Yugoslavs Just Asking for a Fair Shake : Europe: Seeking U.S. aid, the nation boasts of an excellent record on free market reforms.

Yugoslavia boasts one of Eastern Europe’s best records on free-market reforms and thus does not deserve to be ignored while Congress and the Bush Administration lavish attention on Poland and Hungary, Yugoslav Prime Minister Ante Markovic is telling U.S. officials this week.

“What we want is fair treatment,” Markovic said in an interview.

Unlike Poland and Hungary, Markovic said Yugoslavia is not asking for direct financial aid from the U.S. government, although it has requested a $1-billion loan to rebuild its banking system. Markovic said that the World Bank has agreed to provide $300 million to $350 million, and other loans are being sought from private banks in the United States and elsewhere.

“We are not seeking assistance,” he said. “We are seeking support for what we are already doing on our own.”

Markovic, who took office seven months ago, meets today with President Bush, Secretary of State James A. Baker III, Defense Secretary Dick Cheney and Senate Foreign Relations Committee Chairman Claiborne Pell (D-R.I.). On Thursday he conferred with Treasury Secretary Robert A. Mosbacher, World Bank President Barber Conable and other officials.

Ever since then-Prime Minister Josip Broz Tito broke with Soviet dictator Josef Stalin in 1948, Yugoslavia has been Washington’s favorite Communist country. Since the 1950s, Yugoslavia has been experimenting with private ownership and free markets, usually drawing praise for its efforts from the United States.

Markovic said that the earlier reform efforts all failed because Yugoslav governments were unwilling or unable to deal with the resulting social dislocation or to overcome the resistance of entrenched forces that would have lost political and economic power.

But, he said, his government is determined to bite the bullet and move to completely free markets even though economists estimate that the reform will produce 20% unemployment unless new economic development projects can be devised to sop up surplus labor. He said that all of the laws required to implement the reforms already have been enacted.

However, Yugoslavia’s effort has been overshadowed in the United States by the newer economic reform programs in Poland and Hungary. Markovic said that he wonders why his government seems to have fallen out of fashion.

“Our exports to the world have been growing at a very strong rate but our exports to the United States have been falling,” he said. “In spite of our excellent budgetary situation, when our enterprises enter business deals with American enterprises, it is not enough to have guarantees from our commercial banks--other guarantees are required. Why?

“There is an increasing number of joint ventures with partners from a number of foreign countries but not the United States,” he said, adding that joint ventures with American firms would help the country overcome its looming unemployment problem.

Markovic conceded that Yugoslavia faces daunting problems, such as a 1,200% annual inflation rate and bitter ethnic disputes. But he said the country has reduced its foreign debt from $20.5 billion to $16 billion. At the same time it has built its hard currency reserves from less than $1 billion a year ago to about $6 billion today--a figure virtually unprecedented among the world’s debtor nations.

Unlike Poland and Hungary, Yugoslavia has not decided to dilute its Communist system with multiparty elections. However, Markovic said that the country is moving toward greater democracy, offering contested elections for most important political positions.

“If you have pluralistic ownership you will have political pluralism as well,” he said. “The party has already been separated from the state. . . .”