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  2003 2002 2001 Ranking(2003)
Millions of US $ 6,963 5,249 4,800 104
GNI per capita
 US $ 1,540 1,270 1,240 123
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Borislav Paravac

Update No: 108 - (30/05/06)

Constitutional Reform Remains Elusive
The Dayton Peace Accord of 1995 that ended the war in the former Yugoslav Republic of Bosnia has been held up as a model of brilliant diplomacy, brought about by the most outstanding US diplomat of his generation, the Democrats' answer to the Republicans' Henry Kissinger, namely Richard Holbrooke. It is a compliment to Holbrooke's talents that Clinton did not dare to promote him to the State Department in his second administration, preferring Madelaine Allbright. 
The problem is, and it may not be Holbrooke's fault at all, that the accord led to the creation of a largely dysfunctional system of governance. Bosnia is notoriously an extremely difficult place to govern, ass the Ottomans learned over several centuries, when they were the imperial power. 
Ever since 1995 the government has been essentially divided into three often feuding ethnic entities: Muslim, Croat and Serb. In an effort to end years of political turmoil, Bosnia's ethnic leaders embarked about 12 months ago on a tortuous path to constitutional reform that in April fell just short of being approved, but Bosnian officials and observers remain optimistic.
In late April, the reform proposals fell just two votes short of approval in the Bosnian parliament. Several Bosnian Croats joined by a few Bosnian Muslims voted against the constitutional and legal amendments that had previously won support from seven Muslim, Serb and Croat parties. The constitutional reforms were meant to strengthen Bosnia's weak central government and replace the current three-member rotating presidency with a single president.
Donald Hays, a US diplomat who served as the United Nations deputy high representative in Sarajevo, worked for months facilitating the reform negotiations. Now diplomat in residence at Washington's US Institute of Peace, Hays is optimistic that the reform package will ultimately be implemented. "I think this is a process by which you get real ownership of a document that forms the state of Bosnia-Herzegovina and it is going to happen," said Mr. Hays. "It would be better if it happened sooner in order to facilitate their desires to be members of Euro-Atlantic institutions and the desire to bring prosperity to their citizens."

Elections ahead will decide
Bosnia faces parliamentary elections in October and several observers believe that it is critical that immediate action be taken to try, well before the elections, to get the measures approved by the current parliament. 
Sulejman Tihic is the Muslim, or Bosniak, member of the Bosnian presidency. Following meetings in early May with Secretary of State Condoleezza Rice and Vice-President Dick Cheney, Mr Tihic told a Washington audience that he too is optimistic that the constitutional reforms will be approved. "I took this opportunity, as I was visiting the United States of America, to ask for help in passing these amendments, because it is really in the best interests of Bosnia-Herzegovina and its citizens," he said. "And it was quite close. And that [help] is to be done by the end of this month."
Bob Hand, an adviser to the US Congress' commission on security and cooperation in Europe, has spent considerable time in Sarajevo. While saying he wishes the reform proposals had received more support from Bosnians, he agrees that they are a significant step forward in creating a vital Bosnian state. Hand also says that it is important to act quickly as the parliamentary election campaign could divert attention to other issues.
"Maybe this shock of this setback will reinvigorate efforts and allow people to reach across [ethnic] differences on how far to go and things like that," said Mr Hand. "And maybe put things back together so they can move forward."

National security forces needed
Along with its attempt to reform the constitution, the Bosnian government is also working to create a single national army and police force. 
These steps, Bosnian leaders believe, will help them achieve their goal of gaining membership in the European Union and the NATO alliance. Without them however, Bosnia's forward movement is likely to be halted.

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World Bank helps boost Bosnia's energy sector 

Representatives of Bosnia-Herzegovina (BiH) and the World Bank concluded negotiations recently on the Power IV project in Sarajevo aimed at developing the country's energy sector, Deutsche Presse-Agentur (dpa) reported. 
Head of the World Bank Mission in BiH Dirk Reinermann told reporters: "Power IV is the single largest investment in BiH ever with more than US$260 million." "The project will help develop the electricity grid in BiH and will help its inclusion in the energy community of the south-eastern Europe." Power IV will help BiH exploit its export potential in the energy sector.

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20m Euro EIB loan for SMEs 

Small and medium-sized enterprises (SMEs) in Bosnia-Herzegovina are set to benefit from a 20 million Euro European Investment Bank (EIB) loan, ANSAmed reported.
The EIB global loan (line of credit) granted to UniCredit Zagrebacka Banka DD aims at tackling the scarcity of funds for investment needed to sustain investment in environmental protection, energy savings, infrastructure, industry, services and tourism. With the funds stemming from the EIB, up to 50 per cent of the eligible project costs may be financed. The term for infrastructure projects is 15 years; loans for SMEs may go up to 12 years.

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