A Balkans Power-Broker Faces a Test of His Power Milosevic Survives Upheaval He Helped Spawn. but Yesterday's Vote in Montenegro May Hurt Him

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The man who fanned the flames of Serbian nationalism and let them burn down Yugoslavia is celebrating 10 years in power this month. In the ashes that remain of "Greater Serbia," Slobodan Milosevic has retained his grip on power - and his position as a guarantor of the Dayton peace agreement.

But presidential elections yesterday in Montenegro, the tiny republic that, with Serbia, comprises rump Yugoslavia, could shake that hold if Westward-looking challenger Milo Djukanovic topples Mr. Milosevic's proxy, Momir Bulatovic.

Milosevic, who became president of rump Yugoslavia after his second term as Serbian president expired in July, saw his domestic stature seriously bruised in the opposition protests of last winter. Recent Serbian elections further eroded the power of his leftist coalition. Despite these domestic setbacks, Milosevic has remained indispensable for the Balkan peace process. Last month, Milosevic appeared to have resolved the bitter power struggle that threatened to split the Bosnian Serb republic. In separate meetings with Bosnian Serb President Biljana Plavsic and her arch-rival in the Bosnian presidency, Momcilio Krajisnik, Milosevic brokered an agreement that paves the way for parliamentary and presidential elections in the Bosnian Serb republic later this year. The two leaders were back in Belgrade Oct. 13 for in a meeting that confirmed parliamentary elections would be held later this year. "Milosevic wants to present himself with the Krajisnik-Plavsic agreement as the only person who can create peace in Bosnia, but he's the man who started the war in Yugoslavia," says Ognjen Pribicevic, a researcher at the Belgrade Institute of Social Sciences and author of a recent book on Milosevic. He credits the Serbian leader's continuing success with political opportunism. Milosevic began as a rising star in Yugoslavia's Communist Party apparatus but soon adopted nationalistic rhetoric in the late 1980s. Under his regime, Serbs living in Croatia and Bosnia were encouraged to fight for the dream of a Greater Serbia. Only when United Nations sanctions against rump Yugoslavia began to bite and the Bosnian Serb leadership became disobedient did Milosevic take on the new role of peacemaker. Milosevic's economic and military ties to the Bosnian Serb leadership of Radovan Karadzic made him a useful partner for the international community. Two years ago, Milosevic signed the Dayton agreement on behalf of the Bosnian Serbs. While Milosevic has managed to retain power, it has come at a price to Yugoslavians. Battered by socialist mismanagement and a UN embargo, the economy is a shambles. The democratic process in Yugoslavia - once the most liberal of Eastern European countries - has been damaged by Milosevic's use of state media as a propaganda machine and his successful marginalization of the opposition. Dejan Anastasijevic, a staff writer for the independent Belgrade weekly Vreme, calls Milosevic "a brilliant tactician, but lousy strategist. …