SERBIA: BAN ON EXPORTING WEAPONS TO ARMENIA REMAINS

EASTBUSINESS.ORG
November 14, 2006 Tuesday 5:41 PM (Central European Time)

SECTION: DEFENSE & AEROSPACE

The management of Zastava Oruzje, the Serbian weapons manufacturer,
has announced that it was surprised by the decision of the Serbian
Government not to lift the ban on the export of military weapons and
equipment to the countries of the former Soviet Union, with which
the factory has contracts worth more than USD 20 million.

The management stated that the company expected the Government to
at least allow the exports to countries which are on friendly terms
with Russia and to which Russia itself exports such weapons, with
only Georgia remaining on the black list.

The representatives of the unions in the factory have sent a letter to
the Serbian Prime Minister, Vojislav Kostunica and to the Ministers
of Defence and Economy, Zoran Stankovic and Predrag Bubalo, stating
that they are shocked by the Government s decision not to lift the
ban on exports to Armenia, and the fact that the Government has no
intention of reimbursing the factory for the losses it has suffered
as a result, amounting to approximately USD 2.7 million.

The Government s decision also surprised the experts on the Serbian
defence industry, especially in light of the fact that the factory
recently exported a shipment of weapons and equipment to Armenia
worth USD 800 000, without any questions being raised about this.

The management of the factory announced that they would initiate
negotiations with the Government regarding the compensation for the
losses this company has suffered as a result of the ban. The union
of Zastava Oruzje believe that nothing will come out of this, unless
the cabinet of Vojislav Kostunica is faced with pressure in the form
of a series of workers protest during the election campaign.