THE REPUBLIC OF MACEdonia, southeastern Europe's newest state, faces both potential internal and external threats as it seeks to become a democratic state with a viable market economy. Domestically, there are popular doubts about the government's legitimacy and its ability to manage the country. There is also growing concern over economic security. Tension between ethnic Macedonians and ethnic Albanians is in the air, a result of the Albanians' wish to be considered a founding or constituent nation and the ethnic Macedonians' rejection of that idea. At the same time, Macedonia remains the victim of Greece's economically damaging, unilateral trade embargo, while Skopje continues to enforce, albeit haphazardly, the UN blockade against Serbia - a costly action for the young country.