- Capitalism and Alternatives -

Democracy & the neoliberal agenda (Yugoslavia)

Posted by: bill on April 20, 1999 at 12:03:29:

For a critical evaluation of the neoliberal agenda as it relates to Yugoslavia, check out the article by Michel Chossudovsky. While the report was based on Bosnia & Croatia, the application to Serbia is all too apparant.

Here are some exerpts:

"As heavily-armed NATO troops enforce the peace in Bosnia, the press and politicians alike portray Western intervention in the former Yugoslavia as a noble, if agonizingly belated, response to an outbreak of ethnic massacres and human rights violations. In the wake of the November 1995 Dayton Peace Accords, the West is eager to touch up its self-portrait as saviour of the Southern Slavs and get on with "the work of rebuilding" the newly sovereign states.

"Drowned in the barrage of images and self-serving analyses are the economic and social causes of the conflict. The deep-seated economic crisis which preceded the civil war has long been forgotten. The strategic interests of Germany and the US in laying the groundwork for the disintegration of Yugoslavia go unmentioned, as does the role of external creditors and international financial institutions. In the eyes of the global media, Western powers bear no responsibility for the
impoverishment and destruction of a nation of 24 million people.

"But through their domination of the global financial system, the Western powers, pursuing their collective and individual "strategic interests" helped from the beginning of the 1980s to bring the
Yugoslav economy to its knees, contributing to stirring simmering ethnic and social conflicts. Now, the efforts of the international financial community are channeled towards "helping Yugoslavia's
war-ravaged successor states." Yet while the world's attention is focused on troop movements and cease fires, creditors and international financial institutions are busy at work collecting former Yugoslavia's external debt, while transforming the Balkans into a safe-haven for free enterprise.

"The former Yugoslavia has been carved up under the close scrutiny of its external creditors. Its foreign debt has been carefully divided and allocated to the republics. The privatization programs implemented under the supervision of the donors, have contributed to a further stage of economic dislocation and impoverishment of the population. GDP had declined by as much as 50 percent in four years (1990-93).

"Moreover, the leaders of the newly sovereign states have fully collaborated with the creditors. Even as the fighting raged, Croatia, Slovenia and Macedonia had entered into separate loan negotiations
with the Bretton Woods institutions. In Croatia, the government of President Franjo Tudjman signed, in 1993, an agreement with the IMF. Massive budget cuts mandated under the agreement thwarted Croatia's efforts to mobilize its own productive resources, thus jeopardizing post-war reconstruction. The cost of rebuilding Croatia's war-torn economy was estimated at some $23 billion, requiring an
influx of fresh foreign loans. In the absence of "debt forgiveness," Zagreb's debt burden will be fueled well into the 21st Century.

"With a Bosnian peace settlement apparently holding under NATO guns, the West has unveiled a "reconstruction" program which fully strips Bosnia-Herzegovina of its economic and political sovereignty. This program largely consists in developing Bosnia-Herzegovina as a divided territory under NATO military occupation and Western administration.
Moreover, the Constitution agreed in Dayton hands over the reins of economic policy to the Bretton Woods institutions and the London based European Bank for Reconstruction and Development (EBRD). Article VII stipulates that the first Governor of the Central Bank of Bosnia and
Herzegovina is to be appointed by the IMF and "shall not be a citizen of Bosnia and Herzegovina or a neighbouring State."

"Just as the Governor of the Central Bank is an IMF appointee, the Central Bank will not be allowed under the Constitution to function as a Central Bank. Neither will the new "sovereign" successor State be allowed to have its own currency (issuing paper money only when there is full foreign exchange backing), nor permitted to mobilize its internal resources. As in the other successor republics, its ability to self-finance its reconstruction (without massively increasing its external debt) is blunted from the outset.

"The tasks of managing the Bosnian economy have been carefully divided among donor agencies: while the Central Bank is under IMF custody, the European Bank for Reconstruction and Development (EBRD) heads the Commission on Public Corporations which supervises operations
of all public sector enterprises including energy, water, postal services, roads, railways, etc. The President of the EBRD appoints the Chairman of the Commission which also oversees public sector
restructuring, meaning primarily the sell-off of State and socially owned assets and the procurement of long term investment funds.

"One cannot sidestep a fundamental question: is the Bosnian Constitution formally agreed between heads of State at Dayton really a constitution? A sombre and dangerous precedent has been set in the history of international relations: Western creditors have embedded their interests in a Constitution hastily written on their behalf, executive positions within the Bosnian State system are to be held by non-citizens who are appointees of Western financial institutions. No constitutional assembly, no consultations with citizens' organizations in Bosnia and Herzegovina, no "constitutional amendments".

There is more...

The complete text can be found at http://www.web.net/~newsoc/3/Bosnia.html

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