Who's Bit by Serbia's Sanctions?

Central Europe feels political and economic sting from UN embargo against rump Yugoslavia

WHEN the United Nations voted in May 1992 to impose sanctions on Serb-dominated rump Yugoslavia, the Balkan federation's neighbors kept in step with the world community.

In the two years since then, the international trade embargo seems to have done little to bring an end to the bitter ethnic conflict. But the economies of the nearby nations - particularly Hungary, Romania, and Bulgaria - have been strained by the sanctions. The loss of rump Yugoslavia as an export market has cost those countries billions of dollars in lost trade.

``Every neighbor has suffered from the sanctions,'' Hungarian Foreign Minister Geza Jeszenszky told the Monitor in an interview. He said the West should do more to alleviate the hardships neighboring states continue to endure.

``The West appreciates it, but only in words,'' Mr. Jeszenszky says, referring to the trade losses incurred by Hungary and other nations. ``As long as Yugoslavia is not at peace, we need a general measure that would help neighboring countries.''

For the former Communist nations in Central Europe, the war in former Yugoslavia and the subsequent trade embargo came at a very difficult time.

Following Communism's collapse in 1989, several Central European nations, including Hungary, began overhauling their political and economic systems, trying to foster democracy and a market economy. The embargo against Serbia and Montenegro has made that daunting task even more difficult.

Hungary nevertheless has no intention of breaking the embargo, Jeszenszky insists. To do so would greatly damage Hungary's international reputation at a time when it is striving to join the European Union.

``We need a political settlement [in the former Yugoslavia],'' Jeszenszky says. ``Sanctions that drag on for years would greatly affect Hungary. It could jeopardize the success of the transition. It's no consolation to us that they [sanctions] may cripple Serbia.''

Since the imposition of the UN embargo, Hungary has lost $1.5 billion in trade, according to Bela Kadar, Hungarian minister of international economic relations. In 1993 alone, the sanctions cost Hungary $800 million, knocking about 5 percent off the nation's gross domestic product, he says.

But, Mr. Kadar says, these statistics do not reveal the full picture. ``There are some losses that aren't easily quantified,'' he explains. ``For example, there have always been Yugoslav tourists who came to Hungary to shop. This has dropped significantly.''

The sanctions against rump Yugoslavia were a contributing factor in the thrashing Hungary's governing coalition received in the first round of parliamentary elections May 8, Kadar claims.

The Hungarian Democratic Forum, the main party in the governing coalition, received only 12 percent of the vote. Popular discontent over a 12.6 percent unemployment rate and double-digit inflation figured significantly in the government's electoral defeat, observers say.

The Socialist Party - evolved from the reform-mined branch of the former Communist Party - could dominate the new government after capturing 33 percent of the May 8 vote. A second round of balloting is scheduled for May 29.

``The Yugoslav embargo contributed to the discontent [in Hungary],'' Kadar says.

In human terms, the turmoil in former Yugoslavia prompted a refugee wave that Hungarian officials are struggling to address. According to Andrea Hrivnak, an official at the Hungarian Refugee and Migration Affairs office, about 100,000 Yugoslav refugees are officially registered as living in Hungary, a nation of 10.5 million.

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