July Retouch

Serbian Prime Minister Mirko Marjanovic submitted two reports in July, one recently to the SPS main board and another on July 12 to the SPS Belgrade city board. He spoke of his government’s intentions to establish financial discipline, redistribute tax burdens, reform the social security funds, grant loans for exports and the need to reorganize almost all companies, refresh them technologically and secure turnover capital which is expected to happen in the privatization process. Privatization seems to be a long term plan since, on July 13, New Democracy (ND) leader Dusan Mihajlovic told the Serbian state TV morning show that the ND and SPS don’t agree on all ownership issues but that "those are not primary issues now" and that "there are other things to solve now". Reports on foreign business delegations say they’re coming in only to have a look for the moment.

Marjanovic’s July reports show a slight retouch of current policies which did not draw serious reactions from the opposition which is focused on the citizenship and political parties laws.

Marjanovic’s address to the SPS leadership, not parliament, shows that the SPS parliament group is weaker than the party leadership and perhaps it shows there is more resistance to the government in the ruling elite than among the opposition.

The state media paid great attention to June statistics on rising exports and a revival of production and reopening of some shipyards. The moment when aspirations start growing can be critical to any government especially this government which has control over an excessively large public sector and protects a large number of state companies. In Serbia that means regional lobbying has started and the government is trying to get as many people as possible off the list.

Kragujevac officials were received by President Slobodan Milosevic on July 1 to lobby him to get the government to introduce measures to start production in Zastava car factory. Nezavisna Svetlost weekly said Kragujevac socialists admitted a breakdown but added that the population won’t benefit from the admission. Reports from the city early in July said politically marginal directors of some public companies were dismissed.

The director of Hemofarm spoke out against imports of medication and predicted that the pharmaceuticals industry will stop working. The Nis Electronics Industry fought for and won a financial injection. Yugoslav construction companies in Russia are being pressured to move their business from off shore companies to companies registered in Yugoslavia.

Marjanovic’s report to his party comrades (including his complaints of insufficient cooperation with state unions and the economic chamber) seem like a request for a social consensus. Formally, the SPS controls the institutions that could secure that consensus (directors, most private businessmen, state unions and the chamber) and is ignoring the opposition.

Nasa Borba’s New York correspondent said the New York Times quoted a CIA report that said the isolated and corrupt Serbian economy is stagnating, that the national foreign currency reserves have almost melted away and that president Milosevic will face serious political unrest in the next six to nine months unless the situation improves. All the speculation on unrest in Serbia has proved incorrect to date. The SPS is violating the constitution and setting up action organizations for certain companies.

No opposition party has shown that it is counting on exploiting social unrest nor do they have the union organization to channel dissatisfaction. Everyone is preparing for federal elections this year. The most active is the Zajedno coalition which is continuing its election campaign. DS leader Zoran Djindjic told a July 14 rally in Arilje that the authorities "Should be asked who they’re working for" and offered an answer: "To fill their bank accounts abroad".

Vesna Pesic (GSS) said Milosevic "donned his old suit and started cutting ribbons at construction sites which will never be finished". Vuk Draskovic (SPO) said the SPS program is empty words.

Viewed from any side the prime minister’s July reports are just another sign of efforts to delay the inevitable: serious privatization and political reform in Serbia.