Workers "revolt" a precondition for "genuine privatisation"

Louis Proyect lnp3 at
Sat Oct 14 08:57:04 MDT 2000

Financial Times (London), October 14, 2000, Saturday London Edition 1

EUROPE: Yugoslav revolution runs into squalls as old guard faces removal
from businesses: 'Crisis headquarters' teams are being installed as
management, but there is a danger of turmoil, reports Stefan Wagstyl:


Revolution came to Dunav, Yugoslavia's dominant state-run insurance
company, in the form of Dragisa Kecojevic, a self-employed car insurance

Mr Kecojevic and about a dozen supporters arrived at Dunav's concrete and
glass headquarters in central Belgrade this week and demanded to see the
company president, Nebojsa Maljkovic.

Speaking in the name of the Democratic Opposition of Serbia (DOS), the
grouping of parties which has overthrown former leader Slobodan Milosevic,
Mr Kecojevic declared he was establishing a "crisis headquarters" to run

Leaving most of his party guarding the lobby, Mr Kecojevic and two
associates went to Mr Maljkovic's office and demanded his resignation. Mr
Maljkovic explained he planned to leave anyway. As a political appointee of
the Milosevic regime he felt his continued presence could now damage Dunav.
But he wanted to deliver control to Dunav managers.

During a heated conversation Mr Kecojevic forced Mr Maljkovic to resign on
the spot. As news of the intrusion spread, Dunav employees argued about
what to do. Some defended Mr Maljkovic, insisting that despite his politics
he had managed the group well. Others supported Mr Kecojevic. Eventually
senior managers, led by Tomislav Simovic, Mr Maljkovic's deputy, called DOS

It emerged that Mr Kecojevic, co-owner of a small company called Autonena,
had taken the revolution into his own hands. He had no authority. But he
would not leave until the next day when a DOS leader and former general,
Momcilo Perisic, sent a letter nominating Dunav's existing managers as the
"crisis headquarters".

Mr Simovic declines, in an interview, to discuss any details. He says: "We
had some small problem this week. Now we are doing our jobs as usual."

Serbs are discovering that the overthrow of one regime and the creation of
a new is more complicated than it seems. The country is in turmoil
following Mr Milosevic's defeat nearly two weeks ago at the hands of
Vojislav Kostunica, the new president.

Fired by their success in storming the federal parliament building
(incidentally, insured by Dunav), Mr Kostunica's supporters are fighting to
complete their victory by removing political appointees from top public
sector posts.

In spite of Mr Kostunica's efforts to prevent freelance takeovers, he and
his colleagues cannot supervise everything. Mr Milosevic's allies are also
hitting back, accusing the reformists of causing chaos, while
simultaneously taking advantage of the disorder to cover their tracks and
to replace well-known Milosevic stooges with other less prominent supporters.

For example, at EPS, the electricity monopoly, Dragan Kostic, a former
minister and member of JUL, the party of Mira Markovic, Mr Milosevic's
wife, was moved in favour of Krsto Vukovic, a member of Mr Milosevic's
socialists. The reformists resent the change but respect Mr Vukovic as a
first-class engineer and are unlikely to risk disrupting power supplies.

All parties are using Yugoslavia's laws on social ownership that spread
ownership between the government, local authorities, trade unions and
workers' representatives. Under Mr Milosevic's autocratic rule the
distinctions did not matter, but now they give great scope to inventive
takeover leaders.

Ljubodrag Stojadinovic, a former army spokesman, says: "There is anarchy.
The responsibility is on all sides."

Despite dark rumours about Mr Milosevic plotting a coup, events are
unfolding with a remarkable lack of violence. Only one person has died
through the protests - a woman who was accidentally hurt during the attack
on parliament. Injuries have been minor. Milosevic regime officials have
abandoned their offices, files and bank accounts without a physical fight.

The changes are incomplete. By late yesterday NIS, the oil refining group,
and Telekom Srbija, the telecoms utility, were in the throes of replacing
their politically appointed presidents but had not found replacements.

At Beogradska Banka, the biggest bank, the battle for control moved to the
television screens when Borka Vucic, its president, commonly known as Mr
Milosevic's banker, went on air to say that at the age of 72 she was not
too old to do her job.

The Yugoslav football federation, having resisted two attacks by freelance
activists armed with baseball bats, posted extra security guards.

A particularly tough battle was fought at Progress, a trading company,
headed by Mirko Marjanovic, prime minister of the Serb republic and one of
the most senior associates of Mr Milosevic still holding public office.

On Thursday the staff formed a "crisis headquarters" and demanded the
resignations of their top managers, who agreed - only to be ordered back to
their desks by Mr Marjanovic.

The management changes are an essential part of the overthrow of communist
autocracy, as they were elsewhere in eastern Europe. But in Serbia the
struggle is complicated because the old regime is proving adept at
retaining at least some power and because ownership rules are unclear.

Miroljub Labus, Mr Kostunica's temporary acting prime minister, admits the
takeovers are illegal in the sense that they are not covered by laws. "But
they are needed to consolidate victory over Mr Milosevic," he says. When
the dust settles down, he plans laws to regularise the position and launch
genuine privatisation.

However, there is a risk that the law will be limited to acknowledging the
messy status quo, as it will be hard to remove "crisis headquarters" teams
that acted in the name of democracy. Events of the last few days could
shape the Serbian economy for some time to come.

Louis Proyect
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