In Bed With Iraq?

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On 11 September, the management of the state-owned Orao manufacturer of airplane parts in Bosnia's Republika Srpska publicly denied U.S. allegations that it was exporting military and other equipment to Iraq. The Republika Srpska Defense Ministry said on 10 September that it had concluded an investigation into the matter and turned up no evidence that the company was dealing with Iraq.

The scandal first began to make waves the previous week, on 4 September, when the U.S. Embassy in Bosnia sent a diplomatic note to the Bosnian Foreign Ministry, accusing Orao of breaking United Nations resolutions 661 and 687, which forbid any type of military cooperation with Iraq, and warning the ministry that if the allegations are proven true, Bosnia could be charged with promoting terrorism.

On 11 September, the Banja Luka daily Nezavise Novine published the entire contents of the diplomatic note sent by the U.S. Embassy. "Planes that looked very much like planes manufactured by Orao were fighting back American planes flying over Iraqi airspace," the paper quoted the note as saying.

In its first public statement since the scandal broke, Orao director Milan Prica told reporters on 11 September that he plans to bring charges against those people who have slandered the company with false accusations, and also against certain media outlets for publishing what he calls unconfirmed stories.

In a company press release, Prica said that Orao has recently restructured its operations and shifted its manufacturing of airplane parts from the military sector to the civilian sector. "Orao has never manufactured any type of weapons. Airplane repair parts — the main focus of the company — are not weapons by world standards," the press release said.

Republika Srpska Defense Minister Slobodan Bilic — who headed a special task force that began investigating the matter on 5 September — said on 10 September that the investigation had been concluded and investigators found no evidence that Orao had ever exported military equipment to Iraq or any other country under U.N. embargo.

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Any Bosnian company wanting to export legal weapons to other countries must first obtain special permission from the army commander in chief and then apply for a license from the NATO-led Stabilization Force (SFOR). In order to get that license, an official order must come from the products' final user.

According to a 10 September statement from the government of Republika Srpska, a second phase of the investigation will determine whether or not other companies that Orao does business with in Bosnia and abroad have been involved in exporting Orao parts to Iraq or other embargoed countries. Authorities have refused to comment until the second phase of the investigation is concluded.

Quoting anonymous sources, the Sarajevo weekly Slobodna Bosna said that Republika Srpska President Mirko Sarovic and Orao director Prica are combining forces to create a strategy to defend the company against the grave accusations. "The goal of the defense strategy is to transfer the blame to French companies with whom Orao had business dealings," the weekly wrote.

According to the daily Nezavisne novine, the U.S. diplomatic note accuses the Republika Srpska Defense Ministry of being involved in the alleged dealings with Iraq and says that not only did Orao export military airplane parts to Iraq, but also sent its own expert technicians to Iraq to install those parts.

Slobodna Bosna suggests a strong link between Orao and Sarovic, who previously held a position in the company's management and is now the commander in chief of the Republika Srpska army. Orao was founded in 1962, and until December 1995 was based in Sarajevo. Following the Dayton Peace Agreement, the company was moved to Bijeljina.

From the onset, authorities in Republika Srpska have denied any knowledge that the company is dealing with Iraq. Republika Srpska Prime Minister Mladen Ivanic told reporters on 5 September that if anyone violates the U.N. sanctions, they do so at their own risk, and the government has no desire to cover up such actions.

But the government of Bosnia and Herzegovina feels that Republika Srpska authorities aren't doing enough to get to the bottom of the scandal. At its 14 September session, the presidency of Bosnia and Herzegovina discussed the initial results of the investigation. Beriz Belkic, the current president in the country's rotating presidency, said that he was disappointed that the president and prime minister of Republika Srpska failed to show up at the special session.

"The presidency of Bosnia concluded that no matter what the results of the investigation, Bosnia and Herzegovina's reputation has already been damaged. Because of that, in the future we need our institutions to be more responsible and more watchful of companies dealing in weapons or parts," Belkic told reporters after the session.

The international community's high representative in Bosnia, Paddy Ashdown, declined to comment on the issue until the final results of the investigation were in.

*This article was edited and adapted from Transitions Online. A longer version is available at: www.tol.cz

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