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Baroness Scotland of Asthal: My Lords, we shall energetically consider on an ongoing basis the kind of assistance we can properly give to the Federal Republic of Yugoslavia. In doing so, we shall obviously participate fully with the EU. The peoples of the Federal Republic of Yugoslavia should be able to look forward to the same opportunities for stability and integration in the long term as other peoples in the rest of Europe. They have seen all around them the benefits that accrue from democratic membership of the European family, and they have chosen to take a step which will enable them possibly to join that family in the future. We think that it was the right choice and the right step for them to have taken.

Baroness Turner of Camden: My Lords, does my noble friend agree that it would assist enormously our relationship with the new Serbia if compensation could now be offered to the civilian--I emphasise "civilian"--casualties of NATO bombing? We should

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remember that the new president of Serbia, the new president of Yugoslavia, has been highly critical of the NATO bombing campaign.

Baroness Scotland of Asthal: My Lords, I hear what my noble friend says. But it is important to remember what the noble Baroness, Lady Williams, outlined--namely, that this beneficial change to the peoples of the Federal Republic of Yugoslavia would not have occurred but for our actions. Therefore I am not able to indicate at this stage that there is any cause for us to change the position we have expressed in relation to what has flowed from those actions. We were right to take those actions. It was painful; it was difficult; we did not like it. But it was the only way, and we have been proven right.

Lord Renfrew of Kaimsthorn: My Lords, I, too, welcome the Government's Statement. I am sure that we all welcome the remarkable turn of events that we have witnessed in the past week.

I agree with the Minister's comments, but we need to do something to encourage the turn of events. Will the Government give further thought to the suggestion of the noble Baroness, Lady Williams, of providing aid for clearing the Danube and ensuring that it works effectively? It is very important that Mr Kostunica sees benefits flowing at once to the Federal Republic of Yugoslavia and to Serbia as a result of these remarkable events. His position will be strengthened if the right kind of support is given from the West. It should not be seen as meddling but as rapid economic support. I hope that it is something which the Government, together with other nations of the European Community, will bring rapidly into effect.

Baroness Scotland of Asthal: My Lords, I agree with many of the noble Lord's comments. I should remind the House that the EU is funding already 85 per cent of the costs of clearing the Danube. Reconstruction needs must be carefully assessed before decisions can be taken on individual projects. Now that Milosevic is out of the way, we can continue with greater rapidity.

The United Kingdom and the EU already are helping Serbia. The EU will now look urgently at the aid that Serbia will need, but it is too early to put a figure on major reconstruction assistance. The first task is for the international financial institutions, at the request of the Federal Republic of Yugoslavia authorities, to send a needs assessment mission. Once the new government has accepted its conclusions and is clearly committed to a programme of economic reform, a donor conference can be organised. The EU will have a key role to play in supporting reform within the existing financial perspective. The EU will continue to provide technical assistance.

The issue of aid is extremely important. The clearance of the Danube at Novi Sad remains a priority. The EU will be supporting the efforts of the Danube Commission states to get an early start to the work. Much can now be done. We should congratulate the Yugoslav people on making this change possible.

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Lord Molyneaux of Killead: My Lords, I, too, congratulate the Minister on the Statement in regard to the rehabilitation and repair of the infrastructure of Montenegro. In the course of my contacts with the leaders of that country over many years, it was clear to me that they never supported the Belgrade regime.

Baroness Scotland of Asthal: My Lords, Montenegro has been in a very difficult position. One of the benefits of the changes in the Federal Republic of Yugoslavia is that the healing process can now begin. It is to be hoped that we can work together with the peoples of the Federal Republic to strengthen their country and to restore it to its previous good health.

Lord Richard: My Lords, it is a matter of some rejoicing that the people of Serbia have changed their government by democratic means. It is a matter of greater rejoicing that, from Ireland on the Atlantic as far as Russia, the whole of Europe is now governed by democratically elected governments. However, does my noble friend agree that we should not assume that the new government in Serbia will be nice, gentle, liberal and democratic? From what we know of it so far, it will be a Serbian nationalist government, albeit one that has been democratically elected. We should perhaps await the outcome of four tests. First, what will be the new government's attitude towards Kosovo? Secondly, what will happen between Serbia and Montenegro? Thirdly, what will happen with the Serbs in Bosnia, who have clearly been influenced in the past by events in Belgrade? And, fourthly, what will happen with Mr Milosevic and a possible criminal trial? We should apply those four tests and perhaps not be quite so euphoric. Although I welcome the fact that the changes have taken place democratically, we should wait a little while to see how things settle down.

Finally, can my noble friend say a word about the current level of United Kingdom diplomatic representation in Belgrade? What is happening there?

Baroness Scotland of Asthal: My Lords, I understand my noble friend's caution. He is right to draw attention to those important issues. However, we should look first at what we know. We know that the new president did not agree with the Milosevic regime. We know that he used the democratic process through elections to gain power; and we know that he did so without the use of violence. All those are good things. Obviously we need to be cautious--we would be cautious with any new government--but that is why, as I hope I have made clear both in the Statement and in my comments, we are trying to work together in partnership with the Federal Republic of Yugoslavia.

The tests in relation to assessment of need will be dependent upon meeting standards that we all agree are appropriate. Therefore we should not besmirch this moment of joy by being too pessimistic about the future. We should look at what we know. We should be cautious about the way in which we plan the future, but this is a moment for joy--a moment which we hope will last for a long time.

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Lord Mackie of Benshie: My Lords, can the noble Baroness tell us if the European Union is committed to paying for all the clearing of the Danube and the rebuilding of its bridges now that the ridiculous objections of Milosevic have been withdrawn.

Baroness Scotland of Asthal: My Lords, the European Union has already committed itself to providing 85 per cent of the money needed for this task. Milosevic obviously had to allow access and agree to various other issues, which he refused to do. That blockage has now been removed and the steps which need to be taken to clear the Danube can continue without further obstruction. It is right that that should be a priority. It will be a priority with the new government and, together with our EU partners, we shall do all we can to ensure that that work is carried out as speedily as possible.

Lord Shore of Stepney: My Lords, may I remind my noble friend that the new Serbia also has a tremendous problem in dealing with the 250,000 Serbs who were expelled from the Krajina in Croatia, as well as over 100,000 Serbs who have fled Kosovo and lost their homes since the events there? There is some reason to be very careful about what we say about telling the new Serbian government what their attitude should be. I hope that our approach will be generous in helping them to solve what are some very serious internal problems.

Baroness Scotland of Asthal: My Lords, I reassure the House that the attitude adopted by Her Majesty's Government has been one of listening and working in partnership. From the moment the election took place, we were in contact with the new government in Belgrade. We have listened carefully to the requests that they have made. We are of the view that the new government are in the best position to identify the type and nature of the aid that they will need in order to complete their task. We shall do that with energy, and robustly, as I said earlier; but we shall do it also with a weather eye on the circumstances in which the Federal Republic of Yugoslavia finds itself. This a new beginning, but that beginning must be informed by what has gone on in the past.

Lord Acton: My Lords, what has been the response of the United States to these events?

Baroness Scotland of Asthal: My Lords, the United States has certainly congratulated the new president and has welcomed the change. It is right to say that it has not as yet, to the best of my knowledge and belief, expressly offered any aid or any specific package. One would certainly hope that that would follow relatively speedily. We have set an example by what we in the European Union have done. As the noble Baroness, Lady Williams, rightly said, the EU response has been swift and appropriate. Obviously, we invite others to follow our example.

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