Serbia: Ambassador's Introductory Call on Minister Dulic

UNCLAS SECTION 01 OF 02 BELGRADE 000266 SENSITIVE SIPDIS DEPT FOR EUR/OHI - JOHN BECKER AND EUR/SCE AID FOR E&E/ECA E.O. 12958: N/A TAGS: ECON EINV KIDE SENV PGOV SR SUBJECT: Serbia: Ambassador's Introductory Call on Minister Dulic (Environment and Zoning) Summary -------------- ¶1. (SBU) In her February 9 introductory call on Minister of Environment and Zoning Dulic, the Ambassador thanked him for his assistance leading to the NEC groundbreaking. Dulic pledged his ongoing support as construction proceeds and requested technical assistance on a variety of environmental issues including hazardous waste, green construction, and climate change. He spoke at length on land use and land reform issues, and stated the long-promised restitution law would provide for monetary compensation, and not in-kind return of property. On political issues, Dulic discussed improving Serbian-Croatian relations and developments in Vojvodina. End Summary. "Green" NEC and Environmental Matters -------------- -------------- 2 . (SBU) The Ambassador opened the meeting by thanking Dulic for his assistance securing permits needed for the February 10 NEC groundbreaking. Dulic confirmed he would speak at the ground breaking event and pledged ongoing support as the project proceeded. Dulic, a Copenhagen conference attendee and UNGA speaker on climate change, was enthusiastic that the NEC would be the first LEED (Leadership in Energy and Environmental Design) compliant, "green" building in the region. (Note: Dulic's remarks at the February 10 groundbreaking underscored the environmental aspects of the project, the importance of U.S. investment in Serbia, and his hope that the new building would be a symbol of the continuing strengthening of relations between the two countries. End Note.) ¶3. (SBU) Turning to environmental issues, Dulic asked for technical assistance, exchanges, university programs and other assistance concerning climate change, hazardous waste, recycling, and other environmental initiatives. He requested a designated point of contact, noting Serbia's need for EU compliant regulations, and stressing his strong personal interest in environmental programs. The Ambassador noted our excitement about the green aspects of the NEC and post's commitment to continued leadership in this area. Post is following up with a working level meeting to discuss further environmental cooperation, including the many U.S. based experts who will come to work on the NEC. Land Use Reform and a Restitution Law ......Still Waiting -------------- -------------- -------------- ¶4. (SBU) The Ambassador asked about the Planning and Construction Law passed in 2009, which brought a rueful smile and Dulic's acknowledgment that "implementation is always difficult in Serbia." The Planning and Construction Law provided that 50 percent of money collected to convert land usage rights into ownership rights would be allocated to a Restitution Fund. However, neither a restitution law nor the necessary implementing regulations have been enacted. Dulic acknowledged that the concept of additional rights payments and restitution generally were "very painful" issues politicians had been unwilling to tackle. He said it was "very important to finish this issue in the first half of 2010," and promised a model would be announced within the next couple of months. Dulic stated restitution would take the form of financial compensation, not restitution-in-kind, and would likely be payable over 20 or 30 years. When asked why restitution in kind would not be included, he stressed the complexity of the situation, noting compensation was the only model that could attract political consensus. ¶5. (SBU) The Ambassador and DCM noted concerns that restitution proceeds might simply disappear (as had privatization funds) and reiterated offers to provide USAID or other assistance implementing a trust. Dulic acknowledged that citizens had expressed concerns BELGRADE 00000266 002 OF 002 about Serbian politicians controlling these funds and requested additional information regarding trusts. Church Property Law to be Overturned? -------------- -------------- ¶6. (SBU) Dulic noted he expected the Constitutional Court to overturn a law that had returned church properties. He added that he did not expect the church would be required to return those properties, observing "the situation is a mess." Croatia and Vojvodina -------------- ¶7. (SBU) Dulic spoke favorably regarding the prospects for improved Serbian-Croatian relations, pointing to a growing popular trend in both countries in favor of improved relationships, growing cultural ties and increasing economic cooperation. With respect to Vojvodina, he noted Vojvodina was a "special historical case", but believed the recent statute was a good example of how other parts of Serbia could be decentralized. Comment -------------- ¶8. (SBU) Dulic, a young and energetic DS member, plays a key role within the DS coalition as a liaison with Croatia and with minorities in Vojvodina, and is an important U.S. interlocutor. He has been a strong supporter of the New Embassy project and personally appointed his senior assistant to ensure the Embassy's requests for various permits would not be mired in lower level bureaucracy. His enthusiasm for environmental matters is genuine and his openness to discussing the internal debate regarding resolution of restitution and other land use issues is welcome. Embassy will follow up with his requests for assistance and engagement on environmental issues. End Comment. WARLICK