MONTENEGRO'S PM EXITS THE CENTER STAGE

UNCLAS SECTION 01 OF 02 BELGRADE 001626

SIPDIS

SIPDIS

SENSITIVE

E.O. 12958: N/A
TAGS: PGOV PREL PINR MW
SUBJECT: MONTENEGRO'S PM EXITS THE CENTER STAGE


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SENSITIVE BUT UNCLASSIFIED - PLEASE HANDLE ACCORDINGLY

This is a Podgorica cable. It has not been cleared with
Embassy Belgrade.


1. (U) Summary: President Vujanovic announced October 3
that Milo Djukanovic has declined to accept a mandate to
continue as Prime Minister. The announcement ends
Djukanovic's 16 years at the center of the Montenegrin
stage, as either Prime Minister or President. Djukanovic
will remain as the head of the ruling Democratic Party of
Socialists (DPS). The opposition Serbian People's Party
(SNS) observed that "even if Milo was in Alaska, he would
still be the most powerful political force in
Montenegro." Media speculates that the DPS Main Board,
which will meet on October 4 and October 5, is likely to
name current Finance Minister Igor Luksic to become PM;
other candidates are possible. Luksic is a young, highly
educated "technocrat" without a strong party position,
and no hint of scandal. End summary.

Buzz to Announcement
--------------


2. (U) The departure of PM Milo Djukanovic from the
central positions of the Montenegrin government has long
been discussed, suggested and even urged by many,
demanded by the opposition, and occasionally hinted at by
Djukanovic himself. Under Djukanovic's leadership his
party, the Democratic Party of Socialists (DPS),enjoyed
marked success this year in leading Montenegro to
independence in May and then in holding on to a clear
Parliamentary majority in September. Surprisingly, the
ruling coalition was not ready with a cabinet after the
September 10 results were official shortly after the vote
-- the first faint hint that Djukanovic might be stepping
down. President Vujanovic's very brief announcement
midday on October 3, that Djukanovic would not continue
as Prime Minister, still caught many in Montenegro by
surprise, as the DPS had been keeping the substance of
the discussions of the DPS senior leadership very quiet.

New Prime Minister
--------------


3. (U) Local media has recently begun to speculate that
Igor Luksic, Finance Minister since early 2004, may get
the nod as next Prime Minister. Luksic has declined
comment until after a decision is made public. However,
other names are still in play, including Justice Minister
Sturanovic and Deputy PM Gvozdenovic. Former Serbia and
Montenegro State Union President Svetozar Marovic has
confirmed that he will not be Prime Minister, nor will he
take a seat in the Parliament. The DPS Main Board is
expected to announce the name of the new Prime Minister
after either its October 4 or October 5 meeting.
Coincidentally, October 5 marks nine years to the date
after Djukanovic won his first election after breaking
with Slobodan Milosevic.

Biographic Note on Luksic
--------------


4. (U) Igor Luksic was born in 1976 in Bar, Montenegro,
and was awarded a PhD in economics in September 2005.
After serving as Deputy Foreign Minister for SaM in 2003,
he became Finance Minister in early 2004, the position he
currently holds. He speaks English fluently. While a
loyal party member of the DPS, his less a politician and
more a "technocrat," interested in the smooth and
effective functioning of his ministry. Unlike
Djukanovic, a lightning rod for opposition attacks and
tainted by hints and rumors of scandal, Luksic has
generally good relations with the opposition and a clean
reputation, although he was criticized for the late
release of campaign funds to the parties for the
parliament campaign this year.

Party Reactions
--------------


5. (U) DPS's coalition partner, the Social Democratic
Party (SDP),has supported Djukanovic's decision to
withdraw, adding that it should not be "over dramatized."
Ferhat Dinosa, of the Democratic Party of Albanians (DUA)
said ethnic minorities shall lose their significant
protector, and that if Djukanovic and vice-president of
DPS Svetozar Marovic were not in state positions,
democratic processes in Montenegro and its integration
into European structures would suffer. (Comment: This

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reflects Dinosa's close relationship with Djukanovic and
the DPS, and would not be the unanimous view of the
Albanian community. End comment.) The opposition
Movement for Changes (PzP),Liberal Party, and Democratic
Serbian Party (DSS) welcomed Djukanovic's decision, PzP
saying it would reduce political tensions, DSS calling it
a sign that the "last totalitarian regime in Europe" was
ended. The opposition People's Party (NS) saw the
decision as resulting from "pressure from the
international community," adding its view that Djukanovic
will want to come back as President. The Serbian People's
Party (SNS) observed that "even if Milo was in Alaska, he
would still be the most powerful political force in
Montenegro."

Regional Reactions
--------------


6. (U) Prime Minister Adnan Terzic of Bosnia and
Herzegovina stated that he was sorry that Djukanovic was
stepping down, as Djukanovic contributed to the
stabilization of the region during the last couple of
years. He believes that it will not have any implications
on the politics in the region, for he knows that
Djukanovic is still the strongest political figure in
Montenegro. "He, as an experienced politician, knows that
he has to leave when he is at his best", stated Terzic.
Albanian PM Sali Berisa stated that Djukanovic was a
brave politician who was a friend of the western
countries in the most difficult days, who dared to oppose
Slobodan Milosevic, and restored Montenegrin
independence. Leader of the Hungarian Liberals in the COE
Parliamentary Assembly, Mathias Ershi, stated that
"nobody is irreplaceable in democracy, which always has
an alternative".

Grey Cloud from Italy
--------------


7. (SBU) It has long been rumored that Djukanovic remained
so long in office at least in part to shield himself from
prosecution. In the 1990s, during UN sanctions and
afterwards, the GoM allegedly benefited financially from
cigarette smuggling into Italy. Allegations that
Djukanovic was directly involved in the operations have
hung over him like a grey cloud, and led to his being
named in the Italian courts as a potential witness (but
never indicted). The Italian P.O. told P.O. October 2
that the remaining, long-pending case is being pursued by
a dogged and independent prosecutor in Bari, who has no
support from the GOI for his efforts. As to Djukanovic's
involvement, the Italian P.O. said the "evidence" was
taped phone calls, supposedly of PM Djukanovic talking to
someone in Italy about cigarettes - enough to besmirch a
reputation, but probably not enough to support a criminal
case.

Comment
--------------


8. (SBU) Djukanovic's departure marks the end of an era,
for Montenegro and for the former Yugoslavia. Clearly
committed to economic reform, Djukanovic has never
completely escaped his roots in the Communist Party, or
his start as an ally of Milosevic, despite the absolute
break with Milosevic in 1997.


9. (SBU) The view that Djukanovic will remain the central
political force in Montenegro, despite leaving government
office, is widely held. Some note that he will remain as
head of the ruling party, in a state where that formerly
was the key political position. Others stress his
political influence and undeniable charisma. Post
however believes that while the next Prime Minister may
listen, even closely, to Djukanovic, especially in the
first few months, no successor will be content with the
role of a puppet. Moreover, in independent Montenegro,
the international community will pay attention to the
holders of government -- not party -- office, enhancing
the power of the new Prime Minister. It should be noted
that the Prime Minister plays the lead role in advancing
reform. Additionally, post sees the possibility of an
expanded role for President Vujanovic, who has been
content to stay in Djukanovic's shadow, but may assert
his position's prerogatives more strongly with him gone.
End comment.

POLT