POLITICS-YUGOSLAVIA: Montenegro Moves Towards Independence

By Vesna Peric Zimonjic Reprint | | Print |

Vesna Peric-Zimonjic

BELGRADE, Nov 7 1999 (IPS) - For all practical purposes, Montenegro took last week the first step towards independence by adopting the German mark as a parallel currency to the Yugoslav dinar.

Montenegro and Serbia are the two remaining components of the Yugoslav federation, which once also comprised Bosnia-Herzegovina, Croatia, Macedonia and Slovenia.

As a consequence of the decision, Yugoslav central bank officials said they may freeze all transfers of federal funds to Montenegro, to which Podgorica reacted by threatening to stop payments to Belgrade.

Montenegrin prime minister Filip Vujanovic described the monetary decision as a “necessary step”. It was “our constitutional obligation and it falls in line with our responsibility to protect Montenegro’s economy and people.”

The move was necessary, he said, due to the destructive influence of Serbia’s worsening economic situation. The Yugoslav dinar has sharply lost value since the air war launched by the North Atlantic Treaty Organisation (NATO) in March.

According to financial sources, the government has been financing the country’s reconstruction effort by printing money without proper economic backing in goods and services.

After years of sanctions and the widespread destruction caused by the air war this year, the Serbian economy is almost totally isolated and non-productive, except for food and electricity.

The newly-established Currency Board of Montenegro’s central bank rated the Yugoslav dinar at 17 to one German mark, making it equal to the current black market rate.

The German currency is the preferred currency in commercial transactions in Yugoslavia.

Economy experts here, however, warn that the introduction of the German mark does not necessarily mean a step towards Montenegro’s independence from Yugoslavia, which has been so far rejected by the U.S. and its European allies.

Nebojsa Medojevic, member of the prominent Group-17 (of independent Yugoslav economists) describes the move as “technical.” Its aim is, he says, to protect the small Montenegrin economy from a possible collapse of the Serbian economy.

“The elimination of the Yugoslav dinar in Montenegro or the introduction of a totally new currency would be a step towards independence” Medojevic said.

But Jovan Zebic, Yugoslavia’s vice-prime minister, described the Montenegrin decision as “illegal”. He said that now plans have to drawn in Belgrade “to protect Serbia’s monetary system.”

Montenegro’s opposition Socialist People’s party (SNP), an ally of president Slobodan Milosevic’s Serbian Socialist party, described the move as “unconstitutional”.

“The introduction of the German mark is an unconstitutional act…as it is in contradiction with the alleged intention of Montenegro to have a common financial system and market with Serbia, within Yugoslavia” Momcilo Vucetic, a SNP high official told Radio Belgrade.

Last month, delegations of Montenegro and Serbia held inconclusive talks aimed at preventing the disintegration of the Yugoslav Federation.

Montenegro did not announce its departure from the federation, but also did not promise to stay in Yugoslavia at any cost. The growing rift between the two governments has been the subject of speculations abroad about another war in Yugoslavia.

But Yugoslav officials have turned down such possibility, stressing that Serbia will not try to prevent Montenegro from seceding by force.

Svetozar Marovic, one of the closest aides of pro-Western Montenegrin president Milo Djukanovic, told journalists after the talks that the meeting was “useful”.

“We don’t want them (Serbian officials) to love us, but to understand what we’re saying…If someone wants conflicts, another war, victims and violence, we’re strongly opposed to that”.

Miodrag Vukovic, a high Montenegrin official present in the talks, told IPS that the small republic remained firm in its basic demand for “redefined relations” between Serbia and Montenegro.

The expression means that Montenegro wants Belgrade to recognise the 1998 election results, when Djukanovic became president and his Democratic Socialist party (DPS) won a narrow parliamentary majority.

Serbia and Montenegro do not have simultaneous elections due to several early elections held in Serbia.

Contrary to the federal Constitution and the established rules within the federation, the Yugoslav government did not allow the Montenegrin representation in the federal parliament to be changed according to the elections’ results.

In spite of the elections, president Milosevic appointed his Montenegrin ally Momir Bulatovic as federal Prime Minister. The Constitution establishes that Yugoslavia’s prime minister must be a Montenegrin if the President is a Serb.

Belgrade’s delegation at the bilateral talks provided a vague description of the event. Goran Matic and Ivan Markovic, both high ranking officials of the Yugoslav United Left (JUL- a ruling coalition partner) described the meeting as “aimed at keeping the federal state together”.

“We don’t want Yugoslavia to function like the Commonwealth of Independent States after the USSR (Soviet Union) fell apart…we want our State to stay together,” they said in a statement.

Montenegro has announced a plan for possible referendum of independence in February, but for that it will need the approval of its western backers, who are reluctant to the creation of more mini ethnic states in the Balkans.