Grounding Yugoslav Airlines

The day after the decision was officially announced, the Serbian Prime Minister Mirko Marjanovic called an urgent session and lodged a vehement protest. In the process, he quite expectably ignored the fact that Momir Bulatovic, the Federal Premier, should have addressed the matter. Marjanovic issued a statement to the effect that "the EU decision to ground JAT is another example of the organization's discriminating and arrogant behaviour and, indirectly, its support for the terrorists in Kosovo. The decision is a sad example of the EU's destructive policy aimed at discriminating Yugoslavia, masterminded by certain German officials". Having determined who is what to us and why, Marjanovic said that Yugoslavia shouldn't retaliate because it would "make the same offense and violate its principles of free trade and free circulation of people".

The Serbian government issued a stern warning to the EU that it will ask the Federal government, more precisely Momir Bulatovic, to "suspend the return of false asylum-seekers and consider other measures against countries pursuing a discriminating policy against the Federal Republic of Yugoslavia, its officials and citizens".
Marjanovic's government probably expects the whole of Germany to tremble with fear. Predictions that Yugoslavia would retaliate by banning flights from EU member countries went down the drain, but the decision to suspend the repatriation of "false asylum-seekers" from Germany was quite expected.

Marjanovic is probably unaware that he has done a huge favour to many politicians in Germany, who were accused by various adversaries and humanitarian organizations of deporting civilians to those who force them to take the status of refugees and asylum-seekers. Yugoslavia's refusal to take back some 150,000 ethnic Albanians who were denied asylum in Germany will relieve many politicians in Germany and clear their conscience.

LIFE IS A TEACHER: The sanctions arrived at a time when Yugoslav Airlines wanted to renew its Airbus 319 fleet, a European product in the true meaning of the word. The project was sponsored by a number of Serbian banks, in an effort to switch from American to European aircraft. JAT also planned to apply new technologies, win new markets and develop a strategy to stabilize its international position.

The initial announcements that EU countries might ground JAT were discarded with the firm conviction that Great Britain and Greece will veto the decision. Great Britain and Greece complained that they had separate bilateral agreements with Yugoslavia and that the deadline given to suspend them was far too short. After the Greek "betrayal", patriotic media in Serbia rested the nation's hopes on the fact that the first air transport agreement with Great Britain was signed in 1959, long before the EU even existed. After the EU ministerial council made its decision in Salzburg, British officials declared its intention to suspend grounding JAT flights for 12 months. Yugoslav Airlines and British Airways had four flights a week from Belgrade to London and back.

The British foreign ministry confirmed it intention to stick to the 12-month deadline on September 8, once again stressing its approval of the decision to impose sanctions against Yugoslavia.

Until last Tuesday, JAT had 48 flights a week to 17 EU cities. Ten days before the formal ratification of the decision to ban Yugoslav Airlines, JAT's managing director Zika Petrovic qualified the decision as groundless and said that JAT would retaliate by asking for a ban on flights from EU countries to Belgrade. He said that JAT would also ask for international arbitrage, compensation and agreements with foreign companies prepared to do business and share the profits with Yugoslav Airlines. Petrovic said the decision to ban JAT flights was politically motivated and aimed at shattering the weak and vulnerable Yugoslav Airlines.

Zorica Radosavljevic, an advisor in the Yugoslav Ministry for air transport, said that flights to and from EU countries accounted for 95 percent of JAT's business. According to her, the International Civil Aviation Organization (ICAO) noted Yugoslavia's objection to the EU decision, meaning that it could discuss JAT's appeal at its upcoming summit from September 22 through October 2.

However, all JAT flights to and from EU member countries are banned until further notice. The only time when a JAT aircraft will be allowed into EU air space is in case of an emergency landing and a resultant take off to its original destination. Sanctions are to be imposed against all EU countries, companies and individuals that violate the decision, with the intention of discouraging and preventing any such action.

Exempt from the ban is Montenegro Airlines, with the explanation that the EU does not wish to cause economic damage to Montenegro as it "firmly supports the policy of economic and political reforms pursued by Montenegro's president Milo Djukanovic". The goal of he sanctions imposed against JAT has also been made public and very obvious; "to punish the regime of Yugoslav president Slobodan Milosevic for using excessive force against ethnic Albanians in Kosovo". British restraint fits into the theory that the sanctions resulted from the USA's ongoing confrontation with Europe on events in Kosovo, but Serbian officials would be unwise to "invest" in this "conflict". The real issue is who will keep or raise their shares in the Yugoslav air space worth around 200 million US dollars, as estimated by JAT's managing director Zika Petrovic.

MORE SPECULATION: From that point of view, it would be fair to say that Europe has grounded JAT with the intention of shattering it completely as Yugoslav Airlines still haven't recovered from the effects of sanctions imposed against Yugoslavia from 1992 to 1995. None of JAT's officials were willing to comment on the Serbian's government's decision not to retaliate. One JAT's managers, who preferred to remain anonymous, told the weekly Vreme that the company still doesn't know what to do. "At least 80 percent of our flight are related to the EU, which is why it will be very hard to do business after the ban. The sanctions will certainly hit JAT and the state, but direct and indirect damage resulting from losing markets, passengers and the sales network are going to be much more severe. If foreign airline companies stay in Yugoslavia, things are only going to get worse for us. If that happens, we can last a year or two at the most. Only God can give you a market with no local competition". Hence, only a fool would be merciful to competition eliminated from the market. Therefore, we shouldn't be too thrilled with Swissair's gentle offer to "take over" JAT's passengers and "compensate" the Yugoslav company in return, regardless of the fact that Switzerland could dispute the ban as it's not an EU member.

Local patriots unhappy with the Serbian government's response qualified the EU decision as an uncivilized act of violence and arrogance, with the intention of bringing Serbia to its knees. Several parties issued statements qualifying the act as "barbaric behavouir by the so-called civilized democratic world" while the state-controlled media focused their attention on he air show in Vranje, held the day before the ban was imposed.

On the other hand, the owners of shuttle vans that became famous for their highly commercial trips to and from Budapest from 1992 to 1996 are relishing the prospect of being back in business. Their profits will match those in the above-stated period if the inflation rises just a little bit. Everything seems to be in the right place. If JAT becomes a private enterprise one day, the new owner will definitely be someone outside the EU.