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Briefing 66 / Europe & Central Asia

Brčko Unsupervised

The international community should start a process to close its supervision of Bosnia’s Brčko District at its meeting next week and develop a new strategy to better help domestic institutions address governance challenges and corruption, while retaining the ability to sanction any attempts to undermine security.

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I. Overview

It is time to close international supervision of Bosnia’s Brčko District. Once seen as a model of post-war reconciliation and good government, it is drowning in corruption and mismanagement that flourished despite its supervisors’ best efforts. The territory is vital to Bosnia and Herzegovina (BiH)’s stability: it links the two halves of both Republika Srpska (RS) and the BiH Federation (FBiH), and belongs technically to both entities but is independently governed and multi-ethnic. Many of its former leaders are under suspicion in a corruption probe that may have only scratched the surface; several high profile development projects are collapsing in bankruptcy and litigation. RS has a strong influence on the district but is not threatening to undermine its status. Nevertheless, the international community should ensure that Serb leaders of that entity are left in no doubt that any move to take Brčko over would meet a strong reaction. Stability is now dependent on whether local politicians, law enforcement and the judiciary can take responsibility. International supervision is no longer helping, and a new strategy is needed.

A special international Arbitral Tribunal established as part of the Dayton Peace Accords created the Brčko District in August 1999 (the “Final Award”), under the exclusive sovereignty of Bosnia and Herzegovina as a multi-ethnic, democratic unit of local self-government. An international supervisor, who also serves as Deputy High Representative, was also appointed in 1997 to oversee implementation of the Dayton agreement in the Brčko area with executive authority to promulgate binding regulations and orders.

In 2009 the international community assessed that Brčko institutions were functioning effectively and apparently permanently, the main condition that had been set to enable closing down the special supervision. Since then additional conditions have been put mainly on the RS to demonstrate that it has no intention to usurp Brčko authority. The Serb entity is making no claim on the district, and apparently has formally fulfilled the final condition by acknowledging that the inter-entity boundary line (IEBL), which splits Bosnia’s two entities, does not run through Brčko.

This may appear the wrong time to end international supervision. The district faces its greatest crisis yet of governance and economic development, due to hardening political positions and endemic corruption. All Bosnia is being shaken by a political and economic crisis. Over a year since the October 2010 elections, there are neither a state government nor 2011-2012 state budgets. Some fear the RS is increasingly intent on declaring independence from BiH, and Brčko will become the site of renewed violence in connection with such manoeuvres. But supervision there involves only the town’s internal governance; it cannot affect BiH-wide security, which remains the responsibility of the already weakened High Representative (OHR) and the EU member state force (EUFOR).

The Brčko international supervisor has not stemmed corruption for more than a decade and has neither resources nor international support to impose change now. Retaining him as ultimately responsible in the town provides an easy way for local politicians to avoid finally exercising that responsibility and accountability which Bosnians must ultimately show themselves capable of to protect their own basic interests.

The FBiH has neglected Brčko District since its establishment, creating a vacuum RS is eager to fill. The Federation government, and the FBiH-based parties with branches in Brčko, should work to improve relations with local business and political elites to balance the weight of Banja Luka. For its part, RS has legitimate interests in the district and has contributed much to its economic revival; this benign influence should be encouraged to continue and grow. Working together through the BiH state, Serbs, Bosniaks and Croats should also cooperate in agreeing to locate at least one significant government agency in Brčko District. All should intensify efforts to fight local corruption, especially strengthening independence of police, prosecutors and judges.

Moreover, at the same time as the international community acts to compel local officials to take responsibility for their own affairs, it should take parallel steps to make clear that its commitment to the independence and territorial integrity of Bosnia remains firm and that any attempt by RS to violate the provisions of the Dayton peace dispensation including the special status of Brčko will be met decisively. RS’s interests in Brčko must not be allowed to lead to a belief that it can successfully question the Final Award. Accordingly:

  • At the Peace Implementation Council (PIC) meeting on 12-13 December, the Brčko supervisor should recommend that supervision close within a set number of months, but that the Arbitral Tribunal stay open as a safety mechanism. In case of a grave violation of Brčko’s autonomy by RS (or the FBiH), the retained tribunal could reopen supervision or modify the Final Award and assign the district to the other entity. Closing supervision and retaining the tribunal were not foreseen in the Dayton Peace Agreement or in the Final Award of 1999 but is being seriously considered by PIC members. It seems unlikely that a claim against this strategy could be sustained if the PIC Steering Board, the Brčko supervisor and the head of Brčko Arbitral Tribunal, U.S. diplomat Roberts B. Owen, agree to these steps, as they have to the maintenance of the tribunal twelve years after the Final Award was made.
  • The EU should give further indications of its intention to pay greater attention to Brčko. Its delegation to BiH should help Bosnian officials fight corruption through strengthening the rule of law and relevant institutions, and preparing for the EU accession, including by opening a new office in the district, as the regional office of the OHR headed by the supervisor closes. Most of the responsibility for adopting and implementing the acquis communautaire, the body of EU law, falls to Bosnia’s entities and cantons – and on Brčko, which has a much smaller capacity. It will need support through gradual reform. A useful first step would be for the supervisor in his final months to work with the government to encourage adoption of the Anti-Corruption Strategy for 2009-2014, which the EU could help implement.


Sarajevo/Istanbul/Brussels, 8 December 2011

Report 232 / Europe & Central Asia

Bosnia’s Future

While the physical scars of the 1992-1995 Bosnia war have healed, political agony and ethnic tension persist. Real peace requires a new constitution and bottom-up political change.

Executive Summary

Bosnia and Herzegovina (BiH, or Bosnia) poses little risk of deadly conflict, but after billions of dollars in foreign aid and intrusive international administration and despite a supportive European neighbourhood, it is slowly spiralling toward disintegration. Its three communities’ conflicting goals and interests are a permanent source of crisis, exacerbated by a constitution that meets no group’s needs. The political elite enjoys mastery over all government levels and much of the economy, with no practical way for voters to dislodge it. The European Union (EU) imposes tasks BiH cannot fulfil. A countrywide popular uprising torched government buildings and demanded urgent reforms in February 2014, but possible solutions are not politically feasible; those that might be politically feasible seem unlikely to work. Bosnia’s leaders, with international support, must begin an urgent search for a new constitutional foundation.

The international project to rebuild Bosnia has had success: war’s physical scars are largely gone, and the country is peaceful. The political agonies, however, show the intervention’s limits. Years of well-intentioned reforms, imposed or urged, have left a governing structure leaders circumvent, ignore or despise. May’s floods left scores dead and thousands homeless, exposing the price of poor governance. With growing frequency, Bosnians ask the questions that preceded the 1992-1995 war: shall it be one country, two, or even three; if one country, shall it have one, two or three constituent entities, and how shall it be governed?

The heart of the problem is in Annex 4 to the Dayton Peace Agreement, known as the constitution (and in several changes imposed by courts and international officials). It defines BiH as a state of two entities, in effect but not explicitly federal, but also the state of three constituent peoples (Bosniaks, Croats, Serbs), and yet, simultaneously, of all citizens. A suffocating layer of ethnic quotas has been added, providing sinecures for officials increasingly remote from the communities they represent. The tensions created by constitutional schizophrenia are pushing BiH to the breaking point. A new design is needed: a normal federation, territorially defined, without a special role for constituent peoples, but responsive to the interests of its three communities and the rights of all citizens.

The state administration’s need to reform is made acute by a 2009 decision of the European Court of Human Rights (ECtHR) that in effect requires BiH to change the ethnicity-based way it chooses its chief executive and part of its legislature. Existing proposals try to squeeze the constituent peoples into an ostensibly ethnicity-blind structure on top of which a complicated network of indirect elections would allow party leaders to choose the executive with as little democratic input as possible. The EU and the outside world support this tinkering with Dayton to satisfy the decision, though such proposals have manifestly failed. Bosnians need to rebuild their political structure from the bottom up.

There is no consensus on where to start, but Bosnia may have to break from its political system based on constituent peoples and their rights. Crisis Group has not reached this conclusion lightly. It reflects long experience and observation that no one has been able to frame a broadly attractive vision on the existing flawed basis. With stresses and frustrations accumulating in all communities, Bosnia must conceive new foundations to survive. Agreement may take years and much experimentation and debate, but the search should begin.

BiH is home to three political communities: those primarily loyal to the Bosnian state, usually but not always Bosniaks; those loyal to Republika Srpska (RS), usually Serbs; and those desirous of Croat self-government, usually Croats. Giving the Croats what they want, their own entity to make a three-entity Bosnia, is absolutely rejected by Bosniaks. Building virtual representative units for the three communities, possibly with new emphasis on municipalities as basic building blocks, is intellectually plausible but requires a leap of faith few seem ready to take. A purely civic state is inconceivable to Serbs and Croats.

Neither leaders nor civil society have deeply explored alternatives to three constituent peoples in two entities; any consensus would take time. Nevertheless, the goal should be clear. The head of state should reflect Bosnia’s diversity, something a collective does better than an individual. The same body could be the executive government. Some decisions should require consensus, others a majority. All three communities should be represented, not necessarily in equal numbers. There should be no ethnic quotas; representation should reflect self-defined regions and all their voters. Poorly performing, unnecessary state agencies and ministries should be slimmed or abolished, with powers reverting to the entities; but the state would need new ministries and agencies required for EU membership. The ten cantons in the larger of BiH’s two entities, the Federation (FBiH), are an underperforming, superfluous layer. They could be abolished, their powers divided between the municipalities and the entity government.

Political culture is part of the problem; an informal “Sextet” of party leaders in effect controls government and much of the economy. A multi-ethnic coalition persists, election to election, with only minor adjustments. Membership is earned by winning opaque intra-party competitions in which voters have little say. Change in this system can only come from within: Bosnians should join parties and participate in genuine leadership contests. Sextet power is further buttressed by control of hiring, investment and commercial decisions at state-owned firms, a situation that chokes private investment and growth.

Bosnia is unimaginable without the work of international officials who did much to shape political institutions and implement peace, but the international community has become more obstacle than help. BiH is trapped in a cycle of poorly thought-out, internationally-imposed tasks designed to show leaders’ readiness to take responsibility but that put that moment forever out of reach. The only way to encourage leaders to take responsibility is to treat the country normally, without extraneous tests or High Representatives. The EU could signal a new start by stating it will receive a membership application – the first of many steps on the long accession road. It should then be an engaged, not over-didactic partner in Bosnia’s search for a way to disentangle the constitutional knot.