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Serbia
& Montenegro
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The Kingdom of Serbs, Croats, and Slovenes was formed
in 1918; its name was changed to Yugoslavia in 1929. Various
paramilitary bands resisted Nazi Germany's occupation
and division of Yugoslavia from 1941 to 1945, but fought
each other and ethnic opponents as much as the invaders.
The military and political movement headed by Josip TITO
(Partisans) took full control of Yugoslavia when German
and Croatian separatist forces were defeated in 1945.
Although Communist, TITO's new government and his successors
(he died in 1980) managed to steer their own path between
the Warsaw Pact nations and the West for the next four
and a half decades. In 1989, Slobodan MILOSEVIC became
president of the Serbian Republic and his ultranationalist
calls for Serbian domination led to the violent breakup
of Yugoslavia along ethnic lines. In 1991, Croatia, Slovenia,
and Macedonia declared independence, followed by Bosnia
in 1992. The remaining republics of Serbia and Montenegro
declared a new Federal Republic of Yugoslavia (FRY) in
April 1992 and under MILOSEVIC's leadership, Serbia led
various military campaigns to unite ethnic Serbs in neighboring
republics into a "Greater Serbia." These actions
led to Yugoslavia being ousted from the UN in 1992, but
Serbia continued its - ultimately unsuccessful - campaign
until signing the Dayton Peace Accords in 1995. MILOSEVIC
kept tight control over Serbia and eventually became president
of the FRY in 1997. In 1998, an ethnic Albanian insurgency
in the formerly autonomous Serbian province of Kosovo
provoked a Serbian counterinsurgency campaign that resulted
in massacres and massive expulsions of ethnic Albanians
living in Kosovo. The MILOSEVIC government's rejection
of a proposed international settlement led to NATO's bombing
of Serbia in the spring of 1999 and to the eventual withdrawal
of Serbian military and police forces from Kosovo in June
1999. UNSC Resolution 1244 in June 1999 authorized the
stationing of a NATO-led force (KFOR) in Kosovo to provide
a safe and secure environment for the region's ethnic
communities, created a UN interim Administration Mission
in Kosovo (UNMIK) to foster self-governing institutions,
and reserved the issue of Kosovo's final status for an
unspecified date in the future. In 2001, UNMIK promulgated
a constitutional framework that allowed Kosovo to establish
institutions of self-government and led to Kosovo's first
parliamentary election. FRY elections in September 2000
led to the ouster of MILOSEVIC and installed Vojislav
KOSTUNICA as president. A broad coalition of democratic
reformist parties known as DOS (the Democratic Opposition
of Serbia) was subsequently elected to parliament in December
2000 and took control of the government. DOS arrested
MILOSEVIC in 2001 and allowed for him to be tried in The
Hague for crimes against humanity. (MILOSEVIC died in
March 2006 before the completion of his trial.) In 2001,
the country's suspension from the UN was lifted. In 2003,
the FRY became Serbia and Montenegro, a loose federation
of the two republics with a federal level parliament.
Widespread violence predominantly targeting ethnic Serbs
in Kosovo in March 2004 caused the international community
to open negotiations on the future status of Kosovo in
January 2006. In May 2006, Montenegro invoked its right
to secede from the federation and - following a successful
referendum - it declared itself an independent nation
on 3 June 2006. Two days later, Serbia declared that it
was the successor state to the union of Serbia and Montenegro.
A new Serbian constitution was approved in October 2006
and adopted the following month. After 15 months of inconclusive
negotiations mediated by the UN and four months of further
inconclusive negotiations mediated by the US, EU, and
Russia, on 17 February 2008, the UNMIK-administered province
of Kosovo declared itself independent of Serbia.
MILOSEVIC-era mismanagement of the economy, an extended
period of international economic sanctions, and the damage
to Yugoslavia's infrastructure and industry during the
NATO airstrikes in 1999 left the economy only half the
size it was in 1990. After the ousting of former Federal
Yugoslav President MILOSEVIC in September 2000, the Democratic
Opposition of Serbia (DOS) coalition government implemented
stabilization measures and embarked on a market reform
program. After renewing its membership in the IMF in December
2000, Yugoslavia continued to reintegrate into the international
community by rejoining the World Bank (IBRD) and the European
Bank for Reconstruction and Development (EBRD). A World
Bank-European Commission sponsored Donors' Conference
held in June 2001 raised $1.3 billion for economic restructuring.
In November 2001, the Paris Club agreed to reschedule
the country's $4.5 billion public debt and wrote off 66%
of the debt. In July 2004, the London Club of private
creditors forgave $1.7 billion of debt just over half
the total owed. Belgrade has made progress in trade liberalization
and enterprise restructuring and privatization, including
telecommunications and small and medium size firms. It
has made halting progress towards EU membership despite
signing a Stabilization and Association Agreement with
Brussels in May 2008. Serbia is also pursuing membership
in the World Trade Organization. Unemployment and the
large current account deficit remain ongoing political
and economic problems.
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