Corruption Claims Hold Back Bosnia

Allegations of fraud in government contracts and privatization are pitting the government against monitors and scaring off foreign investors

By Miroslav Ajder

The ability of Bosnia's Serb-dominated entity to fend off lingering suspicions of high-level corruption is again being tested, even as the entity government claims to be launching a new anti-corruption initiative.

In the past few months Republika Srpska has lost a large foreign investment amid suspicions of political meddling in major industries and has seen controversy-prone Prime Minister Milorad Dodik embroiled in a corruption scandal of his own. This has made cooperation with Bosnia's international monitors even more contentious and, some analysts believe, may slow the planned transition to a softer, less intrusive international presence throughout the divided country.

DODIK HAS A PLAN

Last month came the latest episode in a long-running battle of words between the Republika Srpska government and critics from civil society and international bodies, when Dodik reacted angrily to a report of a probe by Bosnian prosecutors into fraud at the highest levels of his government.

After news reports in February said criminal charges had been filed against Dodik himself, Dodik said the deputy director of the State Investigation and Protection Agency, Dragan Lukac, had acted behind the backs of his superiors and in violation of legal procedure.

It remains unclear whether the central government prosecutors followed due procedure in preparing the charges. In addition, Republika Srpska Justice Minister Dzerard Selman said the media reports mistakenly referred to a prior investigation and blamed SIPA for the error.

Dodik attributed the indictment to a "sectarian group" that probably wanted to see his dismissal before the appointment of a new international high representative, following the resignation of Miroslav Lajcak in January to become the new Slovak foreign minister. On 23 February European Union foreign ministers put forward the name of Austrian diplomat Valentin Inzko to replace Lajcak in a job that was supposed to be phased out by this June, giving way to an EU special representative with fewer powers. Many in Bosnia now suspect that the slow pace of change in the country in many important areas, including its pervasive corruption, will delay the end of the high representative's office, and consequently the reinforcement of the EU's role.

With or without the criminal charges, Dodik, once the darling of the international community, especially Washington, has been highly controversial and in constant conflict with the internationals in Bosnia. He became infamous for insulting journalists and representatives of nongovernmental organizations.

Dodik last tangled with the central government's judicial authorities in November, when international prosecutors at the Court of Bosnia and Herzegovina requested documents from the Republika Srpska government concerning the financing of a 110 million euro government building complex in Banja Luka and on construction of a highway. Dodik refused, saying the court had no jurisdiction over Republika Srpska, and filed a lawsuit against Deputy High Representative Raffi Gregorian and international prosecutors. He accused Gregorian, an American, of plotting against Republika Srpska and said central-level prosecutors and judges were biased against Serbs.

Eventually, under pressure from international representatives, Dodik handed over copies of documents and the lawsuit was dropped. But when he said it was unacceptable for Muslim judges on the court to probe into Republika Srpska's affairs, Lajcak and the U.S. Embassy in Sarajevo delivered unusually sharp rebukes.

Then, in December, Dodik declared a new, more effective anti-corruption strategy for the Serb entity, saying corruption remained a serious problem. He also announced the formation of a council to monitor implementation of the strategy and to "inform the public about corruption." No further announcements on the strategy or the council have been made.

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