The Albanian Connection

by Michel Chossudovsky

Arms smuggling from Albania into Kosovo and Macedonia started at the beginning of 1992, when the Democratic Party came to power, headed by President Sali Berisha. An expansive underground economy and cross border trade had unfolded. A triangular trade in oil, arms and narcotics had developed largely as a result of the embargo imposed by the international community on Serbia and Montenegro and the blockade enforced by Greece against Macedonia.

Industry and agriculture in Kosovo were spearheaded into bankruptcy following the IMF's lethal "economic medicine" imposed on Belgrade in 1990. The embargo was imposed on Yugoslavia. Ethnic Albanians and Serbs were driven into abysmal poverty. Economic collapse created an environment which fostered the progress of illicit trade. In Kosovo, the rate of unemployment increased to a staggering 70 percent (according to Western sources).

Poverty and economic collapse served to exacerbate simmering ethnic tensions. Thousands of unemployed youths "barely out of their Teens" from an impoverished population, were drafted into the ranks of the KLA...

In neighbouring Albania, the free market reforms adopted since 1992 had created conditions which favoured the criminalisation of State institutions. Drug money was also laundered in the Albanian pyramids (ponzi schemes) which mushroomed during the government of former President Sali Berisha (1992-1997).23 These shady investment funds were an integral part of the economic reforms inflicted by Western creditors on Albania.

Drug barons in Kosovo, Albania and Macedonia (with links to the Italian mafia) had become the new economic elites, often associated with Western business interests. In turn the financial proceeds of the trade in drugs and arms were recycled towards other illicit activities (and vice versa) including a vast prostitution racket between Albania and Italy. Albanian criminal groups operating in Milan, "have become so powerful running prostitution rackets that they have even taken over the Calabrians in strength and influence."

The application of "strong economic medicine" under the guidance of the Washington based Bretton Woods institutions had contributed to wrecking Albania's banking system and precipitating the collapse of the Albanian economy. The resulting chaos enabled American and European transnationals to carefully position themselves. Several Western oil companies including Occidental, Shell and British Petroleum had their eyes rivetted on Albania's abundant and unexplored oil-deposits. Western investors were also gawking Albania's extensive reserves of chrome, copper, gold, nickel and platinum... The Adenauer Foundation had been lobbying in the background on behalf of German mining interests.

Berisha's Minister of Defence Safet Zoulali (alleged to have been involved in the illegal oil and narcotics trade) was the architect of the agreement with Germany's Preussag (handing over control over Albania's chrome mines) against the competing bid of the US led consortium of Macalloy Inc. in association with Rio Tinto Zimbabwe (RTZ).

Large amounts of narco-dollars had also been recycled into the privatisation programmes leading to the acquisition of State assets by the mafias. In Albania, the privatisation programme had led virtually overnight to the development of a property owning class firmly committed to the "free market". In Northern Albania, this class was associated with the Guegue "families" linked to the Democratic Party.

Controlled by the Democratic Party under the presidency of Sali Berisha (1992-97), Albania's largest financial "pyramid" VEFA Holdings had been set up by the Guegue "families" of Northern Albania with the support of Western banking interests. VEFA was under investigation in Italy in 1997 for its ties to the Mafia which allegedly used VEFA to launder large amounts of dirty money.

According to one press report (based on intelligence sources), senior members of the Albanian government during the Presidency of Sali Berisha including cabinet members and members of the secret police SHIK were alleged to be involved in drugs trafficking and illegal arms trading into Kosovo:

(...) The allegations are very serious. Drugs, arms, contraband cigarettes all are believed to have been handled by a company run openly by Albania's ruling Democratic Party, Shqiponja (...). In the course of 1996 Defence Minister, Safet Zhulali [was alleged] to had used his office to facilitate the transport of arms, oil and contraband cigarettes. (...) Drugs barons from Kosovo (...) operate in Albania with impunity, and much of the transportation of heroin and other drugs across Albania, from Macedonia and Greece en route to Italy, is believed to be organised by Shik, the state security police (...). Intelligence agents are convinced the chain of command in the rackets goes all the way to the top and have had no hesitation in naming ministers in their reports. The trade in narcotics and weapons was allowed to prosper despite the presence since 1993 of a large contingent of American troops at the Albanian-Macedonian border with a mandate to enforce the embargo. The West had turned a blind eye. The revenues from oil and narcotics were used to finance the purchase of arms (often in terms of direct barter): "Deliveries of oil to Macedonia (skirting the Greek embargo [in 1993-4] can be used to cover heroin, as do deliveries of kalachnikov rifles to Albanian `brothers' in Kosovo".29

The Northern tribal clans or "fares" had also developed links with Italy's crime syndicates.30 In turn, the latter played a key role in smuggling arms across the Adriatic into the Albanian ports of Dures and Valona. At the outset in 1992, the weapons channelled into Kosovo were largely small arms including Kalashnikov AK-47 rifles, RPK and PPK machine-guns, 12.7 calibre heavy machine-guns, etc.

The proceeds of the narcotics trade has enabled the KLA to rapidly develop a force of some 30,000 men. More recently, the KLA has acquired more sophisticated weaponry including anti-aircraft and antiarmor rockets. According to Belgrade, some of the funds have come directly from the CIA "funnelled through a so-called "Government of Kosovo" based in Geneva, Switzerland. Its Washington office employs the public-relations firm of Ruder Finn--notorious for its slanders of the Belgrade government".

The KLA has also acquired electronic surveillance equipment which enables it to receive NATO satellite information concerning the movement of the Yugoslav Army. The KLA training camp in Albania is said to "concentrate on heavy weapons training - rocket propelled grenades, medium caliber cannons, tanks and transporter use, as well as on communications, and command and control". (According to Yugoslav government sources.

These extensive deliveries of weapons to the Kosovo rebel army were consistent with Western geopolitical objectives. Not surprisingly, there has been a "deafening silence" of the international media regarding the Kosovo arms-drugs trade. In the words of a 1994 Report of the Geopolitical Drug Watch: "the trafficking [of drugs and arms] is basically being judged on its geostrategic implications (...) In Kosovo, drugs and weapons trafficking is fuelling geopolitical hopes and fears"

The fate of Kosovo had already been carefully laid out prior to the signing of the 1995 Dayton agreement. NATO had entered an unwholesome "marriage of convenience" with the mafia. "Freedom fighters" were put in place, the narcotics trade enabled Washington and Bonn to "finance the Kosovo conflict" with the ultimate objective of destabilising the Belgrade government and fully recolonising the Balkans. The destruction of an entire country is the outcome. Western governments which participated in the NATO operation bear a heavy burden of responsibility in the deaths of civilians, the impoverishment of both the ethnic Albanian and Serbian populations and the plight of those who were brutally uprooted from towns and villages in Kosovo as a result of the bombings.
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RESOURCES:

1. Roger Boyes and Eske Wright, Drugs Money Linked to the Kosovo Rebels The Times, London,
Monday, March 24, 1999.
2. Ibid.
3. Philip Smucker and Tim Butcher, "Shifting stance over KLA has betrayed' Albanians", Daily
Telegraph, London, 6 April 1999
4. KDOM Daily Report, released by the Bureau of European and Canadian Affairs, Office of
South Central European Affairs, U.S. Department of State, Washington, DC, December 21,
1998; Compiled by EUR/SCE (202-647-4850) from daily reports of the U.S. element of the
Kosovo Diplomatic Observer Mission, December 21, 1998.
5. "Rugova, sous protection serbe appelle a l'arret des raides", Le Devoir, Montreal, 1 April 1999.
6. See Alfred W. McCoy, The Politics of Heroin in Southeast Asia Harper and Row, New York,
1972.
7. See John Dinges, Our Man in Panama, The Shrewd Rise and Brutal Fall of Manuel Noriega,
Times Books, New York, 1991.
8. "The Dirtiest Bank of All," Time, July 29, 1991, p. 22.
9. Truth in Media, Phoenix, 2 April, 1999; see also Michel Collon, Poker Menteur, editions EPO,
Brussels, 1997.
10. Quoted in Truth in Media, Phoenix, 2 April, 1999).
11. Ibid.
12. Geopolitical Drug Watch, No 32, June 1994, p. 4
13. Sean Gervasi, "Germany, US and the Yugoslav Crisis", Covert Action Quarterly, No. 43,
Winter 1992-93).
14. See Daily Telegraph, 29 December 1993.
15. For further details see Michel Collon, Poker Menteur, editions EPO, Brussels, 1997, p. 288.
16. Truth in Media, Kosovo in Crisis, Phoenix, 2 April 1999.
17. Deutsche Presse-Agentur, March 13, 1998.
18. Ibid.
19. Daily News, Ankara, 5 March 1997.
20. Quoted in Boyes and Wright, op cit.
21. ANA, Athens, 28 January 1997, see also Turkish Daily News, 29 January 1997.
22. Brian Murphy, KLA Volunteers Lack Experience, The Associated Press, 5 April 1999.
23. See Geopolitical Drug Watch, No. 35, 1994, p. 3, see also Barry James, In Balkans, Arms for
Drugs, The International Herald Tribune Paris, June 6, 1994.
24. The Guardian, 25 March 1997.
25. For further details see Michel Chossudovsky, La crisi albanese, Edizioni Gruppo Abele, orino,
1998.
26. Ibid.
27. Andrew Gumbel, The Gangster Regime We Fund, The Independent, February 14, 1997, p. 15.
28. Ibid.
29. Geopolitical Drug Watch, No. 35, 1994, p. 3.
30. Geopolitical Drug Watch, No 66, p. 4.
31. Quoted in Workers' World, May 7, 1998.
32. See Government of Yugoslavia at http://www.gov.yu/terrorism/terroristcamps.html
33. Geopolitical Drug Watch, No 32, June 1994, p. 4.

Michel Chossudovsky
Professor of Economics at the University of Ottawa and author of The Globalization of Poverty, Impacts of IMF and World Bank Reforms, Third World Network, Penang and Zed Books, London, 1997.

ęCopyright by Michel Chossudovsky, Ottawa, 1999. All rights reserved. Permission is granted to post this text on non-commercial internet sites, provided the essay remains intact and the copyright note is displayed. To publish this text in printed and/or other forms contact the author at chossudovsky@sprint.ca
Department of Economics, University of Ottawa, Ottawa, K1N6N5
Voice box: 1-613-562-5800, ext. 1415
Fax: 1-514-425-6224
E-Mail: chossudovsky@sprint.ca

Recent articles by Chossudovsky :
on Yugoslavia: http://www.hartford-hwp.com/archives/62/022.html
on the Brazilian financial crisis: http://wwwdb.ix.de/tp/english/special/eco/6373/1.html
on global poverty and the financial crisis:
http://www.transnational.org/features/chossu_worldbank.html
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http://www.twnside.org.sg/souths/twn/title/scam-cn.htm
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http://heise.xlink.de/tp/english/special/eco/6099/1.html#anchor1
Taken from The Transnational Foundation for Peace and Future Research
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