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BOSNIA AND
HERZEGOVINA

 
  
   

 
Key Economic Data 
 
  2002 2001 2000 Ranking(2002)
GDP
Millions of US $ 5,249 4,800 4,400 109
         
GNI per capita
 US $ 1,270 1,240 1,230 126
Ranking is given out of 208 nations - (data from the World Bank)

REPUBLICAN REFERENCE

Area (sq.km)
51,129

Population
3,922,205

Capital
Sarajevo

Currency
Convertible Mark 

President 
Zivko Radisic

  

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: 076 - (28/08/03)

A troubled land
Some eight years after deploying 32,000 troops in Bosnia to keep Serbians, Croatians and Bosnian Muslims from fighting each other, there are still 12,000 international troops on the ground in Bosnia-Herzegovina. Even now few doubt that without them the fragile peace could well crumble into discord and dissension again.
Bosnia is still a very divided country, ethnic animosities that brought 240,000 deaths and created millions of refugees are just below the surface. The international aid workers and officials on the ground are convinced that the troops are still needed to keep a lid on things and to buy more time to create a valid civil society. That is becoming more difficult to persuade the Americans of, keen to devote more attention and troops to the anti-terrorist campaign.
After 9:11 Donald Rumsfeld, US defence secretary, called for a reduction in troop strength of one third, which duly happened. The Bosnia Mission, he told a NATO meeting, was straining the US and others "when they face growing demands from critical missions in the war on terrorism."

The Europeans to understand the Americans
A new division of labour can be expected in which the Americans are the peace- makers and the Europeans are the peace-keepers and nation-builders, as in Afghanistan. This is involving fewer troops in all, who will act as a centralised force ready to be transported at a moment's notice, if trouble brews up. It will in all likelihood involve less aid too. There will be many in the aid movement who think this will be no bad thing. The US$5bn extended to Bosnia since 1995 has often found its way into the wrong hands.
There is no longer any need to bribe the Bosnians to stay together is one view, articulated by the former International High Representative in Sarajevo, the top international official in the Balkans, Wolfgang Petritsch, "In Bosnia four years of fighting led to a kind of exhaustion and realisation on all sides that war is not going to help them." His successor, Paddy Ashdown, would be in agreement, but still regards the tasks ahead as truly formidable. "Troops are still required," he says, "until peace is irreversible."
Ashdown and his colleagues are trying to create an independent judiciary and a legal framework for economic development, including clear rules on the recovery of property by refugees.
What the Bosnians need to do to keep the West interested is to set up legislation to attract foreign investment; not least because this is where the Americans could come back in force again. A new law on foreign investments was passed in the federation's lower house last year, and has been adopted in the upper house. But it will take time to assess its full significance.

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BANKING

Deadline for Bosnian banks to register with agency extended to end of year

From 8th August, the Bosnia-Herzegovina Deposit Insurance Agency and the Serb Republic [RS] Banking Agency are working in the new offices in Banja Luka in which the United States Agency for International Development [USAID] invested over 1.7m KM [convertible marks], RTRS Radio web site has reported. At a ceremony marking the opening of the new offices, it was stated that, by unifying the work of entity agencies for deposit insurance into one state agency, Bosnia-Herzegovina had made a great step forward in creating a single economic territory. The deadline for deposit insurance for banks was extended until the end of the year and banks must first submit to the agencies their activity action plans in order to avoid the liquidation process. 
Velimir Bozic for the RTRS Radio web site reported that the Bosnia-Herzegovina Deposit Insurance Agency got new offices and equipment, while the RS Banking Agency got new furniture and equipment. Howard Sumka, director of the USAID mission in Bosnia-Herzegovina, commended the work of those agencies, particularly with regard to the control of financial operations in banks and prevention of money laundering. Some banks were banned from operation during the process of control, Sumka said. 
He added: "Bosnia-Herzegovina took a major step towards the creation of a single economic territory when entity agencies for deposit insurance united into one state agency. USAID will continue to work on the development of the banking sector." 
Sumka emphasized that one should also be considering the establishment of a single agency for supervision of banks. Josip Nevjestic, director of the Bosnia-Herzegovina Deposit Insurance Agency, said that the deadline for banks to register with the agency had been extended from 12th August until the end of the year, but warned that the banks first needed to draw up and submit action plans. According to him, 13 banks have registered with the agency so far, 11 from the Bosnia-Herzegovina Federation and two from the Serb Republic. 
Nevjestic said: "If those plans are not realized, banks will run a risk of losing their licence. Consequently, we believe this to be a good step forward, that is, a major step forward in the banking sector

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SHIPPING

River Sava's low water levels paralyse shipping

The River Sava's level is at its lowest for the past 100 years, measuring minus 206 cm [206 cm below the normal water level] at the measuring station in Slavonski Samac, Federation News Agency has reported.
"The River Sava's level has been below minus 100 cm over the past 70 days, and it is regarded as critical when it reaches minus 90 to 100 cm. It is still possible for ships to sail down the Sava if they take great caution. However, the low level of over minus 200 cm has paralysed traffic along the river and the work of the port in Brcko," the port's commercial director, Mehmedalija Zilic, has told Fena.
"Due to the exceptionally low level, ships cannot dock or reload in the port in Brcko," Zilic added.
He said that a ship with 800 tonnes of soya for the Brcko-based Bimil company is stranded 12 km downstream from Brcko.
"All goods for the port of Brcko had to be redirected to one of the ports along the Danube, whose level is still good. Two ferry boats which reached Sremska Mitrovica [in Croatia] had to turn back and be reloaded in Novi Sad [Serbia]," Zilic said.
He stressed that this situation was causing enormous losses not just for the port, but all its customers. He added that the final damage inflicted by the low level of the River Sava would be assessed once the situation was back to normal.

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