Bosnia & Herzegovina has failed for more than ten months to end the deadlock it entered after the October 2018 general election, and the country is sinking deeper into the swamp of never-ending political crises, with no chance to get closer to Nato or EU membership, while it pushes away investors from the West.
Bosnia could dive into an even deeper crisis as one of its leaders — the Serb member of the tripartite presidency Milorad Dodik — has declared he might force his entity to once again question the authority of the state-level institutions, thereby breaching the Dayton peace agreement.
Bosnia held a general election in early October 2018 and since then the main ethnic parties representing the Bosniaks, Serbs and Croats have been unable to reach a compromise to form a state-level ruling majority. The main issue is the country’s future membership of Nato, to which the Serbs fiercely object and are attempting to prevent at any cost.
At the beginning of August, after long and tense talks helped by the EU, the leaders of the three main parties — Bakir Izetbegovic of the Bosniak Party of Democratic Action (SDA), Dodik of the Serb Alliance of Independent Social Democrats (SNSD) and Dragan Covic of the Croatian Democratic Union (HDZ) — reached a compromise, signing a coalition agreement and pledging to form a state-level government by September 5.
Although it looked like the light at the end of the tunnel had finally appeared, it turned out to be just a brief flicker before Bosnia plunged back into crisis.
The hot potato again was Nato. In the coalition agreement, the three parties noted very vaguely that the country will not freeze its progress towards Nato membership. This meant that Bosnia should send Nato its first Annual National Programme (ANP) on preparations for possible future membership. However, Dodik refuses to accept that, and the other two leaders say they will not make any further compromises.
Bosnia’s current situation seems even more hopeless than after the previous general election in 2014. Then it took the political parties six months to reach a compromise and name a prime minister, pro-European Denis Zvizdic, who still holds the position while also chairing one of the chambers of the state-level parliament.
The country’s agreement with the International Monetary Fund (IMF), a main driver of any reforms, has been frozen since July 2018 as the country has failed to implement the pledged reforms. The current political situation means a complete lack of any reforms, meaning the deal with the IMF will not be unfrozen and preventing Bosnia from accessing much-needed cheap cash.
Although Bosnia has not issued any official data for 2019, foreign direct investment (FDI) also seems to be hitting bottom this year as no major investor has been willing to risk launching a project in the highly unstable political and economic environment. Bosnia’s sole aluminium smelter, Aluminij, was recently forced to halt operations as it failed to find a strategic investor.
So far, only China seems interested in energy projects. Russia and Serbia are willing to back Bosnia’s Serb entity Republika Srpska with loans and grants, which has political consequences as it opens the door for even stronger influence from Moscow.
Analysts have previously said that the pro-Russian Dodik is completely under the influence of Russian President Vladimir Putin and his Serbian counterpart Aleksandar Vucic. There were reports in 2018 that Moscow could have started secretly providing Republika Srpska with weapons and military training and analysts have suggested that Putin could spark a conflict in Bosnia if that would suit his own interests.
The EU will also keep its door firmly closed to Bosnia if the country fails to appoint new government. The country is already lagging behind all the other Western Balkan states except Kosovo as they move towards EU membership.
More fuss ahead
While at the moment the situation in Bosnia is business as usual, Dodik has given signals he could raise tensions even more after the September 5 deadline for formation of a government expires. If until then the parties fail to nominate a new prime minister, their coalition agreement will no longer be in force and new difficult negotiations should start.
The anti-Nato Serb leader was expected to nominate Zoran Tegeltija, a member of his party, as the next prime minister on August 27, but at the last minute he changed his mind and told reporters the country is entering a deep crisis now.
He also threatened that, unless the other two leaders agree to cancel sending the ANP to Nato, he will call on the parliament of Republika Srpska to withdraw the entity’s agreement to the formation of state-level military, judicial authorities and for the collection of indirect taxes.
Republika Srpska agreed on these along with the Bosniaks and Croats as part of the Dayton peace accord that ended the bloody Bosnian war in 1992-1995.
Dodik’s latest threat could be yet another of his attempts to make noise and attract support, but would further destabilise the country if implemented. He has many times claimed that the state-level military and judiciary are unconstitutional.
Meanwhile, the international community is attempting to influence the Bosnian leaders to find a compromise and end the crisis. The ambassadors of five countries — France, Germany, Italy, the UK and the US — have issued a joint statement, backed by the EU, saying that the decision to postpone the latest session of Bosnia’s tripartite presidency, at which a new prime minister was supposed to be named, shows the need for compromise and consensus-building among Bosnia’s political parties and leaders.
“We reaffirm our steadfast commitment to strong and effective state institutions and call upon all political leaders to fully respect and uphold the constitution and laws of [Bosnia & Herzegovina],” the statement says.