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Montenegro: In the Shadow of the Volcano


Montenegro has been a crisis-in-waiting for two years now, with Belgrade opposing efforts by a reform-minded government under President Milo Djukanović to distance itself ever further from its federal partner Serbia. Federal President Slobodan Milošević has steadily escalated the pressure against Djukanović, probing the extent of NATO support for Montenegro and pushing the Montenegrins toward a misstep that might undermine their international backing. Each of the three possible policy-paths facing the Montenegro government, however, is unappealing in its own way:

 Going ahead with a referendum on independence for Montenegro would risk radicalising a population still peacefully divided over the issue, and would offer maximum provocation to Belgrade, which retains a powerful military presence in Montenegro.

 Maintaining the status quo may offer a better chance of avoiding open confrontation with Belgrade, but it leaves Montenegro in a limbo. Its friends are not offering all the help they could, on the grounds that it is not a sovereign state; but prospects for self-generated income through inward investment or revival of the tourist industry are still hostage to international risk perceptions.

 Achieving rapprochement with the Serbian government would be possible if Milošević went. But Montenegro cannot afford to leave its future in the unsure hands of the present Serbian opposition. And as the atmosphere in Serbia steadily worsens, political and public opinion in Montenegro appears to grow ever less willing to compromise.

Djukanović is under some domestic pressure to move faster towards holding a referendum, but all his foreign contacts are advising him to go carefully and not provoke Belgrade into a response, and for the moment he is being patient. For its part, the Belgrade regime seems content for now to play a cat-and-mouse game with the Montenegrin government and population, keeping them nervous and not knowing what to expect. Montenegro’s dual-currency system – with both Deutschmarks and dinars as legal tender – appears to have stabilised the economy at the cost of unwelcome if temporary inflation, but Serbia has intensified its trade and financial blockade.

Overall, the situation is fragile, and could deteriorate rapidly. The fifth war of the break-up of Yugoslavia may not be far away. Montenegro’s friends need to act quickly, decisively and visibly if this prospect is to be avoided.

The NATO allies can help Djukanović out of his policy trilemma

 by giving Montenegro the economic support it deserves but is presently being denied (reducing the perceived advantages of independence);

 by increasing the presence and visibility of the international community in Montenegro (giving political support, and raising the stakes for any would-be attacker); and

 by making a stronger direct commitment to Montenegro’s security, backing that commitment with a formal authorisation to NATO to commence military planning and appropriate movement of forces.

Unless an effective deterrent strategy is rapidly developed and applied, the international community will again cede the initiative to Milošević, and could yet again in the Balkans find itself reacting, after the event, to killing and destruction that could have been prevented.

RECOMMENDATIONS

Security

1. The NATO allies should make a commitment that any attempt to use force to install a pro-Belgrade government in Montenegro will be met with a forceful military response, and convey that warning to Milošević openly or privately.

2. The North Atlantic Council should formally task the NATO military command to plan such a response, and there should be movement of forces in the region appropriate to demonstrate seriousness of purpose.

Economic

3. The forthcoming Regional Financing Conference of the Stability Pact for South Eastern Europe should be the occasion for a major international focus on, and response to, Montenegro's economic and financial needs.

4. Montenegro should be given further substantial balance of payments and general budgetary support, and funding for major infrastructure projects satisfying World Bank criteria.

5. If the necessary support cannot or will not be provided by international financial institutions like the World Bank, International Monetary Fund, European Bank for Reconstruction and Development or European Investment Bank, on the ground of Montenegro's non-sovereignty or the indebtedness of the Federal Republic of Yugoslavia, then it should be provided bilaterally.

6. The other major economic powers should follow Germany's lead in providing investment guarantees for companies prepared to invest in Montenegro.

7. The Montenegrin government should be offered the assistance of both EU and United States officials in establishing an aid co-ordination unit to strengthen Montenegro's absorptive capacity and improve co-operation among agencies.

Political and Other

8. Every opportunity should be taken in capitals to publicly express political support for the Djukanović Government in its resistance to harassment and intimidation from Belgrade.

9. A major effort should be made to increase the presence and visibility on the ground in Montenegro of the international community, both governmental and non-governmental. In particular:

(a) there should be an increase in high-level visits to Montenegro by ministers, officials and parliamentarians;

(b) the European Union should open a flagged and permanently staffed office in Podgorica, the primary function of which could be to co-ordinate aid delivery by the European Commission and Member States;

(c) the European Community Monitoring Mission should expand its presence, especially in the north of Montenegro, and make public its findings; and

(d) both inter-governmental and non-governmental organisations should be encouraged to make a special effort whenever possible to hold meetings, seminars and conferences in Podgorica.

10. To further thicken the international presence in Montenegro, governments, humanitarian assistance agencies and other international organisations active in Kosovo and Bosnia should be encouraged to use, as far as possible, the port of Bar for the transit of supplies.

Podgorica/Washington/Brussels, 21 March 2000




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