Killing Off Dinar

Dinar and tolar, which are soon to be accompanied by other money substitutes, have finally found their way into the street market. Its success will be a clear indication of the chances the ruling party has in the next period. After the proclamation of the independence of Slovenia on October 7, and the introduction of its new currency, the final breakdown of the Yugoslav body politic and dinar was announced by the shock-parity of 70 dinars for a German mark (in Zagreb, where the Croatian crown is soon to come out). A few days later, the Moscow peace agreement between Serbia and Croatia, which extended the life of dinar for another month, has reduced the German mark - dinar parity to around 1:40.

Since any currency represents an "obligation" of the authorities to pay tomorrow for today's work effort of its population, the situation in the black market unmistakeably indicates the success of the Serbian ruling party and the trust in its ability to keep the given promise.

It is clear even today that the present power holders, along with their money, are "sweeping the streets", since they can get no real money. They have to try and raise real money with inflation. Converting dinar into foreign currency shows that no one is willing to finance a civil war. In the last ten weeks every time the Yugoslav plane touches down the Larnaka airport, the Cyprus is a beneficiary of another million dollars taken from Belgrade. We shall try to trace the itinerary of these billion marks that emigrated to Cyprus and the conditions under which this money from time to time finds its way into the dangerous Balkan Safari.

Let us take a hundred German marks note, which represents a daily wage of an Albanian migrant worker from Prizren (Kosovo). His compatriot comes to collect it, since he proved to be good at making enough dinars for keeping the numerous family of the young worker. So a hundred marks taken by this skillful courier are being transferred from Munich to Zurich first, where they board the charter plane of Kosovo Tourist and fly to Skoplje (Macedonia), where our men will reach his Kosovo link. Despite the fact that the money has been burdened with the expenses of an air transfer and the unpredictable customs risk, the family of an Albanian migrant worker still manages to get his pay in dinars, which is twice higher that evaluated at the official exchange rate. The lorry driver takes the note and driving through Hungary to avoid the Serbian road blocks around Belgrade get it to Zagreb. After it reaches Zagreb, it will end up in Vienna, where the Croatian capital has been pouring in. If it sells in the black market in Belgrade or Novi Sad, it will get to the orthodox Nicosia, where the banks are not subject to profit tax and where the possible European blockade of Yugoslavia (Serbia) is not taken seriously. The moment the note reaches the Cypriot banker with the Serbian accent, it will find its way back into the Serbian economy in the shape of a foreign credit. The now numerous private Serbian banks, savings banks and the private agencies acting as financial intermediaries are easily finding the clients who will by our note among the now desperate Serbian businessmen, who are searching for the imports of the necessary raw materials, since they have found a way for making an export deal. Since the price of our Munich note includes the 10 000 kilometres long risky journey, as well as 5 or 6 intermediaries, it is now very expensive. When after an export deal it returns to Serbia, the National Republic Bank will welcome it by seizing 30% for the future Serbian reserves. Since all of this has to be covered somehow, the prices at home are rising. Some other German currency note, which will as early as tomorrow venture on an even more dangerous trip, will clearly show what the price of the present war in Yugoslavia really is. It will also point out to the fact that everyone, including Serbia, is taking part in the war they are unable to finance.