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  BOSNIA AND
HERZEGOVINA


REPUBLICAN REFERENCE

Area (sq.km)
51,129

Population
3,922,205

Capital
Sarajevo

Currency
Convertible Mark

President
Zivko Radisic

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Background:
Bosnia and Herzegovina's declaration of sovereignty in October 1991, was followed by a referendum for independence from the former Yugoslavia in February 1992. The Bosnian Serbs - supported by neighboring Serbia - responded with armed resistance aimed at partitioning the republic along ethnic lines and joining Serb-held areas to form a "greater Serbia." In March 1994, Bosniaks and Croats reduced the number of warring factions from three to two by signing an agreement creating a joint Bosniak/Croat Federation of Bosnia and Herzegovina. On 21 November 1995, in Dayton, Ohio, the warring parties signed a peace agreement that brought to a halt the three years of interethnic civil strife (the final agreement was signed in Paris on 14 December 1995). The Dayton Agreement retained Bosnia and Herzegovina's international boundaries and created a joint multi-ethnic and democratic government. This national government is charged with conducting foreign, economic, and fiscal policy. Also recognized was a second tier of government comprised of two entities roughly equal in size: the Bosniak/Croat Federation of Bosnia and Herzegovina and the Bosnian Serb-led Republika Srpska (RS). The Federation and RS governments are charged with overseeing internal functions. In 1995-96, a NATO-led international peacekeeping force (IFOR) of 60,000 troops served in Bosnia to implement and monitor the military aspects of the agreement. IFOR was succeeded by a smaller, NATO-led Stabilization Force (SFOR) whose mission is to deter renewed hostilities. SFOR remains in place at a level of approximately 21,000 troops. 

Update No: 066 - (22/10/02)

Nationalists sweep the board
Elections in Bosnia have seen a triumph for the nationalists in every constituent part of the country. The moderates, who were in charge, have taken a beating. Bosnian Muslim Croat and Serb nationalist parties all claimed triumph in early October.
The Party of Democratic Action (SDA) of the Bosnian Moslems has prevailed, the SDA president and future member of the country's tripartite presidency, Sulejman Tihic told the press in Sarajevo. Two years ago it had been ousted from power by the victory of the Social Democratic Party (SDP).
The Croat Democratic Union (HDZ) and the Serb Democratic Party (SDS) also did well. This had been predicted in earlier polls of public opinion. The SDS immediately claimed victory.

Role of the international high representative
Whenever the nationalists do well, the role of the International High Representative becomes more important. It is the most important job in the country, with powers to override decisions at the governmental level, and even to sack ministers. It has been held up to now by a succession of diplomats from the smaller countries of Europe, Sweden and Austria, namely Carl Bildt and Wolfgang Petrischt.
The present incumbent, Paddy Ashdown, marks a break, being a politician who led the Liberal Democratic Party in the UK. Although denied power, he saw his party more than double its number of seats in parliament. His post in Bosnia is a more taxing affair, never more so than now, with the nationalists in the ascendant. 
He claims that the results of the elections do "not mean that nationalism in Bosnia-Herzegovina is going deeper," which would appear to be belied by events. Nevertheless, the SDA chief Tihic said that he and his party would be prepared to fully respect the reform agenda and work with the international community, meaning not just Ashdown, but the extensive colony of economists, administrators and aid workers on the ground, as well as the 30,000 international troops. 
The SDA will displace the SDP, which led nine smaller parties in the Alliance for Change government coalition since elections in 2000. This government in the Bosnian Moslem entity was the only break in the power of Bosnian nationalists for a decade. 

Uneasy anniversary
The 2002 elections come on the tenth anniversary of the onset of civil war in 1992. The war that raged for three years in 1992-95 has left problems behind that have not yet been resolved. By no means all the refugees have returned home and a mosaic of different ethnicities still renders the situation fraught with risks, especially in the Moslem-Croat Federation, but also in the Serb-dominated Srpska Republic.
The Dayton Agreement of 1995 gave the international community the decisive role of maintaining the peace and administering aid and credit to facilitate reform. But the reform programme itself is inevitably the job of parliaments, and governments in the two main entities. They need to work together to concert a continuation of peace, retrenchment and reform.
Ashdown has announced a five point anti-corruption programme to make the confederation the region's most attractive venue for foreign investment. But he has yet to tackle the refugee problem fully, an admittedly tough assignment, given the intractable ethnic divisions of the country. 

The model for Iraq?
An intriguing parallel can be drawn between Bosnia and Iraq to which indeed, it has been accused of selling arms. Both are countries that have been cobbled together out of refractory elements. 
In the one case, it is a question of historic enemies, the Serbs and Croats, plus their one common foe, the Bosnian Moslems. In the other it is a matter of religious enemies, the Sunnis and the Shi-ites, and their common foe, the Kurds. Bosnia has held together under international supervision, Iraq under a ruthless dictator.
If the dictator is removed, could a similar international colony to that of Bosnia be created in Iraq? It would be worthwhile to put the question to a man with experience in running the show in Bosnia, namely Ashdown. NewNations.com will be having an interview with Ashdown shortly in which the question will be put.

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FOREIGN ECONOMIC RELATIONS

Bosnian-British accord on security of investments to be signed 2nd October


Bosnia-Herzegovina Foreign Minister, Zlatko Lagumdzija, visited the UK recently at the invitation of British Prime Minister Tony Blair. A bilateral agreement on protection of investments was due to be signed on 2nd October in Blackburn, Bosnia-Herzegovina Federation TV has reported.
Business circles in London believe that this will open doors and encourage British investments in Bosnia- Herzegovina. The agreement will provide guarantees for those who are set on investing in the country.
The only concern of investors is to yield profits and to be reassured from the very beginning that they will not lose even one pound of their investments, something which will be guaranteed by the British government. This agreement presents the British government's support for economic development in Bosnia-Herzegovina.
Translations of the agreement in English and the Bosnian language were coordinated on 30th September at the Foreign Office. The agreement was concluded by Bosnia Herzegovina Foreign Minister and British Foreign Secretary, Jack Straw.
The agreement will provide security of investments for both sides. The same guarantees and security measures will extend to businessmen from Bosnia-Herzegovina whose intention is to develop business projects in the UK. According to sources close to the Bosnia-Herzegovina embassy in London, British businessmen are interested in investing in food production, metals, textile and footwear industries. British businessmen are also interested in importing Coca-Cola which has been produced in Bosnia-Herzegovina.
Securing investments from London is by far the best way to attract investments from other parts of the world.

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FOREIGN LOANS & AID

Montenegrin president hails US donation of US$40m 

Montenegrin President, Milo Djukanovic, has said that aid given to Montenegro by the USA, totalling US$40m, will significantly stimulate both democratic and economic reforms in Montenegro in the forthcoming year, Radio Montenegro has reported.
Djukanovic said: "I truly believe that Montenegro is making steady progress in the implementation of reforms, and that the day is not far off when we shall be able to maintain our budget without donations from abroad and to realize all our development projects ourselves, and with international capital in the form of loans. 
"In any case, we shall still need donations of this kind for this year, maybe the next year and the one after that, but in terms of politics, it is very important to us that this help is coming from as powerful a partner as America. I am very grateful and this confirms the stability of the friendship existing between the American and the Montenegrin people and the persistently supportive US policy for Montenegrin democratic and economic reforms."

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INTERREGIONAL RELATIONS

Bosnian Serb, Serbian officials discuss business cooperation

In the first eight months of the year, exports from Yugoslavia to Bosnia-Herzegovina totalled US$196m, while imports from Bosnia-Herzegovina to Yugoslavia amounted to US$96m, Serbian Minister of Trade, Tourism and Services, Slobodan Milosavljevic, told reporters on 25th September in Banja Luka, Onasa News Agency web site has reported. 
He emphasized that the Federation share in the turnover is only two per cent, while the rest is related to the Republika Srpska [Serb Republic]. 
Milosavljevic said such a ratio is a consequence of a recently signed agreement on foreign trade exchange between Bosnia-Herzegovina and Yugoslavia, adding that it is expected that this amount will increase in the coming period when the Federation is concerned. 
"The agreement, signed in Sarajevo, three months ago. By this, we have clearly showed that we want to reduce the deficit, which currently totals some US$100m," Milosavljevic said. 
He told reporters after a meeting of the RS and Serbian businessmen that the strategic fields for the cooperation between the two countries are banking, wood industry, oil industry, car industry. He said Serbia has already established cooperation in these fields with the RS, but that it aims to expand the cooperation to the Federation as well. 
According to Milosavljevic, Serbian banks, which are present in the RS, are interested in opening offices in the Federation as well. 
The businessmen discussed the cooperation between the RS and Serbia together with senior officials of Serbia and the RS, as well as the presidents of the chambers of commerce, and the representatives of 81 companies from the RS and 70 companies from Serbia.

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