by Sandro Orlando
Il Corriere Economia (page 7), Monday 26 April 1999
The brochures describe it as one of the strategic centres of the Federation: Kosovska Mitrovica, the only industrial town in Kosovo, is built on huge deposits of lead and zinc. The Rmhk-Trepca complex is one of the biggest in Europe and the potential value of its mining veins, which also contain magnesite, chromium, nickel, and asbestos, is estimated at around $5 billion. In 1989, at the beginning of the military confrontation with Milosevic, this wealth had already led the Albanian population to occupy the mines in Mitrovica to protest about the policy of forced Yugoslav immigration. And on 23 March, on the eve of the NATO raids, Kosovska Mitrovica was the first place from which Albanians were deported en masse.
We are the state.
It was the NATO bombing of a cigarette factory in Nis, believed to belong to Milosevic's son Marko, that raised the question: "Yugoslavia is a state based on nepotism," said NATO. "It is impossible to hit any industrial target without destroying the property of Milosevic's ministers and family, because they are the state." After the end of the era of worker co-operatives, the economy of Serbia and Montenegro passed into the hands of an elite few (30 or 40 families are in control of the country), and business and politics are indissolubly linked. Rmhk-Trepca, for example, is controlled by Yugobanka, the Central Bank, and by Genex, the country's main import-export company. The governor of the Central Bank is Miodrag Zecevic: he has known Milosevic since the early sixties, was a witness at his marriage to Mira Markovic, and his colleague at the Beogradska Banka until he became Managing Director (Milosevic would subsequently be the chairman, after being responsible for many years for relations with the Internati
onal Monetary Fund). He finally went to Paris to manage the Franco-Yugoslav bank that Slobo himself helped to found. In the summer of 1998, Zecevic, now travelling on a French passport, was arrested at Paris Airport, accused of having circumvented the sanctions imposed by the UN on the Belgrade regime by means of illegal transactions using Swiss bank accounts. Two deals in particular, in February and March 1996, aroused suspicion: the first, to the value of around $750,000, was a payment to the Swiss-Yugoslav Bank, apparently destined for Zecevic's daughter, who lives in London. The second sum (around $2 million) was paid into a Barclays account in Zurich, and was made out to Mrs Milosevic. The money came from a mysterious finance company in Nicosia, capital of the off-shore haven of Cyprus. The Yugoslav Foreign Minister himself intervened to ensure the release of Zecevic. Placed under house arrest, he fled to Belgrade, where he was appointed as Governor of the Central Bank. There is now an international arr
est warrant on his head.
Meanwhile, his position in Paris was assigned to Borislav Milosevic, the President's older brother, who as well as being Yugoslav ambassador to Moscow is also the real power behind Genex. It was Borislav, together with Zecevic, who in 1996procured two contracts for Rmhk-Trepca for the sale of minerals in the US and Greece. The Greek deal is worth $500 million, and gives Greek financier Evangelos Mytilinaios the right of pre-emption over the future privatisation of Rmhk-Trepca. By coincidence, a few months after the deal it was discovered that Milosevic had begun to invest in property in Athens and was negotiating the purchase of a villa in Corfu, where he had already spent $300,000 on a yacht.
Privatisation in the family.
In April 1998, bankruptcy proceedings were commenced against Genex. The company, whose capital in 1990 was worth more than $1 billion, was officially valued at $70 million, including the mines. A laughable price which immediately cast doubt on the government's privatisation plans. The urgent need for liquid assets also drove Mrs Milosevic, leader of the neo-Communist JUL party, to abandon her famed aversion to liberalism. 49% of Telekom Serbia was sold to Telecom Italia and to the Greek OTE for $950 million, a sum that would not even cover the balance of payments deficit for six months. Meanwhile, thanks to a network of relations and friendships, in Moscow Milosevic's brother managed to obtain gas supplies from Gazprom on credit, at a cost of $300 million a year. These relations brought Genex into contact with Mabetex, the Swiss construction company owned by Behget Pacolli, the Kosovo-born boyfriend of Italian pop star Anna Oxa: Behget recently ended up in the Kremlin-Gate inquiry, the scandal of "golden con
tracts" in Russia, a story involving sex and porn films as well as kickbacks totalling millions of dollars. The Geneva daily Le Temps discovered that Genex is named on the Mabetex website as a partner company in the context of the project for the restoration of the Kremlin and the Russian Parliament. "A mistake," claimed Mabetex.
The hidden treasure.
Before the scission of Slovenia and Croatia, Yugoslavia's foreign reserves were worth almost $10 billion. These reserves, kept in the strongholds of the Central Bank in Belgrade, amounted to only $300 million at the end of 1997. Many people now believe that some of the missing billions were channelled abroad, as early as 1992 and 1993, while the Yugobank continued to print dinars, bringing inflation to 20%. This capital is added to by the part of the foreign debt that remained in Belgrade ($12 billion), despite the legitimate claims of the secessionist republics. The escape route for the money is via Cyprus, thanks to another of the President's friends, Borka Vucic, the elderly lady who directs the Beogradska Bank and its branch in Nicosia.
At the beginning of the war at least $3 billion passed through the three Serbian banks on the island (the other two are Karic and Kreditna), destined for Frankfurt, London and Paris. The money serves to pay the special police forces, those most faithful to Milosevic, through covering institutions such as Asi Bank (which only funded JUL members), formerly directed by the German-Serb businessman Zoran Todovoric, killed three months after his appointment to the board of Beopetrol in 1997. The statement made by the late Deputy Home Minister Radovan Stojicic Badza remains memorable: "There is no organised crime in Serbia."When he was killed, in April 1997, he was carrying a briefcase containing 700,000 marks.
