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Balkan Assets, Spread Apart During War, May Be Divvied After

December 6, 1995

WASHINGTON (AP) _ Diplomat Nebojsa Vujovic sits among the vestiges of a far-flung kingdom. He works at the Yugoslavian Embassy _ in a building with no ambassador _ for a Serb government with few friends.

When the former Yugoslavia began to break up four years ago, the Serbs ousted the now-independent Bosnians, Croatians, Slovenians and Macedonians from the Washington embassy, too.

Now, with peace breaking out in Bosnia, the nondescript, two-story building is part of a larger political power struggle that will set the course for the future of the Balkans. The breakaway states want to divvy up billions of dollars in assets worldwide _ including the Washington property _ that are part of the former Yugoslav republic. But the Serbs believe they are the true heirs. An international council in Geneva will decide.

``It’s a nasty divorce,″ says Thomas Burns, deputy director of the State Department’s Office of Foreign Missions. ``It is the disassembling of a nation into five component parts.″

While the issue is debated, Bosnia’s ambassador and his staff rent space in a building in a Washington neighborhood dominated by law firms.

Slovenia’s ambassador is in a new $1.4 million chancery building.

And the Croatian diplomats spent $2 million in donated funds and labor to fix up a building on ``Embassy Row.″

``With peace, the situation has changed,″ said Kresimir Pirsl, a consular agent in the Croatian Embassy. ``There is not war, so instead of complications of war, you have complications of peace.″

For the people of the former Yugoslavia, it’s a matter of history.

``The property which we enjoy at the moment has been inherited by the Kingdom of Serbia and the Kingdom of Yugoslavia,″ political officer Vujovic said with majesty. ``So we do not understand the countries, which left the Federation of Yugoslavia, saying this is something for them, too.″

When the Soviet Union dissolved, a property division took place as well _ and isn’t yet complete worldwide. In Washington, the Russians took over the vast Soviet Embassy complex with apartments and offices.

But the share-the-wealth scenario for the former Yugoslavia promises to be much more difficult; Serbian atrocities have stained the Balkans, embittering old enemies.

Each Balkan state has shouldered a portion of what was once a shared debt of hundreds of millions of dollars to qualify for World Bank loans and other international aid, according to Janusz Bugajski, an expert on the former Yugoslavia at the Center for Strategic and International Studies.

Bugajski believes the Serbs, too, will be forced by world pressure to divide whatever assets are left after the fighting ends.

``If Yugoslavia wants to be admitted back into the international community, they’re going to have to make some compromises,″ said Bugajski. ``They have to share with the states, recognize them, give them their due.″

Sven Alkalaj, the Bosnia-Herzegovina ambassador in Washington, estimates the wealth of the former Yugoslavia at $100 billion _ about 80 percent of that in military equipment and land. The World Bank said it couldn’t estimate the value of the far-flung republic.

Assets also comprise foreign currency reserves, including those kept by the Yugoslav central bank when it froze out the independent states, and properties in more than 80 countries. The former Yugoslavia owns buildings from European offices and villas to a $20 million Fifth Avenue suite in New York once owned by the Vanderbilts.

``In 1991, at the very beginning, the Serbs planned all this, to keep control of everything,″ Alkalaj said. ``They sent notes recalling all the ambassadors and the staff who were not Serbs in all the embassies worldwide. ... Now, they’re holding the property captive.″

In New York, the suite overlooking Central Park used to be the U.N. mission for the former Yugoslavia. Now, it’s occupied by Montenegro diplomats aligned with the Serbs, who have lost full U.N. status, according to Matjaz Kovacic, a lawyer for Slovenia in New York.

The Serbs filed a lawsuit against a second building cooperative in an attempt to occupy a Park Avenue apartment that used to house the Yugoslav ambassador to the United Nations. It has stood empty since 1982. The State Department and the Balkan states oppose the Serbs. Meanwhile, $70,000 to $80,000 in annual building maintenance fees accrue, Kovacic said.

``In the past, each ambassador had sold his shares (in the cooperative) to the one who comes after him,″ Kovacic explained. ``The last one didn’t.″

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