VZCZCXRO0885
PP RUEHAG RUEHAST RUEHDA RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA RUEHLN
RUEHLZ RUEHPOD RUEHROV RUEHSR RUEHVK RUEHYG
DE RUEHSQ #0464/01 2001314
ZNR UUUUU ZZH
P 181314Z JUL 08
FM AMEMBASSY SKOPJE
TO RUEHC/SECSTATE WASHDC PRIORITY 7532
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE 0369
RUEAIIA/CIA WASHINGTON DC
RUEKDIA/DIA WASHINGTON DC
RUEKJCS/JOINT STAFF WASHINGTON DC
RUEKJCS/SECDEF WASHINGTON DC
RUESEN/SKOPJE BETA
RUEHSQ/USDAO SKOPJE MK
RUCNDT/USMISSION USUN NEW YORK 2307
RHEHNSC/WHITE HOUSE NATIONAL SECURITY COUNCIL

UNCLAS SECTION 01 OF 02 SKOPJE 000464 
 
SIPDIS 
 
STATE FOR EUR/SCE 
 
E.O. 12958: N/A 
TAGS: PREL PGOV MK
SUBJECT: MACEDONIA: ARREST OF OPPOSITION VP PROMPTS 
PARLIAMENT WALK OUT 
 
SUMMARY 
 
¶1. (SBU)  Zoran Zaev, Vice President of opposition party SDSM 
and rumored next leader of the party, was arrested on 17 July 
along with five associates on charges of corruption  and 
abuse of official position related to financial gains from a 
tender for a shopping mall in Strumica, where Zaev serves as 
mayor.  While MoI officials presented us with details of the 
case against Zaev and his associates, the timing of the 
arrest and the conduct of the investigation raise questions 
about political motivations.  SDSM and its "Sonce Coalition" 
partners have called the arrest politically motivated and 
have walked out of Parliament "until further notice."    End 
Summary. 
 
¶2. (SBU)   Criminal charges against Zaev and his associates 
stem from a tender for a shopping mall, from which the group 
was alleged to have profited 7.8 million Euros through 
manipulation of the tender process.  The tender (for 
construction of a mall on state-owned land currently disputed 
in the courts under the denationalization process) was 
allegedly not broadly advertised as required by law and 
categorized improperly as "reconstruction" rather than "new 
construction" for added flexibility in the tender process. 
Only two bidders on the tender submitted documentation, and 
while both submitted incomplete documentation, only one 
company's bid (a Bulgarian company) was dismissed.  According 
to the MoI, the winning company, Deluxe Engineering, is a 
newly-formed company with no financial assets, controlled by 
a close associate of Zaev's.  Zaev is also said to have 
violated legally proscribed timelines for the tender process, 
closing the deal with his associate's company within a week. 
Zaev's relatives are also said to have profited by getting 
deals for free or discounted space in the mall. 
 
Conduct of the Investigation Raises Questions 
--------------------------------------------- 
¶3. (SBU)   Ministry of Interior (MoI) officials report that 
the investigation by local Strumica police began in April 
2007, and the case was passed to MoI's Department for 
Organized Crime in November 2007.  Questions have been raised 
about the conduct of the investigation.  In January 2008, the 
MoI placed information on its website, then promptly withdrew 
the statement, and, in effect, apologized, saying that there 
were no charges.  According to the MoI's account, charges 
were retracted because the prosecutor called for additional 
investigation.  Additional investigative reports were then 
submitted to the prosecutor earlier this month, resulting in 
the criminal charges and order for Zaev's arrest.  Zaev and 
SDSM leaders were clearly convinced that all charges had been 
dismissed in January 2008 and that the case was closed, as 
Zaev resigned his newly-won Parliamentary seat to remain 
Mayor of Strumica, thus giving up the opportunity to be 
protected from prosecution as an MP. 
 
 
Kicking them When They're Down? 
-------------------------------- 
 
¶4.  (SBU) SDSM and all other members of the opposition 
"Sonce" coalition called the arrest politically motivated and 
announced their departure from Parliament "until further 
notice" just hours after Zaev was brought to the Skopje Basic 
Court for his hearing before the investigative judge.   Of 
the departure from Parliament, SDSM's Sekerinska said to the 
VMRO-DPMNE coalition, "Since you desired absolute power and 
dictatorship, you will have the opportunity to exert it in 
the Parliament." 
 
¶5.  (SBU)  A sizable crowd of SDSM supporters (estimated 
between 350 and 800) gathered to protest in front of the 
Skopje Basic Court, urged by party leaders to stay until Zaev 
made his initial statement and was released.  Zaev was 
released just before midnight, and his passport was held to 
ensure his next court appearance.  It is not clear when the 
investigative judge will pass the case to the court to 
schedule a hearing. 
 
¶6.  (SBU)  Speculation that the arrest was politically 
motivated and politically timed centers around Zaev's future 
role in SDSM.  President Crvenkovski announced on 16 July 
 
SKOPJE 00000464  002 OF 002 
 
 
that he would not seek re-election.  SDSM's President 
Sekerinska stepped down following their electoral defeat in 
the June early parliamentary elections, and as SDSM aims to 
re-group, Zaev's name has topped the lists for leadership of 
the party.  He also has been mentioned in the press as a 
possible candidate for President.  SDSM leaders cited the 
media circus surrounding the arrest as evidence of a 
politically-motivated MoI, arguing that they had called the 
media to alert them of the arrest.  While in meetings with 
us, MoI officials denied alerting the media of the initial 
arrest, media later reported that MoI Spokesman texted 
reporters on the morning of the 17th:  "Looks like Zaev's 
leadership aspirations will have problems.  He will be 
appearing in Skopje Court 1 in half an hour." 
 
¶7.  (SBU)  Comment:  While it is not entirely clear whether 
the case against Zaev is primarily politically motivated, the 
reactions from opposition SDSM and its partners were swift 
and strong.  With their ability to influence the work of the 
Parliament limited by the VMRO-DPMNE coalition's 82 seat 
majority, SDSM VP Igor Ivanovski called the Parliamentary 
walk-out the only way to protest the "ongoing political 
chase" VMRO-DPMNE is conducting against SDSM and its 
partners.  End Comment. 
 
 
 
Milovanovic