Press briefing on Trepca & regulation on illegal construction

18 August 2000

SRSG Bernard Kouchner

I have few words to say before I go to the Trepca safety plan. UN is now in charge of the administration. Of course it has always been in charge but it was difficult not only to take real responsibility in our hands but to raise some funding and to protect the environment, to protect mainly the workers, then to go eventually to a business plan.

But first you know that the Center for Democracy has been targeted an hour ago by a rocket or by a bomb. But we are not surprised. It. s just painful. Fortunately nobody has been wounded and nothing has been entirely damaged. But it will be like that going to the elections on 28 October. We are ready and prepared to insure security as -much as possible. But we are convinced unfortunately that extremists from Belgrade and from Kosovo as well, will try to sap our efforts to spoil the elections system. They are the enemies of democracy, so they are the enemies of elections. Anyway, we will go on with our work towards the elections.

Second, there is an increasing rumors and speculations that FRY authorities plan to organize federal elections in Kosovo on 24 September. Although we haven. t been approached by officials of FRY authorities on this particular matter, I feel that such rumors need to be dispelled. According to the Resolution 1244, UNMIK has full responsibilities for the interim administration of Kosovo. We also have responsibility to build democracy in Kosovo. And we firmly believe that everybody in Kosovo has the right to participate in democratic elections. But UNMIK has been working hard over the last year . 14 months in fact-- to prepare municipal elections that meet internationally accepted standards. I cannot see at the moment how could federal elections take place on 24 September in a fair, open and transparent way that could meet the international standard we have been looking for since one year. And of course I cannot see elections going on 24 September without destabilizing the security situation, and without disturbing the political process toward the building of democracy. So, had I decided to prohibit these elections? No. Because I haven. t been asked by any authority, by any official. So I have not made any decision. There is a remaining problem. Yes the Serbs, yes, the Albanians and then all communities in Kosovo have the right to express their opinion.  I don. t see the way to organize another elections operation in such short period of time without security problems.

Third point we are working and we will be issuing very soon a regulation on illegal construction, for all the municipalities. We are aware of regulations on Municipal rights, Municipal elections etc& but we need a very strong and very clear regulation to act in the same way and according to the same rules against illegal construction.

On Trepca, we have been working since more than one year on Trepca. Don. t believe that we discovered Trepca problem because of the lead pollution. Don. t believe that we discovered Trepca problem because of Stari Trg. We were working on Trepca from the beginning. We have reports and expertise. This is the most difficult economical, political, environmental problem in all Kosovo. Our NMIK team is very happy to present you today with a body of understanding miner on the future of Trepca complex, Trepca dinosaur, mainly for the future of the workers.

Dr. Bernard Salome, Economic Special Adviser

When UNMIK arrived in Kosovo as Dr. Kouchner just said, we found that Trepca was the main industrial asset in Kosovo. But it was in an extremely bad condition, in terms of maintenance, in terms of environment and in terms of production capability. In addition, there were complex issues attached to it in terms of who owns Trepca. A number of people were claiming rights over Trepca, and it was extremely difficult adjudicate such claims.

We further found that Trepca. s northern, central and southern chains which are the mine concentrators, the zinc refinery and the lead smelter were & & all other communities in Kosovo, with some parts of the facilities in the North, some parts of the facilities in the South and then Trepca could only operate as a unity with all the communities working together. So we had a vision. Dr. Kouchner had a vision when we started to work on this a year ago. The first idea was to re-establish a robust mining and metallurgical industry in Kosovo, which takes time, money and technical consideration. And which was not a robust mining and metallurgical industry, which had detrimental impact on the environment, because there had been 15 years of neglect of the environment especially in the last 10 years. Second, Trepca should be run by and for all the Kosovo communities. Third that we should start as fast as possible to resume production in the viable components of Trepca. It was estimated that it would take up to 30-36 months to restart most of the operation, with some of the operations starting faster. I. ll come to that in a minute.

Finally, we have to tell the trust that Trepca is a dinosaur. It. s a Soviet style dinosaur. It was the way we found industries in Eastern Europe and the former USSR. It has been run on the principle of maximum employment, with no consideration for productivity. And this is the 21st century. It has to be productive. That means the workers have to be trained, they have to be better managed. And we need competitive participation of Trepca in the world economy. There is not only Trepca as a mining and metallurgic industry in the world.   There is a whole rang of other activities. If we look at the most productive activities in Sweden or in America, they are running with a very lower level of employment, unlike in Terpca. We have a vision of Trepca employing workers and Kosovo benefiting from Trepca, so that the direct and the indirect benefits of Trepca go back to other communities.

To do this we require four conditions in Trepca.  It has to be economically viable in the world market. It has to have a containable, affordable or negligible environmental threat. There are a series of pictures being shown on the screen here which show the results of 50 years of acid main drainage,& & & .in various operations where basically you took the byproducts of the  mining and metallurgic operation and you put it next to the river. This is an ecological disaster. And it will take a long time to fix that.

The third point is that we want to work in a cooperative way with all the workers, on the Albanian and the Serb sides. That means we want to work with the workers and unions and with other representative of all the communities in an open, transparent and democratic way. Fourthly, the conditions have to be secure for the workers, the management and the experts, and this is to be provided by KFOR and UNMIK Police.

We have four imperatives. One, we want to preserve the assets. We want to make sure that some of the mines, which are now partly flooded, are being drained. We want to make sure that the mine of Stari Trg, which the workers of Stari Trg have prevented from being flooding for the last eight months, does not get flooded. That means installing pumps,& & providing spare parts and other equipment in urgently to Stari Trg. We want to make sure that the industrial assets are preserved and that they are prepared and kept ready for production.

The third imperative is the ownership issue which we are not addressing. You all know there have been various claimants for ownership, a Greek Company, a French company and others. UNMIK is no position legally to adjudicate the claims regarding the ownership. However, UNMIK has the right and responsibility under the resolution 1244 to administer public assets. Trepca is a public asset. We. re not making any decision nor are we in position to make decision on ownership. Therefore, we are managing and administering Trepca and we have a team of technical managers drawn from the best companies in the world to help UNMIK administer Trepca. The fourth imperative is that we want independent expertise, the best independent expertise that is possible to get, and now we have it, from the legal and technical points of view.

Therefore, we designed a three-phase action plan. Phase one has nearly been completed and we are moving into phase two. I. ll quickly explain phase one. Phase one was a preliminary assessment. It. s a complex issue. You do not take over a complex like that without getting a whole rang of technical, environmental and legal advise. It takes time and we have just completed phase one. Secondly, while we are doing that we have to do emergency asset preservation. That was done once again through the arrangement we had with Starri Trg workers, who in very difficult circumstances have done an incredible job. The third point is to find the money, and it. s very difficult to find money for an operation like that. We have to find public money. We have to convince the international community that Trepca is a key asset for Kosovo. That means that you have to take immediate action. It. s not a small amount. You. re talking about so far $ 16 million that we have to find for next year. And we will probably need more.

Phase two has started now. Phase two was a programme of raising the money and finalizing the asset and negotiating the contract with international expertise constituted by the international consortium Morrison Knudsen International, TEC Ingenierie and  Boliden Contech. The contract was signed last week. Then we had to make sure that UNMIK will have access to all the necessary expertise in a legal and technical way to help them as independent experts. The third part, which is ongoing now, is the consultation with all the interest groups, with exclusion of nobody, on the Albanian side, on the Serb side, on the workers side and on the management side. It. s a consultation process so that Trepca can be run for all and by all. So, the phase two programme has four points: asset preservation, environmental assessment to remedy 50 years of bad and mismanagement, immediate remedial actions including the smelter that was closed on Monday, technical audit to know what needs to be done and how we can do it, and financial audit and viability assessment.

Results from phase two: we expect to create about 2,000 jobs along the lines I just explained. We expect to have already completed first stages of environmental clean-up and remedial action. We intend to have the assets preserved. We have an emergency response plan that have been prepared that will be further developed. We are preparing for phase III, the production. Here I want to make a point clear. Given the amount of money which is necessary to have a fully profitable Trepca, we want the private sector to invest in Trepca, and to have private sector management contract, so that Trepca cannot operate under market principle. We do not want to use public money to run an operation.  So the phase III activities will be awarding, competitive, transparent and fair management contract to a group of selected investors along the lines of the Sharr Cement model, to have a management contract in place as fast as possible, to have production and contract negotiations so that the benefits of Trepca go back to Kosovo and to its communities and to the Kosovo budget. We want to have full rehabilitation, reconstruction and production in the whole of Trepca complex depending on what. s economically, technically and environmentally feasible.

Funding: EU is the biggest contributor and we would like to thank them for that. They are providing $5.6m for equipment, assets preservation, environmental audit and safety. The US has given $3.75m and France $1.5m. Italy has provided $0.75m  as part of the emergency plan for the asset preservation of Stari Trg mine, and we will continue to use the Italian contribution on Stari Trg. We are in the final stage of negotiations with Sweden for a further contribution of $0.75 m, in particular for the emergency and assets preservation plan and with Holland for $4.2m for the lines I have explained for the EU and the Swedish contribution, to make a total of $ 16.55m. This money will be used to pay workers, to buy equipment and to pay the management fee of the Consortium. The management of Trepca will be done in a transparent way. UNMIK will appoint a board of Trepca, with representatives of Albanians, Serbs, workers and management shared by UNMIK and all the administration of UNMIK. On day to day management, the Consortium will be managed by the Head of the Department of Trade and Industry in Pillar IV, of which Alan Pearson is the chief. As early results, we expect creation of up to 2,000 jobs,  reduction in environmental contamination, with the closure of the lead smelter there is already a major improvement in the pollution in Zvecan, where sulphur dioxide and lead dust were being pumped in the air without using filter whatsoever, creating an ecological disaster and a health disaster in Zvecan.

We intend to maximize the speed which will do the refurbishment of some parts Trepca and we intend to operate one concentrator as well as a part of the smelter complex as fast as possible. We have two of our technical support team, Mr. Rex Osborne and Mr. Charles Brown to answer any technical questions you have about either the Trepca complex at large or the Zvecan complex. Already in one week, we. ll have the preliminary results of the technical audit& & .Zvecan, and I am happy to report that we are ready to deploy rapidly workers back in Zvecan from the Serb work force. We have full co-operation from the Serb work force and we will continue to work with the Serb work force and with most of the management of Zvecan and to make one point very clear, as Dr. Kouchner has said earlier, for the time being, there will be no Albanian workers going in Zvecan, and no Albanian workers going to the North Chain. We have a vision of Albanians and Serbs working side by side, but it. s not ready yet. For the time being, Zvecan will continue to operate as well as the North Chain with Serb workers. Thank you.

ASRSG Mr. Alan Pearson, EU Pillar

I would like to pick from where Dr. Salome  left off and cover for you the area we are talking about in terms of developing northern Kosovo, the area that includes Trepca. The first point I want to make is that development of northern Kosovo has to stay in step with the development of Kosovo. We do not see it as a special exercise  from the point of view of developments outside the Trepca complex. One of the issues we are looking at now is of course speeding up the process, which is quite important.

The key components, which Bernard has briefed on very fully, I want to talk about donor financed projects, including through the JIAS and private sector development aspects.

For the purposes of northern Kosovo, we can see the area we are concentrating on in the yellow portion of the top of the slide, i.e. the four municipalities to the north. What are our main objectives. Let me just summarise them by saying that we are looking at fostering economic activity and local employment, particularly of importance is the local employment aspects. We are doing this initially through international donations. Some 8 million DM have been spent since the beginning of the year and there is more to come in this financial year. We are also encouraging municipal initiatives which I will cover later.

We will move now into the options of revitalising enterprises. However, that requires investment, both local and international and I will cover that as well.

Let. s look at the donation side. Of course the main contributors are probably well known to you already, European Agency, DFID, USAID and a number of other smaller donors. There is a KFOR CIMIC programme and a factors that is often overlooked in the development aspects of whole of Kosovo as well as northern Kosovo and that is the consolidated budget through which funding in the province is outlined, which is about 1.2 million DM through municipal budget for the employment of people and the operating expenses of those areas.

I have listed here the total project donor investment, which is quite important. A large number of smaller projects with a total of 11.5 million DM over the 12 month period. I would also emphasise in terms of donor projects, there are those that are specifically earmarked for northern Kosovo and those that come to northern Kosovo as its share of other reconstruction programme, particularly in the utilities and water area.

Let me look at a few recent donor funded projects. In the Village Employment Rehabilitation Project (VERP), which has been basically completed, the bus station, fish farms, water pumps, renovation of a primary school---again a wide range of activities and a wide range of donors. These are shown on the map to give you and indication that there is a substantial geographic spread also of the activity in the north.

The further projects are listed here, the major ones which are also on the funding sheet. The overhaul of the secondary school in Leposavic, Gazivode clean up and the transformer up in& &   Again across a wide range of activities and geographical locations. I mentioned the municipal and local investment fund now being funded by the European Agency for Reconstruction. This fund in fact is a programme that has been set up for public investments to be carried out through the joint interim administrative structure. It totals about 16 million DM across Kosovo, in which again north Kosovo will gets its share. The objectives of this project, again through the public sector, is provision for municipal infrastructure, and particularly, an important component of training in administration and management. We have taken the view that the development of human capital, both across Kosovo and particularly in the north is an important aspect of generating a market based economy, within the province.

I have listed here three projects that have already been identified for the investment fund, which I must say was only signed into force a week ago. What is listed there is the upgrade of the Zubin Potok road, Leposavic secondary road and repairs to central heating systems in Zvecan. We have called already for new proposals to be presented by the municipalities in early September, so that we can speed up the process.

Let me look at the last and the most difficult exercise that we will face over the near future. That is the revitalization of either the state or socially owned enterprises, both across Kosovo and particularly against northern Kosovo.

The Department of Trade and Industry within my pillar has been working on identifying these enterprises for some time. They are looking at the potential particularly of commercialization, where they can be revitalized. We have identified 16 major enterprises at this point, in construction, woodworking, metal and textiles. The next steps are to move towards attracting investors to these activities. The public sector and in particular, the Kosovo budget not be able to revitalize or provide capital injections for any of these activities that we are identifying. They will need to be funded from external sources, either local or international investment, where there is an economic opportunity for them.

As Bernard mentioned in the case of Trpeca we have avoided the ownership question. We will be doing that as well with these enterprises. We do not plan at this point to address or to resolve ownership questions on them but simply to get them operating to encourage economic activity and generate employment. To do that we would look at management concessions and an approach that puts a management team into the organization. This will be done through an open and transparent bidding process, where there will be tenders called from the interested parties and in some instance we know there may only be one interested party, but the opportunity must be made for all to invest or to manage these activities. The criteria for selection will be based upon not only the incomes that will be generated to the government or the budget that we run, but also on the plans those organizations put forward concerning the activity they want to undertake, the employment that they will guarantee and the other related activity, particularly in their approach to environmental standards.

We will doing this in consultation with municipal administrators, who often are in the best position to understand what. s happening on the ground, with the workers or previous workers of these activities and enterprises with potential investors. This is an important and forward looking aspect of the work that will go on because some of these management concessions, as with Sharr, may go for a considerable period of time. Therefore, they will be important for the long run development and we will be attempting to generate those in the larger enterprises we have identified, as soon as possible.

ITT Consortium Mr. Rex Osborne

I am a representative of the three companies that will be working with UNMIK in revitalizing the Trpeca complex. The three companies are the Swedish firm Boliden Contech, which is a leading international mining and smelting company, a French owned TEC Ingenierie, a leading international company in the mining and smelting industry and the American company, Morrison Knudson International, who are an international mining environmental mediation and construction company.

Dating from mid-1999, each of our companies has done some work in the concentrators and smelter that make up the Trepca complex here in Kosovo. We independently came to the same kinds of conclusions, the most significant of which being that there would be needed significant investment in Trpeca before the complex could even become of interest to private investors.  Through our field work we have gained a detailed understanding of the technical challenges surrounding the Trpeca complex and we have the privilege of working with UNMIK to develop the most efficient and economic approach to revitalizing these facilities. We have come to a realistic understanding if the challenges that we will face in revitalizing these facilities and we are here to assist the professional Kosovar mining community to preserve this asset for future generations. We have seen the environmental damage first hand that has taken place and we will take steps to curtail it. We bring new technology and fresh look, an independent view of the challenges and concerns surrounding the operation of the Trepca complex. Working together we bring world class experience. Our people and assets will allow us to take the steps necessary to bring the Trepca complex back to viable operation. We will work with UNMIK in guiding and directing work at the Trepca complex.

Our purpose is really three fold. First one is to assess the financial viability of Trepca, according to internationally accepted standards. This means we will perform and all body assessment to look at the value and extent of all bodies that are involved. It will also consiast of an analysis of the international lead and zinc markets, to make sure we can find the most profitable of selling our products coming from the Trepca complex. We will look at the transportation that is available in Kosovo so that we can get the marketable commodities to the market in a reasonable time and cost.

The second activity that we will undertake is to assess the environmental status of the Trepca complex, according to acceptable international standards. We will begin to clean up the most glaringly environmental problems within the resources we have available and we have out together a pollution control plan which is to minimize the generation of further pollution and the spread of that which has already taken place.

Our third primary task is to preserve the assets of the Trepca complex for future operations. We will perform a detailed technical assessment of the equipment and facilities. This will require a restart of many of the equipment and processes. Throughout this entire process our view would be in meeting internationally accepted safety and technical standards, so that we take care of the workers and the equipment which is there. We have put together a plan for the repair and replacement of essential equipment within the assets we have. Overall our goal is to put a substantial number of people back to work in the shortest period of time in an organized, orderly manner. Our entire efforts will be focussed on laying the foundations of putting the Trepca complex back into profitable production and creating jobs but not the expense of the environment.

Questions:

Q: If you say the ownership of Trpeca is disputed, how can you give the management and production contract to anyone for the mines or the smelter?

BS: I have already answered that question earlier. The Trepca has been & & & & ..hands and there have been some changes of ownership and as we deployed here in July 1999, we found competing ownership claims. Does that prevent UNMIK to take responsibility under 1244 to make sure we protect the assets? No of course not because we have to preserve Trepca without the other legal processes getting into the way. That. s what we are doing, we are deciding the rights and responsibilities to protect the assets. We don. t want to wait for tribunals who exactly owns Trepca because by that time it is done, we won. t have any assets any more. We have taken the view that we have to preserve the assets and more importantly to preserve the environment and create jobs.

Q: How much money do you have now? You say you have $16.55 million, but this list shows that Sweden and the Netherlands haven. t yet given the money.

BS: We have clearly mentioned in our press brief. We are in the final stages of negotiations with Sweden and the Netherlands. You can calculate $ 16.55 million minus $0.75 million and minus $4.5 million and get the answer.

Q: Mr. Salome we have been wanting to see you here for months, but it was impossible. Why this secrecy around Trepca?
BS: There was nothing secret about Trepca. But you have to understand that when you have such a technical, legal and environmentally complex set of issues and a team of people is working and negotiating, you  are not going to have great details. Anybody who came to my office, including people from Zeri were sent off to the press office.

Q: You said you can bypass the issue of ownership. How are you going to solve the legal issues, if there isn. t clear ownership.

BS: I am not a lawyer. I am an economist. Therefore, the issue of legal ownership of Trepca will be dealt with by the appropriate legal processes.

Q:  Then Mr. Osborne how can you operate or invest in the complex without clarifying this issue?

BS: Mr. Osborne and his technical team are the UNMIK technical team. We are investing. We have the money from the international community. We are investing to preserve the assets and the environment.

Q: Then who is going to deal with the legal issues when they come into play, UNMIK or ITT?

AP:  As you are aware UNMIK is administering the assets and activities in Kosovo. Let me use the Sharr cement factory as an example of how we have achieved that. In that contract negotiated with & & & .Bank to restart Sharr cement we deliberately agreed with them that we could not resolve the ownership issue and in an agreement with them we set the issue aside and we said we are asking you to manage this property on our behalf  or through for us and to generate the employment and to make it work. In 10 years time you will return it to us. If in the interim period the local courts or as we may propose an adjudication process is set up for resolving legally the ownership question, then we left the capacity open to take up the ownership matter again and to look at either restitution or compensation where it. s due. That is the same approach that we would look at in the context of the Trepca complex.  There will be, I am sure, a large number of competing claims. Some will be valid, some will be in the courts or in the adjudication process, ruled invalid or accepted. Once we have got through that we can then work out who is financially responsible, who should have the financial benefits that would accrue, according to their ownership claims that are judged in the court. We cannot wait at this time for that process to go through and therefore we must adopt the administrative route that is to seek to manage the exercise but set aside the question of resolving the ownership issue until we can go through what may well be a protracted negotiation and/or legal process.

Q: Serb workers will get their salary. Does this mean that he will be the worker in that smelter and who pays this money? Secondly Mr. Kouchner said they are in fact with Serb workers and they are speaking with them and then why did you need the army and the police to take over the smelter?

AP: Let me answer the question on the payment to the workers. In the agreement to take the administration of Zvecan, we utilised the Kosovo Consolidated Budget contingency provision for initial payments of salaries or remuneration to the workers who were displaced in that process. We have a contingency to cover a period up until the ITT Consortium are in place and are looking at their employment activity and until we have reached decision on reopening the facility for production, and therefore the workers can go back to work.  So yes it is being covered by the Kosovo budget initially through our contingency provisions for these sorts of events and from then on it will be  resolved with the Consortium activities and the reopening of the complex.

BS: Well it is not that we did not try to discuss with the management of Zvecan for a long time but the fact  that we UNMIK were administering the whole of Trepca and that you were ready to invest some money into the Zvecan smelter. The fact of the matter is that they completely disregarded these discussions and even more importantly to stop polluting the atmosphere in a terrible way, creating an health emergency. I am going to give the floor to Mr. Charles Brown, who is going to give you the concrete example about the fact that in any country in the world this smelter would have been closed that smelter because of the pollution that it was causing.

CB: I entered the factory complex earlier on Monday morning, shortly after the KFOR troops gained control of it. I found just one part of the smelter operating, the blast furnaces.  As Dr. Salome said there was no filtration, which means that lead dust was being emitted straight into the atmosphere and polluting the whole area around the smelter, but primarly it was also polluting the smelter itself and the workforce there. I found they had no safety equipment. One of the workforce had lead & on his feet with & ulcers on his feet. They were not healing. Another one told me, he had been off for a year with lead poisoning. I do not think that we can continue to operate the smelter in this fashion at this time. We need to prepare it and this is what the UNMIK administration is doing through the assistance of the administrators who have been brought into place. The first thing we have to do is to stop and clean the place so that it. s safe for the workers and when it reopens it. s safe for the local population.

Q: Do you think it is realistic that companies are going to come in and make necessary commitment with this ownership question resolved. Some tribunal can come along at any stage and say we have discovered the true owners and it. s not you?

RO: That has to be a business decision those involved will have to make. I would not presume to try and answer for them. We hope to make the Trepca complex something that would be attractive to the industry.

Q: What is the timeframe for the contract awarded to the ITT Consortium? Does Kosovo budget have Dinars?

AP: Yes, we have the Dinars and had them available for the workers. The interesting fact was that at the last country some 160 of the workers asked us for DM and not Dinars and they signed as document formally requesting to be paid in deutsche marks and we paid them in DM but yes we did have Dinars available and we still do in our safe.

RB: We have a 12-month contract.

Q: Do you think Trepca would be operational in 12 months?

RB: We have all been here and we have looked at the some extent at all the facilities. We are just beginning to get into the detailed technical assessment of those facilities. It. s very hard to tell now. We have a requirement in our contract to tell UNMIK just about where we are at as soon as  we have the feel for what that effort will take. It will take some time, it. s very complex, spread out on a large area. It will take sometime to come to that conclusion.

Q: Dr. Salome at the end of your presentation you said Albanian workers will not go to the northern part of Mitrovica, and especially to the Zvecan smelter. At the same time you said in the strategy in the second phase, you are planning to have 2000 workers. How many people used to work there before it closed down and where are you going to find the 2000 workers?

BS: Let me clarify that I did not talk about north Mitrovica, I talked about Zvecan and the Leposavic concentrator and I just repeated what Dr. Kouchner announced on Monday, which is that we have a vision of everybody working together but we are realistic at this point, Serbs and Albanians are not yet ready to work together in the concentrator or the mines. So therefore we are not going to ask Albanian workers to go to Zvecan or to the mines or ask the Serb workers to go to the south. As for how many people are going to be working, there is a discussion going on, which is extremely productive.

Q: Where did you find the Dinars. Did you find them in the safe which was opened a few months ago?

AP: Some months ago, in the previous National Ban of Kosovo, there were a number of safes and vault areas, which we administered and we arranged to have them opened and inventoried the entire amount and that inventory of course became  part of the administration and became part of the Kosovo Consolidated Fund and in those valuts we found a number of currencies, including Dinar.

Q: How much Dinars did you find?

AP: The exact amount I cannot remember, but it was in excess of a million DM. We are still going through the counting process because a large number of those notes have deteriorated from water, there were water stains from water that had got into the bottom part of the vaults and we are still going through that counting process and we have not got it & & ..to account in our Kosovo Consolidated Fund, but it will be  and of course the figures will appear on the CFA web site.

Q: Will the managing board of Trepca be a divided one or a joint one to be supervised by UNMIK? Who is going to be the engineer to represent Kosovo. s interest, will he be a Kosovar or an international?

BS: The Trepca board will not be divided, it will have Kosovo Albanian and Kosovo Serb representatives, there will be workers representatives and management representatives. It will be a board where people will meet under the chairmanship of UNMIK to discuss the future of Trepca. It will be a place where we can take policy decision in a cooperative way. As for your second question, a team in the Department of Trade and Industry, which is making taking car of the technical and legal aspects of what we are doing in Trepca.

Q:  Did you have any discussions with the people from Trepca in Skopje before its takeover. Is it true that KFOR found 900 kilos of silver and two kilos of gold, which authorities in Trepca are talking about?

BS: First of all the discussion with the management of the smelter started last July, when the regional administrator met the management and discussed with them that the pollution is very bad and that UNMIK was ready to help and for a long time the smelter was operating at a very low level, in fact, if it was operating at all. All the attempts to talk to the smelter management, when we told them that we were ready to work with them, all our attempts were rebuffed. They did not give any chance to us but to stop since it was a health emergency.

AP: On the question regarding silver, let me say the administration is still conducting inventory of what is in the plant. I understand there has been some silver located but I cannot confirm the amount.