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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: 072 - (17/04/03)

Islamic fundamentalism on the rise
The Bosnian Federation is in a difficult situation as the Iraq conflict unfolds and has yet to have a clear denouement in the shape of a new elected government. The two million Moslems in the Croat-Moslem republic, one half of the four million federation, are disaffected at seeing a Moslem country under occupation by non-Moslem powers, as they see the matter. The issue is feeding Islamic fundamentalism right on the doorstep of Europe.
A meeting of fundamentalists took place in October in the Southern town of Tolstar right under the noses of international peacekeeping forces, who could do nothing to prevent it, since it fell within the jurisdiction of the government in Sarajevo. The roots of fundamentalism have been long established in Bosnia, as the Ottoman Empire receded from view in the nineteenth century. 
The real encouragement to fundamentalism recently came in the 1980s when recruits were found for the Afghan war, who imbibed al-Qaeda style propaganda, which after the first Gulf war in 1991 turned decidedly anti-American. The stationing of US troops in Saudi Arabia was especially resented. 
The Afghan veterans returned to Bosnia in a highly radicalised frame of mind, conducive to upheaval and to civil war, which duly broke out. The Serb Bosnian side were themselves stoking up violence and ethnic cleansing. Arab volunteers came to help the Moslems, mujahedeen to a man, and the tide of war, initially very much against them, began to turn in their favour. It was then that the US intervened and secured a truce, underscored by the Dayton Agreement in 1995. US claims to have intervened on the Moslem side are heavily discounted by Moslems, who saw themselves as being on the brink of victory.
The majority of Muslims are peace-loving and influenced by the West. But a vociferous minority, particularly among the student population, are attracted by fundamentalism, which ministers to their pride in their religion and their antipathy to Western dominance over their world. The disturbing thing is that it is the young and well educated who are most tempted by the extremist doctrines. Osama bin Laden and the Jordanian-born Kattab are their heroes, the one a fugitive, the other dead at the hands of the Russians in Chechnya, good martyr material in each case.
The Saudis have spent money on building mosques and spreading the Koran. These are what amount to training camps and madrassas financed by their funds in Bosnia. The authorities in the Croat-Muslim Republic are alarmed and, under US instigation, are doing their best to quell the threat. But this can prove counter-productive, driving the fundamentalist' subversive activities underground. The jihad continues, buoyed up by events unfolding in Iraq.
A more moderate, less nationalist government came to power last year and has instituted a Bosnia-Herzegovina Anti-Terrorism Team, headed by deputy foreign minister, Ivica Misic. The government launched an investigation into Gulf charities and raided The Saudi High Commission for Relief in Bosnia, finding signs of terrorist materials, photographs of US military installations and the like, along with manuals for weapon-use.

Fragile peace persists
The whole federation is at peace, however fragile this may appear. The benefits of peace are being felt, the return of refugees to their homes, an economy no longer in such dire straits and a continuous supply of international aid under supervision by the large international community living there under the International High Representative's office. A successful outcome in Iraq would be very helpful to perpetuating peace in Bosnia.
The Dayton Agreement had called for expulsion of the foreigners, particularly the Arab fighters. But nearly all of them had gone native, marrying local women and producing children. Some 94 were expelled after being stripped of their Bosnian citizenship, but they left 300 children behind. It is not difficult to envisage what ideological orientation many of them will have when they grow up.
The local Bosnian Muslim leaders are regarded as virtual infidels by the zealots; and trouble is clearly brewing. The situation is definitely not stable. But the silent majority, for many of whom after a generation of communism, religion is not a matter for passion, back their own moderate clerics against the fanatics - a repeat of the 1990s civil war is not inevitable.

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ENERGY

Bosnia signs agreement to supply Croatia with electricity for next six years


Following a 10-year break, cooperation between Bosnia-Herzegovina's Elektroprivreda [state-owned electricity company and supplier] and Croatia's Elektroprivreda has resumed. An agreement on supplying electricity to the Republic of Croatia, worth 290m convertible marks [KM], was signed in Sarajevo on 1st April, BHTV1 has reported.
In line with this agreement, Croatia will in the next six years be supplied with 5, 220 gigawatt-hours of electricity, which means that the marketing of around 5m tonnes of coal would also be secured. This quantity of electricity represents one quarter of the overall electricity production by Bosnia-Herzegovina's Elektroprivreda, i.e. one half of its overall exports.
This also means a certain stability in the Bosnia-Hercegovina Federation power sector, which is currently undergoing a process of restructuring. That means that both mines and power plants should be reshuffled. Secured sales and marketing help to create a more favourable environment with regard to both the Federation government and Federation parliament which will make the final decisions on the restructuring.
The agreement also resolves all mutual rights and obligations ensuing from the agreements signed in the period between 1972 and 1988 which refer to Tuzla and Kakanj power plants.
The signing of these documents creates conditions for the better application of all systems individually as well as for a better, joint, employment of the two electricity networks. This agreement is significant with regard to the two countries joint appearance on the market and contribution to the future, improved, market in this part of Europe...

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FINANCIAL NEWS

Bosnia, Daimler-Chrysler sign memorandum of understanding worth US$100m 

Representatives of Daimler Chrysler Services company, Peter Hayer and Walter Schmidt, and BiH [Bosnia-Herzegovina] Presidency Chairman, Mirko Sarovic, signed a memorandum on understanding on the economic cooperation on 25th March in Mosta, Onasa News Agency web site reported. 
The memorandum was signed during the Mostar 2003 International Fair, which was opened in Soko Mostar premises. 
The US$100m memorandum represents a strategic partnership in the key industries, especially energy and aluminium. Sarovic said it is a great honour for him to sign such a memorandum, that had been in preparation for two months. 
"This is a good chance for BiH and its companies. Pursuant to the memorandum, the Aluminij combine in Mostar will be modernized, several projects will be realized in reconstructing the BiH energy sector, constructing new energy capacities, and insuring long-term gas supply," Sarovic said, adding that the projects will be realized in both BiH entities. 
Schmidt said his company has been active in BiH for six years. "Through our cooperation with the Aluminij management, we have managed to raise that company to Western standards. Now we would like to spread out business cooperation to both entities," Schmidt said, adding that the projects will not be implemented simultaneously, as agreements on priorities must be reached with the BiH Presidency and entity governments. 
Schmidt said his company will not finance the projects, as some media claimed, but will rather organize their financing. "We will need the support from BiH public, the Presidency, entity governments and all other relevant factors," Schmidt said.

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FOREIGN ECONOMIC RELATIONS

Bosnia, Romania sign free trade accord

Minister of Foreign Trade and Economic Relations within the Bosnia-Herzegovina Council of Ministers, Mila Gadzic, and Romanian State Secretary for Foreign Trade, Eugen Dijmarescu signed a free trade agreement in Sarajevo on 8th April, SRNA News Agency reported, which presented an important condition for strengthening economic ties between the two countries.
Gadzic explained that once the accord came into effect, industrial products from Bosnia-Herzegovina would be exported into Romania without an import tax, and import taxes and other duties on goods exported from Romania into Bosnia-Herzegovina would gradually be reduced and abolished by 1st January 2005.
She went on to say that once the accord became valid, after Bosnia-Herzegovina and Romania had ratified it, the less perishable agricultural produce from an agreed list of goods, would be abolished on both sides.
Gadzic said that the agreement was the condition for strengthening trade between Bosnia-Herzegovina and Romania, a country which has 22m inhabitants and whose "buying power is not much higher than that of Bosnia-Herzegovina."

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FOREIGN LOANS

Bosnian Serbs stand to receive US$6.7m from World Bank for social reforms

The Bosnian Serb Republic Prime Minister Dragan Mikerevic, who visited the USA at the invitation of the International Monetary Fond [IMF] has said that he held successful talks on 11th April with representatives of IMF, the World Bank and International Bank for Reconstruction and Development [IBRD].
In an interview to the SRNA News Agency, Prime Minister Mikerevic confirmed that the Serb Republic was going to receive in two-months' time US$6.7m from the World Bank for reforms in the social sector and that the realization of the programme would start in September.

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