Romanian Smuggling Scandal Sparks Political Turmoil

The scandal over illegal Romanian oil shipments to Yugoslavia during the Bosnian war has taken a new political twist with President Emil Constantinescu accusing two prominent politicians of involvement in the case.

Constantinescu alleges that his predecessor, Ion Iliescu, and former Foreign Minister, Teodor Melescanu, were involved in transporting the fuel, in breach of a UN embargo against Yugolavia.

"Huge quantities of petrol were exported under the cover of the darkness," Constantinescu said, claiming the Romanian secret service played a role in the smuggling, operating on "orders from above" - a clear reference to the country's former political leadership.

The president said Iliescu and Melescanu would be held responsible, "regardless of whether they knew about it."

Melescanu immediately retaliated, accusing Constantinescu of attempting to discredit his rivals ahead of presidential elections in November."Constantinescu is turning the presidential seat into a soapbox from which he can heap abuse on his political opponents," the former minister said.

Without formally denying the accusations, Iliescu said the president's remarks carried "a strong dose of electioneering." It was "unacceptable and dangerous" for the president to "take over the role of the judiciary," Iliescu said.

The smuggling operation followed the UN Security Council's decision in 1992 to impose an oil embargo on Yugoslavia to pressure Belgrade to stop supplying fuel to the Bosnian Serbs.

Romanian police launched an investigation into the country's violations of the UN embargo three years ago. Local press reports earlier this year said Romanian investigators had established around 1,000 railway wagons carrying tonnes of fuel were smuggled across the Romanian-Serbian frontier at Jimbolia.

According to the reports, secret service agents accompanied the trains, which passed the Jimbolia crossing at night with their lights off.

"Operation Jimbolia blew a hole of $100 million in the public purse," the daily paper, Evenimentul Zilei, reported. "The operation was financed by the state through preferential credits allotted to cronies of the former government under the co-ordination of the Romanian Intelligence Service."

Romanian judicial officials have refused to comment on the media reports, but say the investigation is continuing.

On July 5, however, former intelligence chief, Virgil Magureanu, said in an interview with the most popular daily paper Adevarul, "Romania's violation of the embargo against Yugoslavia was indeed a political decision, made at the highest level."

Magureanu said Western governments had also approved the shipments because the oil was meant only for humanitarian purposes. "Other countries like Bulgaria, Hungary and Ukraine also carried out similar special operations," he said.

Although international observers said UN rules had not been breached, Romania is known to have a poor record of observing UN sanctions. The embargo presented many people with an opportunity to ferry barrels of oil across the Danube in small boats. Hundreds of luxury villas, built on the proceeds of this lucrative trade, soon dotted the landscape.

But most Romanians look upon Constantinescu's sanction busting attack on Iliescu as nothing more than a political bluff. Iliescu was ousted by the reformist Constantinescu in the 1996 elections, but looks poised to win back the presidency in the November elections.

Constantinescu may also be sending a signal to the international community ahead of November's poll. Critics have accused Iliescu of maintaining warm relations with Yugoslav President, Slobodan Milosevic. "The allegations against Iliescu are unlikely to enhance Romania's bid to join NATO and the European Union," says Eliade Balan of the daily paper, Romania Libera, "but they should serve as reminder his election victory could complicate the situation in the Balkans."

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