Mr. High Representative, your mission has finally moved to an adequate working space. Earlier this is where the front line between those who defended and those who attacked the city was. With your arrival in this country, it has become the highest political watchtower. How does Bosnia-Herzegovina look from this perspective, at the beginning its fifth peaceful autumn?

My view of the country is mixed. Much has been achieved. There is freedom of movement. There is no longer a frontline here, although the modest monument to Suada Dilberovic on the bridge next to the office is a reminder of the terrible things that took place here. We have seen a real increase in refugee returns. But it does not add up to enough. The return process could be faster. The country is in desperate need of serious economic reform. The BiH state needs to function like a state if it is to take its rightful place in Europe. Unfortunately, many of the country's leaders don't appear to see the same urgency that I do in all these areas. BiH has yet to win the peace.

You come from Austria, a country which in 1878 - which was maybe the moment of greatest exhaustion in the last century - colonised Bosnia, on the basis of its international mandate. Many Bosnians point out an analogy on that basis. Do you see such analogies as appropriate?

That I'm an Austrian here a century after Habsburg rule has something serendipitous about it, I grant. But my work is entirely different. Neither do I represent Austria here, nor an imperialist power. I represent the International Community, and the International Community does not plan to stay in BiH. Indeed its financial commitment is already declining significantly. The International Community is here to oversee the implementation of the Dayton Accords, and help BiH become a prosperous lawful country. It should also not be forgotten that Dayton was signed by all parties involved in the conflict, that means we are here at their invitation.

In the past five years ambitious political and substantial financial investments have been directed into this country. Are the results adequate to the investments?

Major reconstruction has been completed in BiH, reconstruction worth over five billion dollars, with which the infrastructure - roads, bridges, power, water, electricity - has been rebuilt. One could say that the hardware of BiH, if it were a computer, has been fixed. What we now need is the appropriate software, and this is reforms in the economic field. Reforms that will create a business-friendly environment here, attract investment and thereby create growth and jobs. But I worry there's a dependency culture here, that the politicians have gotten used to the aid and are reluctant to implement these much need reforms. International aid is, I repeat, declining. The Federation parliament's decision to raise pensions last week without any money to pay for them is an example of the kind of thinking that has to be overcome. BiH's leaders are in danger of losing all the gains made so far with international aid. BiH has to stand on its own two feet.

Politically seen, Bosnia has walked an important part of the road toward democratisation. However, people still hunt for jobs without success, and many live below the bare level of survival. Do you see a possibility for a faster economic recovery?

The people of BiH could make a start by voting in November for politicians who are serious about economic reform, who are willing to take the country out of its state-controlled past to a market economy. The road is sketched out - one doesn't need to be a magician to know how to create an environment attractive to investors. Just read the Declaration of the recent meeting of the Peace Implementation Council, and you'll know what needs to be done. Individual citizens also have to make a commitment to economic reform -- it is their business ideas and plans that will make BiH's economic future, they just need the government to create an environment that will enable them to implement their ideas. By having voting powers, BiH citizens own the process here. If BiH citizens want business opportunities and stability, if they see rule of law and if they are able to plan their future, then I think there is no reason why the economy can't recover.

In that sense, can we expect an economic strategy of the international community in Bosnia which would have more initiative and be more effective?

There already is a strategy. As a matter of fact, it was adopted by the Peace Implementation Council at its recent meeting in Brussels. Now it is up to BiH officials and citizens to implement it and build the economy. The days of centrally planned economies are over, and the authorities need to pass many laws and build institutions that will turn BiH into a place that is attractive for investment and business. I will only mention the most important elements of what is necessary: closure of the payment bureaux - establishment of a sound banking system - tax reform with the goal of broadening the base and lowering the rates - lower utility fees - reform of the social systems and labour legislation - resolution of the land titles issue - privatisation of strategic enterprises aimed at attracting investors that will restructure the companies and make them profitable - creation of a single economic space with a country-wide harmonised approach to taxes, competition, public procurement, financial services, standards and regulations, banking, public utilities, electric power, telecommunications and transport - elimination of corruption - simplification of bureaucracy. One doesn't need to be a wizard to see why this is important. If you were a businessman, you would not want to have to chase hundreds of permissions, pay outrageous phone and electricity bills, huge taxes, work through the cumbersome payment system, pay bribes to get things done, be uncertain whether something you buy will remain yours, etc. But I am afraid that the officials running this country don't see the need for all these reforms. They behave irresponsibly. Look at the mess with the pensions: instead of adopting the absolutely necessary amendments to the Pensions Law, the Federation Parliament rejects them, risks losing 150 million dollars in funding from international institutions, and increases pensions without having any money to finance this increase! This is irresponsible.

The attitude of the local representatives toward the international community ranges from rejection, through more or less hidden obstructions, to full cooperation. Do you think that ethnicity as the basis for the approach and reaction of B-H political forces has been overcome?

The war cut many deep scars here and I think it would be unrealistic to think people will forget their differences -- real or imagined -- in a hurry. But I think the results from municipal elections in April were a very positive sign that BiH citizens are starting to vote on other issues and no longer fall for empty nationalist rhetoric. This is really one of the keys to BiH's future, the exclusivist, nationalist mindset must be overcome if BiH is to integrate with Europe. Switzerland, a country where three different languages are spoken, is a good example of how this can be done. The future lies in the hands of the voters, and they decide whether they elect politicians who are against reforms and an improvement of the situation, or politicians who will truly act in the interests of the citizens.

How do you assess SDA's criticisms of some moves of the representatives of the international community: do they originate from electoral calculations, or are they an attempt to define a new political identity of the SDA?

I am bound to meet opposition and criticism in all my work here, and as it happens, I am encouraged by the fact that I am critised by all sides on a regular basis. It shows me that I am on the right path. I would not like to speak for the SDA on its election strategy -- you should ask them. I am looking for greater co-operation from all leaders in BiH but I am frequently disappointed by their apparent lack of interest in building a stable future for the citizens that elected them.

Do you believe that the international community has a principled position toward all forces within the political situation in this country, or do you simply continue to pressure those that are most yielding?

I work to make sure the Dayton Accords are implemented -- nothing more. All groups here in BiH -- Bosniaks, Serbs, Croats and others -- are treated equally. I don't look at the ethnicity o a given area, I look instead at what's going on there. If a town's leadership has a poor record on refugee returns, if an official abuses his office, if an official works against progress and the overall improvement of the situation in BiH, I judge it on that basis -- and on none other. Of course, those who are affected by my moves always claim they are innocent and that my moves are not justified. But that's human nature. I wouldn't expect them to tell me: Thank you Mr Petritsch for removing this member of our party, he was a bad man. If they thought that, they would have removed him themselves.

What will you, for example, undertake against Prime Minister Dodik and other politicians from the RS, in case they continue posing obstacles for the reconstruction of the Ferhadija mosque in Banja Luka?

I have travelled to Banja Luka and met all concerned with this issue. The Ferhadija mosque will be rebuilt. Full stop.

Recently one distinguished Croatian intellectual (Professor Ivo Banac) claimed that the names of criminals who prevent return of Bosniaks to Stolac by means of organised crime are known. However, there has been no effective counteraction. Who is to blame for that?

Stolac has a very bad record with regard to crime and return. The fight against crime is clearly the responsibility of the Cantonal Ministry of the Interior, and I am extremely disappointed that they have not taken any action yet, despite all the alleged ongoing criminal activities in Stolac. This certainly doesn't reflect well on the willingness of the authorities to establish the rule of law in that area. But it must be said that not only Bosniaks, but also the Croats residing in Stolac suffer from this lack of lawfulness. Re returns and in particular property law implementation, the situation has slightly improved after I removed the old mayor of Stolac last November. However, I am far from being satisfied. There have been returns of displaced Bosniaks and Serbs to destroyed properties and remote areas and a few decisions to such destroyed properties have been issued, but that's the easy part. I'm looking to the local authorities to start evicting double occupants and the like from homes which do not belong to them. We are watching the municipality very closely.

It is believed that in the history of this country no one has had so much legitimate power as you do. Do you feel uneasy because of your own mandate, which, in some aspects, is even above the Constitution, or in other words, how do you carry the burden of responsibility for the outcome of the project of new Bosnia?

Let me be perfectly clear. The International Community's involvement is not colonial rule. The International Community has a clear and limited aim: to implement the Dayton Peace Accords and help BiH become a stable, prosperous, democratic and lawful country and take its place in the European family of countries. We have to impose some laws and remove officials who are anti-Dayton. This is what I am tasked to do by the Peace Implementation Council, the organisation of 55 countries and agencies that I must answer to. My powers are strong because they need to be to uphold rule of law. But I believe passionately that it is BiH citizens who own the peace process. Every intervention or removal is thought out and debated very carefully and of course feel disheartened at times that I have to use these powers. But adherence to the Dayton Accords is essential if the individual rights of all BiH citizens are to be protected.

On several occasions the local public has noticed an arrogant, anti-democratic conduct of individual representatives of the international community, so as if saying: if the facts do not correspond to our decisions, than the facts are wrong. Does the OHR analyse the work and assess the political conduct of its officials?

No decision is taken without careful deliberation and consultation within the OHR and the International Community, and no OHR official acts on its own, so of course we know what each of us is doing. As I said earlier, we weigh each of our decisions extremely carefully. I think what you are perhaps alluding to here is my removal of Mr Ahmed Smajic, the former minister for Agriculture, Forestry and Water Resources. Mr Smajic argued hard against the decision. But preparations for his removal were thorough and evidence-based. He was not serving the citizens of BiH. Mr Smajic, in his defence, got his facts wrong. We did not. I notice the Federation government has now nominated a successor so I hope we can now press on with urgently needed reform of the agriculture sector.

Do you, as the High Representative, know that in the local authorities of Sarajevo there is a lot of fear from the international community, which issues decisions as a deus ex machina? Local officials carry out all that they are ordered to without a word, in the fear of losing their job and being stigmatised, which is what happens to those who are removed. Will you change something about that?

The International Community does not issue decisions deus ex machina as I've said before. Much debate and deliberation goes into each of them, and let me clear: Officials who respect the rule of law have nothing to fear. But if officials are anti-Dayton, if they don't implement the laws of this country and meet their obligations, they have something to fear -- as is the case in any democratic state. Having said that, I am not happy when I have to impose laws or remove officials, and I am looking forward to the day when BiH will have responsible officials who will pass important legislation on their own, and an independent judiciary that will control and prosecute officials who don't do their jobs.

Do you have more faith in the sustainability of Bosnia-Herzegovina today than you did when you first took your office in this country?

At times I find the slow pace at which returns and economic reform is now taking place immensely frustrating. But I think there has been a real change in thinking here in the last year, that rule of law is something real and tangible and no longer an abstract notion. And I was encouraged by the municipal election results this year in which moderate parties made an encouraging showing. I think we can see now the first shoots of real change in BiH.

How do you personally feel in Sarajevo? What do you like, and what do you dislike - in the appearance of the city and the behaviour of its citizens?

Sarajevo is a wonderful city and the people are incredibly hospitable, and, as a matter of fact, so is the whole country. I like to get out into the city as much as possible with my family -- in the parks or wandering through Bacarsija. My wife and I have enjoyed concerts and films so I feel very at home here. I really am an honoured guest here in Sarajevo.