se times
09/11/2010
Weapons and ammunition manufacturers have spent years trying to rebuild and attract the level of business they did before the 1990s conflicts.
By Jusuf Ramadanovic for Southeast European Times in Sarajevo – 09/11/10
Weapons and ammunition manufacturers have spent years trying to rebuild and attract the level of business they did before the 1990s conflicts.
By Jusuf Ramadanovic for Southeast European Times in Sarajevo – 09/11/10
The military industry in Bosnia and Herzegovina (BiH) -- once a major pillar of economic development -- all but crumbled after the conflicts of the 1990s and the breakup of the former Yugoslavia.
Back in the day, factories dotted the country -- Pretis in Vogosca, Igman in Konjic, Vitezit in Vitez, Zrak in Sarajevo, Cajavec in Banja Luka, Soko in Mostar, Bratstvo in Novi Travnik, Eagle Institute for Technical Overhaul, and Famos in Hrasnica. They produced everything from bullets for small calibre pistols to projectiles for rocket launchers. They turned out ammunition and overhauled engines and other machinery even under the most difficult circumstances, close to the firing lines.
The statistics, in black and white, are startling. According to 1986 data, defence was an $825m a year industry. In 2009, the figure was roughly $30m, or 45m KM, according to the Foreign Chamber of BiH.
Arguably more important is the impact on the workforce. Before the war in BiH, the military industry boasted 40,000 employees; today that figure is less than 3,000.
Although many local economists believe the military industry remains BiH's "chicken that lays the golden egg", the industry has been tarnished by neglect, and crippled by the decision to split the country into two entities.
"There is not a single state-level commercial company that produces arms or military equipment, and they all require entity-level permits for any kind of such business activity," says Uma Sinanovic, spokesperson for the BiH state defence ministry. "The state-level Ministry of Foreign Trade only provides final consent for trade transactions, based on the entity approvals."
Largely left to fend for themselves, some BiH companies managed last year to export to some demanding markets, including Switzerland, Great Britain, and Egypt. The most successful company, Igman, in Konjic, exports the whole range of its ammunition and has earned nearly 15m euros in the past year. All arms producers in BiH agree that relations need to be redefined in terms of ownership of such companies.
With this in mind, the state-level ministry of foreign trade and economic relations has recently started working to amend the law on Foreign Direct Investment policy, to cancel restrictive measures involving the 49% of foreign shares requirement in military industry companies.
A ray of hope is also seen in the completion of interstate agreements on military industry co-operation between BiH and Pakistan, Romania, Turkey, Egypt and Serbia.
According to Dragisa Mekic, assistant minister for foreign trade policy and foreign investment, the agreement with Pakistan has already been signed and ratified, while the agreement with Turkey is in the final stages of drafting.
Back in the day, factories dotted the country -- Pretis in Vogosca, Igman in Konjic, Vitezit in Vitez, Zrak in Sarajevo, Cajavec in Banja Luka, Soko in Mostar, Bratstvo in Novi Travnik, Eagle Institute for Technical Overhaul, and Famos in Hrasnica. They produced everything from bullets for small calibre pistols to projectiles for rocket launchers. They turned out ammunition and overhauled engines and other machinery even under the most difficult circumstances, close to the firing lines.
The statistics, in black and white, are startling. According to 1986 data, defence was an $825m a year industry. In 2009, the figure was roughly $30m, or 45m KM, according to the Foreign Chamber of BiH.
Arguably more important is the impact on the workforce. Before the war in BiH, the military industry boasted 40,000 employees; today that figure is less than 3,000.
Although many local economists believe the military industry remains BiH's "chicken that lays the golden egg", the industry has been tarnished by neglect, and crippled by the decision to split the country into two entities.
"There is not a single state-level commercial company that produces arms or military equipment, and they all require entity-level permits for any kind of such business activity," says Uma Sinanovic, spokesperson for the BiH state defence ministry. "The state-level Ministry of Foreign Trade only provides final consent for trade transactions, based on the entity approvals."
Largely left to fend for themselves, some BiH companies managed last year to export to some demanding markets, including Switzerland, Great Britain, and Egypt. The most successful company, Igman, in Konjic, exports the whole range of its ammunition and has earned nearly 15m euros in the past year. All arms producers in BiH agree that relations need to be redefined in terms of ownership of such companies.
With this in mind, the state-level ministry of foreign trade and economic relations has recently started working to amend the law on Foreign Direct Investment policy, to cancel restrictive measures involving the 49% of foreign shares requirement in military industry companies.
A ray of hope is also seen in the completion of interstate agreements on military industry co-operation between BiH and Pakistan, Romania, Turkey, Egypt and Serbia.
According to Dragisa Mekic, assistant minister for foreign trade policy and foreign investment, the agreement with Pakistan has already been signed and ratified, while the agreement with Turkey is in the final stages of drafting.
Closer to home, Mekic notes a certain level of co-operation with the military industries of neighbouring countries, through commercial contracts between factories.
And farther afield, BiH has been trying to boost its profile. "Our exhibitors have been present at some major and relevant worldwide international fairs, such as the ones in Paris, Ankara, Abu Dhabi, Kuala Lumpur, and the like."
BiH has what it takes, he adds. "We have the human resources, organisational and technological capacities required to come out to foreign markets, as well as a long-standing experience in military production," Mekic says.
What BiH lacks is a huge army in need of weapons and ammunition. Long gone are the days when the former Yugoslavia had more than 400,000 soldiers and was producing everything from small-calibre ammunition to submarines.
This content was commissioned for SETimes.com.
And farther afield, BiH has been trying to boost its profile. "Our exhibitors have been present at some major and relevant worldwide international fairs, such as the ones in Paris, Ankara, Abu Dhabi, Kuala Lumpur, and the like."
BiH has what it takes, he adds. "We have the human resources, organisational and technological capacities required to come out to foreign markets, as well as a long-standing experience in military production," Mekic says.
What BiH lacks is a huge army in need of weapons and ammunition. Long gone are the days when the former Yugoslavia had more than 400,000 soldiers and was producing everything from small-calibre ammunition to submarines.
This content was commissioned for SETimes.com.
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