State union
84. The unresolved question of the union between
Montenegro and Serbia is a major distraction for policy makers
in the Balkans. Dr Eyal explained the importance of the state
union question in his submission: "The seemingly never ending
dispute between [Serbia and Montenegro] has not only precluded
a wider political solution in the Balkans as a whole, but has
also wasted an opportunity to concentrate on economic reconstruction
inside Serbia. Violence between the two entities can be excluded.
Nevertheless, a resolution to this problem—in one way or
another, even if it involves formal separation—is an urgent
necessity in order to break up the current legal logjam."[105]
Commenting on the question of Montenegro's independence, Kai Eide
told us: "This whole question of Serbia and Montenegro adds
to the political burden in the political landscape in Belgrade
and complicates the situation further there."[106]
85. The existing system—a loose federation
between Serbia and Montenegro—is based on the Belgrade Agreement,
which the EU High Representative for Foreign Policy, Javier Solana,
brokered in March 2002; his efforts were part of an attempt to
postpone the separation of the two states until after the Kosovo
final status talks of mid 2005.[107]
Under the agreement, Yugoslavia ceased to exist in February 2003,
and was replaced by the state union of Serbia and Montenegro,
but the discussions leading to the constitutional charter revealed
strong differences. The Serbian government wanted a union chamber
with elected deputies, while the Montenegrin government wanted
to appoint delegates. A compromise which permitted the appointment
of delegates for two years before their election rested on Serbia's
acceptance of a referendum on independence in Montenegro after
the agreement expires in February 2006.[108]
Gabriel Partos assessed the effectiveness of the agreement, saying
it "has been a success in terms of crisis prevention/postponement.
But it has not so far laid the foundations for a stable, long-term
union."[109] Neither
side has adopted the terms of the agreement with enthusiasm and
the FCO wrote in it submission that "progress on implementing
the provisions in the Constitutional Charter has been slow."[110]
In effect, the agreement amounted to a truce until the referendum
takes place.
86. Part of the problem is that the Belgrade Agreement
established an unwieldy vehicle; examples of the complexity of
the state union include the division of posts in Serbia and Montenegro's
diplomatic corps—so a Montenegrin is ambassador in London,
and a Serb in Berlin—and the parallel federal and state
government structures. However, the biggest obstacle to the effective
functioning of the union is growing economic divergence between
the two states. The Embassy of Serbia and Montenegro wrote in
its submission: "When speaking of the state of the economy
in Serbia and Montenegro, we must keep in mind that the economic
systems of the two republics…significantly differ. Amongst
other things: there are two central banks; two different currencies
are in use; the systems of privatisation are different, so are
foreign trade, protection and customs and excise systems, as is
general taxation."[111]
87. The constitutional structure has also impeded
reform efforts as well as Serbia and Montenegro's progress towards
a SAA. Recognising the logjam, the EU launched a twin track process
in September 2004 which will permit the signature of a single
SAA with two separate economic annexes for Montenegro and Serbia.[112]
We asked Dr Whyte about the twin-track process, and he told us:
"I think the twin-track approach recognised the reality that
the attempts to make Serbia and Montenegro integrate with each
other before joining the EU simply was not working."[113]
Dr Anastasakis added that the twin-track approach "shows
a genuine attempt by Chris Patten and the Commission to understand
what exactly the problem is…I think maybe they recognise
that this kind of (Solana) state was a kind of failure…Showing
this kind of flexibility will definitely…end the antagonism
in trying to approach the standards of the EU."[114]
88. However, Dr Whyte added that the EU approach
could also contribute to the end of the union because "the
Montenegrins now plan to make the best go they can of proving
their European credentials within the framework of the new proposed
feasibility study, and they hope to be in a position to turn around
to their own voters and say, 'Look, Serbia is holding us back
from our European integration' and that will then be used as an
argument for separation."[115]
89. The question of Montenegro's independence remains
divisive within both Montenegro and Serbia. In Montenegro the
Democratic Party of Socialists and Social Democratic coalition
government, led by Milo Djukanovic, fiercely advocates separation
from Serbia, while the opposition Socialist People's Party, the
Serbian People's Party and the People's Party, with 40% of the
seats in parliament, staunchly oppose a break with Belgrade.[116]
Gabriel Partos told us: "At present support in Montenegro
for independence and the continuation of the SaM union is almost
evenly balanced".[117]
In this situation, a referendum on independence has the potential
to provoke political instability within Montenegro. Gabriel Partos
went on to describe the political processes which may lead to
independence. He said: "An early indication of [the dissolution
of the state union] may come in the elections for the SaM parliament,
due in February 2005. A strong showing for Montenegrin Prime Minister
Milo Djukanovic's party and its allies could set in motion moves
towards Montenegro's independence…Djukanovic may also want
to use an independence referendum to rally support at a time when
he will have been in power as prime minister or president, without
interruption, for 15 years."[118]
90. In Belgrade, we heard that views within the
governing coalition differ, but that Serbia would accept the results
of a referendum on independence, provided the result was clear
and the poll conformed to appropriate standards. The Embassy of
Serbia and Montenegro said that "ultimately, the will of
the people (as expressed through a referendum) will prevail and
should be respected."[119]
Details such as the phraseology of the referendum question, however,
could be a source of friction between the two governments, as
would a move towards independence ahead of the February 2006 timetable.
91. Montenegro's independence could have an impact
on the region, given the secessionist impulses in some communities
in Macedonia, Bosnia and Herzegovina, and Kosovo. For instance,
one fear is that the independence of Montenegro could provide
a precedent for the secession of Republika Srbska from Bosnia
or encourage the Kosovo Albanians' demands for independence. However,
our witnesses played down the potential impact of Montenegro's
independence. Dr Eyal told us: "I suspect…that if Montenegrin
independence comes, it will have very little impact on Bosnia
where the logic of the behaviour of the various ethnic communities
is completely different. It will, however, on Kosovo, because
it will be very difficult to say we are not settling the legal
status of Kosovo, but we are rushing to settle the legal status
of Montenegro."[120]
Gabriel Partos told us that the impact of independence "will
be marginal, minimal."[121]
92. A further question is whether Montenegro has
the capacity to function as an effective independent state, given
its small size—about 660,000 people—and its problems
with organised crime. Misha Glenny told us that Montenegro "is
so small that absorbing it actually would not make much difference
[for the EU]. It would probably be very easy to do it, although
it is still a pretty highly criminalised state."[122]
The Italian government has particular concerns about crime in
Montenegro. Another concern is the impact that such small states
could have on the distribution of voting powers within the EU.
93. We asked the Minister if the United Kingdom would
accept Montenegro's independence. He said: "I cannot imagine
the British Government…saying that Montenegro cannot have
its independence…[but] I do not want to say independence
on any terms, declared by any faction which can get a majority
vote in a plebiscite. There are a lot of qualifiers to it but
there is no one in Britain saying, 'Under all circumstances, under
all conceivable scenarios, the only future state we will accept
is a merged Serbia Montenegro.'"[123]
We welcome this balanced and realistic position.
94. We conclude that independence for Montenegro
in 2006 is probable, and that it is unlikely to lead to serious
violence or instability. However, we recommend that the Government
strive to minimise the risks of conflict. We conclude that the
international community, including the United Kingdom, should
seek to ensure that the details of the referendum conform to international
norms, should play a role in monitoring any referendum in Montenegro
to ensure its fairness, and should accept the results of a free
and fair poll. We also recommend that the Government work with
the local authorities to tackle organised crime and help build
administrative capacity in Montenegro, for instance by offering
technical support to the government in Podgorica.
The United Kingdom's representation
95. Another issue we examined was the question of
UK representation in Podgorica. In their 2001 Report, our predecessors
assessed the necessity of UK representation and concluded that
"the need for the FCO to have a permanent post in Montenegro
is urgent."[124]
Currently, the United Kingdom has a locally engaged member of
staff in Podgorica and the Ambassador in Belgrade travels frequently
to Montenegro. We asked the Minister why no British diplomat worked
in Podgorica. He told us: "The Committee's report in 2001
said that we should have a permanent post in Montenegro and we
have established that, I accept not with an English-born diplomat,
but this is a serious question of resources."[125]
We recognise that resources are scarce, but consider that
the case for a fully-staffed United Kingdom based Post in Podgorica
is strong, given the increasing likelihood of the dissolution
of the Union of Serbia and Montenegro. Other states, such as the
USA, China, Italy, Russia, Greece, Slovenia and Croatia already
have consular representation in Podgorica.
96. We conclude that the increasing possibility
of Montenegro's independence adds to the case for a Post headed
by a United Kingdom-based diplomat in Podgorica.
105 Ev 4 Back
106
Ev 113 Back
107
Ev 64 Back
108
International Crisis Group, A marriage of inconvenience: Montenegro
2003, 16 April 2003, Back
109
Ev 2 Back
110
Ev 64 Back
111
Ev 132 Back
112
"New formula for stalled integration process", Institute
for War and Peace Reporting, 17 September 2004 Back
113
Ev 132 Back
114
Ev 48 Back
115
Ibid. Back
116
"Montenegrin rivals both claim EU victory", Institute
for War and Peace Reporting, 17 September 2004, Back
117
Ev 2 Back
118
Ev 2 Back
119
Ev 131 Back
120
Ev 7 Back
121
Ibid. Back
122
Ev 50 Back
123
Ev 84 Back
124
Foreign Affairs Committee, Fourth Report of Session 2000-20001,
Government policy towards the Federal Republic of Yugoslavia
and the wider region following the fall of Milosevic, HC 246
para 102 Back
125
Ev 84 Back
