Milan Panic - Speeches






Economic Transformation: The Key To Peace and Democracy in the Balkans By Milan Panic Former Prime Minister of The Federal Republic of Yugoslavia and Chairman & CEO Of ICN Pharmaceuticals, Inc. Speech to the Business Council of the United Nations United Nations, New York January 30, 2001 I am deeply honored to have been asked to speak today on a subject with which I have been actively engaged in speeches and articles for the past ten years. I am especially pleased to be able to address today’s topic in positive atmosphere, when all of the countries of the former Yugoslavia are democracies that have turned away from destructive militant nationalism and are beginning to re-establish the economic ties that are essential as the basis for sustainable peace and democracy in the Balkans. I spoke at the United Nation once before, in September 1992. A consensus had developed to expel Yugoslavia from the United Nations and I, then the Yugoslavia from the United Nations and I, then the Yugoslav Prime Minister, was there to remind the world of the peace program I was trying to implement and to plead for suspension rather than expulsion. The permanent members of the Security Council apparently were worried that I might disrupt the proceedings. So they invited me to a meeting at the Russian mission with their Foreign Ministers and their UN Ambassadors. I tried to convince them that with their support I could prevail over Miosevic in Belgrade and implement my peace program. It looked like I was making some progress with all except the Americans, when Acting Secretary Eagleburger sharply interrupted and stated that there would be trouble with the Moslem countries if the permanent members supported anything less than expulsion. Recognizing the inevitable, I said I would state my case before the General Assembly the following day in a non-disruptive manner, but I believed I was entitled to public statements by all of them in recogniation of my peace efforts. Most of them made such statements to the media as they exited the meeting. Now, Yugoslavia, a founding member of the United Nations in February 1945, is back in its rightful place as a full member of the United Nations and all of its organizations and agencies. It badly needs all of the economic, developmental and humanitarian assistance that the United Nations can make available to help firm up the democratic transition that is in progress. One case of need is refugee relief. Yugoslavia has been inundated with almost one million Serbian refugees from Croatia, Bosnia, and Kosovo. Until now, Yugoslavia has received very little assistance in caring for them .The UN High Commission for Refugees and UNICEF are now involved, and hopefully will quickly help shoulder this burden. I hope that the United Nations, its agencies and its employees will approach their renewed responsibilities in Yugoslavia with patience and understanding. The tasks they face are formidable and the frustrations will be many, but in human terms the rewards will more that justify their efforts. As a business council, your organization recognizes the importance of the importance of the economy as the key factor in promoting and sustaining political stability. The disastrous state of the national economy was a major factor in Serbia’s popular uprising against the arrogantly destructive Milosevice regime. Eight years of economic sanctions and plundering by Milosevic’s kleptocracy left Serbia’s economy in a state of near-total collapse. The sanctions destroyed normal commercial channels and since 1992 dominated most of the economy. Much of industry is at a standstill. Real unemployment is estimated at 50%. For those who have jobs, wages are a fraction of what they were ten years ago. The middle class has been ravaged. For most Serbs, the standard of living has declined to levels last seen in the aftermath of World War II. In a decade of misrule, Milosevic led one of Eastern Europe’s richest countries into impoverishment. Reviving the economy is President Kostunica’s and Prime Minister Djindjic’s most daunting task. They will come under heavy pressure to produce economic benefits more rapidly than will likely be possible. They will need serious international understanding and rapid generous foreign assistance. Europe must take the lead because its security is most directly involved. But the United States must do its part. Rapid and visible direct assistance must be the first goal. Restoration of Serbia’s once impressive productivity will not be a simple matter. There is virtually no domestic investment capital. Therefore, significant private investment initially will have to come from abroad. Serbia will need to create a welcome atmosphere to attract foreign investment. A Serbian official responsible for foreign economic relations understands this and told me last week that one of the measures Serbia will soon introduce is a “ one-stop shop” to assist potential foreign investors in cutting through inhibiting bureaucratic practices and delays in order to expedite the investment process. To help stimulate renewed American business activity in Serbia and Montenegro, my company, ICN Pharmaceuticals, sponsored a conference organized by the U.S. – Yugoslav Business Council in Belgrade in mid-November, entitled, “Renewing Business Ties With Yugoslavia.” Even though they knew they could not sign new contracts until the sanctions were lifted, 60 American business representatives attended many of whom began discussing future possibilities with their Yugoslav contacts and partners. I was very pleased last week when, in one of his last acts in office, President Clinton lifted the sanctions. Business discussions no longer have to be limited to future possibilities. Formal contracts can now be signed and investments made. This is a well-deserved boost to the governments of President Kostunica and Prime Minster Djindjic. As I stated at the outset, I have long preached the need for regional economic cooperation in Southeastern Europe. Articles that I wrote on this subject were published in “ The European” in 1993 and 1994. I argued endlessly for something like the Stability Pact, that now finally exist, to assist and help regional economic cooperation and development among the five “mini-economies” of the former single integrated Yugoslav economy. I argued that while Europe was eliminating economic borders, the former Yugoslav countries were moving in the opposite direction. They were establishing customs and other trade barriers which would be counter-productive for all. I argued that they were of course entitled to retain their newly won political borders and independent sovereignty, but the regional stability and security they all needed could not be won on the battlefield. They need to eliminate all barriers to the movement of goods and services and to restore open trade among them in order to lay the groundwork for European integration and admission in to the European Union. Happily, they all now understand this and are moving in the right direction, which the advent of a newly democratic Yugoslavia should stimulate. Several bilateral free trade agreements among them have been signed during the past year, and more appear to be on the horizon. The new government of Croatia is playing an active role in this process. It now has free trade agreements with most of its neighbors, and recently, together with the U.S. Business Council for Southeastern Europe, agreed to co-sponsor a regional business conference to be held in Cavtat April 30 and May 1. After so much destruction and disruption in the Balkans during the past ten years, the road ahead remains strewn with many difficulties yet to be over come. But all the trends now are finally pointing in the right direction. We must remain alert to doing everything we can do further this process. A clear vision of integration with Europe, the right assistance from abroad, progress in establishing the institutions of democracy and a free market, all will help lay the groundwork for delivering tangible economic progress and benefits. This in turn will facilitate the regional economic transformation that will offer all of the nations of the Balkans reason to believe in a better life for their children and grandchildren. I strongly believe that this vision is the key to peace and democracy in the Balkans. Thank You, Milan Panic Prime Minister The Federal Republic of Yugoslavia 1992-19932 Q & A QUESTION: Is the arrest and trial of Milosevic important or not in resolving lingering issues from the way the rest of the world views aid to Serbia, as well as the way the countries of the region view each other? MILAN PANIC: Not everybody in Serbia is like Milosevic. That is the truth. For that reason, I think Milosevic going to the Hague would be very important. It would cleanse the nation of national guilt. As a former official of Yugoslavia, I was the first one to publicly recommend that he be indicted, which he was. Subsequent to that, I thought hat he should be tried in Belgrade with a jury of his people. And this should be mothers and fathers of children who died for his stupid, devastatingly bad ideas. They should be his jury. He cannot survive that trial. QUESTION: Clearly, the 20th century is populated by leaders who led us into disastrous economic, social, humanitarian morasses. And folks have written about what’s happened in the Balkans. But you say that these leader were insane, in your view. How did they come to power in the late 20th century, and what have we learned about that? What could we do to prevent it from happening again in the 21st century? MILAN PANIC: I think that what we can say for America, this generation of Americans has saved America from being involved in anything really as bad as the Second World War. We, Yugoslavs did not do that for their generations to come. The leaders, who ran the countries until recently, became nationalists, because it was easy to transform from a communist to a nationalist – Milosevic, Tudjman, and other– which created a disastrous situation totally opposite to what American or Europe wanted. We truly are responsible for supporting extremists, and sometimes we, America, supported Milosevic, so that was a mistake. And I think that’s how they were created. QUESTION: Should we reduce our military presence in Kosovo? MILAN PANIC: As an American, my feeling always was that we are excessively assisting Europeans. Europeans are richer today than after the Second World War when we helped them. They have everything now. They are even competing economically in the United States. I think Americans should provide leadership at a minimum involvement. Americans are superb leaders. QUESTION: We know that Yugoslavia has substantial amounts of debt. As an investor in Yugoslav debt, I’m interested in knowing what prospects are for debt conversions, debt for equity, debt for currency? MILAN PANIC: I think it’s possible. I think it’s a good idea. And I think it should be done. QUESTION: Sir, I’d like to go forward about 20 years. I’m very curious about the people who will be 20 years older, meaning the children. I’d like to know: Are there different school books for the different areas, and how do they treat the prejudices of each group in their current school books? MILAN PANIC: Very interesting question. I think that the last few years probably have done damage to children. I think these extremists have written bad books for children, and I think the children have seen disaster. I think that new leaders and others are changing that. I think that the people in Croatia are changing, and in Macedonia. I am very positive we will see very soon where the borders will be lifted. There are already no borders between Hungary and Yugoslavia. Macedonia doesn’t have borders with even Albania and I think Yugoslavia – no border visas and things of this nature. So I think they all will become part of the European Union reasonably soon. We should have an extended program to incorporate the Balkans into Europe. And under these conditions, they will be basically united back pretty much to the way it used to be, with the exception of politically. But they will have the same passport, a European passport. I met the president of Germany, who said to me, “ This is your black part in your history. Don’t be ashamed. Fight for better, and you will be better, just as we did in Germany.” And he was right. This will pass. It will be a black part of the history, and things will change for the better. QUESTION: Recently, there have been a number of conflicts in the area between Kosovo and Serbia in the border region, a lot of armed conflicts and so on. How do you see that developing in the near future as well as today? How do you see the future of Kosovo, and how do you see foreign investors going in to invest in a country that still unfortunately unstable because of these armed conflicts? MILAN PANIC: As to the conflicts and the border, I would put more pressure on NATO, which is in the area to take a stronger position in enforcing peace. I think there are bad Serbs, but there are also bad people in Kosovo, bad Kosovars. On the other hand, the positive aspect, there are many smart Kosovars and smart Serbs. They both see the future without borders, with the same passport. My feeling about extremist Kosovars is absolutely the same as it is against Serbian extremists. They belong to the past. The sooner we develop a system to assist the good ones, these people will disappear. I think demilitarization of the region is an essential part, a program should be started to demilitarize the whole region. The economy is going to make the region succeed and our children even better. On how do you invest, well, you really don’t invest. What we need is a Phase 1, and people like the International Bank for Reconstruction, the World Bank, and other organizations need to put the seed money into this region. Bring them into position where the model in your computer will justify investment. As of today, it would be extremely difficult to invest in Kosovo, even Serbia. They’re not investing in Bosnia. Bosnia should have been an exemplar of economic success. But instead of worrying about economics, we are consistently concerned about politics and borders. If Bosnia succeeds economically, it could be the exemplar of success of influence of the United Nations and Europe. So the time is coming soon. QUESTION: You said earlier that ethnic purity just does not make any sense in the region among different groups of people. What is the history of this mosaic, and what does it tell us about the future? MILAN PANIC: I think that America is not a melting pot. After six months here, I said, “ What melting pot?” Look, there are all nationalities. Serbs have their own organization. Irish, their own, and so on. I decided that this is a place where people of various cultures, most important, learn to live together. But our people live together in Europe; in Yugoslavia, too. Twenty-five percent of Serbs are married to Croats. How can they hate each other. But the clever extremist says, “I’m a Serb or a Croat.” If he’s a Serb or a Croat with a gun, the guy gets to say, “ You’re gone.” So I think it’s just a question, again, of the time when economic concepts will prevail and people will start to think of the future of their children and grand children and stop thinking of history. And it’s enough to grow up and know the history of who you are. It’s just you don’t use it to kill other people. QUESTION: I would be curious if you would just say what role religion plays, the Orthodox church, the Catholic church, the Muslims. MILAN PANIC: Extremists, the false leaderships of the world, take anything to justify their actions and they will use religion. That wouldn’t be first time in history. Communism was very bad. But there was morality in Communism. It’s sort of bad morality, but there was an order. When this anti-religious clique called Communism disappeared, they had trained two, three generations in Russia and everywhere else not to pay attention to religious beliefs. They created a moral vacuum. And religions such as Christianity or other religions, Muslim or others, didn’t have enough time to get involved to bring these people back to standards of modern society. So there is a very important role for the future of our churches – religion, in general – in building amore stable society, a very important role. The moral backbone of the society is gone. It needs to be rebuilt. QUESTION: Mr. Panic, could you tell us, please, from the days you were Prime Minister the extent to which the problem of Kosovo ever appeared on your radar screen and the political constraints at that time which would have led you to figure this is a problem for another day, and then could you fast forward to now, and tell us what you think the attitudes are of Serbs today and how they envision their future relationship with Kosovo in the long tern for the future? MILAN PANIC: It was obvious –the Kosovo problem was obvious. The Kosovars were mistreated. I went there. I met with the leadership of Kosovo. I even met with the nationalist extremists. I talked economy, schools, this and that. And we started to agree to reopen the school the schools in Kosovo. Milosevic closed the schools. Milosevic closed the university. The university was reopened for Kosovars. We didn’t have free election in Serbia. How could he hold a free election in Serbia. How could he hold a free election in Kosovo? So everything was wrong. QUESTION: What comment would you make about Albania? Albania is the poorest country in Europe, and it’s Muslim, and it’s Kosovar. Those are the people there. Would you have any comments about the policy that we should have employed for them? MILAN PANIC: Well, if I had to divide 100 percent today of money available for help, I would send money first to Kosovo; second to Albania; third to Macedonia; fourth to Bosnia. Then Serbia, then Croatia, then Slovenia. That’s how the help should be given economically. So Albania qualifies for rapid economic assistance if we are to a have better region. QUESTION: Given that you’re one of the most active investors in the region, if not the most active, could you tell us what would be the other attractive investment opportunities in the region and what role can the United Nations and the various aid programs play to facilitate those investments? MILAN PANIC: I think they need infrastructure. I would put money in energy, railroads, transportation, agriculture, and of course, pharmaceuticals. QUESTION: You made a comment in passing about sanctions. And I’m curious, if the solution is economic integration, but economic sanctions don’t work with the bad guys around, and we don’t want to use military intervention, what tools do we have at our disposal? MILAN PANIC: Very good question. Well, I could tell you what you shouldn’t do. You should not bomb to teach people democracy. That’s No. 1. You should not use sanctions because it affects the poorest of people, not the leadership. Milosevic did not suffer from sanctions, I can tell you. He had always enough food. He had wine. He had everything. He lived like a king. But the poor people suffered. And I think that’s happening probably in all countries where the sanctions are in force. So I am generally against United Nations’ sanctions as a form of getting something done. Maybe there’s only one example where it worked; in South Africa, maybe. We need to find a new form, a new system of how to remove dictators without killing them. How do you remove dictators? I mean, we have five, six still in the world. And I think we should have think tank to tell us how to get rid of them. Bosnians have their style. Serbs have their style. You see what they did with Milosevic. They put him in confinement in a house and that did not work really that well. QUESTION: One thing that was effective, leading up to the election and success, was a lot of grassroots support in regions throughout the countryside. And I’m wondering if you think more direct support, especially as we are trying to figure out what’s possible to do with Iraq right now, to opposition parties in a much more direct way is a policy that we should be pursuing? MILAN PANIC:Yes, support the right people, usually the young. Support young people with enough longevity to exercise their beliefs in change. I think that we Americans have done quiet a lot. But I think the world should do more. We should support people where we believe in their philosophical concept and vision and where they want to take their countries. QUESTION: I wonder if you would comment, sir, on the status of the media in the Balkans now and what you see as the current and future role of the media in rebuilding those countries? MILAN PANIC: I think that television is a miracle tool for changing the people’s thinking. Media ahs a major responsibility to assist in changes. I am unquestionably for a free press. As the moral standard is raised, so will be the media’s contribution to the development in the region.