Yugoslavia was destroyed by the IMF and the American government

Yugoslavia was once a regional industrial power and economic succes. Two decades before 1980, annual gross domestic product (GDP) growth averaged 6.1 percent, medical care was free, literacy was 91 percent and life expectancy was 72 years.

the Reagan administration targeted the Yugoslav economy in a Secret Sensitive 1984 National Security Decision Directive (NSDD 133), "Us policy towards Yugoslavia". A censored version declassified in 1990 elaborated on NSDD 64 on Eastern Europe, issued in 1982. The latter advocated "expanded efforts to promote a "quiet revolution" to overthrow Communist governments and parties", while reintegrating the countries of astern Europe into a market oriented economy.

[link to www.globaltenders.com]


Whatever Happened to Yugoslavia?

The International Monetary Fund became the chief weapon used to destroy Balkan unity. Increased ethnic friction, then, can be seen as only a secondary cause of the dismemberment of Yugoslavia. As British economist and political analyst Sean Gervasi has stated, "Foreign intervention was designed to create precisely the conflicts which the Western powers decried."

IMF austerity measures were imposed in autumn 1989. The currency was further devalued, wages frozen, and state industries deemed "unprofitable under structural adjustment" (worker-owned companies) were closed. Unemployment immediately rose 20%. The federal government in Belgrade regularly transferred treasury payments to the republics and autonomous regions. Those payments were now stopped, the funds mandated by the IMF to service foreign debt. As the Berlin Wall was falling, wages in Yugoslavia fell 41%.

At this juncture, Prime Minister Ante Markovic visited Washington and reported worriedly that ethnic tensions were rising in the republics (New York Times, 10/14/89). George Bush convinced Markovic of the wisdom of more debt restructuring. An emergency foreign aid package was negotiated when Markovic promised to return home and liberalize constitutional controls on foreign investments. Markovic's ensuing legislation forced over one thousand by-then insolvent enterprises into bankruptcy. These companies could subsequently be purchased 'for a song' by Western investors.

Next, 650,000 Yugoslav workers struck. Although travail was increasing within the republics due to the precipitous decline, workers united in solidarity across all ethnic lines. It was in this atmosphere that Communist party leader Slobodan Milosevic came to power in the fall 1990 elections, railing against the dire conditions. Milosevic's gravest error was in not building upon worker solidarity at this juncture by appealing for the unity of all Yugoslavians. He lacked either the decency or the diplomacy to address each republic's complaints as the federation groaned and strained under economic duress. At a time when nationalist/separatist tendencies were flaring up in the republics, Milosevic fanned the flames by calling only for a united Serbia.


THE BREAKING POINT
Meanwhile, the economy plummeted. Eastern European Economics reported industrial production declined to a negative 10% growth rate and the GDP to a negative 7.5%. Then Milosevic took a bold step, one which would irrevocably condemn him in the eyes of Western monetary powers: he halted the IMF and U.S.-mandated reforms. He brought "structural adjustment" to a standstill.
Revenge was swift. One month later, in early November 1990, the U.S. Congress passed Foreign Operations Appropriations Law 101-513. Annual "foreign operations" appropriations facilitate U.S. corporate control of many of the world's economies by granting -- or withholding -- major funding to international financial institutions such as the World Bank and the Asian, African and Inter-American Development Banks. Section 599a of this Act cut off all aid, credit, and loans to Yugoslavia and demanded immediate, separate elections in each of the country's six republics. The U.S. State Department would alone determine the validity of each election and resume aid to individual regions if the victors were deemed "democratic."

Hence, in areas of Yugoslavia already severely destabilized by a dislocated economy, with strains of micro-nationalism fracturing the political and social landscape, a major influx of U.S. dollars went directly to those right-wing secessionist parties who won these cobbled-up elections. This was in Croatia, Slovenia, and Bosnia. The effect of Section 599a was as if deftly placed wedges had been inserted by the U.S. exactly along fissures of nationalism and ethnic identity and a sledge brought down on each. The economy entirely collapsed, recriminations broke out on all sides and, with separatist tendencies ignited by interventionism, the CIA in The New York Times of November 28, predicted civil war in Yugoslavia.

[link to www.zianet.com]





Statement by Press Secretary Fitzwater on the President's Meeting With Prime Minister Ante Markovic of Yugoslavia
October 13, 1989

The President met with Yugoslav Prime Minister Ante Markovic in the Oval Office for approximately a half hour. The President reaffirmed his strong support for Yugoslav independence, unity, and sovereignty. He welcomed Prime Minister Markovic's commitment to market-oriented economic reform and to building democratic pluralism throughout Yugoslavia

[link to www.presidency.ucsb.edu]

The President reiterated U.S. support for the European Community's ongoing efforts to help resolve the Yugoslav crisis and urged President Mesic to continue cooperating with the United States, the EC, and others in the interest of a peaceful transition to a new Yugoslavia.

[link to www.presidency.ucsb.edu]

Records on CIA National Intelligence Estimate “Yugoslavia Transformed”

The materials in FOIA 2010-0605-F are a selective, not necessarily all inclusive, body of documents responsive to the topic of the FOIA. Researchers should consult the archivist about related materials.
FOIA 2010-0605-F contains materials related to the CIA National Intelligence Estimate entitled “Yugoslavia Transformed.” Materials include declassified National Security Agency cover sheets which route closed correspondence related to Yugoslavia.
It should be noted that a significant majority of the documents listed here are security classified and have been closed under the restrictions of the Freedom of Information Act.

[link to bushlibrary.tamu.edu]