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Yugoslavia arms ties { November 1 2002 }

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Yugoslavia's Arms Ties to Iraq Draw U.S. Scrutiny

By Daniel Williams and Nicholas Wood
Washington Post Foreign Service
Friday, November 1, 2002; Page A26

BELGRADE, Oct. 31 -- Earlier this month, a ship carrying 14 containers of chemical pellets sat in the Yugoslav military port of Tivat, preparing for a voyage. U.S. officials believed that the cargo was solid rocket fuel and bound for Iraq, in violation of a U.N. ban on arms deliveries.

Rather than tell the government of Yugoslavia, which receives $135 million in annual aid from Washington, mistrustful U.S. officials called on neighboring Croatia to intercept the ship, the Boka Star, at sea. "We were uncertain what the response of the Yugoslavs would be if we had asked them," said a senior U.S. official.

The Croatians seized the vessel Saturday in the Adriatic Sea. Croatian and U.S. officials say they have determined that the cargo was in fact solid rocket fuel. It was labeled "active charcoal."

The incident was one of a series of recent high-profile discoveries of suspected weapons-related products and technology illegally bound for Iraq -- at a time when the United States is preparing for possible war with that country. The revelations threw light on Iraqi President Saddam Hussein's continuing ability to evade U.N. restrictions and import military goods and expertise, even from a country such as Yugoslavia that is nominally friendly to Washington.

The Yugoslav government today formally acknowledged illegal military sales to Iraq. "These violations concerned the repair and return of Iraqi jet engines for MiG-21 and MiG-23 fighter jets and providing certain services in military-technical cooperation," a government statement said. It promised to clamp down on future sales.

That admission appeared to refer to claims that U.S. officials made this month after NATO peacekeepers in Bosnia raided a state-owned military firm named Orao. Documents seized there indicated that Orao and Yugoimport, a Yugoslav government-run arms trading company, have been helping Iraq refurbish its antiquated air force. Iraq has used Yugoslav technicians to upgrade its aircraft.

But Western officials contend that the relationship is deeper. A University of Belgrade professor with training in missile technology has acknowledged visiting Baghdad, the Iraqi capital, in recent months. The United States suspects that technology that Yugoslavia sold to Libya ultimately was destined for Iraq and intended to provide the seeds to convert trainer jets into guided cruise missiles. Such a weapon could avoid U.S. anti-missile systems and reach American allies in the Persian Gulf and Israel.

The news is potentially bad for Yugoslavia's efforts to improve its economy and foster closer relations with Western countries. It comes as the U.S. Congress is considering a measure to normalize Yugoslavia's trade relations with the United States, and when the United States is promoting Yugoslavia for membership in the Partnership for Peace program of the NATO alliance.

The fact that the Boka Star passed through Tivat, a military port, indicated that the transactions were not merely private deals but linked with the Yugoslav government and army.

The army is the country's most prestigious institution, according to polls, and its commander-in-chief, President Vojislav Kostunica, is the country's most popular politician. Kostunica has distanced himself from the Iraq traffic, saying he knew nothing, and in any case, the transfers were of low-technology varieties and not "state-of-the-art" sales.

Nonetheless, he has fired six civilian and military officials linked with Yugoimport, including an assistant defense minister, the air force chief and Yugoimport head Jovan Cekovic.

U.S. and Yugoslav officials say the arms trade with Iraq dates from the 1945-80 rule of Marshal Josip Broz, the Communist leader known by his nom de guerre, Tito. The commerce continued through the tumultuous rule of Slobodan Milosevic during the 1990s.

The Milosevic era ended with a street uprising two years ago, but Milosevic holdovers still populate the military establishment in Serbia, the larger of Yugoslavia's two remaining republics. The trade has persisted during President Bush's campaign for "regime change" in Iraq. "There has not been a revolution here, but an evolution," said a senior U.S. official. "And many things have changed hardly at all."

The official said that the Bush administration has had inklings of the trade for two years and passed them on to the Belgrade government with concern. But lacking conclusive evidence, Washington stopped short of making economic aid to Belgrade conditional on stopping the traffic.

In a protest note delivered to the Yugoslav government last week, the United States complained about missile technology transfers to "Libya and probably Iraq." Specifically, the Americans said that Yugoslav firms were helping Libya develop 900-mile-range cruise missiles that could carry thousand-pound payloads. One of the companies allegedly helping Libya also "possibly supplied missile-related assistance to Iraq" and sent representatives to Baghdad to deal with an Iraqi purchaser of missile technology.

The U.S. protest note named one University of Belgrade professor, Djordje Blagojevic, as having helped Iraq develop the Scud missile and Libya perfect missile guidance systems. In remarks to newspapers, Blagojevic said that he "teaches missiles and aerodynamics" but that the charges against him are false. "Only studies are in question here," he told the Blic newspaper. Blagojevic said he taught in Baghdad for a month last spring.

Another professor at the university said in an interview that experts there are working on the 900-mile-range cruise missile, but that it is only at "the concept stage." They have also developed models of smaller rockets for attacking tanks and ships, and have simplified a French design for a jet engine, said the professor, who requested anonymity.

The motive for cooperation with Iraq is largely financial, said the professor. Teachers at the university earn the equivalent of $250 a month. Contracts for helping the Iraqis run in the millions of dollars.

The University of Belgrade also trains foreign students; tuition from these students amounts to about 20 percent of the university budget, the professor said. Currently 30 Libyan students are enrolled, but no Iraqis. Among subjects the visitors study are aerodynamic theory and design, use of computers in rocket and aircraft design, and propulsion and flight mechanics.

The United States made its first public complaint about arms traffic after an Oct. 11 raid by NATO peacekeepers on the Orao aviation factory in Bosnia. Orao is located in the Serb sector of Bosnia, which maintains close links with neighboring Serbia. The company dates to the days when Yugoslavia was a state comprising six republics and military production was spread among them.

Among the finds at Orao was a September letter written by a Yugoimport official in Baghdad notifying the Iraqis of a delay in the arrival of military equipment and jet engine parts. Syria caused the delay by withholding permission to transship the goods from Tartus, a port on the Mediterranean, across land to Iraq, a Western official said.

The English-language letter advised the Iraqis how to prepare for the arrival of U.N. arms inspectors by hiding equipment and disguising its place of origin. They should remove all Orao labels, manuals, documents and catalogues from the work site in Baghdad and put them "in a safe place," the letter said.

"When the possibility of their being discovered passes, the Yugoslav side will reassemble and operate them [the equipment] again," the letter promised. The writer also advised the transfer of Yugoslav experts from their residence in Baghdad, a place "where a number of foreign experts from a number of countries are housed."

A contract discovered at Orao detailed an $8.5 million deal between the Al-Bashair Trade Co. in Baghdad and Yugoimport to overhaul Iraqi military jet engines. The contract includes provisions for the care and housing of Yugoslav specialists, payment schedules and mutual pledges of "business secrecy." The Washington Post obtained copies of the letter and contract.

The Boka Star seizure presents a murkier case, Western diplomats said. Croatian inspectors found no documents pinpointing the delivery address or point of origin. The ship, however, had been used to ferry goods to Iraq via Syria before, a Western official said. Originally, U.S. intelligence officials believed that jet parts were on board, but no such parts have been found.

2002 The Washington Post Company

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