BELGRADE -- Slobodan Milosevic wants Serbs to believe that he stands accused for crimes committed by the whole Serb nation. The International War Crimes Tribunal is taking pains to hold individuals accountable, not all Serbs. Yet despite the collective soul-searching prompted by the Milosevic trial, many Serbs still romanticize the notion of Greater Serbia and retain an attitude of victimization. The trial can help Serbs confront the awful atrocities committed in their name. Doing so will give momentum to political reforms and, thereby, accelerate Serbia's renewal and reconstruction and its integration into Europe.
Hopes were high after Milosevic was overthrown in a dramatic display of people power. Eighteen months later, Yugoslavia is still controlled by a criminal underworld with links to political parties run like Mafia families. The economy is dominated by illicit activities and undermined by widespread corruption. The treasury, plundered during the Milosevic regime, is empty and has no legitimate tax base. The Democratic Opposition of Serbia (DOS) expected a big payoff for extraditing Milosevic to The Hague. So far, they have received scant reward.
Yugoslavia's economy, crippled by years of sanctions and ravaged by NATO's bombing, desperately needs foreign aid to help cover the costs of reconstruction, as well as to pay for essential social services. Serbia's poor and elderly, live without a social safety net. Funds would also help cushion the working class from the economic effects of closing state owned industries. The Central Bank of Yugoslavia is seeking debt forgiveness to stabilize macro-economic conditions and concessionary loans to cover budget shortfalls.
Given the slow pace of reform, donors are understandably cautious. The U.S. Congress has attached broad conditions to its financial assistance, demanding that Belgrade cooperate with the International War Crimes Tribunal, respect human rights and support implementation of the American-brokered Dayton Peace Agreement.
Belgrade's pro-reform leaders have grown bitter about the international community's reluctance to deliver the billion dollars promised last year. Instead of adopting an irritating attitude of entitlement, however, DOS should get on with the business of consolidating the country's democratic development.
Initially, Yugoslav President Vojislav Kostunica was like a breath of fresh air after years of Milosevic's corrupt and tyrannical rule. Today, the West sees Mr. Kostunica as just another Serbian ideologue, and an obstacle to reform. He undermined his standing by harboring war criminals and failing to exert control and financial oversight over the military. Mr. Kostunica also challenged the jurisdiction of the International War Crimes Tribunal and derided its moral authority. His standing has eroded to such an extent that he was denied a meeting at the State Department during a recent visit to Washington, DC.
The Serbian polity is also growing wary. Mr. Kostunica's job approval rating, which stood at 90% last year, has plummeted. While Mafia high-rollers revel in conspicuous consumption, the legal economy is stagnant, and unemployment remains high. Many people responsible for ethnic cleansing remain at large or in positions of authority.
Later this month President George Bush must verify whether Yugoslavia has complied with congressional requirements before authorizing American financial assistance. Congressional leaders insist that DOS will be measured by what it does, not merely what it says. They believe that conditionality is still the most effective tool to leverage reforms. For conditionality to work, however, the U.S. should be more specific about its expectations.
If, for example, the West expects Yugoslavia to be a positive influence on regional stability, Belgrade must resolve Montenegro's demand for independence peacefully. Belgrade should prevent Milosevic's wartime proxies from continuing to undermine the central government in Bosnia and Herzegovina. And it should cooperate with the international community to expedite a popular consultation determining Kosovo's eventual political status.
After the Serbian killing of 10,000 Kosovars and the driving of almost a million from their homes, confidence-building measures are needed to begin the slow process of improving relations. A first step would be to release the 78 Albanian political prisoners languishing in Serbian jails. Kosovo's Serbs should be encouraged to abandon alternative structures and participate in local government. General Pavkovic, who organized mass deportations and the murder of ethnic Albanians, should be fired as Yugoslav army chief of staff, and investigated for his role in the deportation and murder of Kosovars.
The West wants Belgrade to show unequivocal cooperation with the Hague Tribunal. Lip-service pledging cooperation is not enough: an unambiguous extradition law is needed. Ratko Mladic, the Bosnian Serb general responsible for massacring 8,000 civilians in Srebenica, lives under the protection of the Yugoslav army in Belgrade. He should be arrested and sent to The Hague. As long as Yugoslavia insists on paying the pensions of Yugoslav Army officers who fought and stayed in Bosnia after the war, its poverty pleading will fall on deaf ears. The administration of justice must be strengthened, including the prosecution of Serbs accused of war crimes, and the implementation of anti-corruption measures.
With the American deadline approaching, Belgrade will make some token gestures giving President Bush just enough to justify issuing the presidential waiver. Given the fragile state of Yugoslavia's democracy, the U.S. should release its funds. Failure to support pro-reform leaders would galvanize extremists and actually set back the process of reform. The coming year, however, will be a crucial time for consolidating democracy. Substantive reform should proceed apace with decisions to extend more foreign aid or to include Yugoslavia in Euro-Atlantic institutions, such as NATO's Partnership for Peace and the Council of Europe.
The West must not squander the opportunity to consolidate gains in the Balkans. For the first time, the region's leaders have been democratically elected and share the goal of European integration. Belgrade must make real progress so that conditionality can be lifted. Then the Western can focus on more positive incentives to reward Yugoslavia for its democratic development. Serbs cannot be blamed indefinitely for Milosevic's crimes.
Mr. Phillips is a senior fellow and deputy director of the Center for Preventive Action at the Council on Foreign Relations in New York.