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Bosnia: Under International Pressure, Arms Trade Ban Imposed

Bosnia-Herzegovina has imposed a ban on arms trading in the wake of stiff criticism by the international community over the illicit supply of spare parts for Iraqi MiG fighter jets.

Prague, 30 October 2002 (RFE/RL) -- Bosnia-Herzegovina's self-imposed ban on arms trading is the latest in a series of moves by authorities in Sarajevo, Banja Luka, and Belgrade, responding to international pressure to halt illicit weapons trading with Iraq.

The scandal spotlights the absence of adequate export controls and the inherent unreliability of Bosnia's system of administration in its two entities, the Muslim-Croat federation and Republika Srpska. It also threatens to hamper Bosnia's declared intention of joining NATO's Partnership for Peace program.

Peacekeepers of the NATO-led Stabilization Force, or SFOR, recently raided a state-owned factory in Bijeljina, a Bosnian Serb administered town on the border with Yugoslavia. The raid confirmed U.S. intelligence reports that the Orao factory was exporting parts for Iraqi MiG-23 fighter aircraft. A Yugoslav state-owned foreign-trade company, Jugoimport, which facilitated the deal through its Baghdad office, was also implicated.

The U.S. Embassy publicly accused Orao of supplying the parts to Iraq last month. The subsequent SFOR raid revealed an attempt to cover up the activity. The Sarajevo daily "Oslobodjenje" reported that SFOR found a document dated 25 September telling five Orao staffers in Baghdad to remain there and remove all traces of Orao's involvement in Iraq.

Since then, the Bosnian Serb entity, Republika Srpska, has fired the defense minister, the chief of staff, the commander of the Bosnian Serb Air Force, the director of the Orao factory, and the head of a Bosnian Serb military-equipment and weapons-transport agency.

Bosnian Minister for Foreign Trade and Economic Relations Azra Hadziahmetovic said the ban on arms trading will remain in effect until Bosnian authorities begin issuing licenses at the state rather than the entity level. "The Ministry of Foreign Trade and Economic Relations won't make a single exception on imports and exports in the whole packet of arrangements or plan of activities until this whole business of foreign trade in arms is fully under control," Hadziahmetovic said.

The international community's principal deputy high representative, Donald Hays, said he "totally supports" the ban on weapons exports. "Until Bosnia can get appropriate controls in place, the risks of having a repetition of the Orao affair are immense," Hays said.

He added, "We demand that the two entities immediately work with the state to put together a functioning control mechanism that will bring this whole area of trade under appropriate controls."

Hays issued a stern warning, however, to both of Bosnia's entities, Republika Srpska and the Muslim-Croat federation. "Let me emphasize for those of you who don't understand how serious the situation is. Effectively, Bosnia-Herzegovina is in breach of international agreements with the United Nations, [the] OSCE, and other international bodies. It is Bosnia-Herzegovina that will be held responsible, and it is Bosnia-Herzegovina that has to make this right," Hays said.

The commander of SFOR in Bosnia, Lieutenant General William Ward, said SFOR will be monitoring the situation. "We will be very closely watching what's going on, what action [Republika Srpska] takes, and if we deem the actions not fully appropriate, I'm prepared to take actions as required," Ward said.

Ward specifically called for a single functioning defense ministry at the all-Bosnian, i.e., state, level, rather than separate ministries at the entity level.

News reports from Bosnia say SFOR has intensified its patrols along the boundary line between the two entities in recent days after reports of nighttime truck shipments heading for Adriatic ports in Croatia.

Meanwhile, the head of the Bosnian Serb government's Public Information Office, Cveta Kovacevic, said the Republika Srpska government has adopted a plan to set things right in the wake of the Orao affair. "This plan contains 20 very specific measures with specific tasks and deadlines. The entire plan has to be realized by 27 November of this year and is subordinate to measures taken for financial control over the Orao plant. This includes a complete review of all deals that the factory had with enterprises in Yugoslavia, lists of equipment that has been delivered, [and] lists of destinations," Kovacevic said.

Authorities in Belgrade, meanwhile, have been quick to dissociate themselves from the affair, professing ignorance and accusing political rivals of involvement. Yugoslavia has dismissed a deputy defense minister, Ivan Djokic, and Jugoimport's director, Major General Jovan Cekovic, and has ordered the closure of the Baghdad office of Jugoimport.

Curiously, the United Nations committee on sanctions approved Jugoimport's application to conduct oil-for-food trading with Iraq in 1997-98, while Slobodan Milosevic was president.

Yugoslav Defense Minister Velimir Radojevic said his ministry has not issued a single permit for arms exports to Iraq since Milosevic fell from power in October 2000.

A special commission that was established to investigate the Iraqi arms deal is expected to present the preliminary conclusions of its investigation to the federal government tomorrow.

Federal President Vojislav Kostunica has accused Jugoimport of "gambling" and of undertaking what he called "an entirely irresponsible business move" that he said will be punished. But he insists the Jugoimport affair is an isolated incident that should not be interpreted as Yugoslavia's position.

However, Kostunica's foreign-policy adviser, Predrag Simic, suggested the affair is symptomatic of a broader problem of the continued presence of Milosevic-era officials in the defense industry. "People who have access to the ministry and the Yugoslav arms industry are maximizing their gains, while not being part of any state policy," Simic said.

For his part, Serbian Prime Minister Zoran Djindjic said the affair is a matter for the federal president to resolve, since it involves the military. He accused Kostunica of being unprofessional by refusing to dismiss senior military holdovers from the Milosevic era.

Nevertheless, Djindjic has all but ignored his own responsibility in the affair since his interior minister, Dusan Mihajlovic, is a member of Jugoimport's board of directors and claims that he knew nothing.

Meanwhile, Serbian Deputy Prime Minister Nebojsa Covic, a member of Djindjic's government, said exports to Iraq are not in Yugoslavia's national or state interests. He has called for a thorough investigation into the matter. "It would be very dangerous if there were any attempt to hide something. Plenty of questions are being raised about many deals dating back to the period when Milosevic and [Vojislav] Seselj were in power and that are still being applied. Meanwhile, the appropriate organs have yet to uncover them, to reveal which firms have been operating [in the arms trade], which of them are private companies, whether permission was issued by one side or the other, whether papers valid for Bosnia were applied on Yugoslav territory," Covic said.

Covic said cover-ups are "dangerous, as they risk losing the international community's trust."

Another deputy prime minister of Serbia, Zarko Korac, said the arms sales to Iraq have caused serious damage to the Yugoslav state's image. He said the organs of state have no control over what he called "disaffected power centers," by which he means the arms industry and the military. "The main motive in all this is the inertia from the Milosevic era, that no one -- no prosecutor's office -- is presenting the bill for this activity. And second, this is about corruption and profit that some people create. Generally speaking, our country is not regulating the arms trade," Korac said.

Both Yugoslavia and Bosnia stand to lose Western support in the wake of the scandal. U.S. Secretary of State Colin Powell, in a letter to Bosnia's foreign minister this week, announced the end of the U.S. program to train and equip the federation army. Further reductions of the U.S. presence in Bosnia are likely in the coming months.