Yugoslavia - Future trends

Yugoslavia's economic problems will not disappear simply because it now has a democratically elected president. The new government faces the challenge of reconstruction, and the legacy of 10 years of war, sanctions, and corrupt officials' looting will take a considerable amount of time to reverse and will not occur without a substantial inflow of foreign capital. Trade relations can be normalized quickly and co-operation with the West can be energized with the swift resolution of pending political issues.

The government's tasks will include stabilization and economic reform, imposing law and order, and helping vulnerable sectors of society. They will be trying their best to attract foreign direct investment and to unfreeze the assets of the former Yugoslavia by reaching agreement with the other successor republics. The frozen private bank accounts in the names of Milosevic and his associates in Switzerland and elsewhere may be transferred back to the country, and immediate aid of US$172 million was pledged by the EU in late 2000 for medicine, heating, and food through the winter. The Stability Pact for South-eastern Europe, a regional development plan backed by the EU and the United States, the IMF, the World Bank, and regional banks will contribute to the reconstruction and reform process. The prosperity of Serbia and Montenegro will be crucial for establishing lasting peace in the Balkans.