DAL DOCUMENTO UFFICIALE DEL SOROSIANO "INTERNATIONAL CRISIS GROUP"
SULLA STRATEGIA DA SEGUIRE PER SOTTRARRE ALLA JUGOSLAVIA IL COMPLESSO
METALLURGICO DI TREPCA:


Excerpts from -

"International Crisis Group's" thnk-tank instructions on How the West
Should
Take the Trepca Mine Complex In Serbia/Kosovo

International Crisis Group
http://www.intl-crisis-group.org/

[See at end of excerpts identity of ICG]

"Trepca: Making Sense of the Labyrinth"
26 November 1999

------
p.2
After nearly three years of economic sanctions instituted as punishment
for
its role in the Bosnian war, Belgrade was looking for ways to acquire
large
injections of cash. Exploiting Trepca seemed a likely option. In
February
1995, new management was installed, and a 'program of revitalization'
was
undertaken. The new team claimed that by the end of 1996 all the
production
plants were back into operation, ore excavation had increased, modern
mining
equipment had been purchased from Sweden, and all the lead and zinc
mines in
Serbia and Montenegro had been brought under the management of the
Trepca
company. Again according to Serbian official sources, in 1996 Trepca had
exported $100 million of products, making it the largest exporting
company in
the Federal Republic of Yugoslavia.6 Belgrade even planned to bring
mineral concentrates from the Bosnian Serb controlled mine in
Srebrenica,
site of the notorious massacre by Serb forces in July 1995.

------
p.3
The problems of Trepca are many and complex. They include its alleged
liabilities, the question who really owns it and who has been profiting
from
it, the deteriorating condition of its antiquated machinery, its
anachronistically oversized workforce, the scant field of prospective
investors, the disastrous environmental impact of the Zvecan smelter,
and
internal Kosovo politics. Even so, it is critical that at least some
aspects
of the Trepca issue be addressed immediately and not await the
resolution of
the entire nexus of problems. Most urgently, because of its importance
to
Belgrade, Trepca figures centrally in the unresolved security situation
in
Mitrovicë/a and in its current status as a divided city. At least some
of the
talk of a partition of Kosovo arises from the knowledge that control of
Trepca makes a vast difference to the territory's economic prospects.
Reports
of Serbian police in and around Zvecan, of Serb looting, rumours even of
Albanian prisoners being held there - all point to a need for immediate
international action.

------
p.3
It is also urgent that the people of Kosovo begin to see signs of
progress
towards some sort of economic normality. The return to work of even a
few
hundred Kosovar miners would represent, for all Kosovars, the reclaiming
of
their patrimony.
------

p.4
The Structure of the Trepca Conglomerate From Mine to Factory

As already noted, Trepca is a conglomerate which includes not only its
three
key components - Stari Trg9 mine, Zvecan smelter and the Mitrovicë/a
industrial complex - but a total of 41 installations, including some
outside
Kosovo. Trepca encompasses four distinct processes: extraction,
flotation,
smelting, and downstream processing, as well as other production and
marketing units. The Stari Trg mine east of Mitrovicë/a was, in 1989,
responsible for 40-50% of the mining production. Other mines in Kosovo -
Hajvali/Ajvalija, Novo Bërdë/Novo Brdo, Kishnicë/Kisnica, and
Badoc/Badovac -
accounted for roughly another 30% of Trepca's production. Two more
mining
facilities, at Crnac and Belo Brdo, are in the Serb-held areas north of
Mitrovicë/a, while three other mines are outside of Kosovo - these five
mines
are estimated to account for an estimated 20% of Trepca's total mining
extraction.

The minerals taken from Stari Trg are fed into the flotation facility on
the
Stari Trg premises, whereas the minerals extracted from Kosovo's other
four
mines undergo flotation at the Badoc/Badovac plant and those taken from
Crnac
and Belo Brdo are processed in Leposaviq/c. The resulting lead
concentrates
from all these flotation facilities, in addition to that coming from the
mines outside of Kosovo, used to be smelted at Zvecan.

The lead, zinc, silver, gold, cadmium and bismuth then go to such
downstream
facilities as the battery factories in Mitrovicë/a and Pejë/Pec, the
FAMIPA
factory in Prizren, and a hunting munitions factory in
Skënderaj/Srbica.
Hydrogen sulphide from Zvecan is processed in Mitrovicë/a's industrial
chemical plant, and the zinc and cadmium, after being processed in
Mitrovicë/a, are then sent to Gjilan/Gnjiljane for further industrial
processing.

The Environmental Concerns at Zvecan

The Trepca conglomerate has had a long history of environmental
problems.
During the 1980s a Trepca plant that produced agricultural chemicals was
blamed for producing fertilizers with such high super phosphate strength
that
livestock died after grazing on treated land. The worst pollution comes
from
the smelter in Zvecan, just a few kilometres northwest of Mitrovicë/a.
The
river Ibar runs past the smelter, before flowing through the city of
Mitrovicë/a and then into the Gazivoda Lake and so into Serbia proper.
Sulphur dioxide as a by-product of the metallurgical process is released
into
the air. With little or no investment in the plant over the last ten
years
the equipment has not been updated to meet increasingly stringent modern
standards.11 Some Kosovar experts also fear that current smelting
practices
as run by the Serbs are environmentally worse than those of ten years
ago.
They suspect that ore concentrates coming from as far away as Colombia
contain far higher levels of mercury and arsenic than is allowed by
international standards.12 Both Kosovar and international officials
stress
the importance of an in-depth and technically competent environmental
assessment of this outdated and run-down plant.

------
p. 13
Serbia

More serious repercussions could occur in Serbia. None of the opposition
leaders in Serbia has ever tolerated the idea of an independent Kosovo.
On
the contrary Serbian politicians compete to be 'most Serb' over Kosovo.
A key
issue over the next few months will be not only the developments in the
relationship between Montenegro and Serbia but the possibility of
elections
in Serbia itself. The question arises as to what effect firm UNMIK
action on
Trepca would do to the chances of the opposition to weaken or topple the
Milosevic regime. Making no bold moves leaves the festering wound of
Mitrovicë/a to be exploited by Milosevic in claiming his ability to
maintain
a key economic foothold in Kosovo. Should UNMIK assume the
administration of
Trepca and take the Zvecan smelter out of Belgrade's hands all Serb
politicians would have to react. Milosevic would continue to foster the
notion of the great US-EU conspiracy against the Serbs. Vojislav Seselj
would
likely take a stronger line and issue violent threats as he has done on
many
occasions. Opposition leaders like Djindjic and Draskovic would also
likely
deplore the international community's action. However they could exploit
the
argument that the 'loss' was due to the pariah status of
Milosevic himself, so that once again Serbia has lost assets due to his
presence in office. So provided action were taken before any elections
in
Serbia it need not upset, and might contribute to, any strategy for
unseating
Milosevic.

------
p.14
An initial assessment of Stari Trg has already been made: the priority
now
must be to produce a game-plan of measures whether easy and quick or
depending on major investment of money and time, and vigorous attempts
made
to interest donors - Trepca featured as a separate issue neither in the
World
Bank's twin recent reports on Kosovo reconstruction 43 nor at the 17
November
donors' conference in Brussels. Yet Stari Trg, one of the richest mines
in
Europe, must be potentially profitable again and should be a priority
for
donors interested in setting Kosovo on its feet.

------
p.15
Simply handing Trepca over to the Kosovars is ruled out by the shortage
of
modern skills available locally, the need for internationally-verifiable
standards to avoid corruption, and the sheer scale of damage and
degradation
at the various installations. But the people of Kosovo must be included
in
the process. An energetic approach should be taken during the assessment
and
start-up period in attempting to define a consensus amongst the Kosovars
-
meaning the Albanian parties and the Serb professional workforce, since
the
Albanians will not treat with the Belgrade-appointed management of the
combine.

------
p.15
The social impact of the reduced workforce would need to be balanced
against
the need for competitively based private investment

------
p.15
The workforce and management of all Trepca facilities should be selected
on a
merit basis only. Kosovars - living in Kosovo, regardless of ethnicity -
should have preference to work at any Trepca facility.44 But no one with
ties
to the Belgrade regime should be considered.

Finally, looking beyond Kosovo's boundaries, it would be better to have
accomplished the first key steps of this approach before a Serbian
election
campaign in order that the perception of 'who lost Kosovo' falls on the
rightful culprit, Slobodan Milosevic, and to avoid the perception that
a
new, with luck more progressive government, can be accused of 'losing
Trepca'.

------
p.16
Recommendations

UNMIK should as a priority build up the staff capacity to assert total
control over Trepca in accordance with the terms of its stewardship of
Kosovo, take over the installations and announce a modest programme of
action
for a 'pre-donor phase' of rehabilitation.

------
p.16
A court of adjudication should be nominated for claims, in the knowledge
that
this court will probably act very slowly, so that the situation on the
ground
will either have to stagnate, or else develop independently of it. The
above
programme should begin before elections in Serbia.

http://www.intl-crisis-group.org/

The International Crisis Group (ICG) is a private, multinational
organisation
committed to strengthening the capacity of the international community
to
understand and respond to impending crises.

ICG's approach is grounded in field research. Teams of political
analysts
based on the ground in countries at risk of crisis, gather information
from a
wide range of sources, assess local conditions and produce regular
analytical reports containing practical recommendations targeted at key
international decision-takers.
The next step is advocacy.

ICG reports are distributed widely to officials in foreign ministries
and
international organisations and made available to the general public via
the
organisation's internet site, located at www.crisisweb.org. The
organisation
works closely with governments and the press to highlight key issues
identified in the field and to stimulate discussion of potential policy
responses. The ICG Board - which includes prominent figures from the
fields
of politics, diplomacy, business and the media - is also involved in
helping
to bring ICG reports and recommendations to the attention of senior
policy-makers around the world.

The ICG Board is chaired by former US Senate Majority Leader George
Mitchell,
who recently brokered the "Good Friday" Peace Agreement in Northern
Ireland.
ICG is headquartered in Brussels with a U.S. branch in Washington DC.

The organisation currently operates field projects in seven countries
world
wide: Bosnia and Herzegovina, Albania, Macedonia, the Federal Republic
of
Yugoslavia, Algeria, Burundi and the Democratic Republic of Congo.

ICG raises funds from the European Union, governments, charitable
foundations, companies and individual donors. The following governments
currently have funding agreements with ICG: Austria, Belgium, Canada,
Denmark, Finland, France, Ireland, Luxembourg, the Netherlands, Norway,
the
Republic of China (Taiwan), Sweden, Switzerland and the United States.

Private sector donors include the Blaustein Foundation, the Fares
Foundation,
the Hewlett Foundation, the Charles Stewart Mott Foundation, the Open
Society
Institute, the Smith Richardson Foundation and the U.S. Institute of
Peace.

November 1999

Board of Trustees November 1999
George Soros Chairman, Open Society Institute
Senator George J. Mitchell, Chairman Former U.S. Senate Majority Leader
Morton Abramowitz Former US Assistant Secretary of State
Hon Gareth Evans QC, ICG President Former Foreign Minister of Australia
Gianfranco Dell'Alba Member of the European Parliament
Oscar Arias Sanchez Former President of Costa Rica; Nobel Peace Prize,
1987
Ersin Arioglu Chairman, Yapi Merkezi, Turkey
Christoph Bertram Director, Science and Policy Foundation
Alan Blinken Former US Ambassador to Belgium
Maria Livanos Cattaui Secretary-General, International Chamber of
Commerce
Mong Joon Chung Member of the Korean National Assembly
Alain Destexhe ICG President Emeritus, Member of the Belgian Senate.
Mou-Shih Ding Senior Advisor to the President, Taiwan, R.O.C.
Mark Eyskens Former Prime Minister of Belgium
Issam M Fares Chairman, Wedge International
Malcolm Fraser Former Prime Minister of Australia
HRH El-Hassan bin Talal Prince of Jordan Website:
http://www.princehassan.gov.jo
Marianne Heiberg Special Advisor to Director-General of UNESCO
Max Jakobson Former Ambassador of Finland to the UN
Elliott F. Kulick Chairman, Pegasus International
Joanne Leedom-Ackerman Novelist and journalist
Allan J MacEachen Former Deputy Prime Minister of Canada
Graça Machel Vice Chair, ICG Former Minister of Education, Mozambique
Nobuo Matsunaga President, Japan Institute for International Affairs
Barbara McDougall Former Secretary of State for External Affairs, Canada
Matthew McHugh Counsellor to the President, The World Bank
Miklós Németh Vice President, European Bank for Reconstruction and
Development; Former Prime Minister of Hungary
Olara Otunnu President, International Peace Academy; Former Foreign
Minister
of Uganda
Wayne Owens President, Center for Middle East Peace and Economic
Cooperation
Shimon Peres Former Prime Minister, Israel; Nobel Prize, 1994
David de Pury Chairman, de Pury Pictet Turettini & Co. Ltd.; Former
Swiss
Trade Ambassador
Cyril Ramaphosa Deputy Executive Chairman, New Africa Investments Ltd.,
South Africa
Michel Rocard Former Prime Minister of France
Christian Schwarz-Schilling Member of Bundestag; Former Minister of Post
and
Telecommunications, Germany
William Shawcross Journalist and author
Michael Sohlman Executive Director, Nobel Foundation, Sweden
Stephen Solarz Vice Chair, ICG Former US Congressman
Pär Stenbäck President, Finnish Red Cross; Former Minister of Foreign
Affairs, Finland
Thorvald Stoltenberg Former Minister of Foreign Affairs, Norway
William O Taylor Chairman, Globe Newspapers Co.,USA
Leo Tindemans Former Prime Minister of Belgium
Ed Turner Former Executive Vice President, Turner Broadcasting Inc., USA
Eduard van Thijn Former Minister of the Interior, The Netherlands;
Former
Mayor of Amsterdam
Simone Veil Former President of the European Parliament; Former Minister
for
Health, France
Shirley Williams Member of the House of Lords; Former Secretary of State
for
Education and Science, United Kingdom


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