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The Political Directors of the Peace Implementation
Council Steering Board met in
Brussels
on 3 February under the Chairmanship of the High Representative,
Paddy Ashdown.
The Political Directors were briefed by Chief Prosecutor Carla del Ponte on
the status of cooperation by the authorities in BiH with the ICTY. The BiH
delegation, which was led by Prime Minister Adnan Terzic and included RS
President Dragan Cavic, outlined the steps being taken by the RS to accelerate
cooperation with the Tribunal. The BiH authorities also reported on the progress
that has been made since the autumn of 2004 on strengthening the capacity of BiH
institutions and taking forward the economic reform agenda, including the
consolidation of the Single Economic Space.
ICTY Cooperation
The Steering Board reminded the BiH authorities that inadequate cooperation
with the ICTY is now the major obstacle standing in the way of BiH’s progress
towards the European Union and NATO. It welcomed the transfer by the RS
authorities to The Hague of Savo Todovic as a first step, but stressed that this
must mark the beginning of a process of full ICTY cooperation leading to further
transfers of other indictees at large without delay, including Karadzic and
Mladic. Failure to complete the process would have, among other
consequences, the effect of blocking BiH’s future in Euro-Atlantic
institutions.
The Political Directors made clear that the RS authorities now have a short
period of time in which to demonstrate that they are fully cooperating with the
ICTY. They reiterated that the Dayton-Paris Agreement remains the foundation for
peace in BiH including the continued existence of the Entities.The PIC expects
the agreement to be honoured in full and to the letter by the authorities in BiH
at every level. It cautions those political leaders in BiH and elsewhere who are
making irresponsible claims about the abolition of the RS, and calls on them to
concentrate instead on implementing the Agreement and the reforms needed for
integration into Euro Atlantic structures.
The Steering Board stressed that the BiH authorities also have a part to play
in ensuring full cooperation with the ICTY and called on Prime Minister Terzic
urgently to establish means to improve state-wide cooperation on the capture and
transfer to
The Hague
of fugitives,
and asked the High Representative to assist in this process. This should
not, however, in any way diminish the responsibility of the RS authorities to
cooperate fully with the ICTY. The main responsibility lies with them. The
Steering Board stressed the importance of the BiH government now taking concrete
steps to implement the asset freeze of PIFWC support networks, which the EU
adopted in October 2004 and to which the BiH aligned itself. The Steering Board
noted the need for strengthening regional cooperation in this matter and the
view of the Chief Prosecutor that the authorities in
Belgrade
and Podgorica must
cooperate fully with the RS.
Police, Defence & Intelligence Reform
There are fundamental systemic weaknesses built into the law enforcement and
security structures in
Bosnia and Herzegovina
, and in particular the Republika
Srpska. They must be tackled so that these structures finally help, not hinder
the country in fulfilling its international obligations.
In this context, the Steering Board welcomed the progress made in Defence
Reform and expressed its support for the next phase as laid out by the High
Representative in December, accelerating the transfer of responsibilities from
the Entity Defence Ministries to the BiH Defence Ministry. It applauds the
progress made so far by the DRC on the basis of consensus.
The Steering Board reiterated its commitment to offering all necessary
assistance to the BiH authorities so that NATO’s criteria for PfP membership can
be met as early as the first half of 2005.
The Steering Board noted that the three principles required by the European
Commission for police restructuring had been fully met by the recommendations of
the Police Restructuring Commission contained in Chairman Martens’ report.
Progress on police restructuring, consistent with the EC’s three principles, is
a requirement for moving towards a Stabilisation and Association Agreement with
the EU. The implementation of the reform recommendations will provide the
citizens of BiH with an effective and responsive police force that is
financially sustainable. It will ensure that exclusive constitutional competency
for police legislation and funding is vested at the State level; that the local
police will operate in functional areas based on technical criteria, that
politicians are not involved in policing operations, and that international law
enforcement partners have effective counterparts to work with in the fight
against cross-border crime. The PIC reiterates that police reform can only be
taken forward by consensus. It urges all BiH’s politicians to consider the
benefits for their citizens of police reform and debate the recommendations of
the report seriously.
It also noted with satisfaction the progress in establishing a fully merged
intelligence-security agency at State level. The Steering Board welcomes the
consolidation of intelligence reform and steps to create an ‘Intelligence
Community’ where information can be effectively shared.
BiH
StateAdministration
The Steering Board welcomed the progress that BiH’s institutions have made on
passing key pieces of legislation which are EU Feasibility Study Requirements;
implementation must now follow. The Steering Board noted with approval that the
BiH Parliamentary Assembly has enacted legislation on Sales and Excise Tax and
laws providing for a State-level single-rate VAT system to be introduced in BiH
by January 2006 at the latest, and that the State budget was passed in January,
the earliest this has ever been done.
The Steering Board also welcomed the fact that the BiH Council of Ministers
met on 1 February. It underlined the central role of the CoM in delivering the
reforms required by the EU’s Stabilisation and Association process and welcomed
the CoM’s commitment to the reform agenda. Only the BiH authorities can take
forward the reforms required to make BiH’s European future a reality.
The Steering Board calls upon the CoM to continue this pace of
reform and demonstrate its leadership to BiH’s institutions
The Steering Board stressed that the Council of Ministers must now renew and
step up the pace at which it sends bills to parliament. The CoM must act quickly
if BiH is to meet the requirements of the EC Feasibility Study in the near
future.
This accentuates the urgent need for faster and more substantial progress in
implementing the Joint Action Plan. This is severely impairing the capacity of
the BiH Government to work effectively and to implement the full range of
reforms it has taken on. The Steering Board urged Prime Minister Terzic to
ensure that this issue is addressed ahead of the next PIC in April. It is
essential that the Commission for Public Assets begin working as soon as
possible so that the issue of housing essential State institutions can be
addressed.
The Steering Board called on the State and Entity authorities to address the
unsustainable cost of governance – now consuming more than 50 percent of GDP.
The sprawling administrative structure means that citizens are paying too much
money for too little service. The status quo is fiscally unsustainable – if this
issue is not addressed in the first half of 2005, it may be impossible by as
early as the end of this year for the authorities to meet all their obligations
in regard to civil servants’ salaries.
Economic Reform
Principal Deputy High Representative
Donald Hays briefed the Steering Board on economic developments since
the autumn of last year. The resolution of the Internal Debt issue,
together with the completion of legislative steps necessary to introduce VAT,
constitute a major boost to the business environment. This should be viewed in
the context of other recently-enacted laws that will help bolster the BiH
investment climate, including legislation that will make the management of
public companies more transparent, bring accounting and auditing up to European
standard, simplify company registration procedures, and facilitate the speedy
resolution of commercial disputes. The adoption of Entity bankruptcy laws will
help free up the privatization process – though this remains an area where BiH
has signally failed to secure broad-based economic benefits due to a failure by
the authorities to address systemic blockages in the privatization process.
The Political Directors expressed their appreciation for the remarkable
contribution made by Ambassador Hays to the process of Economic reform in BiH
and welcomed Ambassador Larry Butler, who will take over from Ambassador Hays in
March.
Brcko
The Steering Board approved the implementation plan presented by Brcko
Supervisor Susan Johnson, aimed at reaching the conditions required by the Final
Arbitral Award by the end of 2005, by which time she would hope to be able
credibly to report to the Arbitral Tribunal, with the approval of the High
Representative, that the required conditions have been met.
Many of the Award’s specific requirements have already been fulfilled. These
include refugee return, property restitution, infrastructure repair, holding
elections, and establishing executive and legislative bodies, an independent
judiciary and police force, and a multiethnic school system.
Work is still being done on securing the District’s full economic
revitalization, completing the reform and harmonization of legislation and thus
abolishing the IEBL within the District, and ensuring that the District’s
multiethnic and democratic institutions of government are functioning
effectively and permanently and that the Entities as well as the BiH
institutions fully accept the District’s status as a self-governing
administrative unit and have complied with the Final Award. The Steering Board
agreed the PIA/MIP and will review progress on it in June. The Steering Board
will seek the views of the International Arbiter before that date.
Stolac
The PIC calls on the authorities at all levels of
Bosnia and Herzegovina
to contribute to enforcing the Rule of Law and
the Dayton Peace Agreement, not least by implementing decisions of the Annex 8
Commission to Preserve National Monuments. The PIC takes note of the delays in
implementing the Commission’s decision in relation to the removal of illegally
constructed objects in Stolac and expects the decision to be implemented without
delay in a peaceful and orderly manner.
Special Department of Organised Crime
The Steering Board was briefed by Head of the Special Department of Organised
Crime John McNair on the Special Department’s work. The PIC commended the
Special Department’s efforts to address high-level corruption and organized
crime in BiH. The PIC encouraged all members to explore further ways to assist
the Special Department in its efforts.
The next meeting of the Steering Board Political Directors will be on 7 April
in Brussels.
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