9 - 15 July 2001

Skopje, 16th of July 2001

Security situation

Sporadic cease-fire disruption. The extremists removed the checkpoints on the road Tetovo - Jazince (toward the Kosovo border) and in some villages on the Sara Mountain. They are controlling the vehicles on the road at the villages of Neprosteno, Dzepciste, Poroj and Tearce. In the evening hours on the 15th of July 2001 from Drenovec 2, a suburb near the football stadium in Tetovo, according to the police, the extremists opened fire on the positions of the Macedonian security forces.

During the conflicts with the extremists in the area of Tanusevci, a Macedonian Army corporal was wounded. KFOR helped evacuate the soldier to the Army Hospital in Skopje.

Two sides of the truth. According to the daily newspaper in Albanian language "Fakti", in the village of Neprosteno, Bedri Halimi, a NLA member was killed from a sniper two days after cease fire was established, while according to the Macedonian language media he was killed because he refused to fight on NLA side.

The political situation

Framework document talks. The dialogue of the four political parties under patronage of President Trajkovski continued on the framework document for Constitution's changes, suggested by the special envoys from the US and EU, James Pardew and Francois Leotar. According to DPA, the document should be worked on. In the international experts team, the Dutch international law expert Andre Nol Kaemper arrived in Macedonia, who is a member of the Venice Constitutional Reforms Commission in the frames of the Council of Europe. Robert Badinter invited the former German president Roman Herzog to be a Macedonian Government counsel in the process of the Constitution's changes.

Significant progress and blockade of the talks. During the weekend (14th and 15th July) the talks between the four political party leaders and the international envoys (Pardew and Leotar) were intensified. 15th of July was announced as deadline for reaching agreement. Some consider that a significant progress has been made, while others the talks are blocked. The Albanian language as a second official language and establishing local police issues remain disputable.

Economic situation

Budget rebalance and deficit of 223,943,661 USD. Parliamentary debate is going on for Budget rebalance for 2001. According to the Minister of Finance the second Budget rebalance is necessary because of the crisis in the country, causing enormous damages and additional costs on different bases, which totals at 15,9 billion MKD (223,943,661 USD) Budget deficit or nearly 6% of the projected Gross Domestic Product (GDP). Total expenses with the rebalance are projected at 70,6 billion denars (MKD) or 15,4 billion MKD more than previously projected. The biggest increase has been made at the Ministry of Defence from 4,583,178,000 MKD (64,551,802 USD) initially projected to 14,511,455,000 MKD (204,386,690 USD), and the Ministry of Internal Affairs, from 3,831,408,000 MKD (53,963,492 USD) to 7,601,187,000 MKD (107,058,971 USD).

Since the implementation of the new "war" tax, eight days ago, there is a 15-20% inflow more than planned, according to the Minister of Finance.

Economic losses increase. If the crisis situation in the country continues, till the end of the year the total losses of the Macedonian economy will be over 600 million DEM.

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