Capital: Sarajevo, 522,000 (estimate 2001), in 1991: 383,000 (estimate)
Population: 4,112,000 (estimate 2002), in 1991: 4.5 million
Ethnic composition: 48 percent Bosniacs (Bosnian Muslims), 37 percent Serbs, 14 percent Croats (estimate 2000)
Area: 51,129 square kilometers
Gross Domestic Product: 7,020 million US dollars (2003)
GDP per Capita: 1,818 US dollars (2003)

Although the Statistics Agency for Bosnia-Herzegovina has existed since 1998, it is unable to function owing to conflicts between regional political authorities. As a consequence, statistical data about the country is completely unreliable.  

A State Unified under Duress

Under Tito in 1946, Bosnia-Herzegovina was granted the status of a constituent republic within the Socialist Federal Republic of Yugoslavia. The intention was not least to produce a balance of power between Croatia and Serbia—where the nationalists of both countries had made a hegemonic claim to this region. Because it was assumed that they would, sooner or later, adopt the national identity of either the Croats or the Serbs, the Bosnian Muslims¹  were not originally categorized as a constitutive nation in the Yugoslavian constitution. They had to wait until 1963 for official recognition as the sixth people of the Yugoslavian state. This recognition was the result of a foreign policy calculation. As part of his nonaligned policy Tito had stepped up contacts with Islamic countries. This was linked with a revaluation of Islam in Bosnia-Herzegovina. After the Green Revolution began in Iran in 1979, the communist regime became more restrictive with Bosnian Muslims again in order to prevent Muslim fundamentalism and nationalism from gaining strength.

The republic was in a sense the core of this ethnically plural nationstate: in 1991 the population of Bosnia-Herzegovina included 44 percent Muslims, 31 percent Serbs, and 17 percent Croats. As a result of Slovenia’s and Croatia’s efforts to secede, which were increasingly evident in the late 1980s, this model broke down. The integration of Bosnia-Herzegovina into the federalist structures of Yugoslavia was the only thing that could rein in the competing nationalisms. The majority of the Serbs and Croats living in Bosnia-Herzegovina saw themselves more as citizens of their republic than as part of an ethnic community that transcended borders. With the collapse of the multiethnic federal state, however, this construction began to totter. In part to ensure the survival of its constituent republic, the Bosnian government tried to prevent Yugoslavia from being broken up. At first, it had broad support in the population for these efforts, as its perception was strongly influenced by the country’s multiethnic circumstances. The escalation of the civil war in Croatia in 1991, however, increasingly polarized Bosnian society along ethnic lines. The question of secession ultimately destroyed the consensus among ethnic groups that the state territorial unity of Bosnia-Herzegovina should be retained. Once Slovenia and Croatia had separated from the federation for good, the non-Serbian population feared that it would be dominated by Serbs in what remained of Yugoslavia. Hence when the parliament of the Yugoslavian constituent republic of Bosnia-Herzegovina produced a resolution for independence with the votes of the Muslim and Croatian factions, the Serbian nationalists, under the leadership of Radovan Karadžić, proclaimed in return the independent Serbian Republic of Bosnia and Herzegovina. A year later the Bosnian Croats declared the Republic of Herceg-Bosna in their region.

The ethnic fragmentation of Bosnia-Herzegovina was already evident in the first free elections on November 18, 1990. The Serbian Democratic Party (SDS), the Croatian Democratic Union (HDZ), and the (Muslim) Party of Democratic Action (SDA) received the great majority of the votes. In accordance with Yugoslavian tradition, the highest state offices were distributed according to a proportional system: the Muslim Alija Izetbegović²  became president; the Serbs provided the president of the parliament; and the Croats the prime minister.

This coalition of three parties soon fell apart over the future constitution. The Serbian and Croatian politicians endorsed a federalization of the republic along ethnic lines, but this was vehemently rejected by the Muslims. They feared political domination by the majority held by the other ethnic groups and a gradual division of the republic among the neighboring countries.

At the request of the European Economic Community, a referendum on independence was held on February 29 and March 1, 1992, but the Serbs boycotted it. But large differences were evident even among those who participated. Whereas the Muslims associated the referendum with a declaration of faith in a unified state, although accompanied by overtones of a desire to define themselves as the only constitutive state people, the Croats connected the referendum with a canton system based on the Swiss model.

When Bosnia-Herzegovina was recognized under international law on April 6, 1992, a bloody civil war began that turned two million people into refugees. Approximately 250,000 people were killed, and about 175,000 wounded. At first, each ethnic group was fighting against the others. After the United States compelled a cessation of hostilities between Croat and Muslim troops in early 1994, a joint federation was founded on March 1 of that year. Its new constitution was the last farewell to the unitarian state model that had been favored above all by Bosniacs. The state was to be divided into eight cantons, of which four were to be Croatian, two Muslim, and two ethnically mixed.

Thanks to this alliance and foreign armaments, the Serbs were gradually placed on the defensive militarily. The "West" had long hesitated to join the conflict militarily. The deployment of UN troops was exclusively for humanitarian goals, and the creation in 1993 of "safe areas" in several encircled Muslim cities was not sufficient to prevent massacres like the one in Srebrenica. When NATO finally intervened in the war against the Serbs with air strikes, there was an end to hostilities. In keeping with the Dayton Agreement, the country was occupied by NATO forces (SFOR) numbering 60,000 troops in November 1995, and with the task of enforcing the accords. In 2004 the European Union took over the military protection of the accords with a force of 7,000 soldiers (EUFOR). In the meanwhile some of the refugees have returned to their old homes, but about a million refugees are still living scattered throughout the region.

Ethnic Fragmentation and Protectorate Status

Although the Dayton Agreement had established legally an indivisible Bosnia-Herzegovina, at the same time it had created institutional structures that reinforced the separation between the ethnic groups. For example, the republic is conceived as a joint state of three "constitutive peoples"—Bosniacs (Bosnian Muslims), Serbs, and Croats—that is at the same time divided into two autonomous entities of equal size, namely the Serbian Republic (Republika Srpska) and the Bosniac-Croatian Federation (BCF). Both of these entities are under the protectorate of the United Nations. The BCF is in turn divided into ten cantons formed according to ethnic criteria and the district of Brčko, which is granted special status. The various regional bodies have their own parliaments and governments. Each entity has not only its own army and judiciary but also its own educational system. They can enter into international treaties and maintain "special parallel relations" to the neighboring states of Croatia and Serbia-Montenegro. Taken together, this state structure with its fourteen governments and 180 ministers claim more than half the tax revenues.

The federal level is responsible only for foreign, transportation, trade, and financial policy, so the entities and the cantonal agencies have great political influence. The three parties treat the regional bodies that they control like a kind of private property from which they draw resources to serve their particular clientele system. The elections held since 1996 have, with few exceptions, always brought victory to the nationalists, as happened in the most recent referendum in 2002, the first time that elections were held simultaneously for all the regional bodies.

The tension between formal institutions and real power structures also hampers the peace and reconstruction process. A majority of international financial aid is drained away by inscrutable administrative structures and has little visible effect.

In 1997, as part of creating a protectorate to administer the peace treaty, the international community created the office of the High Representative ( HR ), which was granted far-reaching authority. The High Representative can remove Bosnian functionaries from office without providing grounds, declare laws invalid, and enact its own decrees. The Office of the High Representative (OHR) is the agency responsible for implementing and coordinating the representative’s policies.

In recent years the office has suspended a series of politicians for corruption or for insufficient cooperation with the International Criminal Tribunal for the Former Yugoslavia in The Hague. For example, in June 2004 sixty Bosnian-Serb office holders were dismissed for allegedly trying to prevent the arrest of the suspected war criminal Radovan Karadžić. The protectorate authority was equally repressive in its response to efforts on the part of the nationalists to secede. In spring 2001 the HDZ tried to force through once again the Croatian Republic Herceg-Bosna as a third entity. It had been formally dissolved by the founding of the Bosniac-Croatian Federation in 2004, but its power structures and administration had been left largely untouched. In order to give force to the demand for their own government, thousands of Croatian soldiers rebelled for a time. Only after the High Representative dismissed the Croatian member of the Bosnian state presidium and threat ened to ban the HDZ could the proclamation of a third constituent state be prevented.

In April 2002 the OHR compelled a change to the constitution under which the Bosniacs, Serbs, and Croats would be recognized as the constitutive peoples in both entities and would enjoy equal rights as citizens throughout the state territory. Under pressure from the European Union the parliament of Bosnia-Herzegovina adopted a law of defense that assigned united general staff to the divided armed forces of the country and placed it under joint civilian control. On the ground, however, the military units continued to be divided ethnically. By doing this the Bosnian government has fulfilled the essential condition for the country’s future acceptance into the NATO program Partnership for Peace. The High Representative also foresees dividing the police forces into ten regions that do not correspond to the borders of the two entities. This reform is one of the preconditions for

initiating EU negotiations on a Stabilization and Association Agreement.³  However, in September 2005 all of the Serbian parties in parliament rejected the document on police reform. The Bosnian Serbs see the creation of structures of a centralized state as a weakening of the autonomy granted them by the Dayton Agreement. Thus far only the prospect of desperately needed international financial aid has moved the government of the Serbian republic to make concessions to the federal state. Nevertheless, the risk of division still exists. For example, there are fears that the review of Kosovo’s status within the Republik Srpska that has been announced by the community of nations could provide impetus to renewed efforts at secession. The nationalists argue that the Bosnian Serbs must have the same rights as the Albanians in Kosovo.

Economic and Social Depression

After World War Two, Bosnia-Herzegovina was one of the poorest and most backward regions in Yugoslavia. With the help of an accelerated developmental aid policy the republic became the center of Yugoslavia’s armaments and heavy industry in the 1950s. Although it was able to catch up with other parts of the country, Bosnia-Herzegovina continued to receive considerable financial assistance from the Yugoslavian federal development fund until the federation broke up. The secession efforts of the Slovenian and Croatian constituent republics led to a blockade of the Yugoslavian distribution system in 1989-90 that hit the Bosnian economy especially hard.

The monoculture of heavy industry had already proved to be a problem during the socialist era, and the division of labor within Yugoslavia tended to reinforce the structural deficits of the Bosnian economy. Already by the end of the federation, Bosnia-Herzegovina was below the federal average for many indicators of development.

The industrial facilities were largely destroyed during the civil war, and gross domestic product per capita shrank by 80 percent over the prewar level. Provision for the population was dependent entirely or at least in part on international humanitarian aid. Although the Dayton Agreement did end the war, the new constitutional framework crippled the country’s economic development. The federal construction of the state hampered the reintegration of the Bosnian economy and reinforced the tendency toward mutual isolation. The traffic of goods between the entities declined as a result of high customs barriers, and the previous complementary production relationships were not reinstated. The national bank of Bosnia evolved into one of the few functioning federal institutions. It was able to introduce the convertible mark (CM) as the currency for the entire country, and it has benefited from broad confidence thanks to its stability resulting from being tied to the euro.

Since the 1990s Bosnia-Herzegovina has experienced a radical process of deindustrialization. As much as 80 percent of industrial jobs have been lost overall. In 2002 the industrial sector accounted for only about a third of the country’s economic output. The service sector produced nearly half of the gross domestic product, and the share of agriculture was relatively high at 18 percent. According to official statistics, economic growth is 3 to 4 percent, but some experts assume the real figure is only 0.7 percent. Growth is slowing in part because international financial assistance is running out. Bosnia-Herzegovina was rated a "postconflict country" by the World Bank after the civil war but lost this status in mid-2004 to become merely a "country in transformation".

In 2003 the gross domestic product was just 70 percent of its 1990 level. That made it 60 percent lower than the average for EU countries and nearly 20 percent below its neighboring countries. Moreover, its export economy has scarcely developed at all; Bosnian goods cannot compete on the world market. The sluggish restructure of ailing state industries worsens the situation. Accordingly, its trade deficit (56 percent of the gross domestic product) and foreign debt (34 percent of GDP) are high. The monetary board appointed in 1997 was able to bring the inflation rate down considerably, but the share of foreign financing of the budget in the form of foreign loans and financial aid is considered exorbitant even in comparison to the rest of the region.

The republic’s most important trade partners are Croatia and Serbia-Montenegro, though each entity maintains far closer trade relations with its corresponding "parent nation." Germany and Italy occupy first place among the EU-15, which account for 40 percent of exports and 40 percent of the imports. Compared to the rest of the region Bosnia-Herzegovina thus has relatively weak economic ties to the European Union. Even direct investment from abroad has thus far flowed into the country only slowly; Bosnia-Herzegovina has one of the lowest levels among postsocialist countries. The most important capital investors come from Croatia, followed by Kuwait, Slovenia, Germany, and Austria.

The social situation of the population is in keeping with this economic situation. The official unemployment rate is more than 40 percent. Because many people live off the underground economy, whose value is estimated to be 50 percent of the gross domestic product, experts assume that only one in five employable persons actually has no work.

By official measures, more than 19 percent of the population lives below the poverty line of 1,843 convertible marks annually (1.95 CM = 1 euro), with another third just barely above it. The situation is especially bad in the Republik Srpska; there incomes are a third lower than the BCF average. Pensions in the Republik Srpska range between 30 and 150 euros a month; in the federation between 60 and 300 euros. Unemployment benefits, child benefits, and pensions are generally paid only after months of delay or not at all.

A Weak Independent Press

The Bosnian media are strongly influenced by the consequences of the civil war. In mid-1998 the OHR annulled a frequently utilized regulation against "defamation" that had been used to regulate journalists by means of prison sentences and fines. Since late 2000 a law has guaranteed every citizen access to information. There are only three restrictions: possible damages to legitimate goals of foreign policy, sensitive areas of the private economy, and the private sphere of individuals. Thus far, however, a media landscape that is independent of both the national parties and international community has not developed.

The print media is relatively insignificant, with supposedly only 70,000 newspapers sold per day. In this context Bosnian sociologists point to the high illiteracy rate. But shifts in the readership profile have also played a role. The example of the renowned daily newspaper Oslobođenje (Freedom) can demonstrate this; before the civil war it had a circulation of 80,000 copies. The independent paper survived the three-year siege of Sarajevo under dangerous circumstances. Even after the peace settlement, the editorial staff continued critical reporting, despite repeated boycotts on advertising. Sales, however, dropped continuously. Rampant poverty is not the sole explanation; clearly it is also connected to changes in the sociocultural circumstances of postwar Sarajevo. Only part of the once enlightened urban milieu still lives in the city or in Bosnia-Herzegovina at all. The new residents are mainly refugees from the "flatlands" to whom urban life is alien; they prefer the national press. In the mid-1990s the Muslim SDA tried to purchase Oslobođenje, 39 percent of which is now owned by the Slovenian investment fund Kmečka družba. But the publishing house resisted the party’s offer, and the party went on to found the inexpensive daily newspaper Dnevni Avaz, which is now thought to have the largest circulation in the republic. The weekly magazine Dani, published in Sarajevo, caused a public uproar when it reported critically about the leader of the religious wing of the SDA and depicted him on the title page as a nearly naked call boy. After publication of the article nearly all of the companies that had advertised in the magazine received a threatening letter from the Islamic organization.

In addition to a number of private television and radio stations Bosnia-Herzegovina has three public systems: the federally oriented Public Broadcasting Service and one station for each of the two entities. The latter have the largest broadcasting range and highest ratings. The European Union would like to combine the three organizations under one roof. There is, however, resistance to that plan. The Serbian Republic categorically rejects the project, and the Croatian parties are calling for their own country-wide program. The OHR, however, is insisting on its reform proposal. Reform of the media landscape is one of the conditions the European Commission has set before negotiations on a Stabilization and Association Agreement (SAA) can begin.

¹ The Ottomans conquered the region of the present Bosnia-Herzegovina between the fourteenth and sixteenth centuries. Part of the population living there converted to the Islamic faith but retained its Slavic language, developing its own cultural and political identity. In the Federal Republic of Yugoslavia, Bosnian Muslims were allowed to identify themselves as "Muslim undecided" (1948), then as "Yugoslavian undecided" (1953), "Muslim in the ethnic sense" (1961), and finally "Muslim in the national sense" (1971). The establishment of the Bosnian Muslims as the major ethnicity of Bosnia-Herzegovina was not, however, embodied in the constitution. The temporary conclusion in the formation of this nation is their self-identification as "Bosniacs" in 1993. [zurück]

² The first president of the independent Republic of Bosnia-Herzegovina, Alija Izetbegović (1925-2003), was sentenced to several years in prison by the communist regime after the Second World War for his membership in the organization Young Muslims. In the 1970s he authored articles on Islam and in 1983 he was imprisoned again for "nationalism" and "pan-Islamism." After his early release in late 1988, he founded the Party for Democratic Action (SDA) in 1990. [zurück]

³ Although the Stabilization and Association Agreements of the European Union are tailored to the situation of the particular country, as a rule they include the following elements: regional cooperation, support for economic and trade relationships, infrastructure development, regulation of migrant labor, freedom of settlement as well as turnover of payment and capital, gradual harmonization of laws with those of the European Union, cooperation in the areas of the judiciary and security, financial and technical assistance for implementing the treaty, and institutions to monitor implementation. [zurück]