It is a great honour and privilege for me, as the first democratically elected President of Yugoslavia in nearly 60 years, to address this gathering of world leaders. Against the solemn background of yesterday's commemoration and the challenges that confront us, I would like to share with the General Assembly my views on developments in South-East Europe. Before I begin my remarks, allow me to express my deep satisfaction at the election of Mr. Jan Kavan to preside over the fifty-seventh session of the General Assembly. His leadership and experience make him uniquely qualified to guide the extremely important work of this body. I also wish to extend my congratulations to Switzerland on joining the United Nations, and to Timor-Leste on its forthcoming accession to membership. Nearly two years have elapsed since democracy returned to Yugoslavia ─ two years of concerted efforts by my country to alleviate the consequences of a decade of civil war, build democratic institutions, establish the rule of law, carry out market reforms and fulfil its obligations to the international community. After a 10-year delay, Yugoslavia has joined the large group of other European countries in transition that are building their future on the common values of respect for human rights, democracy, free-market economies and a commitment to European and Euro-Atlantic integration. What distinguishes my country from most other Central and Eastern European States is that during that same decade Yugoslavia experienced the largest armed conflict in Europe since the Second World War. The dissolution of the former Yugoslavia, the civil wars waged on its soil and the subsequent NATO bombing have left continuing effects on the well-being of the citizens of my country and on that of the citizens of most of South-East Europe. Yugoslavia knows only too well that peace in the region, attained at great sacrifice, must never be threatened again. The efforts we have made to that end over the past two years, and the good political relations we have established with our neighbours, have strengthened my hope that an inter-State armed conflict in our region is unlikely to happen either today or in the foreseeable future. There are still threats to lasting peace in the world and in the region alike. Those threats come from ideological, religious, ethnic and political extremism, which fuel hatred and sow fear among our peoples. Organized crime is often linked with that extremism, and is the lifeblood of terrorism. Even though terrorism and organized crime in South-East Europe are rather specific in their characteristics, there are many links to leading terrorist and criminal groups throughout the world. I am here to reaffirm my country's firm commitment to the struggle against this threat. I am also confident that the United Nations is the right place for the coordination of international efforts to rid the world of this evil. This struggle will not be easy but, together, the community of democratic nations can prevail through cooperation and a unified response to potential threats, regardless of where they may emanate from. In addition to the security and military measures that we undertake, we must also be equally committed to using other methods to eradicate the conditions that breed terrorists. We must attack global poverty and injustice throughout the world with the same commitment and resolution with which we confront terrorism. We must reach out to the generation of young impoverished children, who are targets for terrorist recruitment and manipulation, by providing them with hope through education and economic opportunity. 6 The stabilization of our region requires continuous action not only by the States of the region but also by the entire international community. My country has finally undertaken a constitutional transformation, with facilitation by the European Union, in order to define the relations between its two member republics, Serbia and Montenegro. This will make our integration with the rest of Europe easier and quicker. Our success requires the success of our neighbours. When it comes to Bosnia and Herzegovina, Yugoslavia is a fervent advocate of the full implementation of the Dayton Accords. In fact, we are a guarantor of those Accords. As in all other cases, our goal is to open borders, not to change them. We want to promote the flow of people and goods, thus restoring the broken ties that bound us to each other. I am pleased to see that this policy has produced significant results, although I have to say that slow economic recovery hinders our efforts, especially in the area of refugee returns. Yugoslavia, in cooperation with Croatia and Bosnia and Herzegovina, will continue to do its part in establishing the trust and cooperation between our three States that will benefit our citizens. I am proud that Yugoslavia will host the next summit of these States, which is scheduled to be held in Belgrade this autumn. I am saddened that the situation in Kosovo is far less encouraging. Some progress has been made since Security Council resolution 1244 (1999) was adopted, and since the United Nations Interim Administration Mission in Kosovo (UNMIK) arrived in the province. With the enormous help and understanding of Secretary-General Kofi Annan, a bright spot was reached through the agreement with Special Representative Hans Haekkerup on cooperation between the Federal Republic of Yugoslavia and UNMIK in November 2001. Unfortunately, Kosovo remains a factor of political instability and a centre for organized criminal networks that transit our region and stretch from Central Asia to South America. There is little doubt that these networks cooperate with extremist and terrorist groups in our region and beyond. Another problem with Kosovo is the desperate plight of the close to 250,000 Serbs, Montenegrins and other non-Albanians who desire to return to their homes but who remain displaced, mostly in central Serbia. Unlike the case of Bosnia and Herzegovina, less that one per cent of Kosovo's population of internally displaced persons has returned. To make matters worse, the fate of more than 5,000 abducted and missing persons is yet to be uncovered. During the last two years, Kosovo's instability twice spilled over into neighbouring areas, first into the Presevo valley in southern Serbia, and then into the western part of Macedonia. Regardless of the fact that Serbs and others participate in Kosovo's provisional institutions, this has not led to an improvement in the security situation or to the establishment of complete freedom of movement. Without immediate and noticeable improvement in those two areas, a more massive return of internally displaced persons is unlikely. All of that, along with the reluctance of Kosovo Albanian political leaders to enter into dialogue with us, makes is impossible to begin a serious discussion on the final status of Kosovo. Yugoslavia will continue to do its part in establishing the conditions for a democratic and peaceful solution to this open issue. To that end, I am pleased that we will upgrade to the ambassadorial level diplomatic relations with our neighbour, the Republic of Albania. I am confident that the cooperation between our two countries will continue and that jointly we will be in a better position to find solutions to outstanding problems. Let me stress that we are fully aware of our international commitments and that we will meet them, not because this is demanded of us but because we desire to establish a democratic society based on the rule of law. I believe that, at the conceptual level, the final point I am going to make is the most important because it determines everything else. The world must understand that change has truly taken place in Yugoslavia and that no authoritarian regime has any chance there anymore. Sometimes there is mistrust towards my country; this is almost unbelievable. There is still prejudice against us, as if nothing has changed, whereas actually a great deal has changed and substantially. The political situation is still evolving. There are still disagreements among the various players. But this is perfectly normal for a transitional period. Nothing should serve as a pretext for continuing a policy of conditionality towards us, or for attempts to interfere in our internal affairs. We continue often to see how such an approach is usually counter-productive not to mention the time it wastes.