neutral as possible. We cannot afford to have the results of this election fan separatist claims in the region. It is now up to [Yugoslav President Vojislav] Kostunica to choose which cards he will play." (Patrick Moore)

THE LEGACY OF MILOVAN DJILAS. Just over six years ago, Milovan Djilas died in Belgrade at the age of 85. He was the man who coined the term "new class," which helped to explain both the nature of communism and also the reasons for its largely nonviolent collapse.

Born in a Montenegrin village in 1911, Djilas joined the Communist Party and rose to become a close associate of Yugoslav Partisan leader and later President Josip Broz Tito. But the latter's break with Soviet dictator Joseph Stalin in 1949 set Djilas on a very different course, one that would lead not only to prison but to the elaboration of one of the most significant critiques of the communist system.

The Soviet-Yugoslav split led Djilas to three major conclusions: first, that communism in the Soviet bloc had become little more than Russian imperialism under an ideological cover; second, that he could exploit his ties to the Western press to criticize communism from within; and third, that communism as actually practiced had led to the rise of "a new class" of rulers, people more interested in their own privileges than in the ideals they professed to believe in.

Djilas' understanding of the nature of the Soviet bloc did not put him at odds with Tito. Indeed, in many ways Djilas simply expressed in more intellectual language the tensions between Belgrade and Moscow. But precisely because he was an intellectual, Djilas pushed this idea to its logical conclusion and argued that national independence and a unique national approach to socialism were absolutely necessary for progress.

That idea was not only dangerous in multinational Yugoslavia but a direct threat to the power of Tito and his entourage. As a result, in 1954, Tito accused Djilas of factionalism, and Djilas in turn semi-apologized and turned in his Communist Party card and became a lifelong dissident.

In that role, Djilas pioneered a technique which was to be used by others who found themselves trapped within communist regimes. Under attack at home, Djilas did something few had ever had the courage to do before: he gave an interview to "The New York Times," both in order to get his own ideas out and also to use the Western press as an ally against his own government.

That move did not keep him from mistreatment at the hands of that government -- he later spent nine years in prison -- but it did give him time to elaborate the ideas which became his most important book, "The New Class," which was published abroad in 1957.

In that study, Djilas argued that the communist regimes had degenerated from an ideologically committed elite into a group of greedy individuals concerned only about their own privileges and status. Djilas' conception built on the earlier ideas of Jan Machajski and James Burnham, but his invention of the term "new class" caught the imagination of many in both communist countries and the West.

Djilas' basic point became part of the critique of the system by dissidents across Eastern Europe and the Soviet Union, and it generated such later studies as Michael Voslensky's 1980 classic, "Nomenklatura," which described in greater detail the nature of the new and ever less ideologically committed power elite in the USSR.

Because Djilas understood the nature of communist regimes so well and was not blinded by their ideological protestations, he recognized that the ruling classes of these countries would ultimately understand that to survive and prosper they would have to shed their ideological shackles. In one of his last essays, Djilas wrote that the end of communism in Europe had been so quiet precisely because "communism had overthrown itself."

Like many prophets, Djilas saw the details of his argument ignored both when he made his predictions and when they came true, and most analysts in both East and West have forgotten what he said about the nature of the new class. Were they to pay more attention to his words of four decades ago, they would almost certainly understand far better why many members of the new class have continued in power, albeit without the ideological verbiage of communism.

And they would also understand better why the greed of the new class has become even less constrained now that its members no longer have to pay even lip service to the ideals of justice and equality. (Paul Goble)

THE LION FLIRTS WITH THE EAGLE: BAVARIAN BUSINESS INTERESTS IN SERBIA. "And the people at the tables round about one come from the same kitchen: rich feeding, not too digestible, but not at all insipid. Some of them, indeed, are definitely indigestible, beings of ambiguous life, never engaged in any enterprise that is crystalline in quality." These are some of Rebecca West's impressions on a journey through Yugoslavia in the 1930s. The British author's book was first published in the U.S. in 1941. West, who was usually sympathetic towards Yugoslavia and Serbia, nevertheless noticed the criminal energy of some Belgrade business people.

Sixty years later, in Milosevic's Serbia, criminal elements were always present in daily life and deeply involved in politics. Corruption and political murder were part of the landscape. After Milosevic's downfall in October 2000, the gangsters "lost their protection and are now thought to be turning to more daring crimes such as kidnapping," as the "Daily Telegraph" put it on 11 April.

Serbia is one of the poorest countries in the former communist world, and it is possible that it is sliding "towards the post-Soviet Russian scenario of unbridled mob-sponsored capitalism," as the London daily put it.

Undoubtedly, Serbia needs financial support and foreign investment. But an economy is not driven by democratic zeal and altruism. And members of the old Milosevic regime are still active in political life.

The former leader himself is in Belgrade -- albeit in prison -- and there is no political consensus among Serbs to send him to the war crimes tribunal (see "RFE/RL Balkan Report," 13 April 2001). Radovan Karadzic and General Ratko Mladic, who are two of The Hague's most wanted war criminals, are still free.

But all these facts are unimportant for business, which is interested primarily in bottom-line results. Many foreign businessmen are looking to Serbia as a possible venue for trade and investment now that Milosevic is out of power and his wars are over.

One important area of cooperation is management training for Serbian businessmen. German experts have long recognized that Serbia's economy must be thoroughly modernized from the ground up, and that this first and foremost means that those engaged in business must abandon old habits and attitudes (see "RFE/RL Balkan Report," 12 November 1999).

These are plenty of reasons for the German state of Bavaria in particular to renew its economic ties to Serbia. After all, Bavaria's investments in Southeastern Europe (including Hungary) are greater than those of all the other German states combined. Bavarian interests in Serbia were recently summed up by Josef Sickinger, chief press officer of the Munich Fair: "Serbia is a market with 11 million people," as the "Muenchener Merkur" quoted him as saying on 22 March.

Prime Minister Edmund Stoiber visited Belgrade recently. A cooperation contract between the fairs of Munich and Novi Sad was signed, and Serbia will be represented at the upcoming Transport and Logistics Fair in Munich.

Bavaria's medium-sized companies can potentially find an ideal field for their activities in Serbia. In 1999, Bavaria's volume of trade with Serbia amounted to 187 million marks. In 1997, two years before the Kosova conflict, it had been 320 million marks. The potential for expanding trade is best illustrated in relation to the trade volume between Germany and Yugoslavia on the one hand, and Germany and the much smaller Slovenia on the other. In 1999, the German volume of trade with Yugoslavia was 992 million marks. With Slovenia, Germany had a trade volume of 8.8 billion marks.

For Bavarian companies, the EU's Stabilization Pact could prove interesting in the long run, even though German firms to date have received only 6 percent of the orders for economic projects in Bosnia, for example. This is despite the fact that Germany provides some 30 percent of the Pact's funding.

Another factor affecting Bavarian interests are the 150,000 Serbs and Montenegrins living in Bavaria. They could be a help in restoring Yugoslavia's economy and building new ties between Munich and Belgrade. Taking this into account, the Yugoslav Ambassador Vlado Ljubojevic is planning on founding a German-Serbian Society, the "Muenchener Merkur" reported on 22 March.

The unemployment rate in Serbia is about 40 percent. Economic cooperation is the only way out of the dilemma. A strong and cooperative European economy, furthermore, can only be built on the rule of law. Every financial injection from abroad should thus be linked to well-defined reforms in Serbia if the investments are to be effective.

Belgrade is currently planning legislation to punish people who were part of Milosevic's extended crony system. It is said that up to 5,000 companies are involved (see "RFE/RL Newsline," 18 April 2001). Serbian Deputy Prime Minister Vuk Obradovic pointed out recently that not a single case of these companies' illicit dealings has been documented. Many Serbian analysts doubt that it will be easy to break the power of the crony system and imprison the kingpins, or "bogatasi," especially if those in question also had or have links to Serbia's new leaders. A recent study by Zoran Kusovac for "Jane's Intelligence Review" suggests that more than a few bogatasi have found new patrons within the new leadership.

It will be interesting to see what Bavarian businessmen will write several years from now about their meetings with Serbian businessmen in Belgrade's restaurants. Will they tell us how "crystalline in quality" Serbian enterprises really are? (Christian Buric. The author is a freelance writer and a consultant for business communications based in Munich, christian.buric@gmx.de)

QUOTATIONS OF THE WEEK. "We'll probably see the creation of another Mickey Mouse state, a smugglers' paradise totally dependent on foreign aid." -- Balkans analyst Jonathan Eyal of Britain's Royal United Services Institute, speaking about Montenegro. Quoted by Reuters on 20 April.

"Not all is yet safe in Macedonia." -- Government spokesman Antonio Milosovski. Quoted by AP in Skopje on 19 April.

"Everything that happened was just too much. Psychologically and physically I could no longer handle my post." -- Former Tetovo police chief Rauf Ramadani. Quoted by AP in Skopje on 19 April.

"People [in Herzegovina] are being manipulated by a leadership that is afraid of losing power and credibility and seeks to play the nationalist card to mask its own interests... [I appeal to ordinary Croats] to put the real needs and interests of your families ahead of the greed of those who seek to deceive you." -- The UN's Jacques Klein, quoted by AP in Mostar on 22 April.