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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: 068 - (01/01/03)

The Bosnian republic is being governed by a number of Anglo-Saxon political and military leaders at present, at least in its highest echelons. The International High Representative in Bosnia is Paddy Ashdown, a former marine commando and erstwhile leader of the UK Liberal Democrats, now virtual viceroy of the Balkan state, which is for a while a colony of the international community, meaning in the first place NATO.
The commander of the NATO-led Stabilisation Force (SFOR) is the US supremo, Lt-General William Ward. A key figure in international deliberations about Bosnia is naturally NATO General-Secretary Lord (George) Robertson, formerly a UK Labour party stalwart and British minister of defence.

Streamlining of local military urged
The three figures are acting in concert to bring about a state-level ministry of defence in Bosnia and joint command over three military factions, one Serb, the other two Croat and Muslim in the other of the two constituent republics of the state, that co-exist in the country following the civil war of 1992-95. In early November Ashdown and Ward presented a letter from Robertson to the tripartite state presidency calling upon top officials to move towards the unified command system and common defence structure. The objective is clearly to make a recurrence of civil war an administrative, not just a geopolitical, impossibility.
The only state-level body that currently exists is the so-called Standing Committee for Military Matters (SCMM). A central defence body was never constituted, since the respective authorities in the two Bosnian entities were unable to reach agreement on the vexed issue. Ward has outlined his conception of the natural development of defence policy for Bosnia. Its priority must be to "enhance the role of the SCMM secretary-general and promote him into the country's defence minister."
Meanwhile, Britain has announced that it will help establish an international military training centre in Bosnia, which is slated to open in January 2004. Secretary-General of the SCMM, Stjepan Pocrnja, made the announcement following a meeting with a NATO delegation in Sarajevo where the centre will be based.
The centre is intended to help maintain peace and stability in the Balkans as well as to train troops in the region to serve international military peace missions. Bosnia has yet to fulfil the necessary conditions to join the NATO Partnership for Peace programme. However, Pocrnja stated, the country is now making major steps in the right direction.

Scandals over UN peacekeepers and officialdom erupt
While the Anglo-Saxons are laying down the law in defence and other matters to the Bosnians, their own rectitude is not above reproach in so far as the comportment of SFOR troops and of UN officials in the country is concerned.
This has come to light as a result of a US defence company, DynCorp, being forced to pay compensation to one of its employees, Kathryn Bolkavac, seconded to the UN as an investigative police officer, for unfair dismissal after her investigations revealed the involvement of colleagues and others in the international community in the Bosnian sex trade. She has disclosed that under-age sex with girls as young as 12 has been taking place. Ms Bolkovac said that she had been removed because her investigative work was threatening the company's "lucrative contract" to supply officers, such as herself, to the UN for secondment.
Another former employee, Ben Johnston, has also exposed the affair and has an undisclosed settlement from DynCorp in a lawsuit in Texas. Scandals such as these undermine the moral repute of the international efforts in Bosnia, especially in this case as the UK's Ministry of Defence (MoD) has been unwise enough to award preferred bidder status to a consortium, including DynCorp, to provide support services for rifle ranges in Bosnia. The MoD has been roundly condemned by MPs and union leaders for doing so and would be well advised to reconsider its contracts policy in the light of the matter. 

Brighter side of the international effort
Ashdown is shaping up to become an excellent international high representative. He is learning Serbo-Croat, has settled down in the country with his wife, having bought a house in a rural area, and is amazing the locals at his energy in travelling the length and breadth of his domain.
His experience as a commando in the early 1960s means that he is no novice when it comes to combat, while his tenure of the Lib-Dem party leadership has taught him the skills of in-fighting and the need to knock heads together to get results. His powers enable him to dismiss recalcitrant ministers and judges, which he has already done on occasion. He is well aware of the anomaly of a life-long democrat exercising vice-regal powers and sees his job as preparing the way for Bosnia to assume full independence. Hence the urgency in forging a unified defence ministry for the federation.
The UN mission is winding down, due to leave at the end of the year. UN agencies will remain, but responsibilities for policing will be taken over by the EU, which already has 9,000 troops on the ground. 

The Bosnian model
The international intervention in Bosnia has an exemplary value. The model that has been created is being now pursued elsewhere, in Kosovo, East Timor and Afghanistan. Tomorrow it could be applied in Iraq. So argues Ashdown.
The formula is the old one of the carrot and the stick, but in a new international context. The international community becomes the key player, extending incentives and displaying disincentives to the obdurate ethnicities resisting the formation of a new nation. The incentives in Bosnia took the form of US$5bn or so in aid and credit over the last seven years; the disincentives the troops on the ground.
A similar combination would doubtless be pondered for Iraq, if the US pursues its policy of ousting Saddam. A tripartite polity is in question in each case, Bosnia being divided between the Serb Republic and the Croat-Muslim Republic, which has its own religious divide, while that between itself and the Serb Republic is both religious and ethnic. An Iraqi equivalent would appear to call for a Kurdish Republic (already in existence, thanks to US and UK intervention) and a Sunni-Shi-ite Republic allowing for considerable autonomy for its two components and of itself as the dominant entity vis-à-vis the Kurds (under strong Turkish objection). 

Ashdown's first reflections
He has made an original contribution to the debate on international peace-keeping in an article in the International Herald Tribune on November 5th. While endorsing Bosnia as the model, he recognises the international community has made mistakes in its 'colony.'
It was assumed that democracy was the top priority, leading to numerous structures of power and innumerable elections. There are countless layers of government, with 13 premiers and ministers galore, 57 political parties and perhaps 4,500 politicians. As he says, "the result seven years later is that the people of Bosnia have grown weary of voting. In addition the focus on elections slowed our efforts to tackle organised crime and corruption which have jeopardised the quality of life and scared off foreign investment."
His fundamental conclusion is this: "In hindsight we should have put the establishment of the rule of law first, for everything else depends on it: a functioning economy, a free and fair political system, the development of civil society, public confidence in the police and the courts. We would do well to reflect on this as we formulate our plans for Afghanistan and, perhaps, Iraq."

Advantages of UN role
Ashdown could still point to the fact the UN has helped to restore order, establishing a professional police service in each constituent part. In 1995 when the Dayton peace accords were signed there were 430,000 people under arms: today there are 22,000. The foundations for a prosperous democracy are in place. More than one quarter of a million have returned to their homes, but by no means all the refugees. The transfer from the UN to the EU, is a turning-point, but not a disengagement by the international community.
Recent elections on October 5th saw nationalist parties return after being ousted several years ago. But Ashdown does not see this as a sign of failure by the international community's strategy in Bosnia. 
"The vote was a vote against the non-performance of the non-nationalist governing parties, not a vote for nationalism. Two of the three nationalist parties saw their share of the vote decline, and the party that made the greatest gains was a non-nationalist opposition party." But the nationalist party that forged ahead was in the Muslim area.
Ashdown has the powers to sack ministers and judges and has already exercised them, one deputy finance minister and a string of judges, a fact that is bound to restrain extremist tendencies. The record is largely one of success - so far.

Arms sales to Iraq
A NATO-led raid on Orao, a Bosnian Serb aviation firm, has revealed that it was refurbishing Iraqi military aircraft. US Lt-General Ward, as we have seen the commander of the NATO-led peacekeeping force in Bosnia, demanded action by the Serb Republic's government. In fact its defence minister and chief-of-staff resigned at the scandal.
The astonishing thing is that the aviation firm thought that it could engage in the violation of the UN weapons embargo right under the noses of NATO. For Belarus or Ukraine to sell arms to Iraq is one thing, for Bosnia to do so quite another.

Islamic militants meet in Travnik
An alarming development that shows how there are others prepared to try and hoodwink NATO is that a secret meeting of Islamic militants from more than 50 countries, amounting to more than 150 strong, dared to hold a congress on October 8th in Travnik in the Moslem part of Bosnia-Herzegovina, with the aim of forging a united front against the "American-Zionist aggression." Russian and Yugoslav intelligence sources are claiming that the Islamicists are declaring a jihad against the "European race" - meaning both Americans and Europeans - because it has become "the willing slaves of Jews and Israel." 
Terrorists acts can now be expected in Europe, with the UK, France, Germany and Belgium as likely targets. Bosnia makes a better base of operations for terrorists than might be thought, especially in the Moslem part of course. The NATO forces have limited powers to interfere in civic affairs on the ground and the terrorists are unlikely to make themselves conspicuous. But it is rather cheeky of them all the same.

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ENERGY

Bosnia secures Russian gas supplies for the winter


Sarajevo's Energoinvest reached a deal in Moscow on 20th November with Russia's Gazeksport gas firm on extending gas supplies to BiH [Bosnia-Herzegovina] by 1st February next year, the company said, Onasa News Agency web site has reported.
The Russian partner insists that a method of regulation of a US$104.8m war debt be proposed and agreed by the deadline. Having in mind that Energoinvest, as the gas importer for BiH, has regularly settled its obligations since 1996, the Russian company said it was one of the decisive points that influenced Gazeksport's decision. 
The Russians were pleased that the Sarajevo firm has also succeeded in involving the state in BiH in resolving the problem, Energoinvest said. The company underlined that the activities taken by the BiH Presidency and the Council of Ministers give real chances for concluding a new contract on the supply of gas to of BiH in the next period.

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FOREIGN INVESTMENT

Foreign investment in Bosnia on the rise 

Foreign investment in Bosnia-Herzegovina has been on the rise in the first six months of 2002 and has almost reached the level of the overall investment last year, the director of the agency for the foreign investment promotion, Mirza Hajric, said at a news conference in Sarajevo, Federation News Agency has reported.
According to the information of the Ministry for Foreign Trade and Economic Relations of Bosnia-Herzegovina, the foreign investment in the first six months of 2002 amounted to 270,502,000 convertible marks [KM - Bosnian currency], a bit less than for the whole of the last year, when it amounted to KM274,198,000. Hajric said it was expected the positive trend would continue in the second half of the year as well.
The investment possibilities and the potential of the Bosnia-Herzegovina economy were discussed at a business conference in London on 3rd December.
The conference on the promotion of the investment and trade possibilities of Great Britain and Bosnia-Herzegovina was organized by the agency for the foreign investment promotion and the British embassy in Bosnia-Herzegovina...

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MINERALS & METALS

Bosnian steelworks to employ 3,000 workers on new production line

About 3,000 workers of Zenica's BH Steel Company will be engaged after the firm installs a modern production line for steel production, director Seid Kapetanovic said on 22nd November, Onasa News Agency web site has reported. 
Italian insurance group, SACE, has approved a guarantee for a 32.5m-euro credit to Zenica's BH Steel Company for purchasing equipment from Italian Danieli in order to increase steel production for the domestic and foreign market. 
"This ensures the start of building a power unit with annual production of about 800,000 tonnes of steel. The project will also involve partners from Germany, Austria, Italy and the Netherlands. Domestic firms will be engaged in construction and assembling works," Kapetanovic told Onasa. 
The company plans to export half of its production to foreign markets. 
Kapetanovic said that a very complex preparation process ended after the company gained the credit guarantees. "We expect this will enable continued production of BiH steel. The company has successfully executed an international tender for equipment purchase and ensured financial funds," he added.

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