VZCZCXYZ0001
PP RUEHWEB

DE RUEHSQ #0234/01 0691414
ZNR UUUUU ZZH
P 101414Z MAR 06 ZDK
FM AMEMBASSY SKOPJE
TO RUEHC/SECSTATE WASHDC PRIORITY 4375
INFO RUEHTI/AMEMBASSY TIRANA 3367
RUEHVB/AMEMBASSY ZAGREB 2241
RUESEN/SKOPJE BETA
RUEHSQ/USDAO SKOPJE MK

UNCLAS SKOPJE 000234 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
FOR SENATOR VOINOVICH AND DELEGATION FROM THE AMBASSADOR 
DEPT FOR H, EUR/SCE 
 
E.O. 12958: N/A 
TAGS: OVIP OREP AMGT ASEC MK
SUBJECT: MACEDONIA: SCENESETTER FOR CODEL VOINOVICH VISIT 
MARCH 24-26 
 
REF: A. STATE 29812 
 
     ¶B. SKOPJE 218 
 
¶1. (SBU) Your visit comes as the government and opposition 
are gearing up for this summer's parliamentary election, the 
actual date of which has yet to be determined.  Amid the 
clamor of mutual recrimination and mudslinging of the 
"pre-campaign," which already is underway, your visit is an 
excellent opportunity to remind the government and opposition 
of the importance of free and fair elections to Macedonia's 
NATO and EU membership prospects.  It is also an opportunity 
to press the government and opposition to stay focused on key 
reforms, despite the inevitable distractions of the political 
campaign and regardless of which parties emerge to lead the 
next government after the elections. 
 
MUCH PROGRESS SINCE 2001 CONFLICT 
--------------------------------- 
 
¶2. (SBU) Although the 2001 armed insurgency by the 
ethnic-Albanian National Liberation Army left wounds and a 
controversial legacy, the interethnic coalition that came to 
power in the 2002 parliamentary elections has made important 
progress since then in implementing the Ohrid Framework 
Agreement (FWA) that ended the conflict.  In the process, the 
government has built a democratic, multiethnic state and 
Macedonia is now a secure, stable country. 
 
¶3. (SBU) PM Vlado Buckovski's Social Democratic Union (SDSM) 
is in an uneasy coalition with ethnic Albanian party DUI, 
whose president is the former leader of the 2001 insurgency. 
Despite occasional intra-coalition clashes, the government 
has passed the constitutional amendments and legislation 
required by the FWA, which enhanced the language rights and 
local government decision-making powers of ethnic minorities 
in Macedonia. 
 
¶4. (SBU) Although language rights and national symbols remain 
sensitive issues, the coalition continues to make measured 
progress on FWA-related decentralization reforms.  Government 
entities are stepping up the hiring of ethnic minorities to 
ensure that all ethnic groups are equitably represented in 
the public administration.  Recent measures of public opinion 
are also encouraging; a poll last year found that for the 
first time in seven years, both major ethnic groups had a 
positive view of each other.  And only three percent of 
Macedonians list ethnic relations as the country's largest 
problem -- the vast majority consider economic issues to be 
Macedonia's greatest challenge. 
 
FAIR ELECTIONS KEY TO MACEDONIA'S FUTURE 
---------------------------------------- 
 
¶5. (SBU) Conducting free and fair elections is the first 
challenge Macedonia must face as it aims to strengthen its 
NATO and EU membership bids, as our Ambassador to NATO 
pointed out during a recent visit to Skopje.  The municipal 
elections early in 2005 were characterized by a series of 
irregularities, especially in predominantly ethnic Albanian 
areas.  A flawed system for ruling on challenges to electoral 
results, and lackluster follow-through by prosecutors on 
credible allegations of misconduct compounded the problem. 
 
¶6. (SBU) In light of last year's events, Macedonian officials 
will be keen to demonstrate their commitment to fair 
elections.  PM Buckovski will tell you that the government is 
fully committed to "zero tolerance for electoral fraud" and 
may note that the State Electoral Commission, which 
administers the overall election process, is now fully funded 
and operational.  In addition, the Macedonian government has 
worked with OSCE experts to draft an electoral code that 
addresses concerns raised by the international community 
following irregularities noted in previous elections.  The 
electoral code is under consideration by Parliament, which is 
expected to pass it by the end of March. 
 
¶7. (SBU) The only serious obstacle to the passage of the 
electoral code is a dispute over the composition of local 
electoral boards (LEBs).  Although the OSCE found the 
government draft electoral code acceptable, the main 
opposition party, VMRO-DPMNE, objects to the government's 
proposal to staff LEBs with civil servants.  The party argues 
that the politicized nature of the civil service guarantees a 
heightened potential for fraud.  The government is working on 
a compromise solution that would allow party representatives 
 
to serve on the boards in addition to civil servants. 
 
¶8. (U) President Branko Crvenkovski kicked off on March 2 an 
initiative to intensify outreach to the media, civil society, 
religious communities, and political parties to highlight the 
need for free and fair elections.  I participated in a 
two-hour session during which the President, the OSCE and EU 
representatives, and I gave the media our views about their 
role in the elections.  We underscored our hope that they 
would work to create a positive, constructive atmosphere for 
political debate as campaigning gets underway, and would 
highlight the critical importance of a free and fair process 
for the country's NATO and EU membership prospects.  A 
similar session with NGOs will take place in mid-March. 
 
COOPERATIVE ON KOSOVO FINAL STATUS 
---------------------------------- 
 
¶9. (SBU) The GOM acknowledges that the Contact Group will 
take the lead on Kosovo final status talks, but strives to 
play a small but constructive role in that process.  The 
government will accept any final status outcome that respects 
the sovereignty and territorial integrity of the state.  Due 
to its experience with decentralization and defining the 
rights of ethnic minorities, Macedonia is sometimes described 
as a possible model of a multiethnic democracy for Kosovars 
to emulate. 
 
¶10. (SBU) Macedonia also hopes for demarcation of its border 
with Kosovo before final status talks conclude.  Limited 
talks have been held at the technical level, but the Kosovars 
are unwilling to accept a 2001 agreement between Belgrade and 
Skopje delineating the border.  We support resolution of the 
demarcation issue within the framework of final status talks, 
and we continue to emphasize that Kosovo, whatever its final 
status, will need an internationally recognized and 
demarcated border. 
 
¶11. (SBU) Relations between Skopje and Pristina are good, and 
links between Macedonia and Kosovo are growing.  Macedonia 
opened a trade office in Pristina last year, and the Prime 
Minister and President frequently host working meetings with 
PISG leaders on issues of common concern.  Trains now run 
between the two cities, and a free trade agreement signed in 
July 2005 is a significant example of deepening economic 
ties.  PM Buckovski has expressed interest in hosting a visit 
of PISG Prime Minister-designate Agim Ceku in the near 
future. 
 
MEASURED PROGRESS TOWARD NATO AND EU MEMBERSHIP 
--------------------------------------------- - 
 
¶12. (SBU) A reliable U.S. ally, Macedonia's government was 
disappointed by our announcement that we would not support a 
summit on NATO enlargement before 2008.  Macedonian officials 
have been encouraged, however, by our message that Macedonia 
is on the right path, even if difficult tasks remain.  PM 
Buckovski understands that NATO members want stable, secure 
contributing members in the Alliance.  He is likely to 
emphasize that Macedonia has made good progress on defense 
reforms and contributes to alliance operations in Afghanistan 
and Iraq.  Macedonia has been an important contributor to 
regional cooperation, both as part of the Adriatic Charter 
(A-3 -- Albania, Croatia, and Macedonia) and as a contributor 
to the Southeast European Brigade (SEEBRIG).  A recent poll 
found that 90 percent of Macedonians support joining NATO. 
 
¶13. (SBU) Macedonia was declared an EU candidate country in 
December in recognition of the significant strides it has 
taken toward meeting EU membership criteria.  The European 
Council determined, however, that Macedonia must make further 
progress to strengthen the rule of law, fight corruption, and 
enact judicial reforms before accession talks can begin.  The 
European Commission will report on Macedonia's progress in 
the fall, but we do not expect the EU to set a date for the 
opening of membership talks with Macedonia before late 2007. 
 
CONSOLIDATING RULE OF LAW 
------------------------- 
 
¶14. (SBU) Ethnically mixed police patrols have access to all 
communities in the country, including former "police no-go 
zones" scattered throughout predominantly ethnic Albanian 
parts of the country.  Largely as a result of recent 
standoffs in the Skopje suburb of Kondovo, the police often 
 
get political buy-in for police operations before undertaking 
them in ethnic Albanian villages.  This pragmatic approach 
normally minimizes the need to launch potentially violent 
operations that could spark inter-ethnic violence. 
 
POLICE ACCOUNTABILITY, TIP REMAIN ISSUES 
---------------------------------------- 
 
¶15. (SBU) General rule-of-law weaknesses hamper Macedonia,s 
ability to combat corruption, organized crime, and 
trafficking in persons (TIP).  The Ministry of Interior,s 
Professional Standards Unit (PSU) has investigated a number 
of allegations of police abuse, and has sanctioned such abuse 
when it occurred.  However, the PSU,s record is 
inconsistent, and systems to ensure transparency in the MOI 
are inadequate.  Similarly, Macedonia,s fall from Tier 1 to 
Tier 2 in the State Department,s annual Trafficking in 
Persons report for 2005 reflected lack of political 
commitment to combat aggressively lucrative organized crime 
activities, as reflected in the GOM,s continuing lack of a 
national action plan for combating TIP. 
 
INDEPENDENT AND EFFICIENT JUDICIARY 
----------------------------------- 
 
¶16. (SBU) The parliament in December 2005 passed a package of 
11 constitutional amendments strengthening the independence 
and efficiency of the judiciary, which currently is one of 
the least-trusted of all Macedonian government institutions. 
The amendments curtail the role of Parliament in selecting 
judges, who will now be selected and dismissed by an 
independent State Judicial Council.  Parliament is expected 
to pass bylaws to implement the amendments by June 2006, 
although the process could be delayed if the parties involved 
cannot agree on bylaws to bring the reforms into effect. 
Together with other aspects of the government's judicial 
reform strategy, these steps reflect Macedonia's commitment 
to increase the responsiveness and professionalism of its 
judiciary and sharply reduce the system's backlog of over one 
million cases. 
 
CORRUPTION CONUNDRUM 
-------------------- 
 
¶17. (SBU) As elsewhere in the Balkans, corruption is a 
pervasive problem here.  Macedonia was ranked 104 of 159 
countries in the 2005 Transparency International annual 
corruption perception index (CPI) report.  Very few 
high-profile corruption cases have been successfully 
prosecuted, with even fewer cases involving a significant 
sentence as a sanction.  According to government data, in 
2005 a total of only 37 persons were convicted on 
corruption-related charges, 24 for abuse of their official 
positions.  According to some government sources, the lack of 
an effective wiretapping law thwarts more effective 
prosecution of corruption cases.  In reality, there is a lack 
of political will -- in the government and the judiciary -- 
to tackle this problem effectively. 
 
GOVERNMENT LOOKS TO PROMOTE FOREIGN INVESTMENT 
--------------------------------------------- - 
 
¶18. (U) The government,s most significant economic 
achievement has been maintaining macroeconomic stability and 
fiscal discipline.  The economy has grown at a consistent 
rate of 2 to 4 percent from 2002 to 2005.  The government 
budget deficit is low (-0.6% in 2005), inflation minimal 
(0.5% in 2005), the currency is stable, and the level of 
debt-to-GDP (40%) is manageable.  Despite some marked 
progress, however, both domestic and foreign business 
investment is low, and GDP growth rate is not strong enough 
to lower unemployment or the poverty rate significantly. 
Macedonia ranks 57th in the Heritage Foundation,s 2005 Index 
of Economic Freedom, closely behind A-3 partners Albania 
(52nd) and Croatia (55th). 
 
¶19. (U) The government has made significant economic reforms 
in a number of areas, including recent implementation of a 
"one-stop shop" that has reduced the time required for 
registering a new business.  However, more needs to be done 
to create an economic climate that will attract increased 
investment and bring official unemployment figures down from 
over 30 percent.  Essential remaining steps include enforcing 
property and contract rights, and completing privatization of 
the state-owned electricity monopoly to bolster investor 
 
confidence in the country. 
 
MACEDONIAN, SERBIAN CHURCHES AT ODDS 
------------------------------------ 
 
¶20. (SBU) An ongoing dispute between the Serbian Orthodox 
Church (SOC) and the Macedonian Orthodox Church (MOC) over 
which church may represent Macedonia's Orthodox believers has 
affected relations between Belgrade and Skopje.  The 
imprisonment last year of Zoran Vraniskovski, a former MOC 
bishop now recognized by the SOC as Archbishop Jovan of 
Ohrid, was criticized by the international community and many 
human rights NGOs.  Vraniskovski was released on March 3 
after the Supreme Court reduced Vraniskovski's sentence for 
inciting religious intolerance.  Despite this positive step, 
however, Vraniskovski is likely to return to prison unless an 
appeals court reverses his September 2005 conviction for 
embezzlement. 
 
¶21. (U) A government commission is working on a draft law 
that will determine, inter alia, whether Vraniskovski's 
SOC-affiliated church can register officially as a religious 
group in Macedonia.  Recent revelations that Vraniskovski's 
group is funded by the Serbian government -- a move widely 
seen here as a provocative intrusion into Macedonia's 
domestic affairs -- are likely to complicate the situation. 
 
 
DEMOCRATIC PARTY OF SERBS -- MODERATE FORCE 
------------------------------------------- 
 
¶22. (U) On a political level, ethnic Serbs are represented in 
the Parliament by the Democratic Party of the Serbs (DPS), a 
junior member of the ruling coalition.  The DPS largely 
avoids controversial language and religious issues, although 
its MP, Ivan Stoiljovic, introduced a draft law in Parliament 
last year that would have amnestied Vraniskovski.  According 
to the 2002 census, just under two percent of Macedonia's 
population are ethnic Serbs. 
 
NAME DISPUTE WITH GREECE CONTINUES 
---------------------------------- 
 
¶23. (SBU) Although Macedonia and Greece have extensive 
economic relations, the ongoing dispute over Macedonia's 
constitutional name has complicated relations between the two 
countries.  Efforts to resolve the dispute are being led 
under UN auspices by Matthew Nimetz, a process that the USG 
strongly supports.  While the UN continues to recognize 
Macedonia as the Former Yugoslav Republic of Macedonia (or 
FYROM), the U.S. moved to recognize the country as the 
Republic of Macedonia in November 2004, joining over 100 
other countries that have chosen to do so.  That decision 
dramatically lifted the opinion most Macedonians had of the 
United States. 
MILOVANOVIC