To some eyes, it looked like a foolhardy policy from the beginning: offering the oxygen Mr Milosevic badly needed - foreign investment - to shore up his authority and bolster the gangster economy he had built up over four years of war and international sanctions.
Now, after eight weeks of pro-democracy street protests against the Serbian president, that policy is effectively in tatters. By annulling municipal elections, which were won convincingly by the opposition, and then sending riot police into the streets to try to contain the spontaneous protests that followed, Mr Milosevic has put himself beyond the pale of even the most cynical of foreign-policy formulators in Whitehall, the Quai d'Orsay and the Farnesina in Rome.
Commercial contacts, which had led to a number of fat contracts, including a telecommunications deal with the French company Alcatel, have dried up, and embassies in Belgrade have brought their scouting trips around the decrepit factories and mines of Serbia to an abrupt end. The European Union and the United States have been unstinting in their statements urging Mr Milosevic to reinstate the election results and respect the basic rules of a civil and democratic society.
But the rapid policy transitions have not gone unnoticed among the intellectuals and fledgling opposition politicians of the pro-democracy movement, and even now much bitterness remains. The country invariably singled out for criticism is Britain, which has the unenviable reputation on the streets of Belgrade of being Mr Milosevic's biggest chum in the international community.
The British Ambassador to Belgrade, Ivor Roberts, has been nicknamed "Roberts the Red" and is variously accused of schmoozing with Mr Milosevic and conspiring to contribute to the government campaign in the run-up to last November's elections.
The British government, meanwhile, has been accused of dragging its feet about joining the present chorus of international disapproval - only doing so, as the street wisdom has it - when it found itself with no other choice.
As ever in the Balkans, public perceptions are a mixture of rather conspiratorial fantasy and hard fact.
The fantasy largely concerns Mr Roberts, who seems to have been penalised for his ability to gain frequent but above-board access to Mr Milosevic and other senior government officials - something that the rest of the Belgrade diplomatic corps envies, not resents, him for. The average Belgrade taxi driver will accuse him of appearing "night after night" on state television during the election campaign, but in fact he was the subject of a single short report on a visit to a plastics factory.
In reality, Mr Roberts was the first EU diplomat to draw up a draft reaction to the cancellation of the elections. When the independent Belgrade radio station B-92 was shut down in December, he was there within an hour to sympathise with the staff and was instrumental in getting the station reopened two days later.
The hard facts concern British policy and the behaviour of senior British officials, not just in this crisis but stretching back to the beginning of the Balkan wars. Resentment against Britain has been welling ever since Douglas Hurd, as Foreign Secretary, seemed to make it his policy to uphold a "stable" (ie Milosevic-run) Serbia and Lord Owen, as European mediator, refused to consult any opinion in Belgrade other than that of the President.