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Issue No. 167. - March 27, 2000.
By Valeri Kalabugin
By Slobodan Rackovic
3. Bosnia nad Hercegovina :  EMPIRE BUILDING
By Radenko Udovicic
    By Valeri Kalabugin

With the Moscow's war against Chechen rebels nearing its end and the election of Putin as the new president becoming a fact, it is reasonable to consider new trends in Moscow's policy. Among these trends, there is a thing that may be called the 'Putin's virtual doctrine'.
It is virtual, for it has not yet been postulated; actually it isn't Putin's doctrine, since the idea started emerging among some circles in Moscow in the Gorbachev's era and sharply matured under Yeltsin; it first appeared as practice; still, it may be called a doctrine because it is a distinct political line now carried out,  and it is Putin who will most likely have to finally formulate it. In fact, he is already implementing it.
What might be called the new doctrine is consistent scorched-earth policy in large territories, serving as the Russia's line of defence against disintegration. This new policy is now being polished in Chechenia (I would prefer this name to the distorted Russian 'Chechnya'). This policy is used already on a medium, not a small, scale. Scorched-earth policy in itself is no news; the less so for Russia, a dying empire with barbarous tradition. To destroy societies? Sure Russia did this, and repeatedly, but hitherto it did not totally destroy territories. Let alone 'its own' territories.
In Chechenia, one can see Russia experimenting with the use of large-scale scorched-earth strategy against its colonies' aspiration to independence. In the past, Russia could not use this strategy on a really large scale because of technical weakness. Later, for some period, democratic tendency prevented this. Today, it has become possible as the two main prerequisites are at hand:
(a) technical means, (b) unlimited power of FSB -- not a political force but just an uncontrolled machine built and trained to destroy. One may call the FSB a semi-military junta that has no responsibility and gives account to no one.
To make it a state poicy to completely destroy large areas by modern technical means would be a news. Something akin was once said - but not done - by an U.S. official who promised 'to bomb the Vietnamese into the ground'. Perhaps Julius Caesar, too, said or thought something like that but he did not have the technical means. Most of the Russian politicians perceive the loss of their giant empire as a very unwanted outcome. The Russians have never experienced other ways of statehood; it would be hard for them to imagine being robbed of the 'Great Russia' and start living in a small 'Mother Russia'. They would prefer to avoid this at any cost. To cope with a new reality is always a tough task, so all empires have always went the easier way, just razing a rebellious village or a city to the ground. In the case of Chenenia, Moscow has demonstrated its technical ability to do this with a whole country that threatens to secede.
Today, Moscow's generals are training the world to get accustomed to a total war and total destruction in one's own territory with, reportedly, vacuum bombs and gas. However, one might now ponder on a scenario when, facing a threat of disintegration and struggling with 'inner enemy', Russia would use its nuclear weaponry. For example, using small nuclear missiles
and bombs to annihilate another Grozny.
The use of nuclear weapons in one's own land? This will be a news, too. International law has no tools to prevent this for the sheer reason that no one could ever anticipate this. After all, Russian generals may argue, it would be no crime at all: charges would be small, of local range only, and it will be only population of a small town or a part of a town that will die -- so why not use them?  But why should they use small range nuclear weapons against their 'own' people?
Why not. These 'own' citizens are not fully 'own'. They are different. Nuclear bombs or missiles would be used not in the inner lands, i.e. in the historical center of Russia, but in the larger empire, against other nationalities. Moreover, there is a near precedent: to attain his goals, Lenin had destroyed society and economy everywhere in his country including the 'heartland'  and then summed up victoriously: 'We've conquered Russia!" Notably, the main instrument of his conquest was the notorious Tsheka-NKVD-KGB-FSB, the organization now in power.

An uneasy fact about Putin is that he owes his rise to that new line. Considering the determination of imperial-minded circles and even common 'heartland' population to save the Rusian Federation at any price from an inglorious end as that of the USSR, Putin may well have nothing left to do but to follow that line until it exhausts itself. In other words, until something stops him -- or stops that line. Which is not the same. For instance, nothing can stop the 'order' from which he originated, the KGB-FSB. An organization of fanatics, with an appreciable experience of mass murder, it has nothing that might stop it from any actions.
If Putin 'prematurely' leaves the scene, others will have to reckon with this new anti-terrorist or anti-whoever-that-may-be way of waging internal war. Notwithstanding to what an extent this strategy either remains a potential solution or becomes a reality, and immaterial of the scale on which it will have been practiced, from now on this trend has become a possible option. And if it is possible for Russians, why not also for Milosevic or any other junta that may emerge on the globe? For the Chechen people, anyhow, it is already a reality.

    By Slobodan Rackovic
Last statements of Montenegrin officials leave no doubt that gaining independence of Montenegro is their main goal, but it is also equally certain that Podgorica regime will do anything it can to make that historical plan as painless as possible, although war cries from Belgrade are growing louder.

The nerve game between Belgrade and Podgorica, that has been going on for two years, is nearing its final stage. Whether its epilogue will be peaceful or not - lies to be seen during next days and weeks. However, all estimates say that the final outcome between Montenegro and Serbia, two republics which on 27th April 1992 founded the so-called Federal Republic Yugoslavia (FRY) on the ruins of the old one - will happen before this summer. Herr Albert Roan, general secretary of the Austrian ministry of foreign affairs, has just visited Montenegro. After his visit, he stated that there will be a conflict in Montenegro in July this year, when local elections in Podgorica and Herceg-Novi are scheduled to be held. "Montenegro is a classic case of conflict prevention. That is why I appeal to the EU to give financial aid to this republic, thus preventing its economic and social destabilisation, caused by Belgrade. That would be much cheaper than escalating conflict". According to Roan, EU didn't invest in Montenegro because of security problems. Since Montenegrin deficit is approximately 150 million euros, he thinks that Montenegrin budget for 2000 needs 1,5 billions Austrian shillings. He also reminded that that EU and USA promised more than a third of that amount. "War expenses would be thrice as big" - said Albert Roan for Vienna daily newspapers "Die Presse" and "Standard", adding that Montenegro should be offered "complete military guarantees" due to more and more realistic danger from Belgrade. And that danger is more and more closer and visible even to the ordinary Montenegrin citizens. Political and economic pressures from Belgrade are more and more unbearable, and divisions within the society, incited from the FRY capital, ever deeper. Montenegrin police, now with outstanding 20,000 officers (Montenegro has only 700,000 citizens) and Second army group of Yugoslav army, which is stationed in the republic, have been behaving like cat and dog for months now (during NATO air strikes last year there were even minor armed incidents). It is only a matter of days when the arms will speak in its frightening language. In this tense situation, only Belgrade can choose when and how to provoke war.  Montenegro looks like a sacrificial lamb with its head already set on a block. Situation is even more dramatic than in the eve of aggression on Slovenia, Croatia and Bosnia, since here are two completely uneven opponents. Courageous chief of Montenegrin state, the oldest among Southern Slavs, Milo Djukanovic, is of a different opinion and is certain that he, helped by strong police forces, will be able toresist aggression from Belgrade. He made a following statement to Austrian newspapers "Standard" and "Salzburger Nachrichten", as well as from the German "Spiegel":
"What has been happening during last weeks must be viewed as a seasonal stepping up of the conflict caused by Slobodan Milosevic. We directly informed Montenegrin and international public about it and are now making preparations of our state institutions and people to defend freedom, peace, democracy and statehood of Montenegro! We have learnt how to live with a crisis at hand. The one in the ex-Yugoslavia area has been lasting for ten years now, and the one between Serbia and Montenegro for two years. The crisis actually began when we in Montenegro decided for democracy, economic reforms and integration into Europe. Slobodan Milosevic is now trying to punish us for it.".
When asked are there any signs that Belgrade prepares "something" against Montenegro, Djukanovic said: "Watching Milosevic's behaviour during decisive situations, we can be certain that he prepares something. Special role in his plans will be played by Socialist people's party of Montenegro headed by Momir Bulatovic and the Yugoslav army. Milosevic is specifically concerned with misusing army for his inefficient politics. However, we think that he will not attack Montenegro openly, but will provoke internal clashes, according to already well-known scenarios from Slovenia, Croatia and Bosnia and Herzegovina. He wants to provoke civil war here, so that he can be able to distance himself from it later", stressed Djukanovic. He thinks that inciting armed conflicts in this part of south-eastern Europe would mean a real threat to international community. That is why he is certain that struggle for stability of Montenegro will not be fought by Montenegrin alone, which is also implied by pen call Montenegrin president sent to NATO to give military protection to this republic. Djukanovic especially stressed the fact that Montenegro doesn't want to do anything which might provoke an armed response from Belgrade, which was also requested by international community, but will not stray from its road to independence. "We have written in our constitution that citizens of Montenegro can decide the status of their state on their own" - said Djukanovic, announcing referendum on independence to be held this year. That the independence of Montenegro is inevitable, only Podgorica wants it to pass as painlessly as possible, can also be deduced from statements made by vice-president of the republic's government dr. Dragisa Burzan (a socialdemocrat) to Slobodna Dalmacija, Croatian daily newspapers. "Independence of Montenegro is an inevitable option, but realisation of that goal requires much patience and skill. Strategically speaking, things are going in that direction, and on that road we must be wary of quick moves and remain rational, in order to evade the situation in which Milosevic could get away with an excuse to attack Montenegro.

However, I would be no believer in project of independent Montenegro if I didn't think it to be best solution not only for our republic but also for this region in general", stressed Dragisa Burzan, who thinks that Milosevic will most likely use strategy of "crawling military attack", with separation of the northern part of the republic. However, Burzan also thinks that Milosevic has far less supporters in the northern part of the republic, traditionally oriented to Serbia, than he expects. Even the president of executive committee of the dominant Democratic socialist's party Miodrag Vukovic repeated in his interview in Novi list that FR Yugoslavia is practically non-existent, since not one of its institutions is functioning (not even army, regarded in Montenegro as an intruder). At the same time, Montenegrin government  took over all important tasks from the federal state - foreign politics, trade, customs, security system, fiscal system and its own money. It is interesting that even the National party, the program of which was based exclusively on maintaining unity between Montenegro and Serbia, is now less and less certain about future existence of FRY. Therefore, there is almost absolute inter-party consensus about this important issue, with the exception of Socialist people's party and two or three tiny parties with Serbian national prefix. New president of People's party and Montenegrin minister of justice Dragan Soc (successor of already legendary professor Novak Kilibarda, founder of the party) said in "Piljevaljske novine" newspapers that "dictatorship regime of a man from Belgrade who doesn't respect not one institution is humiliating both Serbia and Montenegro and in such situation we cannot talk about FR Yugoslavia as a perspective union of two states". To this mosaic the only missing piece is the attitude of opposition Liberal alliance of Montenegro, but it is already too well-known that this party has been energetically in favour of independent Montenegro since it was founded. The only problem is that the leadership of the party, headed with charismatic Slavko Perovic, sees independent Montenegro only as a state headed by liberals themselves, so they sometimes made some moves which were objectively damaging the whole project. In their obvious struggle for power, liberals voted against Law on Montenegrin citizenship, which failed (liberals have only 5 MPs in a parliament of 75), but has caused much political damage to the party. However there is no doubt that supporters of this party will opt for project of independent and internationally acknowledged Montenegro at referendum. At  this moment, approximately 60 per cent of the population would vote in favour of independence.
However, the problem is that while waiting for the most opportune political moment to hold a referendum the standard of living in Montenegro is seriously declining. That is a problem to current, pro-Montenegrin and pro-reform government so the fear of social unrest is not completely far. Tight economic boycott imposed by Serbia has caused prices to skyrocket, and the alternative markets, especially of food, in Croatia, Slovenia, Bosnia and Herzegovina, Hungary and Italy are too expensive for Montenegrin merchants. As Albert Roan said, that is why it is absolutely necessary for the EU and USA to give aid, and prove that they are supporting Montenegro in acts, not only speech, which can save this tiny state from social rebellion. Only in such way could Montenegro seeks the real concept for its future in relative peace and quiet.

 Bosnia nad Hercegovina : EMPIRE BUILDING
    By Radenko Udovicic
Although privatization of state property started in Bosnia and Hercegovina over a year ago, only lately has this process entered the public spotlight. The reason for it lies in the purchase of several firms from Sarajevo, which until now have been reputed to be highly profitable and certainly very attractive to potential buyers. However, what is especially intriguing is that these firms have been bought for minor amounts, by people whose economical rise began during the war, which is in Sarajevo often connected with war profiting, and with a good reason. Privatization process is going on at entity level, separately in Federation B-H and Serbian Republic. The whole task of property privatization in Federation B-H is carried out by Agency for privatization, the institution which got authorities from entity government to plan and carry out process of privatization of the state property. It started with the so-called small privatization, most often selling state-owned apartments. Citizens were buying off what has, thanks to former socialist system, already been their permanent property, but had a status of state-owned property, which was an inheritance of Yugoslav communism. SO, the status of state-owned property, (social property) had to be transferred to individual property.
The process of great privatization started in mid-1999. Practically at the beginning of war authorities said all firms whose property was viewed as "society-owned" were then state-owned. However, time has shown that there is no joining modern western societies without radical change of economic system. It has been decided to privatize everything, or almost everything. There are no limits even with public services like water supply firm, electricity firm, even the post. The management of those firms announced soon sale tenders, with no necessary limit of 51 per cent state ownership. However, one of the rare firms which will not be privatized at this stage is state television. It will be transformed into a public service for the whole of Bosnia and Herzegovina and Federal television. But the ownership structure will not be altered and will remain completely in the hands of the state. The reason for it probably lies in the fact that international community, which has a significant i nce in the transformation of Bosnian media, wants to transform present Bosnian radio and television into a politically unbiased and professional television without individual owners who would try to make their own interests through its program. However, the most particular thing of privatization in Federation B-H is usage of certificates as device of buying off state property. After numerous discussions on how to realize privatization process most efficiently, Agency for privatization proposed a bill accepted by parliament to create a system with unique citizens' accounts for participation in privatization. All mature citizens of Federation B-H got certificates which enable them to participate in the process. The principle is the following - each citizen above 18 years of age will get a certificate worth 1900 DEM. That amount is then increased on the basis of how many years he spent at his workplace or in pension, as well as on whether he participated in war or not, and got wounded. For example, a citizen with 25 years of work, who hasn't been in the army during the war, got approximately 12,000 DEM worth certificate. Biggest possible value of a certificate is approximately 30,000 DEM and are given to children whose parents died in the army. Legally, certificates are treated as trade paper, but with exclusive purpose. It means that the only possible way to use certificate is to buy firms, their shares or social-owned apartments. Most citizens used the last possibility and thanks to certificates became full owners of their apartments. However, real use of this trade papers is severely limited by the fact that during any purchase with certificates a third of total amount must be paid in cash. The majority of impoverished citizens of Federation B-H barely manages to come with terms with their most elementary needs so that they didn't even think about possibility of buying firms or spending their certificates appropriately. As a result, many citizens sold their certificates at negligent price in order to get any money meant for bare survival. On street market, nominal value of certificates is around 3 per cent of their full value. For example, 20000 DEM worth certificate yields 400 DEM in cash, which enables the poor who sell them another month of life, and great possibility of growing rich to the buyers. And that is where the story about the new rich begins - they bough certificates cheaply and, thanks to earlier capital and cash, are now buying firms and objects, and accordingly, social, even political power. The most spectacular transaction was few days ago when Nedim Causevic bought hotel "Holiday Inn", located in the center of Sarajevo. The hotel was built just before the Olympic games of 1984 and has the license of Holiday Inn world chain of hotels. It is a big and modern building that remained open throughout the war and has also a symbolic value to Sarajevo and its citizens. That would be nothing unusual if the hotel weren't sold for only 15 million DEM, which is almost three times less than its earlier estimated value. It sale was announced only in local newspapers so that only one, local buyer applied to the public competition. Having no competitors, Causevic bought hotel for just slightly higher price than the starting and became the owner of the hotel which has a huge economical, but lso prestige value. Some stories in Sarajevo say that this purchase was helped by the government, that is the ruling Party of democratic action, which is interested in transferring some objects and firms to "confidential" men, since it is not possible to leave them in the property of the state and party. Causevic, of course, paid only a third of the hotel in cash, and used certificates for the remaining sum. If we assume that he bought the certificates at 3 per cent of their nominal value, then it turns out that "Holiday Inn" hotel cost him not even 5,5 million DEM. Causevic is from Sandzak in FR Yugoslavia. Before the war he was working in the firm Post Engineering which dealt with constructions and realization of all projects of then postal system in Bosnia and Herzegovina. Just before the war started, he established a private firm with which he was drawn into a war drama. In 1993 he was arrested on charge of collaboration with the enemy, because he was trading and importing food from Serbs, but was freed in a new court trial. After the war he used his knowledge accumulated before it started and his firm won multimillion job of laying optical cables for the state postal system. Causevic also owns several business objects in the center of Sarajevo, he is also general representative of the firms Panasonic, Fiat, Lacosta... and has now added a prestige hotel to his business empire. Yet, Causevic is the most capable, but not the only person who used privatization to multiply his business. There are also Comor brothers who bought Sarajevo sweets factory "Zora" and will, according to rumors, soon buy factory of milk products "Milkos". Recently one of the brothers has tried to buy another successful hotel "Bosna", applying at the public competition as pre-war manager in Olympic center Bjelolasnica. However, local media found out that he wasn't a manager in that firm, but just a janitor(!?). In a similar way, across Bosnia and Herzegovina, various tycoons are buying successful factories using huge amounts of certificates while the workers, who have primary right to buy the firms they are working in, leave the race for ownership in their companies for various reasons - often due to incompetence, internal obstructions or the fact that they have sold their certificates earlier. Foreign investors are mostly evading Bosnia and Herzegovina due to unstable political situation.
Of significant foreign investments, we should mention earlier sale of Sarajevo  car factory to Volkswagen, American investment into former Sarajevo factory of Coca-Cola, as well as transfer of Maglaj cement factory in German ownership. Although there are no limits in how much part of ownership foreign investors can buy, they are limited by the fact that the new owner must keep old workers. That is the reason for not selling the biggest Sarajevo shopping center to Benetton since there are many workers without the necessary qualifications. Italian magnate is ready to provide jobs for workers, but those who have qualifications and will be profitable to hire, and profit is the main motive of majority of foreign investors.
In the Serbian Republic the privatization process is just beginning to emerge. There is an ongoing process of registration of the citizens into unique privatization registry. After that, each will be given vouchers, using similar principle as with certificates in Federation B-H. First plan was to provide citizens only with the option to buy firms, not apartments with their vouchers. However, due to enormous pressure of the public and also international community, Serbian parliament decided to change Law on privatization and include also apartments in voucher privatization. It is crystal clear that also in Serbian Republic main buyers of the firms will come from newly created caste of rich people who will buy out vouchers and thus expand their empires. Bosnia and Herzegovina is going towards South American type of capitalism with extreme social differences. Three per cent if the people (also value certificate on the street market) will live in huge luxury, while the rest of the people will fight hard struggle for bare survival.