Serbia and Montenegro - Domestic policy



Serbia and Montenegro's economic issues remain daunting and probably the first priority among domestic problems. The economic health of Serbia and Montenegro is linked to that of the entire Balkan region. Following the handing over of Miloševic to the war crimes tribunal in The Hague, the United States, European Union (EU), and the World Bank pledged US $1.3 billion to help rebuild the former Yugoslavia's economy, which was ravaged by war. Serbia and Montenegro is in debt to the tune of around US$ 12 billion, and needs to attract foreign direct investment. Money is needed to rebuild roads and bridges, and to pay the salaries of teachers, doctors, and other state workers. Although there has been a degree of recovery in the country, much of the economy was still operating at only 50% capacity in 2001. However, despite slow progress in privatization and the effects of the global economic downturn, in 2003 economic growth was projected to be around 4.5%.

The union of the Serbian and Montenegrin republics as the state of Serbia and Montenegro in 2003 has done much to dash the separatist hopes of Kosovar Albanians in the immediate future. Although operating under a fair amount of local autonomy, Kosovo is still governed by the UN Interim Administration Mission in Kosovo (UNMIK), and is dependent upon the international community for financial and technical assistance; UNMIK also collects taxes and manages the budget. Even though the Serbian and Montenegrin republics are allowed to hold referendums on independence in 2006, most observers do not expect Kosovo to attempt to unite with Macedonian Albanians to form a separate state.

Serbia and Montenegro still faces the problem of corruption in society, as many of Miloševic's cronies still hold positions of power in government and business.

Marovic will preside over Serbia and Montenegro's move toward political and economic stability. The fact that he is a Montenegrin tempers traditional Serbian dominance of the region.

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