January
2000
Bosnia
Update Memo
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Bosnia Update Memo |
The following report outlines new developments in the past three months and the state of on-going developments.
1. The regulatory background
As it was pointed out in the Regulatory developments report and in the Key persons - contacts and organisations report, the country is administratively divided into two entities, each with a very high level of autonomy. Federal ministries exist, but in fact the real authorities are their counterpart ministries in the Federation of Bosnia-Herzegovina (FBiH) and the Republic of Srpska (RS). Most of the regulations and legal acts were inherited from the former Yugoslavia. Because of the war that started immediately after the declaration of the independence from former Yugoslavia, there were no real conditions under which to build a new regulatory system. This is one of the most important tasks for both of the entities, and the governments, as well as for the federal administration.
2. Business constraints and entry barriers
Bosnia and Herzegovina is tightly connected with respect to communications and industry to its neighbour countries, and via them to the rest of the world. RS is under the strong influence of the FR of Yugoslavia, and their business community. Similarly, there is a great influence from Croatia and its business community in some parts of FBiH with a Croat population.
Besides the very high level of activity in the field of liberalisation and privatisation certain business constraints remain. Many of the bigger companies are still owned by the State, but there is a substantial number of small and medium size privately owned enterprises.
The privatisation programme is intended to play an integral part in the economic recovery of the country. In that context, the main objective of the programme is to change the structure of ownership so that every enterprise has real owners with clearly defined ownership rights. Other objectives of the programme include: contributing to the maintenance of social stability; dealing with outstanding claims, especially frozen foreign currency deposits; assisting the development of funding for the public pension system; securing resources for the restitution of property; and developing healthy and liquid capital markets.
The privatisation programme will be established by new legislation. All existing publicly owned enterprises are to be included in the programme, with three exceptions:
a. Infrastructure and utility undertakings (such as railways, electric power etc.) will be included in the programme only after the various sectors to which they belong have been re-organised to fit the new internal structure of the country;
b. A number of large enterprises will be restructured (i.e. broken up) under a special programme before parts of them are offered in the main privatisation programme; and
c. Banks will be dealt with under a separate programme.
The legislation and regulations governing privatisation and post-privatisation trading are interdependent, and will be designed as an integrated package. The following laws will be required:
a. Stock Exchanges
b. The Central Registry
c. The Securities Commission
d. Investment Funds
3. Inventory of the major "public" utilities with a potential for use in IS applications
Republic of Srpska
ELECTRICITY
The following hydropower plants operate in the Republic:
Coal-fired power plants utilize coal deposits in Gacko and Bijeljina and their installed capacity is as follows:
Additional CFPP are installed in the large industrial plants like the paper mill "INCEL" Banja Luka with an installed capacity of 64 MW, totaling 142 MW of power generation. Future development of coal fired power plants is based on coal deposits in Gacko and Bijeljina. CFPP "Ugljevik 2" is under construction, and it is planned to construct an additional CFPP at the same location, each of them providing 300 MW of electricity. In Gacko it is planned to build two additional units at 300 MW each.
The main pipeline for natural gas exported from Russia connects Belgrade main junction with Zvornik and Sarajevo. It provides some 320 million nm3 of natural gas per year. It is planned to extend the pipe- line from Zvornik to the western part of the Republic through Bijeljina, Brcko, and Derventa to Banja Luka and Prijedor.
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