MOD Press Briefing

Briefing by the Parliamentary Under Secretary of State, John Spellar, and Chief of Joint Operations, Vice-Admiral Sir Ian Garnett.

7 May 1999

Excerpts:

SPELLAR: Good Morning. I am John Spellar, Under Secretary of State for Defence.

President Milosevic has to face reality as his isolation continues to grow and he has nowhere to turn. Until he agrees to the conditions which have been agreed by the international community, the air campaign will continue. He should know by now we have the resolution to see it through. He should know that the international community is determined to bring an end to the brutality and corruption of his regime because underneath the somewhat respectable veneer of the Serbian government, Milosevic controls Serbia through a system of corruption and patronage. His aim is to transform himself from the political ruler into the owner of the country.

Milosevic has surrounded himself with his cronies, a new class whose loyalty he buys with perks and financial rewards. Party officials and government Ministers use their positions to gain access to government funds and bank loans, to accept bribes on major contracts and to secure lucrative dual appointments. Let me give you a few examples: Mirko Marjanovic, the Prime Minister of Serbia, is also President of the Progress Company which is the major importer of natural gas.

Nikolai Sainovic, as well as being the Deputy Prime Minister of Yugoslavia, holds the position of President of the RTP Bore Copper Mine, a business which is a lucrative source of foreign currency.

Dragan Tomic, the Speaker of the Parliament, is also Director of NIS Jugopetrol, an organisation which has a near monopoly on Serbian petrol.

Dusan Vlakovic is a leading member of JUL, the party of Mrs Milosevic; he is also Governor of the National Bank of Yugoslavia.

Milosevic has a close circle of politicians and businessmen who move state funds to banks in Greece, Cyprus, Russia, China and the Lebanon. This is often done in the names of the private individuals who include Borka Vucic, an old friend and President of the Daogradska Bank. Nikola Stanic, Head of Yugoslav Invest Banker. Milan Milutinovic, President of Serbia. And Vlajko Sthailkvic, Serb Minister of the Interior.

But it does not end there. The web of corruption extends to the Director of State Enterprises which account for over half of the country's economy. The Directors employ their family and friends to whom they give company flats and cars. They also set up their own companies and award themselves contracts to supply their enterprises with goods at inflated prices. And the web of corruption extends throughout the system. As an example, police regularly demand bribes and consider themselves above the law, and council officers are reported to demand a bribe of some of 3,000 even to set up a tiny kiosk in Belgrade.

In addition to this institutional corruption, President Milosevic and his wife own luxurious villas in several different countries. Their son Marko, as we know, is a playboy who has been involved in organised crime, including large scale smuggling of alcohol and cigarettes, and is reported to be involved in drugs dealing. He also threatened, as you know, a handicapped child and assaulted a newspaper editor.

Struggling to survive under this corrupt regime is the Serbian population, 60% of whom now live below the poverty line. But the plight of the Serbs is nothing compared to the Kosovars and it is to allow them to return to their homeland that NATO must continue its campaign. We are tightening the screw on Milosevic and we will continue to intensify the air campaign and are sending more aircraft. The additional Harriers arrive in Gioia del Colle this morning.