Belgrade, 24. 03. 2008.

SERBIA – STATEMENT AND ACTIVITIES ON KOSOVO STATUS

• JEREMIC: MANY COUNTRIES PRESSURED TO RECOGNIZE KOSOVO
• SERBIA REQUESTS INVESTIGATION OF USE OF FORCE IN MITROVICA
• JEREMIC: SERBIA WILL SEEK OPINION OF ICJ
• JEREMIC SAYS KOSOVO'S STATUS IS SUSPENDED IN MIDAIR
• SUTANOVAC SAYS SITUATION IN KOSOVO, REGION STABLE
• SAMARDZIC URGES SEPARATION OF KOSOVO SERBS, ALBANIANS

• UNMIK SENDS SERBIAN GOVERNMENT'S PROPOSAL TO UN
• US OPPOSES DIVISION, DISAPPOINTED BY VIOLENCE
• VIOLAITON OF INTERNATIONAL NORMS CONTINUES, KOSACHOV
• KOSACHEV SAYS NEW NEGOTIATIONS ARE NEEDED
• ALEXEYEV - UNMIK, KFOR ENGAGED IN PROVOCATIONS IN MITROVICA
• PROBLEMS WITH UNMIK AND EULEX
• VENEZUELA WILL NOT RECOGNIZE KOSOVO, CHAVEZ

• DEFENSE MINISTER: U.S. ARMS DECISION SENDING WRONG MESSAGE
• KOSOVO DOES NOT NEED ARMS, BUT ECONOMIC DEVELOPMENT
• DANGEROUS DECISION TO DELIVER ARMS, ALEKSEEV

• NINTH ANNIVERSARY OF NATO BOMBING
• KOSTUNICA SAYS GOAL OF BOMBING TO ESTABLISH NATO STATE
• KOSTUNICA CALLS FOR NATIONALLY RESPONSIBLE GOVERNMENT
• GOV. NOT TO PUT AT RISK ECONOMIC STABILITY OVER ELECTIONS
• BILDT: SERBIA TO SHAPE REGION'S FUTURE
• KOSTUNICA FELICITATES EASTER
• MINISTER: CROATIA STILL WANTS GOOD TIES WITH SERBIA
• DEBT ON BASIS OF BANK LOANS INCREASES BY 6.2 PERCENT

BELGRADE, March 21 (Tanjug) - Serbian Foreign Minister Vuk Jeremic said on Friday, in a statement for Tanjug, that the countries that support the unilateral proclamation of the independence of Kosovo and Metohija are continuing to exert strong pressure on the states of the region and the Islamic world to recognize the so-called state of Kosovo.

"A part of Serbia's neighbors have failed to resist this pressure. I have spoken to all the three foreign ministers of these countries and two of them admitted to me that, unfortunately, they were no longer able to resist the pressure. It is a regrettable fact that certain countries of the region have been forced to choose between Serbia and Kosovo," Jeremic said in an interview to the national news agency.

"The fact that these states decided to do this together presents a precedent," Jeremic said and reiterated that Serbia "stated clearly that any country that decides to violate the territorial integrity and sovereignty of Serbia with a unilateral move, which they are doing with the recognition of Kosovo, will not be able to rely on maintaining the same level of relations with Serbia." This will, unfortunately, also inflict damage to the cooperation and relations in the region, but Serbia is not responsible for that, as its behaviour is the expression of a stand in principle, in keeping with international law, Jeremic said.

BELGRADE, Mar 21 (Tanjug) - In an interview with Tanjug on Friday, Serbian Foreign Minister Vuk Jeremic said that in its letters to U.N. Secretary-General Ban Ki Moon and the UN Security Council Chairman, Serbia had requested an independent investigation of the circumstances under which the use of excessive violence was ordered in Kosovska Mitrovica.

"We have requested an investigation that would be launched from the very center - the U.N. General Secretariat. We may be optimistic that such an investigation will soon be launched. I requested the UN Security Council Chairman to have the Council follow up on the implementation of Resolution 1244 and events, that is all aspects of the situation in the field in Kosovo," said Jeremic, adding that he had discussed this with Russian Deputy Foreign Minister Vladimir Titov. "We leave it to the Security Council and the Chairman to decide on the format for the discussion on the issue - whether it will be in the form of consultations behind closed doors, open consultations or session. We presented our protest against the excessive use of force in Mitrovica on March 17 in a clear and resolute way," said Jeremic.

Minister Jeremic also said that Belgrade will continue to explain through its diplomatic activities that international law was violated on February 17, that an ethnically motivated secession from internationally recognized state was attempted, that this is not in keeping with a Security Council decision, the U.N. Charter and the Helsinki Final Act, which is obligatory for all member states.

BELGRADE, March 21 (Tanjug) - Serbian Foreign Minister Vuk Jeremic said on Friday, in a statement for Tanjug, that Serbia will ask at the United Nations (UN) General Assembly in September that an opinion is sought from the International Court of Justice (ICJ) about whether the proclamation of the independence of Kosovo had been in keeping with international law. Based on the talks he has held so far, Jeremic said he believes that a resolution with which Serbia would suggest this could receive a majority vote.

"Should the majority of the members decide to back this motion, it would be a demonstration of disagreement with the imposing of the solution presented by the unilateral proclamation of the independence of our southern province, so that it would have not only a practical effect in seeking a legal opinion, but would demonstrate in the political sense that the majority of UN members do not agree with the imposing of a solution for this complex ethnic and political conflict," he explained.

Jeremic expressed confidence that "the continuation of European integrations will be one of the key priorities for the next Serbian government as well, regardless of the parties it will comprise after the elections." In his opinion, the further Serbia advances in the European integration processes, the greater is its capacity to fight for the realization of all national interests, including the preservation of territorial integrity and sovereignty.

BELGRADE, March 23 (Tanjug) - The attempt to create a "state of Kosovo" is a strategic mistake and we will do everything to reverse this and that Pristina and Belgrade sit at the negotiating table again, Serbian Foreign Minister Vuk Jeremic has said.

"Our idea is to prevent an international law confirmation of the unilaterally declared independence of Kosovo. We will therefore continue to do everything in our power to ensure that the number of countries that have recognised Kosovo remain limited and to prevent Kosovo from becoming a member of key international organisations," Jeremic told the Belgrade daily Glas in an interview. "When we prove to be successful in this and once it turns out that Kosovo's status is suspended in midair and is not sustainable in the long run, I hope that reason will prevail in the international community and they will say: 'This is unsustainable, we will have to find a new solution. We tried to impose something on Belgrade, it didn't work, let's get back to the negotiating table and find a solution that will be acceptable both for Belgrade and for Pristina," Jeremic said.

"For us, it is very important to consolidate the majority that does not recognise Kosovo's independence, to rally it into a bloc that would prevail over the group of countries that support Kosovo's independence. The best way to achieve this is at the UN General Assembly in September, where each state has one vote, to put on the agenda our demand to call for the opinion of the International Court of Justice," the minister said.

VALJEVO, March 22 (Tanjug) - Serbian Defence Minister Dragan Sutanovac said on Saturday that the situation in Kosovo-Metohija and throughout the region was stabilising after the March 17 unrest in Kosovska MItrovica.

"Things in Kosovo-Metohija and elsewhere in the region are stabilising," Sutanovac told reporters in Valjevo. Commenting on incidents in the northern part of Kosovska Mitrovica on March 17, Sutanovac said that the Serbian Defence Ministry had tried to help stabilise the situation and stressed that KFOR had been requested not to use excessive force in order to avoid causalities.

Sutanovac voiced his regret with the fact that there had been casualties and added that this should be a "big lesson for all those who took the possibility of solving problems through tension too easily." He said that the loss of lives was something that must not be allowed.

BELGRADE, March 22 (Beta) - Minister for Kosovo Slobodan Samardzic said on March 22 that the cabinet has proposed an agreement to UNMIK on "creating an atmosphere for the functional separation of Serbs and Albanians in Kosovo."

"We accept Resolution 1244 and the authority of the UNMIK police force, judiciary, and customs, but after the unilateral declaration of independence of Kosovo only Serbs can support that authority with Serbian assistance," he added.

He added that the Agreement on Joint Implementation of U.N. Security Council Resolution 1244, which he gave to deputy UNMIK Chief Larry Rossin on March 23, is the product of collaboration between the Foreign Ministry and his own Ministry. It is also based on the Jan. 14 action plan adopted by the cabinet.

In addition, Samardzic stressed that the proposal applies to all Serb municipalities and settlements in Kosovo, not just the territory north of the Ibar River. "The Kosovo Albanians will take full control of these institutions with UNMIK's tacit support, unless Serbia does so first," he added. "It's clear that if we don't have a presence in Kosovo and Metohija, we will lose the province," Samardzic said.

Asked if the proposal violates Resolution 1244, Samardzic replied that "Serbia will not cease to respect this document adopted by the highest U.N., but the decision has been undermined by the unilateral declaration of independence of Kosovo and the fact that the Kosovo Albanians are ignoring it." Samardzic described the present situation as "a challenge for UNMIK that involves creative thinking and not just pulling out before the job is done."

"If they want peace and stability, a lasting agreement needs to be reached with the Serbs instead of resorting to violence every other day to put out the fire," he said.

PRISTINA, March 22 (Tanjug) - The UN Mission in Kosovo-Metohija has sent the Serbian government's proposal on the agreed and functional separation of Serbs and Kosovo Albanians in Serbia's southern province to Mission Headquarters in New York, UNMIK spokesman Gyorgy Kakuk told Tanjug.

UNMIK cannot make any decisions on this proposal and has sent the entire text to Headquarters in New York and they will have to decide and advise UNMIK how to react, Kakuk told Tanjug. He said that the proposal had been sent to New York last week and that he did not know the exact date when an answer from UN Headquarters would follow. It is upon New York to decide, he said and added that the procedure had been observed.

WASHINGTON, March 23 (Tanjug) - The United States once again voiced its disappointment with the recent violence in northern Kosovo, when a Ukrainian police officer died and about 150 persons were injured in clashes between Serb protesters and international forces, and voiced its strong opposition to the division of the province.

Speaking at the National Press Club in Washington, ranking State Department official Kurt Volker reiterated the support of President George Bush's Administration to the transfer of authority from the UN Mission in Kosovo to the future EU mission and stressed that the United States would take part in and support this endeavour of Brussels. The transfer of authority is underway, said the acting State Department undersecretary for European and Euro-Asian affairs and added that the forthcoming NATO Summit would discuss the coordination and transition and stress the commitment to joint EU-NATO work in Kosovo. In addition to coordinating the transfer of activity to Eulex, NATO is completely ready to ensure stability, Kosovo institutions and freedom of movement, on which special conclusions will be made in Bucharest.

MOSCOW, March 21 (Tanjug) - Arms deliveries to Kosovo, approved by U.S. President George Bush, consitute a "continued violation of international norms" started by the recognition of the unilaterally declared independence of Kosovo, said on Friday Russian Duma international relations committee chairman Konstantin Kosachov. Kosachov in an interview with Itar Tass news agency said that the United States "is quite certain that in this way it will destabilise the already volatile situation in the region."

"As long as UN SC Resolution 1244 is in force all arms deliveries are illegal with the exception of those that are directly intended for UN peacekeeping forces deployed there," he said and added that "by such a decision the U.S. president has breached international law, as well as the letter and spirit of the UN SC resolution." "The breach started when the United States recognised the unilaterally declared independence of Kosovo, and now it is happening for the second time. We can only regret that the United States is violating international law in such a way," Kosachov assessed.

Russian Duma international relations committee first deputy chief Leonid Slutsky assessed that the arms delivery to Kosovo is not only illegal, but also very dangerous. "Arms deliveries to a volatile region can hardly bring stability. On the contrary, it can become the fuse," Slutsky said and called the U.S. policy extremely hypocritical. "The United States first opens Pandora's Box, and then it says that it is an attempt to consolidate security in Kosovo. There is no logic there," he assessed.

BELGRADE, March 22 (Tanjug) - Russian Duma's foreign policy committee chairman Konstantin Kosachev has said that the aim of foreign policy activity of Moscow regarding Kosovo-Metohija is to use the fact that a small number of countries have recognised independence and that if this trend remains in place in the next few months, the issue of status should be raised again and way be paved for new negotiations.

"I am certain that Russia will remain firmly on its position of observation of international law and that we will continue with our bilateral efforts to ensure that countries that have a dilemma regarding the recognition of Kosovo's independence do not recognise it," Kosachev told the Saturday issue of the Belgrade daily Vecernje Novosti in an interview. According to Kosachev, there are two key issues.

"One is psychological, the other is legal. The first, very important moment is if one-half of countries do not recognise Kosovo's independence. This will be a big blow to the supporters of independence of Kosovo and will have a very strong psychological impact. The other aspect is international and legal. Russia will block Kosovo's entry into all important international organisations, starting with the United Nations and Organisation for Security and Cooperation in Europe. This will be a clear indicator that the West was wrong to support the unilateral declaration of independence of Kosovo," Kosachev said.

BELGRADE, March 22 (Tanjug) - Russian Ambassador in Belgrade Alexander Alexeyev has said that the activity of KFOR and UNMIK police during the March 17 unrest in Kosovska MItrovica was doubtless a provocation and stressed that Moscow wanted a very detailed investigation to determine who had ordered the activity and how legal it had been.

"It is necessary to find out clearly who and on which basis made the decision on the implementation of force in Kosovska Mitrovica. The names of the people who made this decision are necessary, rather than some formulations, and the assessment of how legal these solutions were are also necessary," the Russian ambassador told Tanjug in an interview.

Commenting on the Serbian government's request to the UN secretary-general that the excessive use of force by international forces in Kosovska Mitrovica be investigated, Alexeyev said that Russia was completely convinced that a very detailed investigation into the incident should be implemented, primarily to prevent such developments from happening again.

NEW YORK, Mar 24 (Tanjug) - United Nations officials have yet to develop a serious plan on the future of the U.N. mission in Kosovo and Metohija (UNMIK), and some indications about the direction of further developments are possible only after a new report by UNMIK Chief Joachim Ruecker due to be submitted to the divided UN Security Council in April.

"Transfer of competencies from UNMIK is out of the question at the moment. It has even been seriously suggested to us never to use that term," it was told Tanjug at the U.N. headquarters in New York only two days after State Department official Kurt Walker had stated that EULEX had started to assume authorization in the field. After a series of unsuccessful attempts to move the process of problem solving from a standstill due to the opposed stands of Russia and the West, the divided UN Security Council will again discuss the situation in the province in April, since a new three-month report by Ruecker is due to arrive in New York by March 31. That report will also include a part on the recent unrests s in Kosovska Mitrovica in which a Ukrainian policeman was killed, while 150 persons, both Serb demonstrators and international troops, were injured.

According to an announcement by the European Union, the EU mission, designed on the basis of Martti Ahtisaari's plan, is supposed to assume full control of "supervised Kosovo independence" in four months. UN officials believe, however, that such a plan might turn out to be too ambitious, in view of the fact that the EU mission does not have a mandate of the UN Security Council and that Western diplomats have serious reserves regarding the EU's capacity to deploy all of its mission's 2,000 staff within the planned period of time. "As things are now, UNMIK remains in Kosovo with an unchanged mandate, despite pressure coming from the West, mainly from the EU, to have the United Nations invite EULEX to take over the competencies of the UN mission in Kosovo. At the same time, Russia is also imposing strong pressure against any changes," a U.N. diplomat told Tanjug.

CARACAS, March 24 (Tanjug) - Venezuela will not recognize Kosovo as an independent republic, Venezuelan President Hugo Chavez has said. Refusing to recognize Kosovo's independence, Chavez pointed out that the new European "state" was imposed by the United States, the press service of the president of Venezuela said in a statement on Sunday.

The Venezuelan president also blamed the United States for the violent protests in Tibet over the past two weeks, which are, according to him, aimed at destabilizing China.

BELGRADE, March 22 (Beta) - Defense Minister Dragan Sutanovac has described the U.S. decision to ship arms to Kosovo as "absolutely unnecessary," adding that while it is sending a bad message, it cannot hurt regional stability because it does not address strategic weaponry.

"I had been hoping that the decision would be to consolidate Kosovo's economic resources and help both Serbs and Albanians, not to arm Kosovo," he added.

In addition, Sutanovac said that recent government efforts in Kosovo are not conducive to stabilization and improving living conditions.

"We are talking territorial issues, yet it is unacceptable to put land ahead of lives in the 21st century," Sutanovac said.

He said that the Ministry for Kosovo and Metohija should devote its attention to help people and leave the state leadership to deal with the status of Kosovo.

BELGRADE, March 21 (Tanjug) - Kosovo-Metohija does not need arms, but free and peaceful economic development within the state of Serbia, Serbian Minister of Education and Democratic Party of Serbia official Zoran Loncar said on Friday.

In a statement for Tanjug, Loncar said that it was extremely important to see whether the United States "will be guided by the blindness of the policy of force or if it will hear sensible arguments and give up its idea to arm Albanians in Serbia's southern province."

"Everybody would welcome if the United States changed its decision and, instead of arms, sent brochures with the text of the UN Charter to Kosovo-Metohija and, instead of each rifle, a book on the fundamental principles of international law on which peace in the world rests," Loncar said. He said that otherwise, the United States would continue to take responsibility for the implementation of the policy of force and imposition of the first NATO state in the world.

BELGRADE, March 21 (Tanjug) - Russia's ambassador to Serbia, Alexander Alekseev, said Friday that Russia is very concerned over the US decision to deliver weapons to Kosovo and that it views this as a continuation of attempts to affirm the illegal independence of Serbia's southern province.

We reiterate that the declaration of the independence of Kosovo is illegal and that Kosovo, in its current form, cannot be viewed as in independent state, Alekseev told Tanjug, underscoring that, following Washington's latest move, Moscow has reason more to continue it's principled policy towards Serbia's province. The decision to deliver arms is a specially dangerous move, especially taking into consideration the developments following Feb 17 and the unilateral declaration of the independence of Kosovo.

Russian information is that there are already many weapons in Kosovo and that there is no need for additional arming. The question is what additional arming of Kosovo will bring and who is it that is planning to attack Kosovo, the Russian ambassador wondered.

BELGRADE, March 24 (Beta) - Monday, March 24 marks the ninth anniversary of the 19member NATO alliance's bombing of the Federal Republic of Yugoslavia.

The air campaign, which lasted 11 weeks, led to the death of between 1,2002,500 people. The 78day round-the-clock strikes wreaked havoc on the country's infrastructure, industry, schools, health institutions, media houses and cultural monuments.

The air strikes against FR Yugoslavia were ordered by NATO secretary Javier Solana a little before 8 p.m. on March 24, 1999. The same evening, Yugoslavia's government declared a state of war.

The NATO campaign, which was labeled an act of aggression on an independent state by the FR Yugoslav government and numerous legal experts, ensued after unsuccessful negotiations on Kosovo in Rambouillet and Paris in February and March 1999.

Total damage estimates vary. The Yugoslav authorities produced an estimate according to which the damages inflicted by NATO equal US$100 billion, and requested compensation.

The G17 Plus party is estimating damages at a total of US$29.6 billion.

The strikes ceased on June 10 after the adoption of U.N. Security Resolution 1244. A day earlier, Yugoslav army and NATO representatives signed the so-called Kumanovo Military Technical agreement, stipulating the withdrawal of Yugoslav forces from Kosovo and the deployment of international troops in the province.

BELGRADE, March 23 (Beta) - Serbian Prime Minister Vojislav Kostunica said late on March 23, on the anniversary of the NATO bombing of FR Yugoslavia, that the "brutal demolition" of the country during the war was intended to pave the way for the creation of the world's first NATO state.

"The illegal construction of the enormous U.S. Bondsteel base and annex 11 of the Ahtisaari plan which establishes NATO as the ultimate government agency in Kosovo reveal the true reasons why Serbia was so senselessly bombed and why a NATO state (in Kosovo) was declared on Feb. 17," Kostunica said in a statement to BETA.

Kostunica said that Serbia was a free country which was why the only statement that "a free people and free country" could make was that Kosovo is Serbia.

"The policy of force being used against Serbia is blind and short-term and any force that comes to the Balkans will suffer the same fate. A huge number of states and the larger part of humanity have not recognized the first NATO state, and instead recognize Serbia's lawful and internationally recognized borders," Kostunica said.

He also said that Serbia was on the side of the law and that this was something that the overwhelming majority of countries in the world respected.

BELGRADE, March 22 (Tanjug) - Serbian Prime Minister Vojislav Kostunica has said that the forthcoming parliamentary elections are very important because they should give an answer to whether Serbia will get a nationally responsible government or if citizens will elect authorities that will be prepared to push the defence of the state's integrity aside in favour of EU integration.

"It is of exceptional importance whether citizens will elect a government that will recreate the state or the one that will say let's join Europe and then in this Europe fight for Kosovo, which we will give up first," Kostunica said for the Sunday issue of the Belgrade daily Vecernje Novosti in an interview. "These are empty phrases which lack substance and real activities. Today, (LSV leader Nenad) Canak and G17 are the guarantors that this coalition (DS, G17, LSV) will not recognise Kosovo. Who can believe this. It is enough to imagine where Serbia would be at this point if this coalition led Serbia in the previous years. Like they claim they will defend Kosovo today, they will defend Vojvodina and any other part of our state tomorrow," Kostunica said.

Responding to DS comments that the European Union did not determine Serbia's borders, Kostunica said that each Stabilisation and Association Agreement which the European Union had signed had a clear provision on the observation of sovereignty, territorial integrity and internationally recognised borders of these states. "This is the truth, regardless of what the DS says, trying to amend a weak policy with big propaganda. Ask EU officials whether they recognise internationally recognised borders of Bosnia-Herzegovina, Macedonia, Georgia or any other state and you will get a clear answer immediately," Kostunica said. Kostunica said that under the Serbian Constitution only the government had the authority to sign the Stabilisation and Association Agreement with the European Union and voiced his belief that the Serbian president would observe the Constitution and that his words that he would sign the SAA were just a metaphor.

BELGRADE, March 21 (Tanjug) - Serbian Deputy Prime Minister Bozidar Djelic said on Friday that the caretaker government would not put at risk the macroeconomic stability of the country and increase budget expenditure because of elections.

"We do not plan any so-called pre election actions involving the budget," Djelic told reporters following talks with members of the American Chamber of Commerce. He pointed out that the government's intention to maintain macroeconomic stability was attested by the fact that in the first two and a half months there was a slight budget surplus. Djelic pointed out that he told investors that the government condemned any violence in the country, particularly the violence in the Embassy of the United States In Belgrade, and that Serbia was under an international obligation to compensate the damages.

BELGRADE, March 24 (Tanjug) - Swedish Foreign Minister Carl Bildt has said that the future of the entire region depends on the result of the forthcoming elections in Serbia, as well as that negotiations between Belgrade and Pristina are possible, but not about status. The result of the elections in Serbia will have an impact not only on the future of that state, but also on the events in the neighboring countries, Bildt assessed in an interview for the Monday issue of the Belgrade daily Vecernje Novosti.

The future of the whole region depends on whether Serbia will continue its European path or opt for self-isolation, he added. According to him, since 2000, the European Union has given Serbia over two billion euros, and one more billion is supposed to be allocated for the country by 2011. We are working on the visa liberalisation and some other very important projects, such as the European Commission plan on regional cooperation and transportation, which will make Serbia the crossroads and the main pillar of the region as a whole, Bildt said.

However, we have to be cautious and wait for the result of the voting, because we can do a lot of things and then have such a result of the elections that will tell us that that is not what Serbia wants, he added. Bildt also doubts that Dutch parliamentarians, who are to decide on whether the Netherlands should approve of the signing of the Stabilisation and Association Agreement (SAA) with Serbia, will change their position and give the green light to the signing of that document.

BELGRADE, March 21 (Tanjug) - Serbian Premier Vojislav Kostunica on Friday felicitated Easter to all who celebrate this Christian holiday in keeping with the Georgian calendar, the Serbian government's public relations office has announced.

"My most sincere felicitations go to all those who celebrate Easter according to the Georgian calendar. I hope that the churches and religious communities in Serbia will, in the spirit of Easter, continue to develop and promote mutual understanding and respect, as well as genuine tolerance between the members of different religions and cultural traditions in our country," Kostunica said. He wished good health, spiritual peace and happiness to all.

ZAGREB, March 21 (Beta) - Croatian Foreign and European Integration Minister Gordan Jandrokovic told BETA on March 21 that Croatia's March 21 decision to recognize Kosovo is in no way intended to harm Serbia.

"The independence of Kosovo is a political reality and the result of everything that has happened in this region in the last several decades. Croatia recognizes this reality and that is why it has recognized Kosovo, but we also don't want to hurt our relations with Serbia in any way," he added.

Jandrokovic also said that Croatia considers good relations with its neighbors, especially Serbia, and EU membership its priorities.

"In that context relations with Serbia are extremely important and we consider them almost crucial to stability in this part of Europe. That's why Croatia wants to resume with its policy of good neighborly relations, friendship, and cooperation in mutually important areas with Serbia," he added.

He went on to say that Croatia understands the difficulty that Serbia is experiencing and the feelings of the Serb people, "although I hope that reason will win out and that the Serbian side desires to maintain and develop good relations."

Asked to comment on the threat of worsening Croatian Serbian economic ties, the minister added that trade and other forms of cooperation are necessary to both countries.

BELGRADE, March 23 (Tanjug) - The total state of debt in Serbia on the basis of bank loans in late February amounted to 918.95 billion dinars, or by 6.2 percent more than in 2007, the Association of Banks of Serbia said.

At the end of February, legal persons owed 576.5 million dinars, or by 6.8 percent more than in 2007, while entrepreneurs owed 35.9 billion, or by 17.5 percent more. Citizens owed 306.6 billion dinars, or by 3.9 percent more than in early 2008. Housing loans registered the greatest growth of 8.8 percent and their value reached 111.4 billion dinars, while consumer loans reduced by 6.2 percent to 53.7 billion dinars. Cash loans reached the biggest amount of 133.1 billion dinars and increased by 4.4 percent since the beginning of the year.