Iraq's Bunker Busters

By Andrew Purvis and Dejan Anastasijevic

Old Europe may get the cold shoulder when coveted reconstruction contracts are doled out in post-Saddam Iraq. But Serbian officials say their country--not long ago the target of U.S. bombs--is in line for a chunk of a $680 million pie. Reason: in the run-up to Gulf War II, Serbian and U.S. officials tell TIME, Serbia gave the U.S. vital information about Iraqi targets.

Serbia was perfectly poised to lend a hand. Throughout the 1990s Yugoslav contractors defied U.N. sanctions and did business in Iraq: an outfit named Yugoimport built the Baath Party headquarters and at least five underground bunkers for Saddam Hussein. It also sold arms. That trade was finally shut down last year, after the U.S. blew the whistle and the recently assassinated Serbian Prime Minister Zoran Djindjic came clean.

Belgrade then persuaded Yugoimport to hand over blueprints of the bunkers. A senior Foreign Ministry official tells TIME that Yugoimport's leaders agreed to help "only when they understood that there would be something in it for them." U.S. officials emphatically deny that such contracts have been promised. But Yugoimport is confident: it was back in Baghdad last week reopening the same offices that just last year were peddling arms to Saddam. --By Andrew Purvis and Dejan Anastasijevic