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Romanian Embargo Eases

Romania is hoping for an economic upturn after partially lifting its oil embargo against Yugoslavia.
By Marian Chiriac

"Thank God, our lives have finally changed," says Silviu Grigorescu, 33, a river transport officer who lost his job nine months ago. "I'm now hopeful of working again."


Grigorescu is one of the 4,000 Romanian shipping industry workers who lost their jobs last year after the NATO bombardments over Yugoslavia blocked traffic on the Danube. Up to now, he and his family have struggled on the equivalent of $40 a month in unemployment benefits.


His hopes have been raised following the recent resumption of Romanian oil shipments to Yugoslavia, in line with the partial lifting of the European Union's Yugoslav fuel ban in early February.


A government ruling just over a week ago approved the export of oil and petroleum products to Montenegro, Kosovo and seven Serbian towns and cities - Nis, Pirot, Sombor, Subotica, Kragujevac, Kraljevo, and Novi Sad - controlled by opponents of Slobodan Milosevic.


At the same time, other fuel shipments to Yugoslavia for humanitarian purposes, peacekeeping use and Yugoslav-based Romanian missions will continue.


Transport Minister Traian Basescu, has warned that violation of the government provisions will be severely punished. "Export to areas or for uses other than those stated may be regarded as smuggling and will be prosecuted," he said in a press conference.


The first company to resume crude oil transport is Oil Terminal. Under a contract struck before the 1999 crisis in Kosovo, Oil Terminal, based in the Black Sea port of Constanta, supplied up to 80,000 tons of crude per month to NIS Jugopetrol, the national oil company of former Yugoslavia.


The partial lifting of the embargo is expected to assist the recovery of Romanian industry, particularly oil and shipping companies, who have lost an estimated one billion dollars, or 2 per cent of the country's gross domestic product, as a consequence of the Kosovo war.


"During the one-year ban, Romania lost processing contracts for about 3.5 million tons of oil from Serbia," said Mihai Ionescu, president of the National Exporters and Importers' Association, ANEIR.


As a result of the blockade, 80 per cent of Romanians who worked on the Danube lost their jobs and 23 shipping companies, most of them new private enterprises, teetered on the brink of bankruptcy.


Romanian companies have repeatedly denounced the ban, which they say has been constantly flouted by their Western competitors. Ionescu said Romanian firms had had to sell their products through Western go-betweens. "This has played into the hands of Western companies that delivered considerable amounts of fuel via Montenegro," he said.


For their part, shipping industry workers believe NATO bombed the Danube bridges not to disrupt Yugoslav army supply routes but to damage the Balkan region and boost trade on the Rhine, to the benefit of Western Europe.


Despite the conspiracy theories that had taken hold here, in reality, the war in Kosovo has severely affected the regional economy. Trade between Balkan states accounts for just 14 per cent of the region's economic activity, and has little chance of increasing.


While eager to see the Danube reopened, the Romanian government was reluctant to blame NATO for the river blockade. In fact, Bucharest supported the alliance's policy on Kosovo and opened its airspace to NATO aircraft during last year's bombing campaign, a position that was shaped at least in part by Romania's strong desire to join the alliance.


Whether Romania's policy pays off remains to be seen. For the moment, the country is simply relieved that its struggling shipping industry is to be given a new lease of life.


Marian Chiriac is news editor of the MediaFax News Agency in Bucharest and editor of Foreign Policy, a quarterly published by the Romanian Academic Society.


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