(19 Nov 1996) Eng/Serbo-Croat/Nat
The tiny republic of Montenegro – part of former Yugoslavia – has declared itself an off- shore international business zone, with virtually no limits to foreign investment.
The declaration is being seen as a move towards gaining more economic freedom from neighbour and Yugoslav Federation partner, Serbia.
Montenegro’s Prime Minister, Milo Djukanovic, says the republic wants to fully normalise its ties with the west.
This is the Adriatic resort of Budva in Montenegro.
This beautiful old seaside town is just one of the places in the tiny republic that stands to benefit from its declaration as an off-shore international business zone.
In the Montenegrin town of Milocer at the weekend, the Montenegrin Prime Minister Milo Djukanovic and other officials from the republic met to officially declare the business zone open.
Montenegro is deeply unhappy with Serbia’s reluctance to privatise Yugoslavia’s shattered state-run economy or allow the free flow of foreign capital into the country.
The republic stuck with Serbia through the break-up of the former Yugoslavia and has paid dearly through the trade embargo imposed against Yugoslavia in 1992.
Montenegro’s aim is to attract more foreign investment through the formation of off-shore companies that would pay minimal taxes of 2.5 percent to the state.
The state won’t demand to know the origin of the money invested, which critics say will make Montenegro one of the biggest money-laundering operations in Europe.
Montenegro is hoping foreigners will invest in re-building the republic’s road network and modernising its two main airports.
The main area of potential foreign investment is likely to be in tourism and hotels along Montenegro’s beautiful, 283 kilometre-long stretch of Adriatic coastline.
But the idea has so angered Serbia that its lawyers have started legal proceedings against Montenegro, arguing that off-shore companies are against Yugoslavia’s constitution.
Montenegrin officials have dismissed Serbia’s opposition to the project.
SOUNDBITE: (Serbo-Croat)
“The Federal Republic of Yugoslavia will change in the next four-year period in the framework of the existing constitution. We’ll try to make a country more democratic and more free than it is now.”
SUPER CAPTION: Momir Bulatovic, President of Montenegro
SOUNDBITE: (English)
“The Montenegrin government has provided the framework, I think, which quite a lot of Western countries will want to look at very closely. Tourism is a very obvious one for countries like my own, and they have already started to look at this quite seriously in the relatively short period since the lifting of sanctions.”
SUPER CAPTION: Ivor Roberts, British Ambassador to Yugoslavia
One visiting official stressed the importance of Montenegro re-establishing full ties with important money lenders.
SOUNDBITE: (English)
“We need to have a good and sophisticated banking system in this country, so we need to be a member of the World Bank and the I-M-F. Because of that we should speed up our efforts to become members of those institutions. I think it’s a beautiful idea. We are going to make money.”
SUPER CAPTION: Ratko Knezevic, Chief of Montenegrin Trade Mission in Washington
If all goes to plan, the Montenegrin resort of Budva could once again become a thriving seaside town.
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