Anxiety And Threats

by Dimitrije Boarov

Although the Yugoslav economists' Budva meeting (June 1517) came at an ideal moment when the economy is in a much better state than it was and than it will be, a fear crept into everyone's speeches. That fear was noticeable among many politicians who rushed to the meeting--Yugoslav President Zoran Lilic, Federal Prime Minister Radoje Kontic, Montenegrin President Momir Bulatovic, Serbian Prime Minister Mirko Marjanovic, Deputy Serbian PMs Dragan Radulovic and Jovan Zebic.

Fear among the authorities is understandable because the pressure to make the antiinflation program a success through administrative measures is much greater then last year. Failures were justified through the sanctions and now we have escaped them. Politicians and economists gathered around the Avramovic program all look like a group of people who dragged the carcass of the Yugoslav economy out of the abyss of hyperinflation, restored it with about one billion stable Dinars, consolidated the budgets to between five and 10% of the deficit. Now, they see that the economy has to have a turnover of some 10 billion Dollars through the social product by year's end.

Figures submitted by economic expert Ljubomir Madzar show that a slightly smaller production should be expected, between 4.2 and 5.5 billion dollars.

Few, apart from Avramovic, voiced hope that the Yugoslav economy would face no new traumas and would arrive at a definite conceptual solution.

Jurij Bajec and Danijel Cvijeticanin assessed that the renewed disputes over reviving production are a clash of the concepts of planned, consciously directed development under state management and the concept of development based on a concurrent market economy. In that sense they warned Serbian PM Marjanovic that the government should not give in to pressure aimed at unifying the entire economy into the organizational form of a single company where the big earners would pay for losses.

Bajec and Cvijeticanin were not the only ones who saw that the Avramovic program was seen more as a recovery and less a reconstruction. They drew up a list of system laws which are either lacking in market operations or are blocked in parliament.

Stable prices and exchange rates must be maintained and a balanced budget achieved. But is that possible without an urgent transfer of a part of the stateowned companies which are burdening the budget?

A lengthy debate on current economic policy steps was stirred up by Avramovic, who announced the minting of gold coins for the purchase of crops. Avramovic said the state was putting its gold reserves into the game. They can be used partly to replace trust in the state apparatus since it is clear that the bond market (which would be based on gold) is nowhere in sight.

Besides uncertainties over the entire system and its credibility, the problem of the economic policy model which cannot function long as it is now remains.