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COUNTRY PROFILE Bosnia and Hercegovina (BiH) Croatia Slovenia Our quarterly Country Reports on Bosnia and Hercegovina, Croatia and Slovenia analyse current trends. This annual Country Profile provides background political and economic information. 1996-97 The Economist Intelligence Unit 15 Regent Street, London SW1Y 4LR United Kingdom The Economist Intelligence Unit The Economist Intelligence Unit is a specialist publisher serving companies establishing and managing operations across national borders. For over 50 years it has been a source of information on business developments, economic and political trends, government regulations and corporate practice worldwide. The EIU delivers its information in four ways: through subscription products ranging from newsletters to annual reference works; through specific research reports, whether for general release or for particular clients; through electronic publishing; and by organising conferences and roundtables. 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London New York Hong Kong The Economist Intelligence Unit The Economist Intelligence Unit The Economist Intelligence Unit 15 Regent Street The Economist Building 25/F, Dah Sing Financial Centre London 111 West 57th Street 108 Gloucester Road SW1Y 4LR New York Wanchai United Kingdom NY 10019, USA Hong Kong Tel: (44.171) 830 1000 Tel: (1.212) 554 0600 Tel: (852) 2802 7288 Fax: (44.171) 499 9767 Fax: (1.212) 586 1181/2 Fax: (852) 2802 7638 E-mail: [email protected] E-mail: [email protected] E-mail: [email protected] Website: http://www.eiu.com Electronic delivery EIU Electronic New York: Lou Celi or Lisa Hennessey Tel: (1.212) 554 0600 Fax: (1.212) 586 0248 London: Moya Veitch Tel: (44.171) 830 1007 Fax: (44.171) 830 1023 This publication is available on the following electronic and other media: Online databases CD-ROM Microfilm FT Profile (UK) Knight-Ridder Information World Microfilms Publications (UK) Tel: (44.171) 825 8000 Inc (USA) Tel: (44.171) 266 2202 DIALOG (USA) SilverPlatter (USA) University Microfilms Inc (USA) Tel: (1.415) 254 7000 Tel: (1.800) 521 0600 LEXIS-NEXIS (USA) Tel: (1.800) 227 4908 Copyright © 1997 The Economist Intelligence Unit Limited. 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ISSN 1352-0970 Symbols for tables “n/a” means not available; “–” means not applicable Printed and distributed by Redhouse Press Ltd, Unit 151, Dartford Trade Park, Dartford, Kent DA1 1QB, UK 1 January 31, 1997 Contents Bosnia and Hercegovina (BiH) 3 Basic data 4 Political background 16 Population and society 17 The economy 18 Currency 19 National accounts 19 Employment 20 Prices and wages 20 Agriculture and forestry 21 Mining and energy 22 Manufacturing 23 Transport and communications 23 Tourism 23 Finance 24 Foreign trade and debt Croatia 25 Basic data 26 Political background 33 Population and society 34 The economy 36 Currency 36 National accounts 37 Employment 40 Prices and wages 41 Agriculture, forestry and fishing 42 Mining 42 Energy 43 Manufacturing 44 Construction 45 Tourism 45 Transport and communications 46 Finance 48 Foreign trade 50 External payments and debt 51 Trade, investment and other regulations EIU Country Profile 1996-97 © The Economist Intelligence Unit Limited 1997 2 Slovenia 53 Basic data 54 Political background 60 Population and society 60 Currency 61 The economy 63 National accounts 63 Employment 64 Prices and wages 65 Agriculture, forestry and fishing 66 Mining and energy 67 Manufacturing 67 Construction 67 Tourism 68 Transport and communications 68 Finance 69 Foreign trade 71 External payments and debt 72 Trade and investment regulations 73 Select bibliography EIU Country Profile 1996-97 © The Economist Intelligence Unit Limited 1997 Bosnia and Hercegovina (BiH) 3 Bosnia and Hercegovina (BiH) Basic data Land area 51,129 sq km, of which 20.9% arable, 10.4% pasture and 46% forest Population 4,366,000 (1991 census, ie pre-war); 3 million (1996 estimate) Main towns Population in ’000, 1991 Sarajevo 526 Banja Luka 195 Zenica 146 Tuzla 132 Mostar 126 Prijedor 112 Climate Continental Weather in Sarajevo Hottest month, July, 18-23°; coldest month, December, 0-2°C; wettest month, June, 110-150 mm average rainfall; driest month, December, 20-70 mm average rainfall Language Serbian, Croat and Bosnian (the last of these is a local mixture of Serbian and Croat, which are themselves very similar) Currency Bosnian and Hercegovina dinar (BiHD), which is fixed against the D-mark at DM1: BiHD100. The supply of currency is linked to foreign reserves. However, the Yugoslav dinar (YuD) is used in the Republika Srpska and the Croatian kuna (HRK) in parts of the Federation. The D-mark is also in use throughout BiH Time 1 hour ahead of GMT EIU Country Profile 1996-97 © The Economist Intelligence Unit Limited 1997 4 Bosnia and Hercegovina (BiH) Political background Introduction Bosnia and Hercegovina (BiH) is at the heart of the Balkans—a meeting place of the west European Catholic and east European Orthodox cultures. Turkish occupation also gave rise to a large Muslim population, whose interpretation of Islam has traditionally been moderate and tolerant. At the end of the l5th cen- tury some of the Jews expelled from Spain and Portugal settled in Bosnia. Since the early Middle Ages, Bosnia, and from about 1400 onwards, Bosnia and Hercegovina, has been a distinct entity whether on its own or as part of the Ottoman Empire, Austro-Hungary or Yugoslavia. For several hundred years its character has been created by its unique mix of traditions. Although, before 1992, there were episodes of tensions between the groups, they were also long periods of harmony. Bosnia and Hercegovina was torn apart by the war which started in April 1992 and ended with a ceasefire in October 1995, followed by a peace agreement initialled in Dayton, Ohio, USA, on November 21 and signed in Paris on December 14. The agreement acknowledged the division of BiH into two entities: the Federation of Bosnia and Hercegovina, and the Republika Srpska (RS). It required the RS to cede to the Federation the suburbs of the capital, Sarajevo, and a corridor to the Gorazde enclave. The RS has a corridor through the town of Brcko which links its eastern territory with its territory in north- western Bosnia. It also holds on to areas in eastern Bosnia, including Srebrenica, which formerly had large Muslim and other non-Serb populations. The Federation was formed from the Washington agreement of March 18, 1994, which ended a secondary war which had taken place in 1993 between Croats and Muslims; the Croats had been fighting to extend their self-declared republic of Herceg-Bosna, centred in the western part of Hercegovina into Bosnia. This agreement was successful in that it brought an end to Muslim-Croat fighting in 1994, enabled government and Bosnian Croat forces to cooperate in 1995 against RS forces, and provided the basis of the Dayton peace agreement. However, the “Croatian Republic of Herceg-Bosna”, with almost all its civilian and military functions, still de facto existed at the end of 1996, although Croatia had committed itself to ensuring that its powers were to be transferred to the Federation on August 31. The justification for its continued existence is that the transfer of competencies from Herceg-Bosna and from the former Muslim- dominated Bosnian government should be made simultaneously. Both Muslims and Croats accuse each other of not fulfilling their undertakings. Following the forced displacement of populations, which came to be known as “ethnic cleansing” and was an integral part of the war, the RS and the Croat area which called itself Herceg-Bosna are both largely ethnically homogeneous. The Dayton agreement committed all parties to allowing the return of refugees to their homes, but with one or two isolated exceptions this aspect of the agreement was completely ignored in 1996. Indeed some population move- ments have continued, the largest being that of Serbs from several suburbs of Sarajevo before these became part of the Federation in March 1996. It is only in some parts of the Federation outside the self-styled Herceg-Bosna that different ethnic groups have continued to live side by side, notably in Sarajevo, Tuzla and Zenica. EIU Country Profile 1996-97 © The Economist Intelligence Unit Limited 1997 Bosnia and Hercegovina (BiH) 5 Origins and the medieval Slav tribes settled in the area of Bosnia and Hercegovina in the 7th century, period at the same time as in Croatia. Over the next two centuries it was a semi- independent state ruled by a ban (a feudal title akin to duke) and over which Hungary and Byzantium vied for control. There was a parallel rivalry between the Catholic and Orthodox Churches. In the l2th century an independent Bosnian Church emerged, which avoided a formal hierarchy and was more attuned to local customs than the Catholic or Orthodox structures. In 1377 Ban Tvrtko Kotromanic became King Tvrtko the First. His reign until 1391 represented the apogee of the Bosnian state. After his death Bosnia was divided between rival feudal lords while the influence of the Ottoman empire gradually increased until the independent Bosnian state collapsed in 1463; the last king was Stjepan Tomasevic. Turkish rule Under the Ottoman empire Bosnia formed a pashadom or eyalet (province). From 1580 to 1699 this covered rather more than the present-day territory of Bosnia and Hercegovina.