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Bosnia and the Challenge of Fake States

January 6, 2009


States whose borders have been created by outsiders (generally by former colonial masters) are sometimes referred to as “fake states” because their borders fail to account for ethnic differences or historical or ethnic ties. The problem with fake states is that they are often rife with ethnic tensions and conflict. Africa is filled with fake states and it is one reason that the continent has never achieved the prosperity that its natural resources should have provided. The Middle East is also filled with fake states and I need not recount the ongoing troubles there. One of the most recent fake states is Bosnia — which was carved out of the former Yugoslavia (itself a fake state) by conflict and international negotiations. The sensitivities and anger generated during the civil wars that broke Yugoslavia apart remain a significant challenge in Bosnia [“Fears of New Ethnic Conflict in Bosnia,” by Dan Bilefsky, New York Times, 13 December 2008]. Bilefsky reports that Bosnia once again sits on the cusp of civil war.

“Thirteen years after the United States brokered the Dayton peace agreement to end the ferocious ethnic war in the former Yugoslavia, fears are mounting that Bosnia, poor and divided, is again teetering toward crisis.”

For those unfamiliar with the history of the Balkans, let me provide a thumbnail sketch of events. It was in the Balkans that Christian and Islam cultures stalemated. Religious differences only added fuel to centuries of ethnic skirmishes and mistrust. Among the ethnic groups living in the Balkans are Slavs, Serbo-Croatians, Bosnians, Croatians, Serbs, Montenegrins, Slovaks, Albanians and Macedonians. It was unrest in the Balkans that triggered the First World War. Following that war, a number of kingdoms split apart and the Kingdom of Serbs, Croats and Slovenes was created (which was eventually renamed the Kingdom of Yugoslavia). Like most of Europe, the Balkans became embroiled in the Second World War. Following that war, Tito managed to cobble together a state he called the Federal Peoples’ Republic of Yugoslavia. Following Tito’s death in 1980, ethnic tensions began to rise. The breakup of the Soviet Union fostered even more tension as the disparate ethnic groups in the Balkans believed the time was right to establish their own country. A bloody civil war followed and Yugoslavia began to break apart. The attached image shows the current state of “break-up” in the former Yugoslavia.


Just like a football game, you can’t tell the players without their numbers. The numbers on the image represent the following:


1. Socialist republic of Bosnia and Herzegovina, with capital in Sarajevo,
2. Socialist republic of Croatia, with capital in Zagreb,
3. Socialist republic of Macedonia, with capital in Skopje,
4. Socialist republic of Montenegro, with capital in Titograd,
5. Socialist republic of Serbia, with capital in Belgrade, which also contained:
5a. Socialist autonomous province of Kosovo, with capital in Priština
5b. Socialist autonomous province of Vojvodina, with capital in Novi Sad
6. Socialist republic of Slovenia, with capital in Ljubljana.


The fake state about which Bilefsky is writing is number 1, Bosnia and Herzegovina, and its capital of Sarajevo, which once hosted the winter Olympics.

“On the surface, this haunted capital, its ancient mosques and Orthodox churches still pocked by mortar fire, appears to be enjoying a renaissance. Young professionals throng to stylish cafes and gleaming new shopping malls while the muezzin heralds the morning prayer. The ghosts of Srebrenica linger — recalling the worst massacre in Europe since World War II — but Sarajevans prefer to talk about President-elect Barack Obama or the global financial crisis. Yet for the first time in years, talk of the prospect of another war is creeping into conversations across the ethnic divide in Bosnia, a former Yugoslav republic that the Dayton agreement divided into two entities, a Muslim-Croat Federation and a Serbian Republic.”

Since the terms of the Dayton Accord secured peace in Bosnia for more than a decade, it was often pointed to as the poster child of successfully negotiated settlements to end ethnic conflicts. Most ethnic conflicts are settled in blood, when one side wins on the battlefield. That is why the international community cares about what happens in Bosnia and doesn’t want to see another conflict erupt. Power-sharing agreements are always tenuous and this certainly holds true in Bosnia.

“The power-sharing agreement between former foes has always been tense. Now, however, the uneasy peace has been complicated by Kosovo’s declaration of independence from Serbia in February, which many here worry could prompt the Serbian Republic to follow suit, tipping the region into a conflict that could fast turn deadly. ‘It’s time to pay attention to Bosnia again, if we don’t want things to get nasty very quickly,’ Richard C. Holbrooke, the Clinton administration official who brokered the Dayton accord, and Paddy Ashdown, formerly the West’s top diplomat in Bosnia, warned recently in an open letter published in several newspapers. ‘By now, the entire world knows the price of that.'”

Bilefsky provides a quick history of the Dayton Accord.

“The peace agreement, negotiated at a United States Air Force base near Dayton, Ohio, in November 1995, accomplished its goal of ending a savage three-and-a-half-year war in which about 100,000 people were killed, a majority of them Muslims. A million more Muslims, Serbs and Croats were driven from their homes, while much of this rugged country’s infrastructure was destroyed. But the decentralized political system that Dayton engineered has entrenched rather than healed ethnic divisions. Even in communities where Serbs, Muslims and Croats live side by side, some opt to send their children to the same schools, but in different shifts. And the country’s leaders are so busy fighting one another that they are impeding Bosnia from progressing. Locked in an impasse of mutual recrimination are Haris Silajdzic — the Muslim in the country’s three-member presidency, who has called for the Serbian Republic to be abolished — and the Bosnian Serb prime minister, Milorad Dodik, who is supported by Russia and Serbia and who has dangled the threat that his republic could secede.”

With over 5,000 different ethnic groups recognized around the globe, one can easily understand why it’s important to find a way for ethnic groups to get along and find a shared path to prosperity. If you think the world has a hard time managing the affairs of around 200 nations, imagine the chaos that could be created by a world divided into thousands of small countries. That is why Bosnia matters, why the West continues to provide foreign aid, and why the European Union maintains a cadre of 2,000 peacekeepers in the area. Bilefsky provides a glimpse of the future if things turn bad.

“Sketching a worst-case example, Srecko Latal, a Bosnia specialist at the Balkan Investigative Reporting Network in Sarajevo, warned that if the Serbian Republic declared independence, Croatia would respond by sending in troops, while the Bosnian Muslims would take up arms. If Banja Luka, the capital of the Serbian Republic, were to fall, he continued, Serbia would be provoked into entering the fray, leading to the prospect of a regional war. ‘For the first time in years, people are talking about war,’ Mr. Latal said. ‘They are tired of it, and they don’t want it. But it is not beyond the realm of possibility.’ Leaders across Bosnia expressed hope that Mr. Obama would be more engaged in Bosnia than President Bush has been, while emphasizing that the president-elect’s multicultural background made him ideally suited to mediate here. And although Bosnia was featured in a painful campaign gaffe for the probable new secretary of state, Senator Hillary Rodham Clinton — who stepped back from a claim that she had ducked sniper fire during a visit here as first lady — many here are optimistic that she will have a vested interest in salvaging Dayton as part of President Bill Clinton’s legacy.”

The painful truth is that a stable, peaceful, and prosperous future rests in the hands of the people of Bosnia, not in the intervention by outside forces. Senator Clinton may be able to get the parties to sit down together, but only good intentions and a willingness to compromise by the parties involved will make a real difference. Although, as Bilefsky notes, the people in Bosnia are tired of conflict and mistrust, there are always fringe groups and zealots anxious to stir up trouble. Until such groups are marginalized, the threat of conflict will always be near.

“Bosnia’s prospects for stability, analysts say, would also be helped if it joined the European Union, the world’s biggest trading bloc. But progress has not been encouraging. In a damning report assessing Bosnia’s readiness to join the bloc, the European Commission, the group’s executive body, warned in November that ‘inflammatory rhetoric has adversely affected the functioning of institutions and slowed down reform’ while corruption and organized crime were significant. The world is so concerned about Bosnia’s stability that the United Nations Security Council has extended the mandate of its senior envoy to Bosnia, who was supposed to leave this year, until June. Still, Miroslav Lajcak, the envoy, said in an interview that while the situation is critical, it was a sign of Bosnia’s progress that politics now trumped security as the biggest challenge. ‘The political situation is difficult, volatile and unstable, but it is not undermining security,’ he said. ‘Violence can’t be ruled out, but I don’t see the prospect of another war.’ For the country to progress, leaders on all sides say, the structure established by the Dayton accord must be overhauled. The country’s two entities have their own Parliaments, and there are 10 regional authorities, each with its own police force and education, health and judicial authorities. The result is a byzantine system of government directed by 160 ministers, a structure that absorbs 50 percent of Bosnia’s gross domestic product of $15 billion, according to the World Bank. While untangling that bureaucracy would be difficult, persuading the country’s leaders to put aside their fundamental differences might be harder.”

When I talk to leaders of emerging market countries about Development-in-a-Box™, I often point to examples of countries that have done well and explain why I believe they overcame long odds to succeed. Bosnia is the counterexample. It has no vision of a unified and prosperous future (which means it has no strategic plan), it has a problem with corruption (which wastes resources and discourages investment), it has a “byzantine system of government” (which means that it is neither transparent nor efficient), and it has senior officials but no true leaders. Bilefsky underscores the point about bad leadership by noting that the current cadre of politicians in Bosnia possesses neither a vision nor a spirit of compromise.

“Mr. Silajdzic, who as Bosnia’s wartime foreign minister was at Dayton, argued in an interview that the institutional structure created there had served to legitimize the genocidal policy of the Serbs during the war. He urged the world to help write a new Constitution that would create a unified state based on economic regions, effectively consigning the Serbian Republic to the dustbin. ‘The problem with Dayton is that it created an ethnocracy rather than a democracy and has become an umbrella under which Slobodan Milosevic’s project of ethnic cleansing is hidden,’ he said, referring to the former Serbian president. ‘If the situation is allowed to continue, the message this sends the world is, “Kill thy neighbor and get away with it.”‘ For Mr. Dodik, the prime minister, such talk just proves that Bosnia’s Muslim leadership is intent on domination. ‘If Silajdzic doesn’t like Dayton, then why did he sign it?’ he asked. Mr. Dodik, a charismatic former basketball player with a large power base in the Serbian Republic, was once a Western darling for his wartime and postwar opposition to Radovan Karadzic, the Bosnian Serb nationalist leader now on trial in The Hague on war crime charges. But many Western diplomats say he has since adopted Mr. Karadzic’s nationalist language and they blame him for impeding Bosnia’s progress. Mr. Dodik recently further inflamed tensions by filing criminal charges against a senior United States envoy and foreign prosecutors in Bosnia, accusing them of plotting against his government after they opened a corruption investigation into the Serbian Republic’s infrastructure deals, including one for $146 million government building in Banja Luka. … Guessing whether he will tear the country apart has become a favorite parlor game in Bosnia in recent months. In the past, he has said that a referendum for independence could be a fair way to settle the Serbian Republic’s status.”

Despite his many failings and sometimes ruthless ways, Tito did manage to bring ethnic groups together for nearly half a century. Those who attended the winter Olympics in Sarajevo in person or watched them on television could not have imagined that the idyllic city would later be shattered by civil war. Politicians in Bosnia seem to have given up on the dream of developing a country in which people of all ethnicities and religions can work together in peace and prosperity. Until the people of Bosnia are willing to shed the past and create a future together, no amount of outside negotiation will help them achieve prosperity. They need to create shared values, shared holidays, shared traditions, and shared dreams.

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