World View : If Yugoslavia Breaks Up, Other Federations May Follow : It would set off tremors in other regions, particularly the Baltics. And economic hazards posed by a breakup are akin to the financial chaos that often results from a divorce.

A world already weary of one war might be tempted to dismiss the conflict begging to break out in Yugoslavia as an insignificant family feud that is more of an irritation than a threat.

But a civil war venting pent-up ethnic hatred among Balkan peoples could spark violence and unrest elsewhere on the European continent, and even a peaceful dissolution of the Yugoslav federation poses disturbing consequences for foreign governments from Moscow to Washington.

If Yugoslavia dissolves into the national pieces welded into statehood in 1918, external borders may also be called into question, as well as territorial transfers among other European nations set down by the same postwar agreements that etched today’s Yugoslav frontiers.

There is the risk that the separate parts will abandon the obligations assumed by the whole, leaving foreign creditors holding $16 billion in debts from a non-existent country and no responsible central government to ensure adherence to thousands of agreements Yugoslavia has signed.

Any disruption of reforms under way in the northern republics could unleash a new refugee wave on Western Europe, and a violent confrontation among Yugoslavia’s dozen or so ethnic groups would surely drive thousands to join the disillusioned Romanians, Bulgarians and Soviets already straining the largesse of Western relief agencies.

Perhaps most disturbing to those outside Yugoslavia is the precedent its breakup would set for other federations, particularly the Soviet Union.

Slovenia and Croatia, the two Yugoslav republics pressing for independence, voluntarily joined with the Kingdom of Serbia in 1918 to form Yugoslavia--a federation that professes to recognize the right of all peoples to self-determination. Officials in Belgrade, the federal capital, concede each founding republic has the right to secede.

The Soviet Union seized the Baltic republics of Lithuania, Latvia and Estonia by force in 1940, and independence drives in those occupied states are now seeking to rectify the historical injustice. Moscow, however, has firmly resisted Baltic secession, claiming it would be destabilizing.

Should Slovenia and Croatia manage to achieve a peaceful separation from the rest of Yugoslavia, the Kremlin’s strongest argument against Baltic independence would be seriously weakened.

For the other superpower, Yugoslavia’s demise would deal a blow to the image of American diplomacy.

President Woodrow Wilson was one of the chief architects of the Yugoslav idea of binding World War I’s victors with the vanquished in hopes of ensuring stability on the Balkan peninsula. It was a historic experiment, seeking to unite the Serbs long dominated by Ottoman Turkey with the Austro-Hungarian provinces of Slovenia and Croatia. Some say the state’s collapse would, in a way, constitute the failure of American foreign policy.

Yugoslavia’s immediate neighbors have the most to fear from its impending division. The federation’s borders were fixed to divide up war spoils, following rivers and ridges rather than the seams of the ethnic patchwork. Today’s frontiers slice through communities of Slovenes, Hungarians, Greeks and Albanians, raising the possibility that the national groups on either side could seek to unite.

Serbia’s Communist-dominated Parliament last week passed a disturbing resolution declaring that “all Serbs want to live in a single country.”

The mayor of Belgrade, Aleksandr Bakocevic, also warned a visiting delegation from the European Parliament that Serbia would seek negotiations on its borders if the federation is split.

Such a demand would open a Pandora’s box of unresolved issues, as Yugoslavia’s borders--both internal and external--have roamed with the course of the region’s history, seldom settling for more than a few decades. Serbia and Croatia can assert overlapping claims of historic association with vast regions that are ethnically mixed.

Territorial definition of several states within Yugoslavia is also complicated by those regions that are truly “Yugoslav”--like the republic of Bosnia-Hercegovina where no single nationality comprises a majority. The republic has long been buffeted by ethnic rivalry and political intrigue, and it was in its capital of Sarajevo that World War I was touched off in 1914 by the assassination of Austrian Archduke Franz Ferdinand by a Serbian nationalist.

Even beyond Yugoslavia’s borders, territorial issues could be raised by the federation’s breakup. The same postwar conferences that defined Yugoslavia stripped Hungary of the Transylvanian region and awarded it to Romania. Though the loss occurred more than 70 years ago, it remains at the heart of strained relations between Budapest and Bucharest.

If the Yugoslav federation agreement is discarded, Hungarians might reason that its territorial concessions are also moot.

The European Parliament delegation, headed by Paraskovas Avgerinos of Greece, warned the separatist republics that the Continent prefers Yugoslavia as a single nation and looks with dismay on their efforts to create new countries.

“Europe’s interest in having a united Yugoslavia is that it prefers to have one partner, not several,” Avgerinos said last week. “Transportation is one example of the kind of service that is more difficult to maintain with several small countries.”

Beyond the inconvenience of “Balkanized” road, rail and air networks, and the complexity of conducting trade with disappearing or multiplying nations, the European delegation lobbied for Yugoslav unity because it has contributed to ensuring peace on the Continent since World War II.

Slovenia’s leading daily newspaper, Delo, noted recently that there are roughly 8,000 international agreements to which Yugoslavia is a party. Those pacts will require years of review and renegotiation to apply them to the new state of Slovenia--should it come into existence.

Slovenia has already announced plans to introduce its own currency, dropping the Yugoslav dinar which, although not fully convertible, has established links with monetary systems abroad.

While tourists enjoy making souvenirs of the stamps and coins of dollhouse nations, the charm will wear thin among those trying to conduct business in the multiplying Balkans.

Numerous Yugoslav industries pool resources from several republics, like the Serbian raw materials, Slovenian manufactured parts and Croatian labor that go into producing cars and appliances for export. Yugoslav joint ventures with foreign companies would be greatly complicated by the customs and export rules imposed by separate new countries.

The economic hazards posed by a Yugoslav breakup are akin to the financial chaos that often results from a divorce. Debts acquired collectively are easily shirked once the union crumbles, and Yugoslavia’s republics are already deep into accusing each other of bad investing.

Only one of the six republics--Bosnia-Hercegovina--has been making regular payments to the federal budget, from which interest payments on Yugoslavia’s debt to Western banks are financed.

The International Monetary Fund has refused to extend further credits to Yugoslavia until all six republics promise to respect their obligations to the federal government. Four attempts by Prime Minister Ante Markovic to win even minimal assurances of support have failed.

The dwindling number of federal officials still loyal to the idea of a united Yugoslavia contend there are innumerable arguments for keeping the federation together, the most compelling of which is to avoid the risk of providing a spark that could enflame a broader region, as occurred at the start of World War I.

Yugoslavia: The Ethnic Troubles Continue

National rivalries among the Balkan nations have never been resolved. Eight fractious kingdoms and provinces were merged in 1918 after the collapse of the Austro-Hungarian and Turkish Ottoman empires after World War I. Communist partisan Josip Broz Tito emerged to lead the federation after World War II and managed through personal influence and political repression to keep nationalist outbreaks in check. Since his death in 1980, nationalist tensions have surfaced again in Yugoslavia.

Population Per capita (in millions) income SERBIA 9.83 $2,492 Vojvodina 2.51 NA Kosovo 1.94 $750 MONTENEGRO 0.64 $2,111 CROATIA 4.68 $3,886 SLOVENIA 1.95 $10,420 MACEDONIA 2.11 $1,658 BOSNIA-HERCEGOVINA 4.48 $1,875

Figures are for 1989