Grass from the Guns

Carl Bildt, the international community's high representative for Bosnia, recently held a meeting with the three Bosnian Prime Ministers (Bosnian Serb Rajko Kasagic, Sarajevo government Hasan Muratovic and Moslem-Croat Federation Izudin Kapetanovic) in Banja Luka recently. They discussed mutual economic trends.

Fanatical patriots and the uniformed shook their heads; yesterday's enemies are going to start doing business? They said the Serb exodus from Sarajevo showed that nothing can be done together in Bosnia, they said. They forgot that trade flourished throughout the war: guns, food, cigarettes, drugs, services. There was only condition - cash payment in hard currency.

In the midst of the Moslem-Croat fighting in Mostar in 1993, the Bosnian Army (BiH) paid the Bosnian Serb Army's (BSA) Herzegovina corps 20,000 DEM to shell the Croat Defence Council (HVO). The shelling began at a set time but continued past the deadline. Worried Moslem officers contacted the BSA artillery by radio and were told not to worry, the extra is on the house.

That example shows the developed trade in arms, personnel and military services that reached a climax in 1993/94. Serb soldiers wearing HVO uniforms shelled Moslem troops from Serb tanks for 150 DEM a man. With the exception of the Cazin area where both Moslem armies bought weapons from the Krajina Serbs (Fikret Abdic also rented men and materiel) the arms and services trade in central Bosnia was mainly between Serbs and Croats. The Bosnian Serb Republic (RS) got 14,000 tons of fuel through Herzegovina. Serb trucks replaced their plates with Croat registration plates, went to Split to load the fuel and replaced the plates on their way back. Serb-Croat trade died down after the Washington agreement in 1993 and the Croats began trading with the Moslems.

Throughout the war the arms trade was a very profitable business.

Former Moslem Prime Minister Hasan Cengic explained how the trade was done in Slovenia's parliament after an arms scandal in 1994. Slovenian Defence Minister Janez Jansa "discovered" 120 tons of weapons intended for the BiH at Maribor airport. Cengic said: "We paid the Slovenian police in cash and with no records (...) We got 30-35,000 rifles and several hundred pistols from the police. That cost us somewhere between 1.2 and 1.6 million DEM".

But, the arms trade was not a business under a state and para-state monopoly. Private businessmen, doing small deals, saw their business flourish in 1992 and '93. It started with UNPROFOR in the Krajina. As soon as the UN personnel settled in, traders appeared offering bayonets for $20, hand grenades for $10-15 and pistol ammunition for $1-2 a bullet. Business boomed once the market formed. Since UNPROFOR paid its men in USD there was no problem in adopting the US currency.

The question is why the peacekeepers bought weapons. Part of the answer is supplied by Austrian customs officials. Some 60 of their officers surrounded and searched three buses in late 1993 which were carrying Czech UN troops home. They seized a pistol, six hand grenades and some ammunition. Informed sources said the best prices were paid by the Bosnian Moslems who were short of arms then, especially in Bihac. They bought arms from Serb and Croat dealers at any price.

Another question is where did the Serbs get that surplus of weapons. Informal analyses show that over 60% of the arms left to the them by the former Yugoslav National Army (JNA) went missing and they still had enough to go around.

As the war continued, the small deals died off. All three sides had plenty of weapons and the demand dropped drastically. Some Krajina dealers who managed to get some of their stock to Serbia are complaining that not even the Albanians want to buy them now.

Drugs and arms are considered two branches of the same business. An indirect example proves that. During the worst of the Moslem-Croat fighting in October 1993, BiH troops fired a dud mortar shell full of marijuana to the right bank of the Neretva which divided Moslem and Croat areas of Mostar. The HVO sent the dud back filled with cigarettes.

The drugs trade also flourished in the former Yugoslavia war. Prices even dropped lower than before the war and the explanation of that is simple. Many arms dealers were not averse to selling drugs since they were already risking their necks. The demand for drugs grows in wartime and most dealers knew where to get the stuff even before the war. The more so since supplies of modern weapons and drugs are the domain of organized crime. The dealers' paradise was complete because there was no law to avoid. BiH General Jovan Divjak complained early in 1993 that "dirty money is playing a big role in this war" and that "thanks to criminal groups Sarajevo was defended in the first weeks of the war" but "they were allowed to do what they wanted for too long".

In mid-1993, a gram of grass sold for three DEM in Sarajevo, heroin for 50-70 DEM. The prices in Belgrade were five DEM and 80-100 DEM. After dealing with the Sarajevo Mafia that year, the local secret police said a large amount of heroin was found in the home of one of the crime bosses and claimed that supply channel had been cut.

The arms trade is a state monopoly and the drugs trade requires knowledge of specific people, but the cigarette business is believed to be the best, although not most profitable, and safest deal. In the winter of 1992/93, cigarettes were a form of payment in Sarajevo and you could buy anything for them.

Oslobodjenje daily published the story of the tobacco routes in 1993. It said cigarettes were carried on horses, on foot, tractor, across mountain trails. A carton cost 7-10 DEM in Gornji Vakuf, 20 in Fojnica, 30 in Visoko and 70 in Zenica. The Bosnia war holds a record in that respect: one carton of Marlboro was sold for 500 DEM. 50 cartons of medium quality cigarettes could buy a Golf car in central Bosnia in 1993 and early in 1994 a cigarette (any kind) cost five DEM in Vitez. A kilo of tobacco traded for 20 kilos of flour in Gorazde in the winter of '92-93 and cost over 50 DEM. The best tobacco deal was done by Fikret Abdic: he somehow got an unbelievable amount of 20 year old Colombian Galles cigars for his defence forces. Part of them were immediately sold to the BiH 5th corps. When Kladusa fell the 5th corps also captured several tons of Galles.

Every deal has to die for whatever reason but food trade can't. Everything is sold for food: jewelry, antiques, furniture.

The Sarajevo black market is a good example. A kilo of sugar sold for 70 DEM, a liter of cooking oil for 35, 30 eggs cost 100 DEM, a new Mazda cost 5,000 and a CD player 80. At the same time, black marketeers in Bihac sold sacks of flour for 100 DEM each but there were times, during battles, when those sacks cost up to 1,000 DEM. A ranking customs official in Tuzla said food came from Bijeljina regularly through the war and added that it was fresh.

Two places in Bosnia were a smuggler's paradise: Kiseljak and Velika Kladusa.

In Kladusa, business went on thanks to Abdic. In 1991, he traded with the Croats through his Agrokomerc corporation and supplied the Krajina Serbs. When he was surrounded, something like a duty free zone started operating on the borders of his enclave. It stated when ropes were thrown across the Glina river to link the villages of Gejkovac and Miljakovici. The Serbs sent food, drink and other goods across and the Moslems returned cash. Prices were set in shouting matches across the river. Very soon, Serbs and Moslems began crossing the river to trade. Business really got going once Abdic declared his Autonomous Province of Western Bosnia and got the road to Karlovac opened for his trucks. He traded with everyone: Croatia, the Krajina, Serbia, the RS, even the 5th corps which was waging war against him. He had a customs outpost set up near Dvor Na Uni where his police and the Krajina police checked every truck. Soon the Krajina and RS leaders realized Abdic's importance and they cracked down on all small time smugglers. That didn't really help nor did specially formed military police units.

The small smugglers supplied Bihac. Mainly Bihac women did deals, braving their own mine fields to earn money which explains the large number of girls with no legs in the town. Markets popped up along the confrontation lines. Some time before the fall of the Krajina, a Krajina Army unit allegedly opened fire on one of those markets to prevent "illegal trade with the enemy".

Kiseljak was like Casablanca to Sarajevans. Trade started there in the summer of the first year of war under an agreement between Kiseljak Croats and Ilidza Serbs which was never broken despite serious pressure throughout the war.

Absolutely everything was smuggled in and out of Kiseljak - from powdered eggs and milk to marble for elite Sarajevo clubs. Prices were formed according to the number of middle men: beef was bought in Croatia for 1-2 DEM and sold in Kiseljak for 6-8, Ukrainian UN troops sold it to Sarajevo's Mafia for 20 who sold it on to middle men for over 30 and when it reached the market it cost 50 DEM a kilo, sometimes even 100. The Ilidza Serbs charged a transit tax either in goods or cash. The Kiseljak Mafia won itself a reputation as the most capable and the most brutal in just a few months. Clashes were frequent and some sources said HVO General Tihomir Blaskic (who has been charged with war crimes) was moved out to Vitez from his post as Kiseljak commander because he sided with the wrong group of smugglers.

The best example of the supply offered in Kiseljak dates to early 1993: a bomb was thrown into an elite restaurant. In just 20 days its glittering marble, brass and mirrors were replaced from Italy.

The real sharks among that type of businessman were the state and para-state officials: political, military and police. Bildt has no reason to fear. If they are not prevented from earning money the Bosnian economy will flourish. The people who invested in smuggling will know how to invest in production. Business is business.