The Tremors under Milosevic's Yugoslavia A Key Region, Montenegro, Makes Reforms That Loosen His Grip Onpower

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With its soaring mountain ranges, spectacular opening to the Adriatic Sea, and leisurely pace of life, the tiny Yugoslav republic of Montenegro seems worlds away from the confrontational politics in much of the country.

But this land of some 600,000 inhabitants is in many ways the key to the future of Yugoslavia, where ethnic violence is raging in the province of Kosovo and where civil unrest seems inevitable in the capital of Belgrade.

Western diplomats consider Montenegro to be a beachhead in their effort to reform Yugoslavia and its dominant republic of Serbia. And in recent months, they say, Montenegro has made significant strides in helping to loosen Yugoslav President Slobodan Milosevic's grip on power - even in the face of US sanctions that are intended to punish Mr. Milosevic's regime but affect Montenegro as well. "The improvements we have seen in Montenegro over the course of the last year ... have been historic," says US diplomat Robert Gelbard. "The point here is that we have, as a strong policy, the need to support and to help those who want democracy and market economic reform." Milosevic himself may have further pushed Montenegrin sentiment for reform with a series of provocations. The leader, who has family roots in Montenegro, has orchestrated several federal-government shuffles, replacing reformers with regime loyalists. He also recently fired the top general of the Yugoslav Army, Momcilo Perisic, who has close ties with Montenegrin President Milo Djukanovic. In addition, Montenegrins accuse Milosevic of withholding money earmarked for Montenegrin pension funds. Analysts speculate that after Kosovo, Milosevic may turn the focus of his activities on Montenegro. Reaction to Kosovo For now, Montenegro has become increasingly important with the deepening of the conflict in the province of Kosovo, where the 90 percent ethnic Albanian majority is calling for independence and Serbian forces are accused of massacring civilians. Montenegrins have openly criticized the actions of the Yugoslav Army there, and have maintained solid relations with the ethnic Albanian populations in both Kosovo and Montenegro. When Yugoslav officials said Jan. 18 they would expel the top international observer in Kosovo - William Walker of the Organization for Security and Cooperation in Europe (OSCE) - Montenegrin officials promptly invited Mr. Walker to Montenegro. Mr. Djukanovic, who finished his first year in office last week, has promised economic reform and greater integration with Europe. To do so, he has distanced himself from Milosevic and stopped recognizing the federal government, whose prime minister is a Milosevic ally hailing from Montenegro, Momir Bulatovic. By pulling away from Serbia, Djukanovic has alienated those who identify with the Serbs and want to maintain close ties. …