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Sunday, June 27, 1999 Published at 17:25 GMT 18:25 UK

Race to rebuild Balkans hots up

Dozens of bridges were demolished by Nato's bombers

The reconstruction of Kosovo and the rest of Yugoslavia is provoking rivalry between European countries eager to secure their share of potentially lucrative contracts and build influence in the Balkans.

Kosovo: Special Report
Russian planners are already busy with major projects to rebuild Yugoslavia's crippled infrastructure.

The Itar-Tass news agency says that Yugoslavia has confirmed an order for Russian equipment worth around $150m to repair its electric power system.

[ image: Reconstruction contracts are expected to be worth billions]
Reconstruction contracts are expected to be worth billions
Leading Russian engineers, architects and planners visited Belgrade last week to draw up reconstruction projects for the Yugoslav capital and the country's second city Novi Sad, where key buildings, bridges and installations were destroyed in Nato air raids.

Konstantin Zatulin, aide to Moscow mayor Yuriy Luzhkov, said the Moscow government had decided to finance the construction of a new rail-road bridge in Novi Sad, opposition-run Serbian Studio B TV reported.

According to a preliminary estimate by Yugoslav economists, Nato strikes caused damage worth some $29.6bn, not counting damage to military installations, residential areas in Kosovo and the ecological impact.

Pressure for aid

Economist Mladjan Dinkic, quoted by the Yugoslav state news agency Tanjug, said Yugoslavia would need immediate financial aid of $1.17bn to help refugees, repair the electricity and heating systems, rebuild homes, repair key bridges and overpasses and launch social welfare programmes.

Up to two years will be needed to rebuild the main road from the Hungarian border to the southern Serbian town of Nis, according to Serbian Chamber of Commerce chairman, Momir Pavlicevic.

[ image: Massive amounts of investment will be needed]
Massive amounts of investment will be needed
Russia and Italy, like UN Secretary-General Kofi Annan, have said aid for Serbia should not be linked to the question of whether Yugoslav President Slobodan Milosevic remains in power.

At the G8 summit in Cologne this month, Italian Prime Minister Massimo D'Alema argued that a way should be found to help the Serbian people "without consolidating a regime which isn't to our liking".

Meanwhile the Federal Association of German Industry (BDI) has demanded that German firms get an adequate share in the Balkan reconstruction.

BDI managing director Ludolf von Wartenberg, quoted by the German news agency ddpADN, said Germany had provided one-third of the funds for rebuilding Bosnia-Herzegovina after the war there, but had won no more than 8% of the contracts.

Fair deal

But some of Nato's partners in eastern Europe have complained they are not getting a fair deal in the reconstruction projects, Hungarian radio said in a report on a recent Nato meeting in Budapest.

[ image: Putting Yugoslavia back on the road will take years]
Putting Yugoslavia back on the road will take years
"We are not at all satisfied with the role given to us in the reconstruction," Ukrainian Foreign Minister Borys Tarasyuk told the meeting.

Hungary's Ambassador to Nato, Andras Simonyi, said he found such criticisms levelled against Nato to be "natural" .

Bulgarian Prime Minister Ivan Kostov put his country's losses due to the war at more than $150m, but said the real cost was much higher, the Bulgarian news agency BTA reported.

Macedonia, another of the Nato partner states, has also complained about Western policy on reconstruction.

Macedonian Defence Minister Nikola Kljusev says he regrets the European Commission's "last-minute" decision to locate the agency for regional reconstruction in the Kosovo capital Pristina, instead of the Macedonian capital Skopje.

Mr Kljusev, quoted by a Macedonian news agency, said the war against Yugoslavia had cost Macedonia $172m a month.

"It is an insult to offer us credits for the damage we suffered," he said. "We want the damage to be paid for."

BBC Monitoring (, based in Caversham in southern England, selects and translates information from radio, television, press, news agencies and the Internet from 150 countries in more than 70 languages.

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