Balkan Report: August 10, 2001

NEW RIFT IN MACEDONIAN LEADERSHIP? Macedonia's government of "national unity" has displayed its lack of unity before. During the three months of its existence, there have been a number of occasions when members of the government have accused each other of various blunders when trying to cope with the threat posed by the ethnic Albanian National Liberation Army (UCK).

There have open clashes between hard-line Interior Minister Ljube Boskovski of the Internal Macedonian Revolutionary Movement-Democratic Party for Macedonian National Unity (VMRO-DPMNE) on the one hand, and Defense Minister Vlado Buckovski of the Social Democratic Union of Macedonia (SDSM) on the other. There have also been disagreements between VMRO leader and Prime Minister Ljubco Georgievski and Boskovski on one side, and President Boris Trajkovski -- of the same party -- on the other.

These disagreements were based mainly on different approaches to how to deal with the crisis. While the hard-liners Georgievski and Boskovski prefer a military solution, Trajkovski and Buckovski advocate a peaceful one.

The ethnic Albanian political parties in the current cabinet did not become involved in these conflicts within the government. Despite immense pressure from the UCK, which limits their room to maneuver, the Albanian "bloc" has even profited from the strife within the Macedonian "bloc," as media describe the ethnic divide in the government.

"Mister Butch" and "Mister Bosh" -- as former Interior and Foreign Minister Ljubomir Frckovski called Buckovski and Boskovski, respectively, in his newspaper comments -- overcame their public differences when it became clear that their feud was weakening the government.

After some weeks without any major disagreements in the government (or did the media simply come to ignore the feuds?), a new rift opened -- just at the moment when the peace talks seemed to be drawing to a close.

On 6 August, Trajkovski scheduled a meeting of the National Security Council. After that session, both the president and the defense minister denied that there were any differences between them. The next day, the media speculated about the reasons for the meeting. Some media reported that Trajkovski had called the Security Council gathering because his order to the army to open up an important road between Tetovo and the border to Kosova had not been obeyed.

The road runs from Tetovo to the border checkpoint at Jazince and lies in a demilitarized zone which was set up recently in order to help facilitate the peace talks. In a statement on 6 August, the Defense Ministry denied that Trajkovski had given it any orders to open up the road. The ministry also denied the allegation that neither the Defense Ministry nor the General Staff had worked out a plan to defend the town of Tetovo, which has been at the center of tensions for months.

While Trajkovski and Buckovski declared after the council session that there are no differences between them, the Skopje daily "Nova Makedonija" had already launched a fierce attack on Buckovski. In a front-page article, the newspaper -- which is close to the VMRO-DPMNE -- stated that there is a deep rift between president and defense minister.

The article claimed that Buckovski called Trajkovski on the phone, saying: "Who are you to issue such orders. If you issue another such order, I will have you arrested and brought to [the Skopje jail] Idrizovo." Buckovski, "Nova Makedonija" says, works together with the [ethnic Albanian] "terrorist mafia groups." How else could one explain why the Defense Ministry several times ignored the [VMRO-DPMNE-run] Interior Ministry's call for support in its fight against the UCK?

All this, according to "Nova Makedonija," is part of a "petty game of the SDSM, in which the whole state loses. The VMRO-DPMNE has publicly stated repeatedly that the Social Democrats are courting the Albanian political bloc and, in any event, are interested in signing a [peace] agreement in order to have early elections and form a coalition with the Albanian parties."

In a comment for the same newspaper, Dimitar Kjurkciev accused Branko Crvenkovski, the leader of the Social Democrats, of having never given up his role as an opposition leader, even after his party joined the government in May. First, Crvenkovski had pressed for the formation of the "national unity government," and then he encouraged labor unrest at a most inconvenient time (see "RFE/RL Newsline," 30 May 2001). Crvenkovski had also constantly hindered the government from taking decisive military action against the ethnic Albanian rebels of the UCK, Kjurkciev added.

It seems that the VMRO-DPMNE leadership is looking for a scapegoat. By blaming the SDSM for allegedly cooperating with the Albanian parties (and the West), Georgievski and his hard-line followers want to show the electorate that if an unpopular peace agreement is signed, it is not their doing.

Crvenkovski and his Social Democrats, on the other hand, are in a comfortable position. Whatever the outcome of the peace talks may be, the SDSM will be among the winners. The party gained the confidence of the West as a cooperative partner in the negotiations, and they presented themselves as a possible partner for a future coalition with the ethnic Albanian political parties. Months of belligerent rhetoric have eliminated this option for the VMRO-DPMNE. That means that early elections would inevitably lead to the political defeat of Georgievski's nationalist and conservative party.

And perhaps most importantly for some of that party's faithful, a political defeat would also mean that the VMRO-DPMNE would lose the economic advantages that it built up during its years in power (see also "RFE/RL Balkan Report," 4 May 2001).

It is hard to assess what would be more painful for the party members: the loss of power or the loss of the "gravy train." And it is also hard to assess whether the SDSM will change its behavior once it has defeated its main Macedonian rival. As a Western diplomat put it, the SDSM leadership is as greedy as the VMRO-DPMNE leadership, but they are more skilled in concealing that fact. (Ulrich Buechsenschuetz, ub@itinerarium.de)

ALBANIAN ECONOMY SLOWS DOWN. Albania's inflation reached 5.6 percent in July, according to figures published by the Institute for Statistics in Tirana, "Albanian Daily News" reported on 9 August. Inflation has grown continuously since 1999, when the year ended with zero inflation, thanks primarily to international aid deliveries Albania received during and after the Kosova war. In 2000, however, inflation reached 4.6 percent. For 2001, the Central Bank had expected an inflation rate of between 2 and 4 percent.

Central Bank Governor Shkelqim Cani said that the bank will try to keep to that target figure. He added that the increase in inflation is due largely to an unexpected surge in the money supply, which he expects to be only temporary. Cani said the amount of money held outside banks has grown by 18 percent since July 2000.

Albania is largely a cash economy, with many small and medium-size entrepreneurs not even using bank accounts. Bank deposits grew by only 14.7 percent since July 2000.

According to Cani, Albania is on course to meet its target of 7.3 percent GDP growth this year, just slightly less than last year's rate of 7.8 percent. Unemployment fell to 13.3 percent, compared to 17.07 percent at the end of 1999. About 2,000 people found new jobs in June, bringing the total number of unemployed to about 190,000. In December 2000, there were still 215,085 people unemployed.

It remains unclear, however, what impact recent emigration has had on the reduction of unemployment.

Officials from the Labor Ministry said that the still-high level of unemployment is largely due to the closure of inefficient state enterprises and cuts in the work force in privatized companies.

The government spent about $48.6 million over the past year on programs creating about 70,000 jobs, and has pledged to create another 10,000 jobs by the end of 2001. Cani warned, however, that the conflict in neighboring Macedonia and severe power shortages pose a threat to growth. Some foreign investors in the leather and textile industries have recently closed down their operations, saying that repeated power cuts are adversely affecting their production.

On 8 August, the Albanian Electricity Company KESH announced that Tirana will have blackouts of six hours per day according to the new power cuts schedule for the capital and the rest of the country, "Albanian Daily News" reported. Tirana will be the most privileged city compared to other towns that will get power cuts of up to 10 hours a day. Citizens and companies in Tirana pay an average of 85 percent of their electricity bills, which is very high by Albanian standards. The capital consumes one-third of the country's electricity.

Meanwhile, the former chief of Albania's National Energy Committee, Bujar Nepravishta, told "Tema" that "the decrease in electricity use is one of the conditions [for assistance] imposed by international financial organizations." He stressed, however, that the main reason for the current energy crisis is the poor condition of the power grid, which loses up to 55 percent of the electricity in the transmission process. Nepravishta added that "for the year 1999, electricity production amounted to 5.39 TeraWatt hours (TWh). From that amount we lost 3.076 TWh. We have the same situation this year, which is going to create the preconditions for another crisis."

Albania is largely dependent on hydroelectric power, but Nepravishta added: "I don't think that the lack of rain is the reason for our crisis.... The lack of rain only makes an already existing crisis more evident." Water levels in Lake Fierza, which provides water for the country's largest power plant, have fallen this summer to their lowest point in a decade.

KESH director Dritan Prifti said in July that Albania imported 900 million kilowatt hours (kWh) during the first half of 2001 and plans to import the same amount in the second half. Prifti added that the building of a new $50 million high-voltage interconnection line linking Elbasan with Podgorica in Montenegro will help Albania increase its importing capacity. (Fabian Schmidt)

QUOTATIONS OF THE WEEK. "It seems that some people cannot get enough of talking." -- An unnamed "Western diplomat" in Skopje, after the Macedonians announced that they want the UCK to begin disarming even before any agreement is ratified. Quoted in "The Washington Post" on 7 August.

"Macedonia's biggest problem is a breakdown of trust between the majority Slavs and minority ethnic Albanians. The agreement seeks to rebuild this trust by giving ethnic Albanians greater civic rights in return for pledges to work with Slavs in a united country. Both sides know the alternative is a bloody partition." -- The "Financial Times," on 8 August.

"Without the use of force, it would be impossible to establish full compliance with the cease-fire by the paramilitary and terrorist gangs, nor would conditions for a tentative agreement on alleviating the crisis be possible." -- Statement by Macedonian President Boris Trajkovski in Ohrid on 8 August, after a meeting of the National Security Council. Quoted by AP.

"This fight that we have today [with the conservative opposition] is no easier than Operation Storm" in 1995, which ended the Serbian rebellion. -- Croatian Prime Minister Ivica Racan, in Knin on 5 August. Quoted in "Jutarnji list."

"Kosovo always has been, and will be, part of Serbia. Because you [Hans Haekkerup] do not accept that, you should leave Kosovo, the sooner the better." -- Serbian Justice Minister Vladan Batic, in an open letter to Haekkerup, the UN's chief civilian administrator in Kosova. Quoted in "Vecernje novosti" on 8 August.

"NATO Has Strategic Interests In The Balkans. Does The Western Military Alliance Want Bases In Our Country? Vuk Obradovic: The Members Of That Organization Want To Get Closer To The Oil Deposits In The Middle East Via Serbia." -- Headlines in the Belgrade daily "Glas javnosti" on 9 August.