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Key Economic Data 
  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
Ranking is given out of 208 nations - (data from the World Bank)

Books on Bosnia & Herzegovina

Update No: 121 - (27/06/07)

The uneasy peace
Bosnian Serb politicians were blamed for whipping up ethnic intolerance in the run-up to the October poll last year in the Serb Republic (RS), and for playing on national differences to win votes. The victory of the more moderate Alliance of Independent Social Democrats (SNSD) over the more nationalist Serb Democratic Party (SDS) was predictable. But analysts say both resorted to playing the ethnic card in order to secure votes from RS's largely nationalist electorate.

This has aggravated an unfortunate legacy of ethnic strife. No Balkan geopolitical entity is more mired in history than Bosnia, alas.

Polarized entities
Despite the ten years that have passed since the end of the 1992-5 war, and the millions of euros and dollars invested in attempts to return refugees to their homes, the two entities that make up Bosnia-Herzegovina remain as ethnically polarised as ever. While the Federation is home to most Bosniaks and Croats in the country, the overwhelming majority of inhabitants in RS are Serbs. This leads to tension, especially in summer, as now, when many Bosniaks and Croats living outside RS or outside Bosnia-Herzegovina come back to RS to visit their former homes.

Last summer, these temporary returns have also coincided with an election campaign. 'Politicians are opting for the tried and tested course of instigating national intolerance in order to improve their chances in the elections,' Srdan Puhalo, a social psychologist, told Balkan Insight at the time. Puhalo said politicians resorted to this approach in the absence of offering any other more mundane solutions to the problems posed by a generally poor economic situation. 'Once again they are going for national homogenisation. The only question is which party will be most successful at this,' said Puhalo.

Zvonko Tarle, of the Croatian Cultural Centre, in Banja Luka, said some nationalist politicians were still trying their utmost to stop the return of refugees to RS. 'The politicians have been preaching national intolerance for a decade since the war,' he said. 'These provocations, which are neither prevented nor condemned by the local officials, serve to secure the status quo and prevent any positive developments in the field of ethnic coexistence.'

Hardliners return; Ashdown's mistake?
Political analysts say the situation has been worsened by the return to the political stage of a group of hard-line nationalists, who were earlier excluded from politics. Relenting on this issue may have been the biggest mistake of the previous High Representative, Paddy Ashdown. 

He and his predecessors used the extensive powers granted them by the international community to force numerous Bosnian Serb hardliners from office. The most often cited reason was alleged activities against the 1995 Dayton peace settlement and instigation of confessional and national hatred. At the end of 2005, however, Ashdown ended the ban on a number of such politicians, some of whom are now re-entering politics and taking part in elections.

One striking returnee to the political stage is Predrag Lazarevic, former leader of the Serb Party for Republika Srpska (SSRS). In 2000, international community representatives banned his party from the municipal elections after SSRS refused to remove from office its leader, who was accused of violating election rules and instigating ethnic hatred. Lazarevic returned to the political stage last year as a member of the Radical Party of Republika Srpska (SRS), using the opportunity to air his hard-core opposition to the concept of a multi-ethnic state, which he has described as 'an empty word, a story for children'. He openly opposes the existence of united Bosnia-Herzegovina, proposing a 'Scandinavian-ized' Balkans in which 'there will be one state for each nation'. 

Bosnia-Herzegovina is home to three nations, Bosniaks, Serbs and Croats. Lazarevic advocates a division of territory along ethnic lines, involving 'nations living next to each other, because living with each other has inevitably resulted in bloodshed at regular intervals'.

Puhalo said Lazarevic's political ratings were always high on the right of the Serbian political spectrum and had gone higher since he joined the Radicals. Analysts like Puhalo say such divisive political options are attractive to young people in RS. 'It is a generation that sprang up during the war and developed when nationalism was at its peak,' he said. 'Unfortunately, they can easily switch from words to actions,' he added, referring to recent incidents against non-Serbs.

Youth the key; a sombre prospect
Aleksandar Trifunovic, director of the Buka media project in RS, fears that nationalism among the younger generation in Bosnia-Herzegovina will be hard to combat. He hopes that it will not go any further than written or verbal provocations directed against other ethnic communities. 'The young generation is the key obstacle to the revival of coexistence in Bosnia-Herzegovina,' Trifunovic told Balkan Insight.

A straw poll taken by Balkan Insight on the streets of Banja Luka suggests Trifunovic's pessimistic description of the youth scene is based on reality. Mirjana Avdalovic, a student at the philosophy faculty in Banja Luka, said what she called 'mixing of the nations' ought never to have been allowed after the war. If Bosnia -Herzegovina had to be a single state, each nation ought to have been given a territory of its own within it, she went on. 'We cannot live together and we should not have allowed Bosniaks and Croats to come back to Republika Srpska and build mosques... It is only causing frustrations among Serbs,' she concluded. Stanimir Nježic, a technician, agreed. 'Every nation should live separately, which is why Republika Srpska should break away from Bosnia-Herzegovina,' he said.

Infighting stalls reforms in Bosnia 
Nevertheless, RS Prime Minister Dodik is keen to keep things together. The alternative to strife and disunion is entry into the EU, he says. But this is stalled by political infighting.

There will be no progress on police reform, a vital condition laid down by Brussels, until politicians in the Federation accept the Serbian entity. "They can think whatever they want about Republika Srpska but until they accept it, there will be no agreement, even if Bosnia has to stand still for a hundred years on its path to the European Union," the prime minister told reporters.

Police reform is an essential step for Bosnia's possible admission to the European Union. For the US-brokered peace agreement that ended the 1992-1995 Bosnian war left the country divided into a Bosnian Serb mini-state and a Muslim-Croat Federation, with each having their own government and police. 

Haris Silajdžic, the Muslim member of the Bosnian Presidency and other Muslim leaders in the Federation have stepped up their demands for abolition of RS since the International Court of Justice (ICJ) based in The Hague, Netherlands, ruled in February that Bosnian Serb forces committed genocide in July 1995 when they overran the eastern enclave of Srebrenica, killing up to 8,000 Muslim men and boys. 

Dodik was especially outraged by the latest calls of Silajdžic for the abolition of Republika Srpska. During his recent visit to London, Silajdžic asked British diplomats to support the abolition of the Bosnian Serb Republic "because it was created through genocide." 

"We have no intention of talking to Silajdžic about any issue as long as he continues to claim that the police in Republika Srpska committed genocide. That is a lie and this must stop," Dodik said and added that the ICJ verdict did not incriminate institutions in Republika Srpska, but individuals and groups of individuals. 

Silajdžic responded on Bosnian television, saying that Dodik should divert his accusations to the ICJ in The Hague as it was the ICJ that said that institutions, the police and the army of Republika Srpska committed genocide. "I will continue to talk about genocide and remind everyone that the results of genocide cannot be acknowledged and have to be eliminated," Silajdzic said. 

At an open meeting of the UN Security Council in May, the international community issued a tough warning to Bosnian politicians to stop nationalistic rhetoric and start essential reforms or else EU membership will remain a distant dream. 

Iran stresses bolstering economic ties with Bosnia 
A pariah to the international community, Iran, is far more welcoming and sensitive to Bosnian needs. Iranian Foreign Ministry Director General for Central and Northern Europe, Ali Baqeri, in Sarajevo on June 10th called for expansion of trade and economic ties with Bosnia. Baqeri made the remark during a meeting with Bosnian Minister of Trade and Economic Relations Slobodan Puhalac. 

The Iranian official said grounds have been prepared for participation of Bosnian companies in Iran's economic affairs. Establishment of a joint economic committee between the two countries as well as Iran-Bosnia Joint Chamber of Commerce would help boost bilateral cooperation in various economic fields. 

Puhalac, for his part, stressed the importance of promotion of bilateral economic ties and called for final conclusion of an agreement on trade preferential tariffs between Tehran and Sarajevo. The Bosnian minister welcomed Iran-Bosnia joint investment in a third country. 

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Sarajevo's Global Payments signs a deal with VABA Bank 

Global Payments Inc, a world leader in electronic transaction processing services, recently announced that its Sarajevo-based, wholly-owned subsidiary, Global Payments Europe d.o.o. Sarajevo, has reached a five-year agreement to provide comprehensive payment card processing services to VABA Bank dd, Sarajevo, New Europe reported. 
VABA Bank dd, Sarajevo is a newly established bank in Bosnia Herzegovina, after its parent bank, VABA Banka, Varazdin, Croatia, acquired the assets of Ljubljanska banka, Sarajevo. 
Global Payments Europe Sarajevo will provide the bank with a complete array of card processing services including authorisation, card management, fraud monitoring and prevention, card personalisation and Point of Sale (POS) terminal network management, Fars news agency reported. Ismet Kumalic, senior executive of VABA Bank dd, Sarajevo said, "With Global Payments we have a recognised partner with worldwide references and a reputation for providing high quality services. Global Payments' strong regional presence and experience in the card business is a great competitive advantage for us. Global's expertise will help us create added value for the Bank and our clients. We see this agreement as an important part of our business success in this dynamic market." 
Mustafa Bektic CEO of Global Payments Europe, Sarajevo said he was happy with the agreement with VABA Bank which represents the first agreement with a new banking client signed to retain its services since Global Payments acquired the assets of Diginet d.o.o.

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