IMF readmits Yugoslavia

WASHINGTON -- Yugoslavia has rejoined the International Monetary Fund after being kicked out eight years ago.

The international lending body said on Wednesday that membership had been approved, bringing the number of member countries to 183.

The IMF board also approved a loan of $151 million to help stabilise Yugoslavia's economy and rebuild administrative capacities.

However, Yugoslavia will have to repay arrears to the IMF of $130 million from the loan.

During the presidency of Slobodan Milosevic, Yugoslavia was cut off by the IMF in 1992 and the World Bank in 1993 for its role in a series of Balkan wars and for refusing to pay back loans it owed.

AUDIO Alessio Vinci describes the lack of challenges faced by reformist forces in Yugoslavia 150K/12 sec. AIFF or WAV sound

But Milosevic's ouster by popular revolt in October and the subsequent democratic election of Vojislav Kostunica as president have led to the easing of sanctions by many countries.

"This is a great success for the federal government and the central bank after only two months of negotiations," Yugoslavia's central bank governor Mladjan Dinkic told a Belgrade radio station after learning of the IMF decision.

"This effectively means that the gates of world capital are now open to us," he said.

"It's a green light for investors, and we expect substantial private investments next year."

IMF officials said that Yugoslavia needed to rejoin the world economy and the international community to deal with serious economic challenges.

"The Federal Republic of Yugoslavia authorities face the complicated task of stabilising and reviving a devastated economy after years of regional conflicts, international isolation and economic mismanagement," said Stanley Fischer, the IMF's first deputy managing director and its acting chairman.

Yugoslavia owed $128 million in arrears to the IMF, but officials said earlier that the arrears would not have to be paid before it rejoined.

The European Bank for Reconstruction and Development earlier this month became the first international institution to agree to admit Yugoslavia following Milosevic's downfall.

Reuters contributed to this report.

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Federal Republic of Yugoslavia
International Monetary Fund

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