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Italian Security in the MENA and Balkans, Part 7: Montenegro

September 25, 2016

By Matteo Albertini and Chris Deliso

This, the seventh and final installment in our present series, assesses the modern economic, security and diplomatic relationships between Italy and Montenegro.

Italy’s relationship with Montenegro is unique and fundamentally conditioned by historic ties and the maritime situation of both countries on the Adriatic. This geographic reality – with all the good and bad factors it entails – is complemented by a cultural legacy in which Italy’s presence is felt also through the Catholic Church. In the post-Yugoslav years, diplomacy, politics and church affairs have frequently become interwoven in the Italian-Montenegrin relationship.

Although diplomatic relations between the two republics began only in 2006, as a consequence of the independence of Montenegro, Rome and Podgorica (once Titograd) have a long history of bilateral relations.

Montenegro’s most legendary leader (once dubbed “Europe’s father-in-law”), King Nikola Petrovic-Njegos, strengthened diplomatic support for his short-lived kingdom by marrying his sons and daughters off to members of Europe’s royal families. In fact, his daughter Elena married Italian King Vittorio Emanuele III in 1896, inaugurating decades of good relations between Italy and Montenegro. These relations were only partially marred by the Italian occupation during WWII. As reported widely by media, during the 1990s Montenegro attracted the interest of Italian institutions mainly concerning cigarette smuggling between Bar and Bari: a trafficking route which allegedly involved top officials of the then-Federal Republic of Yugoslavia.

The stigma of organized crime that started with the “tobacco mafia” stories has, more than anything, compromised Montenegrin leaders’ ability to create truly independent policies: though it may be the best-known owing to its active investigations of leaders by anti-mafia police, Italy is far from the only foreign power that has sought to influence Montenegrin politics, policies and business in the last 25 years.

The cumulative result of this tendency has been a slow but steady movement towards Western institutions, as was seen most recently in this past summer’s NATO accession. That had been preceded by a fierce influence campaign by media from foreign countries who all referenced the country’s reputation as the reason for why it needed to join NATO – or would be a liability to it.

Especially in the decade following independence in 2006, Montenegro has signed many agreements with Italian and European institutions. Amongst the latter, the 2010 Stabilisation and Association Agreement and the 2012 memorandum on the succession of Montenegro are important to note. They followed historic bilateral treaties between Yugoslavia and Italy (and confirmed 18 previous agreements).

On the economic side, it is also important to note the recent contract between the government of Montenegro and the Italian company A2A, regarding the management of Montenegrin Electric Society, EPCG. This document represents (as the agreement with FIAT does for Serbia) a rare case of an international treaty made between a state and a private company. This agreement has increased the Italian economic presence locally.

Italian Diplomacy in Montenegro

Since 2013, the Italian ambassador in Montenegro has been Vincenzo del Monaco. This was a very interesting choice, considering that he is one of the few Italian diplomats with experience in the Italian armed forces, having worked in the Carabinieri before starting a diplomatic career in 1997. Subsequently, he was posted in Beijing (from 2001 to 2005), and worked in the Economic and Commercial Office, before being appointed as First Secretary of the Italian delegation to the European Union until 2009, when he was nominated diplomatic counselor of the Italian Presidency.

Italy maintains a Podgorica mission composed – according to April 2016 data – of 12 members. However, two of these (the military and police attaches) reside in Belgrade. This reaffirms the historic reality of police and military cooperation involving a joint perspective, as with operations against drugs and cigarettes smuggling rings composed of Serbs, Montenegrins and Italians.

While this diplomatic deployment may seem numerically modest, one should also remember that Montenegro has a population of only 650,000. Thus, when considering also cultural groups, international organizations, businessmen and the Catholic  Church, Italy is well-represented in Montenegro. It has something similar to, but smaller than, the leading role it has (as discussed earlier in this series) in Albania. Rather, Italy has above-average diplomatic representation in Montenegro.

Considering Montenegro’s small population, the discrepancy is quite interesting, especially when it comes to today’s ‘Great Powers.’ As such, Russia has 15 diplomats in Montenegro, while the US has 13 persons and China, nine diplomats (Turkey also has nine staff in Podgorica). The sharp decrease in US presence (a year or so ago it still had 20 accredited diplomats) is unusual and might indicate that with Montenegro’s NATO accession, the main task has been accomplished.

Many important European and world countries do not have embassies in Podgorica, instead covering the country from Belgrade. And even those with an embassy or consulate in Montenegro also divide their resources between Serbia and other countries, as does Italy. Among those countries with locally-based embassies, France has four persons (with another five based in Belgrade and one in Zagreb), while Germany has six (with another four based in Belgrade and one in Sarajevo), Surprisingly active Hungary keeps eight diplomats, and one attache in Belgrade. Greece has six diplomats in Montenegro, all locally-based.

Italy’s diplomatic representation in Montenegro is thus double the European average, While not on the same level as Russia, it is competitive with China, the US, and indeed all other countries. The strong Italian deployment benefits traditional maritime ally Britain, which only keeps a couple of people in Podgorica (though it has several affiliated diplomats covering it from several other nations).

Finally, Italian diplomacy in Montenegro has a strong inter-cultural component. For example, there is the XIV Italian Language Week, held under the patronage of the Italian president. Among the events, the embassy in Podgorica organized a “traveling exhibition of Italian cinema,” with film showings in Podgorica, Bijelo Polje, Niksic and Cetinje in October and November.

Italian-Montenegrin Economic Relations

As is the case with Serbia, current trade levels between Italy and Montenegro attest to the deep collaboration between the countries: according to the latest data published by Monstat (the Montenegrin Statistic Institution), in the period January-July 2015, Italy and Montenegro trade exceeded 100 million euro, with a positive balance of trade for Italy of almost 39 million euros. Italy is the fourth-largest exporter in Montenegro after Serbia, China and Bosnia-Herzegovina, and is the second-largest recipient of Montenegrin export after Serbia. Italy imports mainly metallurgic products and machinery, while exports to Montenegro are primarily textiles, clothing, and alimentary products.

Over 30 significant Italian companies are currently active in Montenegro, mainly in the energy sector, with A2A and Terna dominating the internal market, despite some allegations and scandal which also involved the Montenegrin Parliament, and were reported in Italian media in October 2014. The bilateral business relations of Italy and Montenegro are regularly supported by business forums like this one. The longtime prime minister, Milo Djukanovic, has also stated in interviews his positive opinion of Italian trade and overall relations with his country.

Italian Moves on the Montenegrin Energy Scene, in the Context of the Larger Energy War

Italian energy giant ENI, which we discussed in regards to its Libya activities earlier in this series, is also active in Montenegro. In a historic decision of February 2016, the Montenegrin government awarded a 30-year oil and gas concession to ENI and Russian energy giant Novatek. Undoubtedly, the pairing raised some eyebrows in certain Western capitals, but in a sense it just cemented a relationship that had been anticipated in earlier planned scenarios.

The final contract between ENI and Russia’s second-largest gas company was signed on September 14, 2016. According to Reuters, “the contract for four blocks covering an area of 1,228 square kilometers has been awarded in line with the terms of a 2014 tender, which initially covered an area of 3,000 square kilometers. Each of the partners will have 50 percent interest in the exploration licenses.” The prime minister, Milo Djukanovic noted that the country will establish “a fund for oil and gas, adopting Norwegian energy model, based on which the country claims ownership over oil in its land.” Drilling is expected to begin this year.

This agreement is particularly significant if we take into account the chronic confrontation between the US and key EU states with Russia over European energy supply. This antagonism has been seen in recent years particularly in regards to two projected pipelines. The (for now, cancelled) Russian South Stream, which would have passed under the Black Sea through Bulgaria and Serbia, was the first. In February 2012, Gazprom announced that Montenegro would join the project (as one of several Balkan states expected to get a gas connector).

The Montenegrin government had planned since October 2011 to join this Russian project. It is important to mention, for the historical record concerning Italian energy strategy, that the agreed investor competition as of 2012 included ENI at 20%, along with Gazprom (50%), Wintershall (Germany, 15%) and EdF (France, 15%). The whole project was of course crushed in 2014 when the US and EU put tacit pressure on Bulgaria to back out.

When this occurred, ENI withdrew from the South Stream project. This left only the American-backed Trans-Adriatic Pipeline, from Azerbaijan to Turkey, Greece and undersea to Italy. As of August 29, 2016, the shareholders of TAP also included an Italian public energy company: along with BP (20%), SOCAR (20%), Fluxys (19%), Enagás (16%) and Axpo (5%), the gas infrastructure and regasification company Snam S.p.A. owns 20% of the venture. This fact, and ENI’s new re-emergence with the Russian Novatek in Montenegro, indicates that Italian energy companies are aggressive and well-positioned for operations in Montenegro, and indeed the Eastern Adriatic in general.

Where Montenegro comes back into the picture here is the proposed TAP connector, the Ionian Adriatic Pipeline (IAP), planned to pass northwards along the Eastern Adriatic coast from Greece. In late August 2016, an MoU was signed by Albania, Bosnia-Herzegovina, Croatia, Montenegro and Socar. The construction of this pipeline fits in with a general trend we have long noted, both in terms of EU funding structures and even religious activities, that will establish an ‘Eastern Adriatic’ zone of Western-oriented territories, Rather than the misleading and amorphous term ‘Western Balkans’ we are so used to hearing about today, the Eastern Adriatic zone of control was historically the dividing line between the Eastern and Western Roman Empires, and was heavily influenced by Italy (with the Venetian Republic and so on) and the Austro-Hungarian Empire. So while in official rhetoric and pledges involving the EU, we will continue to be told of a focus on the “Western Balkans,” in practical terms the most development will occur on the historically Western-influenced Eastern Adriatic shores.

The energy game here will thus be of constant interest, especially considering that we expect (for other reasons) US relations with the key player in all of this – Azerbaijan – to steadily worsen in the next year. This Caucasus country had always been the cornerstone of US energy policy when TAP was first suggested, as an alternative to Russia, while Turkey was also considered a dependable ally for transit. But the trajectory of US policy in the recent period is increasingly at odds with the two key countries involved in TAP.

Thus, the survival of Turkey’s Erdogan, and his apparent rapprochement with Vladimir Putin are rekindling hopes for a Turkish Stream pipeline that would transit the Black Sea and resurface in Turkish Thrace, thereafter passing westward through the Balkans. While Putin had proposed this pipeline in 2014 as a replacement for the mooted South Stream, the poor relations between Russia and Turkey over Syria froze the project- until, that is, the July 15 coup attempt led Erdogan to reconsider the value of his Western allies.

On September 15, a senior Gazprom official announced that the two countries will sign an agreement on offshore construction in early October, by the time of the World Energy Forum in Istanbul. Cumulatively, these developments (among many others) indicate an intensification of Great-Power struggles which will play out across John Kerry’s so-called ‘line of fire,’ of which the Balkans are definitely a part.

For Italy, therefore, Montenegro will remain a useful base of operations not only for investment in energy, but as a hub for gaining economic and political intelligence on a variety of energy-related potential projects. Montenegro may just be located on a peripheral pipeline extension route, but even this is a crucial element for the EU to get all its ducks in a row for the continent’s energy master plan. Thus the investment and intelligence presence of the US, Russia and China here all make it an important place to keep monitoring- especially for the country that sits right across the sea from it, Italy.

Italian Support for Innovation

Italy’s support for research and innovation in the country was reaffirmed in a recent memorandum signed between Italian company AREA Science Park and Montenegro, through the sponsorship of Italian Friuli Venezia-Giulia region. According to Friuli’s president, Debora Serracchiani, “this agreement makes research a driving force for competitiveness in the international market. The agreement supports the creation of new companies in Italy and Montenegro.

For the Italian region, the agreement will allow a better exchange of knowledge and skills, while for Montenegro the cooperation with AREA could help the country to implement the ambitious National Plan for Investments in Innovation.

Police Cooperation

It is far beyond the scope of this brief overview to delve into all the details of Italy’s investigations and indictments that stemmed from drugs and cigarette smuggling in 1990s (and later) Montenegro. Suffice it to say that the alleged involvement of high-level politicians in both Montenegro and Serbia hindered police and security cooperation between Italy and Montenegro Unreliability, mistrust, and the need to protect important figures created obstacles for joint police investigations of mafia activities. As Balkanalysis.com reported in 2011, the “Adriatic Connection” between Italian and Balkan smuggling outfits grew in those years and significantly affected bilateral relations. Since then, the situation has improved, even if the ruling forces in the country have not really changed in over 20 years.

Since 2010 Italy has sent police liaisons to Montenegro, located at the Italian Embassy, to improve police and security cooperation. Another Eastern Adriatic consolidation trend, one that also reflects realities of organized crime, is now being seen in the increased cooperation of Italian police with their counterparts in Montenegro, Kosovo and Albania. Under the IPA Project, Montenegro was granted 20 million euros from the EU to enhance security agencies and refugee management. On 5 April 2015, the Center of Tarvisio-Thorl Maglern hosted EULEX officials and colleagues from Montenegro, Albania and Kosovo, with the future plan to establish a Center for Police Cooperation between the three countries in Plav.

It was planned that this center would help the exchange of information, risk analysis and improved cross-border cooperation. Support for this initiative had previously been given at a Rome summit of 20 October 2014, in which Italian Interior Minister Angelino Alfano and Montenegrin Minister of Justice Dusko Markovic also cited other areas for improving bilateral police and security cooperation.

Underworld Killings as a New Area of Focus for Italian Intelligence in Montenegro

A high-profile recent case on which Italian police and intelligence are sure to be investigating was the assassination of Montenegrin organized crime figure Dalibor Djuric on 22 September. He was shot by a long-range sniper, through a wire fence while exercising in a prison yard in Podgorica. According to Balkan Insight, “the assassination is the third drugs-related killing in a few months, after a bomb blast killed two alleged members of drug gangs in September… Five people have been killed since early 2015 in apparent clashes between the rival Skaljari and Kavac clans, named after neighbourhoods in Kotor.” The sniper’s shot had come from a hilltop. A burned-out car with Italian license plots was later found by police nearby.

In this 2011 report, we discussed how mafia groups that emerged from the 1990s wars later developed a new and more ‘Italian-style’ model of discretion and white-collar business activities. However, it seems the recent spate of underworld killings in Montenegro has to do broadly with the fallout of several major drug busts, that are squeezing gangs’ profits and space for movement while providing motivation for fratricidal revenge. This has followed the increasing law-enforcement efforts of Italy, the USA, South American countries and others in Europe.

In a way, therefore, the success of judiciaries in trying alleged drug lords with white-collar businesses in Montenegro has also ironically created a new kind of hard-security risk in terms of armed combat on the streets of Montenegrin towns. This is hardly beneficial for the country’s image or all-important tourism economy. So we can expect Italian intelligence to also focus more on the ‘ground war’ aspect of organized crime as much as on the usual investigation of international trade routes and partners.

Italy’s Position on Montenegro’s NATO Membership

Since Montenegro’s independence in 2006, Italy has remained a great supporter of its Euro-Atlantic integration. Italy supported its NATO membership, before and after it was invited to join the alliance in December 2015. On 20 May 2016, Russia condemned this invitation, stating that it could raise new tensions between Moscow and Brussels. Russian government spokesman Dmitry Peskov stated, according to Reuters, that Moscow considers “the enlarging of the NATO as a wrong idea, since this process won’t translate into better security for Europe.”

On the other hand, the Secretary General of NATO, Jens Stoltenberg, stated that “Montenegro is already contributing to NATO, UN and EU operations, promoting regional cooperation and implementing important reforms; giving to Montenegro the possibility to become a member will ease the political process inside NATO itself. It will bring more security and stability in the region […] and will be a clear signal that NATO’s doors are always open to nations that share and promote our values.”

Russia objected to this declaration. While considering Montenegro a “traditionally friend country,” Moscow was disappointed by the government’s decision. Foreign Ministry Spokeswoman Maria Zakharova called the decision a new attempt to change the strategic-military balance in Europe, “especially in light of the alliance game started to isolate our country.” However, analysts knew that Russia was hardly surprised by Montenegro’s (inevitable) choice to join NATO, and had made contingency plans. One interesting conjecture, that cannot of course be proven, is that Russia’s annexation of Crimea was partly a precautionary measure against the potential loss of its ‘warm-water port’ on the Adriatic.

In any case, Western diplomatic sources in the Balkans have stated for Balkanalysis.com that Russia’s declared opposition to Montenegrin NATO membership could be just a pretext for defending its general international role, since Moscow, aside from energy supplies, does not have any real means of leverage to condition local politics and future decisions.

Italy and other Western countries have planned that in the long term, Montenegro’s NATO membership will help to expand the rule of law and limit the influence of both organized crime and foreign intelligence services on local actors. It is interesting to note that the intensification of rival mafia assassinations has massed around the time of Montenegrin accession to a Western bloc (NATO) closely resembling the similar experience of Bulgaria before joining another (the EU).

The Mysterious Convergence: The Church, Italian Intelligence and Montenegro

Montenegro became an independent state on June 3, 2006, following a referendum three months before. According to official 2015 data, the first ambassador to present his credentials (on March 30, 2007) was Enrico Tuccillo- representative of the Sovereign Military Order of Malta. (For unknown reasons, the 2016 list gives his accreditation date as April 29, 2008). A veteran lawyer with close relations to the Catholic Church, the Naples-based Tuccillo had successfully defended  Milo Djukanovic’s right to diplomatic immunity, in the latter’s long battle with the Italian state over the cigarettes smuggling affair of the 1990s.

In the bigger picture, this affiliation is important as it reveals another aspect of Italian interest – and sophisticated ability to work international systems – present in Montenegro. The Knights of Malta, a Rome-based chivalrous order and one of the very few given official status by the Vatican, maintains diplomatic relations with over 100 countries. The Montenegrin state possesses several priceless ancient Christian relics that once belonged to the SMOM, who have tried (and will continue to try) to ‘win back’ these state heritage items.

Since the early 1990s, the policy of driving a wedge between Serbs and Montenegrins has been a Western goal and part of this has come through the creation (first as an NGO, later as a religious body) of a ‘Montenegrin Orthodox Church,’ to rival the established Serbian one. Structures within the Church and Italian intelligence have helped guide this process of church-building, diplomatic sources have stated for Balkanalysis.com, with different sides looking for their own interests. The Knights of Malta regarded an independent church that could claim all religious heritage in the country as advantageous to their obsession with reclaiming relics. In the big picture, the Western plan to bring Montenegro into the desired Eastern Adriatic bloc was partly envisioned as a geopolitical one involving religion. While that process is not yet finished, already 30 percent of Montenegrins support the MPC. Today, a similar attempt to divide the Orthodox Church in Macedonia – again, for geopolitical goals – is being promoted by Western intelligence services in the context of the political crisis.

Montenegro, despite being small in size, has an outsized importance for rival intelligence services due to its maritime placement between Croatia, Serbia, Kosovo, Albania and Italy. This has brought many interests to the table. As the authors noted in an ebook, The Vatican’s Challenges in the Balkans, Hungarian intelligence in Montenegro has played an invaluable support role for the Vatican- something particularly ironic considering that in the 1970s Hungary had been tasked with conducting hostile intelligence activities against the Vatican, for the Soviet Union.

As was the case with Serbia, Italy’s main intelligence interests in Montenegro are firstly economic, and second police- and security-related. Keeping track of major energy deals and the preparations that go into them (as well as intelligence and counter-intelligence on potential business partners and foes) is an important task, as is monitoring the Montenegrin security services for Russian penetration. As in Albania and Croatia, Italy can use its superior HUMINT capacities here to benefit its allies, chiefly Great Britain. For the latter, this need will intensify in a post-Brexit situation.

The second trend worth watching in future regarding Italian intelligence and Montenegro is expected developments with Latin America. drug smuggling and the Montenegrin-Serbian diaspora are two issues of focus relevant in this context. But the three-way relationship is richer. Italy has a significant and historic relationship with Argentina, for example, which continues today- the pope, after all, is an Argentine of Italian descent.

Argentina was the second country (following the Knights of Malta) to have an ambassador offer his credentials to the newly-independent Montenegro, when Domingo Santiago Cullen did so on 9 November 2007. It also hosts a large Montenegrin and Serbian diaspora, and is a key site of activity for the renegade Montenegrin Orthodox Church (in fact, before becoming pope, Archbishop Bergoglio met with MOC leaders in Argentina). In addition to the high-profile issue of cocaine smuggling from Latin America through cooperation of Italian, Serbian and Montenegrin groups, these issues are all of relevance to larger Italian interests.

Fortunately, Italy will be well-represented down south. Relatively few Italian intelligence officers have intimate experience of both Montenegrin and South American issues, so it is advantageous for AISE that its operative in Montenegro through 2013, Filippo Candela, will probably be running the Buenos Aires station. If cleared, this prestigious promotion decided in March will follow two turbulent (but apparently successful) years in Macedonia. (We covered the publicly perceived Italian role in Macedonia’s political crisis in the third part of the current series). The appointment will improve Italian intelligence’s abilities to ‘put all the pieces together’ concerning all of the Argentine-Balkan areas of common overlap mentioned above.

Conclusions

Italian diplomatic, economic, intelligence and security relations with Montenegro represent perhaps the most interesting (if not the most significant) case of Italian influence in the MENA and Balkan regions.

For here there are numerous overlapping interests of Italian and foreign investors, including the ‘energy game’ and Montenegro’s connected pipeline projects, as well as the strong moves of outside powers like China in infrastructure development and the UAE in high-end tourism.

While still a haven for organized crime with deep connections to Italy, Montenegro is also now a NATO ally – with all of the interests that invities – and a strong base of activity for the Vatican and related Italy-based groups like the SMOM. But above all, Montenegro is a playground for very wealthy individuals from all over the world, representing divergent political, business and intelligence interests. Often Hollywood exaggerates a stereotype, but the decision to partially set the remake of Bond classic Casino Royale in Montenegro does reflect a certain reality about the kind of visitors it attracts.

Finally, while some Western states have simply bemoaned the influence of corruption and crime in Montenegro’s political life, the tiny and mountainous enclave has never functioned as a perfect democracy, though it has always been independent-minded. Socialist Yugoslavia brought a temporary exception to this historic identity- one seen most vividly in the exploits of King Nikola, and again in that of his modern-day successor, Milo Djukanovic.

It is thus not surprising that the historic periods of maximum Italian influence in Montenegro have been precisely at those when it has existed as a sort of glorified fiefdom. And so, while Western sticklers for democratic processes and rule of law have frequently been frustrated and ineffective here, Italy has been more persuasive- specifically because it understands Montenegro less as a state than as a ‘manageable paradise.’

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