Bargain Hunting in Yugoslavia : Itinerant Traders, Buyers Flock to ‘Gray Market’ in Eastern Europe

There were leather jackets from Turkey and sets of wrenches from WestGermany. There were new headlight assemblies and floor mats for cars made in Sweden. There were jeans from Italy and baby clothes from Bulgaria.

Polish men sold silver chains, dangling like tinsel from safety pins attached to their sweaters, and the fur of silver foxes, spread out on the hoods of their well-traveled cars.

Vladislav Popovic, director of a small Belgrade legal firm, wondered if the chains were a good buy. With inflation running above 150% a year in Yugoslavia, Popovic, 34, was tempted by the notion that a fistful of Polish silver might be more valuable next year, or even next week, than a wallet full of Yugoslav dinars. For the moment, though, he let the silver go and went to check the texture of the fox fur.

Like thousands of other Yugoslavs on this recent Sunday, Popovic had stopped by Pancevo to see what was selling on the chance that some unbeatable bargain--and there were plenty--might actually coincide with something he needed.

Every Sunday, that satisfaction is guaranteed for most who come here, for Pancevo, a small town about 20 miles by road northeast of Belgrade, the capital, happens to be at one of the great “gray market” crossroads of Eastern Europe. It is a point where the bargains of a dozen countries come together in the hands of hundreds of itinerant traders and opportunistic vacationers.

Generally, their profits are turned into dollars, at black market rates, and taken home, where the dollars are once again changed on the black market. Then the local currency is used to buy cheap goods that will, in turn, be taken out of the country for sale.

It is a cycle tirelessly and profitably repeated by a group of entrepreneurs skilled at reading the shortage-plagued East European market--at determining what goods will sell in which countries, at knowing just how many boxes of, say, baby clothes or leather jackets will be tolerated without a fuss by the customs agents as they cross the borders.

The profits can be substantial, although the work can be hard and the risks high. A Yugoslav accountant, who spoke of his experience on the condition that he not be identified by name, told of spending 10 years smuggling jeans from Italy into various Eastern European countries, financing his education and supporting his family in the process.

The most profitable scheme he and his partners devised, he said, was smuggling the jeans in the roof panel of a passenger train that traveled from Trieste to Budapest. “I would wait in Budapest, and my colleagues would telephone me with the number of the car where the jeans were hidden,” he said.

Now and then, he said, a bribe would be passed to help smooth the way, but the profits when the jeans were sold through the back door to retail merchants were splendid.

“I made more money then than I do now,” he said. “But it was a lot of worry.”

Most East European countries tolerate flea markets of one kind or another, although most are for the sale of used household items or spare auto parts. Indeed, that was the purpose behind the establishment of the market here at Pancevo. But it also has a reputation as a thieves’ market.

“They say that if your television is stolen on Wednesday,” Popovic said, “you can find it in Pancevo on Sunday.”

Although there is plenty of thirdhand and “antique” junk for sale in Pancevo, as well as some possibly hot automobile tape decks, the real attraction for most consumers here has become the bargains in new goods.

In recent years, Poles have become the predominant dealers at Pancevo; business is readily transacted in Polish as well as in Serbo-Croatian, and both buyers and sellers seem to know at least a few phrases of both tongues.

In the summer months especially, thousands of Poles finance trips through Romania, Bulgaria, Turkey, Yugoslavia and Hungary by selling trunkloads of goods bought cheaply at home. Now that the summer crowds have gone, most of those left are professionals who are on the circuit more or less permanently.

Most are understandably reluctant to explain the details of how they earn a living, for if they are not actually breaking the law, they realize that they are straining it to the limit. Last summer, the Hungarian government, in a spasm of pique at the Poles, required all Polish travelers to deposit in hard currency the value of all goods they brought into the country, reclaimable when the goods passed back across the border. The rule was rescinded after a good deal of diplomatic wrangling between Warsaw and Budapest.

Bargain on Fur

But the itinerant Polish free-enterprisers have not been discouraged, and Pancevo continues to be one of their major profit centers.

“Silver fox is very good now, very good quality,” said a Pole from Wroclaw as Popovic leaned over the hood of a car begrimed with the mud of three countries to finger the thick pelts offered for sale.

“I know a man in Belgrade,” the Pole said. “He can make a fine coat for your wife.”

Popovic looked tempted. Then he shook his head.

“No,” he said. “I don’t know anything about fur.”

Another Pole stepped forward quickly and pulled open his coat to display an array of silver chains pinned to his sweater.

“You like silver?” he asked. “Very good Polish silver, very good price.”

Variety of Goods

Popovic retreated from the high pressure and found himself standing beside a late-model Mercedes-Benz van in which a young Polish woman presided over an array of children’s clothes.

Popovic, the father of a 4-year-old boy, was interested enough to marvel at the stack of merchandise in the van. In addition to the clothes, there were toys, games and small appliances. Heavy coats were flung over the seats. It was hard to tell if the coats were for sale or if they belonged to the family occupying the van.

A crowd of Yugoslav women stood four deep around the van’s open door, trying to get the attention of the Polish woman, who looked as if she feared a sudden mass assault. The shouting was intense.

A few yards farther along, a Yugoslav man, Peter Vojnic, 34, was doing a more modest business. He had a few tools, a power saw and a set of wrenches, purchased in West Germany.

Vojnic said he had bought the wrench set for about $12 and was now selling it for the local equivalent of $25. He said he was not a big dealer, unlike the Poles and Turks and other long-distance travelers. He was simply an electrician, taking small advantage of a recent trip to Frankfurt. But he had been to Pancevo often enough, as a customer, to see that profits could be made.

“This is only a small addition to my income,” Vojnic said. “But it helps.”

Popovic was not tempted by the wrenches. In the end, he did not find much that interested him, although, as always, Pancevo finally yielded something. He bought a bottle of American after-shave lotion. It cost a little more than a dollar, paid to a Gypsy who merely shrugged when asked where it had come from. Popovic slapped a sample of the lotion on his face and said:

“Now I can go home happy. I’ve bought something.”