(A Background and August 2000 Issue in Brief)

© Institute for Security and International Studies (ISIS), Sofia


Research Study 8, 2000

Hard copy: ISSN 1311 - 3240




1. The Post-conflict situation in Kosovo
2. The Post-war rehabilitation of Bosnia and Herzegovina


1. Albania
2. Bulgaria
3. FRY
4. Greece
5. Romania
6. Turkey


1. Bilateral Relations
2. Regional Initiatives: The Pact of Stability for Southeast Europe


1. Bulgaria
2. Croatia
3. Greece
4. Turkey


1. The United States
2. Russia


I.  Introduction

The many negative tendencies stemming from the obstructive policy of the regime of Yugoslav President Slobodan Milosevic persisted during August.  At a period when preparations are taking place for elections in Kosovo, the Federal Republic of Yugoslavia (FRY), Albania and Romania, Russia reminded observers that it has the potential to strengthen the destructive factors in Southeastern Europe.  The Russian Foreign Minister confirmed with his friends from official Belgrade “how dangerous the situation will become if the elections in Kosovo take place”. The declaration comes after a year of obstructive attitudes on the side of Milosevic and his clique that were not confronted by Russia.

The preparations for the elections in FRY definitely show the elections will not be democratic and free.  The Serbian opposition, for its part, has done what it could to remain disunited three weeks before election day.  Polls show that the opposition is leading with 35 per cent, opposed to 23 per cent of Milosevic supporters.  At the same time, 6 per cent follow the candidate of Vuk Draskovic’s party, and 5 per cent are scattered around other opposition candidates.  A missed chance for the opposition to win the elections and take power in a peaceful way would be highly irresponsible.

The USA confirmed in August that its links with Albania, Bulgaria and Croatia matter greatly in trying to bring prosperity to Southeastern Europe.  The bilateral and the multilateral contacts among the countries of the region were not as intense as in previous months – a mark of the ongoing hot summer in the Balkans and the focus of Albanians, Bulgarians, Greeks and Turks on extinguishing big fires in their national territories.

II.  Conflicts and Post-Conflict Developments in the Balkans

1.  The Post-Conflict Situation in Kosovo

Political violence in Kosovo intensified in August as the province approaches the planned municipal elections on 28 October this year.  The Political Services Centre of the Organisation for Security and Cooperation in Europe (OSCE) in Pristina, which houses the offices of the political parties in Kosovo, was hit by an explosion on 18 August.  In separate incidents Serbs, Albanians and Roma have been killed.  Analysts believe that the Milosevic regime and extremist Albanian forces are behind these acts of violence.  The death of two Kosovo Albanians in unclear circumstances, held in Serbian jails in mid-August, provoked the rage of Albanians in the province.  The Kosovo Transitional Council (KTC) said it had information on worsening detention conditions in centres for Kosovo prisoners held in Serbia.

The UN Mission in Kosovo (UNMIK), together with the Kosovo Force (KFOR), the OSCE and the office of UNMIK head Bernard Kouchner will examine the political killings and violence.  Dr. Kouchner began a series of meetings on 10 August with representatives of the Kosovar minority communities, including with Bosnians, Roma, Turks and other communities.  In an effort to improve the legal order in Kosovo, Dr. Kouchner appointed on 10 August an additional 139 judges and prosecutors and 309 lay judges.  They will start their activity at the beginning of next year, when the new budget takes effect.

UNMIK with the support of KFOR assumed responsibility on 14 August for a smelter that has been linked to rising levels of atmospheric lead in northern Mitrovica – at times reaching 200 times the acceptable levels recommended by the World Health Organisation (WHO).  Upon his visit to the plant Dr. Kouchner said the factory is of 19th-century standards.  UNMIK took action to improve the management of the factory, of the environment and of the production complex itself.  In the meantime, the workers will receive compensation.

Some 400 university students from Japan helped the people of Pristina at the beginning of August with garbage removal and beautification – planting trees, bushes and flowers – in a three-week programme with Kosovo students.

2.  The Post-Conflict Rehabilitation of Bosnia and Herzegovina

The accidental deaths of three de-miners in Bosnia, as well as the targeted killings of refugees returning to their native places, in two separate incidents this month show that the post-conflict rehabilitation is far from complete.  During the war in Bosnia, an estimated one million mines were laid in some 19’000 minefields.  Though slowly, the process of returning of refugees to areas dominated by other ethnic groups continues.  In the past six months the UN High Commissioner for Refugees (UNHCR) has registered 19’500 minority returns in Bosnia and Herzegovina, compared to just 2’000 returns registered during the same period last year.

NATO announced on 1 August that US army Lieutenant General Michael L. Dodson will serve as the next commander of SFOR, the NATO stabilisation force in Bosnia and Herzegovina, succeeding Lieutenant General Ronald E. Adams.

The organisation of the police in Bosnia by the UN mission in that country is improving, and more minority representatives in the Bosnian police forces can be seen.  The recruiting of minority cadets for police academies is also progressing.  A third aspect of the same issue is the redeployment of minority officers between the Bosnian entities.  Nearly 450 minority graduates are currently attending or have graduated from Bosnia’s police academies, while 130 minority officers have been identified for redeployment across the lines of the entities.

The judicial reform in Bosnia is slowly taking root, there is a growing cooperation between Republika Srpska and the Interior Ministry of the Federation, and state institutions, as the state border service, are beginning to function.  Despite the various obstacles, especially those created by Belgrade, Bosnia is beginning to knit together.

III.  The National Perspectives of the Balkan Countries:  Specific Issues

1.  Albania

Albania is preparing for local elections on 1 October this year.  The Albanian Government has pledged to carry fully transparent and fair elections.

2.  Bulgaria

The escalation of the internal conflicts within the ruling Union of Democratic Forces (UDF) in Bulgaria has been postponed for the autumn, following political and corruption scandals.  The country is approaching its general and presidential elections in the spring of 2001 with two basic social characteristics:  first, rising unemployment that reached 700’699, or 18.33 per cent of the working population, and second, lost confidence in the social function of the state (85 per cent of Bulgarians believe the state will not help them if a fire or a natural disaster leave them homeless) and dramatic de-motivation to participate in the election process (52 per cent said they would not go to vote on election day).

3.  FRY

The presidential representative of the united Serbian opposition, Vojislav Kostunica, is leading in the opinion polls a month before 24 September, election day in FRY, with 35 per cent.  Milosevic and his supporters follow with 23 per cent.  17 per cent are yet undecided, 9 per cent said they would not vote, 6 per cent support Vojislav Mihajlovic, the candidate of Vuk Draskovic’s Renewal Movement, and 5 per cent support other opposition candidates.  The poll was carried out by the Belgrade-based Institute for Social Sciences.  After the constitutional violence committed by the Milosevic clique, Montenegrin democratic leaders have distanced themselves from participation in, and the introduction of regulations in support of, the elections.  The Montenegrin Ministry of Information has decided to forbid electoral campaign coverage for the federal elections in the state or local media of the republic, which does not affect the private ones.  The boycott of the elections, though a principle position on the side of the democratic leaders of Montenegro, would increase the number of votes for Milosevic and his party.

The only chance for an eventual success against Milosevic, despite the ongoing unfair and undemocratic campaign in FRY, is the united opposition of all who disagree with Milosevic’s  government in Serbia and Montenegro.  The Belgrade dictator is exercising specific election tactics to bring nationalist supporters under his banner. The arrest of two British OSCE team members in Kosovo and partners within UNMIK, together with two Canadian nationals, and a previous arrest of four Dutch men, fit well Milosevic’s notion of the outside world as trying to undermine the country and to destroy his government.  This is why the Yugoslav Army (VJ), his undemocratic tool for political purposes, has imposed a blockade on the roads that lead from Montenegro to Republika Srpska in Bosnia.  The explanation was that this is a measure to protect FRY from a foreign country.  The tactics amount to pre-election pressure on the rebellious Montenegrin Government, too, rekindling fears of a brutal suppression of any secessionist acts from the federation.  This trick of the VJ acts as a uniting factor for the nationalists in Serbia.  Another measure of Milosevic to assure his own electoral success is by silencing the voices with strong arguments against him.  Ivan Stambolic, nephew of the long-time leader of Socialist Yugoslavia, Tito, and a former Serbian president, was kidnapped during his regular morning jog on 24 August and has been missing for the last five days.  Stambolic was one of the creators of the politician Milosevic but became one of his harshest critics, after Milosevic removed him from his way in 1986.  Stambolic criticised Milosevic for his nationalism and has said that he is guilty of creating a Frankenstein in Milosevic.  Milosevic’s wife Mira also joined the election campaign after her nomination as a candidate for a member of parliament.

4.  Greece

A contract was signed this month at the Greek National Defence Ministry for the purchase by the Hellenic Air Force of 15 new Mirage 2000 5S and the modernisation of 10 older-model Mirage fighters.  Under a separate contract the country will also acquire 200 Mica air-to-air missiles and 56 Scalp missiles.

The two deals, signed with France’s Dessault Aviation, Thompson-SCF Detexis, Snecma and Matra British Aerospace Dynamics are part of a five-year armaments modernisation programme, estimated to cost Greece a total of 554 billion Drachmas (approximately US$1.5 billion).  The French company has also proposed that Greece buy its fourth generation Rafale jetfighter, which Greece is assessing, National Defence Minister Akis Tsohatzopoulos said.  Tsohatzopoulos said a contract has also been prepared for the purchase of 60 fourth generation Eurofighter warplanes.

The Greek Government is negotiating credits from Germany for the purchase of new German-made tanks, according to a German Finance Ministry report tabled with relevant Bundestag committee.  Greece is in the final stages of selecting a new main battle tank (MBT) for its armed forces.  The deal could be worth of more than DM 4 billion (US$1.8 billion).  Germany’s Leopard 2A5 is one of the main contenders.  Other candidates for the Greek order include US, British and French companies.  The plans for the purchase is for 250 tanks, 24 recovery vehicles and 12 bridge layers.

Greece has signed weapons contracts worth more than US$4 billion over the past three years.  Earlier, Turkey also declared the intention to buy 1’000 tanks.

5.  Romania

Presidential elections will be held in Romania in November.  President Emil Constantinescu made a statement that he is leaving politics.  He also said he had been unable to eradicate corruption, which had affected the economy and parliamentary politics.  The former president, Ion Iliescu, is the favourite to win in November.

6.  Turkey

Turkey signed the International Covenants on Civil and Political Rights and on Economic, Social and Cultural Rights on 15 August.  The Turkish police arrested on 22 August six terrorists who had planned to bomb various targets in Istanbul.

This month the commander of the First Army, General Hilmi Ozkok, handed over his duties to General Necdet Timur.  General Ozkok was recently appointed Land Forces Commander.

IV.   The Bilateral and Multilateral Relations in the Balkans.  The State of the Regional Initiatives

1.  Bilateral Relations

a.  Albania-Greece.  Greek Defence Minister Akis Tsohatzopoulos visited Tirana on 1 August and met with his counterpart and with Albanian President Rexep Maidany.  The Maidany called on his Greek neighbours to revoke the law of 1940 that still keeps the two countries in a state of war.  Though the Greek Government cancelled this law, it has not yet been repealed by the Greek Parliament.

b.  Bulgaria-Turkey.  Turkish Deputy Prime-Minister Mesut Yalmaz visited the summer state residence Evksinograd near Varna on 21-22 August and met with Bulgarian Prime-Minister Ivan Kostov.  They discussed a broad range of bilateral and regional issues.  Over the next two years Turkey will increase the transit through Bulgaria of Russian gas with 2 billion cubic metres each year, reaching 14 billion in 2002.  Bulgaria will receive US$17.4 billion from the transit.  Yalmaz discussed also with Council of Ministers officials the increase of the export of electricity to Turkey.  The Turkish Deputy Prime Minister pledged that by the end of the year Turkey would begin the agreed construction of water power electric stations in southern Bulgaria and the construction of the Maritza highway, which will improve the roads between the two countries.  Though the visit was unofficial, Yalmaz presented an invitation on behalf of Turkish Prime Minister Bulent Ecevit to Kostov to make an official visit to Turkey.

Bulgaria has not yet had its real estate in Istanbul returned, as was pledged earlier to the present Bulgarian Government, and the issues of divided families and other contentious property issues have not yet been completed in the bilateral relations.

2.  Regional Initiatives:  The Pact of Stability for Southeast Europe

The launch of a Stability Pact quick-start project, a Balkan Media Academy, was announced on 11 August in Sofia.  It is to organise seminars in the Balkan capitals, mainly in those countries where media freedom is endangered.  The project is worth €21 million.

V.   The Economic Situation of the Balkan Countries and the Region

1.  Bulgaria 

The foreign trade deficit of Bulgaria in the first half of the year was US$581.9 million.  However, there has been a tendency in the last ten months of a relative increase in exports, for the first half of the year at 23.8 per cent.

2.  Croatia

Representatives of the government, unions, employers, business people and the president’s office discussed Croatia’s development for the next three years on 25 August at Privicka Jezera.  Among other issues, they discussed proposals by the Finance Ministry regarding the reduction of public spending, the employment of 30’000 people annually, a stable fiscal policy, the budget until 2003, the framework of the strategy of economic development, and changes to the tax system.  The experts concluded that the starting point of a stable budget in the coming three years was the expected rise of 2.8 per cent in the gross domestic product (GDP) this year.  The rise in coming years is expected to be a 4 per cent increase in GDP in 2003 and a 5 per cent increase in GDP in 2004.

3.  Greece

  The National Bank of Greece has purchased 89.9 per cent of the second biggest Bulgarian bank, the United Bulgarian Bank (UBB).  The Greek owners are expected to buy by 2002 another 10 per cent, presently held by the European Bank for Reconstruction and Development (EBRD).

4.  Turkey

  An analysis by Moody’s this month found Turkey’s economic plans successful.  The analysis emphasised that the government had strong parliamentary support.  Due to the positive political developments in Turkey, there may be an increase in its rating.  Interest and inflation rates have a tendency to decline.  The report concludes that maintaining a stable decline in the inflation requires completing the financial and structural reforms and privatisation.

VI.   The Influence of External Factors on the Region:  National Great Powers and International Institutions

1.  The United States

USA-Albania.  Albanian Prime Minister Ilir Meta visited Washington, DC, on 23 August and met with US Secretary of State Madeleine Albright.  The internal situation in Albania and the state of regional relations were discussed during the visit.  US support to Albania has focused on restoring public order, strengthening the civil service and institutionalising democracy.  US technical and monetary assistance to Albania will continue at about US$30 million to US$40 million a year.

USA-Bulgaria.  The director of the US Central Intelligence Agency, George Tennet, visited Sofia on 13-15 August at the invitation of the director of the National Intelligence Service of Bulgaria, General Dimo Gyaurov.  Tennet held talks with Bulgaria’s president, prime minister, minister of defence, minister of the interior, chief of the National Security Service (the counter-intelligence), chief of the National Service for Fighting Organised Crime and his counterpart General Gyaurov.  A meeting was convened on 14 August between Tennet and the chief of Military Intelligence, General Lieutenant Angel Katsarov.  Analysts believe several topics were discussed during Tennet’s visit:  regional security, cooperation in fighting drug trafficking, illegal trafficking of people and arms and organised crime.  Very probably hot security issues in Southeast Europe, such as the situation in Montenegro, Kosovo and FRY, were also discussed.

USA-Croatia.  (1)  President of Croatia Stjepan (Stipe) Mesic and Croatian Prime Minister Ivica Racan visited the US starting 9 August and met with US President Bill Clinton and other senior US administration officials.  They discussed a broad range of bilateral and regional issues.  Clinton said Croatia’s success would help its own people and would also benefit the region.  He also pledged three new aid packages for Croatia.  These include US$21 million from a recent supplemental appropriation, US$4.5 million to reconstruct houses for refugee returns, and US$4 million for foreign military financing, now that Croatia is a member of the Partnership for Peace (PfP).  During Mesic’s visit to the Pentagon, US support for the military reform of Croatia and the issues of the civilian control of the military were discussed.  In the current fiscal year the US has provided US$40’000 for Croatia’s PfP participation, and US$ 117’000 have been provided for the next year.  Funding has been provided by the US for international military education training.  The US has financed the training of 10 to 20 people from Croatia at the Marshall Centre on how to run militaries under civilian control.  Some US$1’625 million have been provided for bilateral military cooperation with Croatia by the US for the period 1999-2001.  In a State Department ceremony on 9 August, Madeleine Albright was presented with a Badge of the Grand Order of Queen Jelena with Sash and Star by Mesic for her outstanding contribution to the promotion of democratic changes in the Republic of Croatia, for the solution and the stabilisation of crises in Southeastern Europe, and for the strengthening of Croat-US relations based on the principles of partnership.  (2)  An agreement was signed in August at the Croatian Navy (HRM) headquarters in Split in line with a plan on Croatia-US cooperation for organising a joint military exercise of the US Navy Sixth Fleet and the Joint Croatian Armed Forces to be held in the central Adriatic area.

USA-FRY.  (1)  At a regular State Department briefing Deputy Spokesman Philip T. Reeker said the US has challenged Milosevic to run free and fair elections, called for 24 September.  The challenge is to allow the free and independent media to resume reliable coverage without clouding the facts in the election process.  (2)  At the request of Albright, the US ambassador to Croatia, William Montgomery, has been named to lead a new Office of Yugoslav Affairs within the American Embassy in Budapest, Hungary.  This office will consist of State Department and US Agency for International Development (AID) officials who will work to support the full range of democratic forces in Serbia.  Both official Belgrade and the leading opposition presidential candidate, Vojislav Kostunica, declared they were against the opening of the office in Belgrade.  However, after the closure of the US embassy in Belgrade, the US needs a place to meet representatives of Serbian democracy, and the office is not designed to promote a particular opposition representative or party.

USA-Romania.  (1)  The Export-Import Bank of the USA (Ex-Im Bank) declared on 4 August that it is backing a US$51 million bank loan to Romania’s National Institute of Meteorology, Hydrology and Water Management that will enable the institute to purchase state-of-the-art weather forecasting equipment and services from Lockheed Martin Overseas Corporation, Bethesda, Maryland.  (2)  The US Federal Bureau of Investigation (FBI) is to open a station in Bucharest by mid- September.  This would be the implementation of an agreement to support the fight of the Romanian police services against organised crime.

USA-Turkey.  The Ex-Im Bank stated on 14 August that it would back US companies’ exports to Turkey through its credit insurance programme.  This year Turkey has become Ex-Im Bank’s fourth largest market, up from fifth place in 1999.  Ex-Im Bank is open in Turkey under all its short-, medium- and long-term programmes, which are available in both the private and the public sector.  Ex-Im Bank authorised US$20 million in financing of US exports to Turkey in fiscal year 1999.

2.  Russia

Russia-Bulgaria.  The Russian Foreign Ministry qualified on 7 August the debates in the Bulgarian Parliament on the yearly report of the government on national security as
“unfriendly” towards Russia.  The declaration of the ministry was provoked by the Bulgarian Prime Minister’s reminder that not allowing the transit of Russian aeroplanes to Pristina at the close of the Kosovo conflict last year over Bulgarian air-space prevented the failure of the peace process, which had just begun in June 1999.  At that time NATO and Russia had not yet agreed on the functions and zones of responsibility in the province of the Russian contingent.  The Russian Foreign Ministry’s displeasure is linked to the Bulgarian Government’s perceptions of Russian activity in the Balkans.  The perceptions are called “inadequate”.  The Russian daily Izvestia said on this contentious issue that “we live in the age of rationalism and pragmatism, when the allies are selected on qualitatively new criteria” (in comparison to the traditional religious and ethnic links).  It seems, according to the Moscow newspaper, that this has not been realised only by the Russian Foreign Ministry.  Further on the article asks: “Why do we have always to place our neighbours to the artificial, invented choice:  Russia or the West?”

The exchange of harsh declarations between the Ministries of Foreign Affairs of Russia and Bulgaria last month are counterproductive to bilateral relations.  Russia has the potential of playing a much greater positive role in Southeastern Europe than it has played till now.

Russia-FRY.  Russia officially declared on 25 August that the elections in Kosovo on 28 October would endanger the regional security in the Balkans, a position long supported by the regime of Milosevic, the major obstruction to post-conflict reconstruction in Kosovo.

VII.   The Security Situation and the Region-Building Evolution:  Conclusions

1.  The coming elections in Albania, FRY, Kosovo and Romania will be a major test for the stability of the regional security situation.  The special concerns are linked to FRY and Kosovo.  These elections are also going to be a test of the ability of the great powers outside the region and of international institutions to influence and support the progress of democracy and the chances for economic prosperity of the people of the Balkans.  The guarantee for the progress of the region is the new majority striving for democracy, European and NATO integration, and people from the region learning to work hard for their own prosperity on a market economy basis and in a new strategic environment.

2.  The solution of the economic issues of the individual Balkan countries remain the major stepping stones towards an improved regional market and to a closer relationship with and integration into the EU.  More extensive support from the Stability Pact donors and countries is of key importance to making economic relations in the region more dynamic.



Dr. Plamen Pantev, Editor–in–Chief

ISSN 1311 – 3240

Dr. Tatiana Houbenova-Delissivkova

Address: ISIS, 1618 Sofia,

Mr. Valeri Rachev, M. A.

P. O. Box 231, Bulgaria

Dr. Sc. Venelin Tsachevsky

Phone/Fax: ++(359 - 2-) 551 828

Mr. Ivan Tsvetkov, M. A.

E-Mail Address:

Dr. Dinko Dinkov


Dr. Todor Tagarev


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