BOSNIA
Bosnia Herzegovina, Capitalising
on the assets of peace and reconstruction

Why it is worth investing in Bosnia - The presence of the international community - Comparative advantages of BiH - Free trade agreements - A long tradition of Industrial Production - Things to Achieve -
Start of stock market - Investment Opportunities - Investing Advantages


Mr. NEVEN TOMIC

Interview with

Mr. NEVEN TOMIC
Mayor City of Mostar
Mostar is a city that has suffered a lot from the fact that it is divided in two ethnical groups. Is it difficult for you to manage a city like Mostar?

Of course! It is very difficult to imagine the situation we deal with in a city like Mostar because it was badly wounded by the war and became a divided city with checkpoints in its centre. However, it is also a challenge for me to try to make of Mostar a normal city, functioning normally as a European city. Everyday we notice the progress and this is for us an important challenge to make this city function again.

So, how do you manage to administer in a regular way while you have most of the time to deal with two kinds of institutions, two water suppliers, two telephone suppliers, etc.?

We are now working on a program meant to establish normal functioning of the city. The Pre-condition for that was to organise the city's administration and to bring together the different city structures. You have to know that Mostar has an administrative structure including six municipalities and a central zone, directly under the control of the city's administration. Of course, the city has to bear some responsibilities regarding the State constitution, and as a result it has its own urban planning, infrastructure, public transport and financing. We are now trying to set up institutions that will enable us to implement these responsibilities in the best possible way, but a lot of things are depending on higher levels of authorities such as the Federal government and the Cantonal government. However, many fields still depend on us, as we are now establishing joined city institutions.

Soon we will create a single city police. The municipal police, as well as the city tax administration have been established in the beginning of 2002. We are currently establishing an urban planning institute and other institutions such as the land register institution.

This process takes place slowly because during a long period of time we lived as two cities in one. Together with the international communities and some local authorities, we are now targeting this harmonization and every day we are proud to move forward in this direction.

Everything is duplicated in the city but you are the only mayor…

No, in fact, there is not only one mayor: we have a mayor and a deputy mayor. Mostar has a specific structure and if there are nowadays one single city water supplier and one single urban transport company for the public transport, there are still two telephone operators and we hope that this problem will be solved with the privatisation process.

In accordance with our status of a particular city, we have a mayor and a deputy mayor, acting more or less like co-mayors. The mayor has to discuss the main issues with the deputy mayor. Our mandate is of four years but during this mandate, we rotate each year between the positions of mayor and deputy mayor. That means that I am the mayor in charge until the end of this month and during the next mandate I will be the deputy mayor of the city. My colleague who is now the deputy mayor will then be the mayor and for all the decisions we have to make, we co-sign them. This is one of the measures aimed at strengthening the trust among the main communities living in Mostar as the rule binds us to have a mayor and a deputy mayor belonging to the two main ethnical groups.

Isn't it difficult to manage a city in this way?

Of course it is! It is not necessary the political issue that makes the difference between us, but only some diverging points of views. It is normal for two persons living together to make compromises so it is the same when you have to harmonize two communities and find a common solution. It is the same for the municipal workers: they have to harmonize their opinion and points of view.

We are changing little by little this structure but of course the last change will be the rotation between the mayor and the deputy mayor, as everything existed twice. For instance for the reconstruction of the city, you had two architects: one Bosnian and one Croatian. Now we still have two architects but working together on the same edifice: one building the finance and the other one working to protect the rights and the security of the people.

How do you work to make the people of the city get along together?

We organize many things for the whole city and we are, here in Mostar, the host of various events. For instance during the summer, we have the Mostar Summer Festival in which our local and cultural institutions are involved but also our guests from all over the world. We also organise some sport competitions such as the Street Race with concerts and events just like everywhere else in the world! The main problem is the issue of security, which is normal.

What are the main issues in Mostar regarding the privatization process that is undergoing in the municipality?

Mostar was not only divided as a city, but also as a canton. As Mostar is the capital of this Canton, (that was divided until the beginning of this year in two sub-cantons), it is very hard to build one city, as you can imagine! We have here two different levels of regime, but now that we have been working on a unification process from the beginning of this year, we are making big steps towards integration within the canton. This is very important to know because this is one of the reasons explaining the fact that the process of privatisation is so slow. Mostar had always been in the past a kind of "black hole" because of the different political conflicts that have had a direct impact on the privatisation process. This year we expect that the main privatisations will take place. Aluminij is one of the best companies in Bosnia and Herzegovina as the main exporter with excellent results. After its privatisation, strategic partners will enable to double its capacities, meaning 1000-1500 new jobs in Mostar. Moreover, there will be investors coming from Italy and other countries to invest in the business based on aluminium here. We also expect a lot from the privatisation of a tobacco company situated in Mostar and of some companies in agriculture, producing wine. Before the war, trade was very important here. The problem of the privatisation by certificates is that it will not bring significant results, as there is no "fresh money": it is just changing the property from the state to somebody, (i.e., from "nobody to somebody"). When the second round of privatisations will take place, private owners will look for foreign investors. And then the image of our city will be very important to show to the world that we are ready and that we have all the best conditions gathered. Mostar is situated near the port of Ploce, a real connection point in the middle of Europe. Mostar is besides situated at the crossroads of our highway that is being constructed (Mostar-corridor 5 C), and will be a European corridor from Budapest to Ploce, Budapest-Osijek-Sarajevo- Ploce. Finally two other assets are the airport and the fact that our region is one of the best energy sources in BiH. In Mostar we have indeed four hydroelectric powerplants, and for the whole canton, six (the whole Federation counting eight ones, meaning that 2/3 are situated here). This represents a good base for the aluminium and some other metal industry.

You were talking about the airport and railways. Is the infrastructure being reconstructed and improved?

Railways have been now reconstructed as Aluminij uses them to import bauxite and export aluminium. These are indeed in good conditions especially from Mostar to the South, i.e. to the port Ploce. However investments are still necessary to improve them to the North, because the average speed is of 50 km/h and we need to improve that. As I said, we invested a lot in the airport and it is functioning as an international airport. We had international flights to Vienna and we have one to Zagreb. There will soon be daily flights and there is a project with a regional German company. There are also many charter flights, with Medugorje and two per month from Lebanon. We are currently looking for some local carrier, and there are some investors who are ready to establish a company at Mostar's airport to run its operations. In the same time, we are also working on other infrastructures in the city like a water supply system. We also have a big project of about 15 millions $ with the World Bank and some donation associations. We thus plan to solve the problem of the water supply for the city for the next 15-20 years. What is also very important for the potential investors is that we are now finishing the feasibility study of the sewage system in the city and this will be our next most important project. And we also want to protect the river Neretva in the framework of an ecological project. The City will also solve the problem of public transportation: next month we will receive 36 new buses and will solve therefore this issue for the next 10-15 years. These are all progresses we are proud of.
You were talking about the donations and asssistance from foreign institutions but Mostar has many rich companies in its municipality. Do they also support the city?

In this transition phase, the best investors are people from the region. Mostar is THE regional centre and many new companies from all over the country, eastern Herzegovina and Republika Srpska, arrive here to open their headquarters.

Croatia has also here a strong presence because they know the situation here better than other countries. Donation associations helped us mainly with the reconstruction of infrastructures. One of the most important issues now is the establishing of legal institutions and working on the political stability of the country because one of the main concern of investors is to protect their investments. A country where you have every two years elections is not good for investors and I hope that after the next elections we will adopt the four-year mandate system.

When do you think that the city will be able to live on its own revenues and taxes?

Maybe in two years, when the tax system would be completely established. There are still many gaps at the level of the city municipalities and we still need investments such as the one dedicated to the public transport issue because, less money will be spent on maintenance costs. On the other side, there are other infrastructure issues like the maintaining of roads, which remains ambiguous between the City, the Canton and the Federal government. That is why I assume this will be realised within two years.

We are the first city in BiH that has decided to work on an economic development strategy. Everybody was laughing when we started, because the city was more or less divided but we decided to go on because there was a challenge in gathering people from both sides to adopt one direction. The issue of the destruction of the old bridge was in this regard a hot issue. But everybody agreed on the fact that the old bridge and the old city were the most important features of the City for tourism. We also decided to develop some projects regarding the development of tourism, projects with the European Union, including the collaboration with the economic development agency. The Campaign for the Pride of Mostar, is also a very important factor because the main support for tourism is the reconstruction of the centre of the city. We are now ready to work on issues like the repairs of destroyed facades and the construction of hotels to give a new tourist infrastructure to the city.

Last week we met Mr. Durakovic who is responsible for the Tourism municipal association of the old part of Mostar. Mostar has a lot to offer to tourists; don't you think this sector has to be more promoted in the future?

Indeed, this tourism association for the city municipality is one of the twin organisations of Mostar: a Tourism Association for the municipality of the Old city, a Tourism Association for the West side and for the Croat municipalities. But now they are starting to work together because we included them in the process of promoting the city.

We are working with city associations like the city sport organisation, the city tourism associations, the city Red Cross organisation, etc. This is one of the issues for this year and this is highly necessary because now both sides of the city are trying to promote the city. You can imagine for instance that when the tourism association from the Free Croat Majority goes to fairs and shows photos without the old bridge, it s odd because the one of the most important things that you can offer in Mostar is old bridge!

That is why we cannot accept to have many different sides of the city promoting something else. By the end of 2003, the bridge will be repaired. I hope that by the end of this month we will have the constructors for the arch and the two towers, so that we can proceed as money and stone are provided! There are a lot of symbols around the bridge. And its reconstruction is the best way for everybody to walk hands in hands in one coordination unit. Croatians and Bosnians are now working together with the World Bank on the project. This is the proof that this project is good for reconciliation, trust and strengthening our ties. Notwithstanding the fact that this is essential for the economy, tourism, with many shops around, for example. The bridge area is very crowded especially during the summer with many events taking place.

As this place is highly interesting regarding architecture, history and culture, we expect visits of students, architects, historians, etc. The bridge will be reconstructed in the same way as it was 500 years ago. This means no use of concrete, no armed structure but "stone by stone" with a very special mortar. The only problem will be the mortar because this mortar was made of eggs. Nowadays we don't have enough strong chicken! We now have chickens bred in incubators! However, the analysis and possibilities offered by modern technologies will enable us to use a mortar of the same quality.

As mayor of one of the most famous city of BiH, what would be your message to the readers of Forbes Global?

Firstly, education is the key to everything. Even the old bridge project has an impact on that issue as we developed a school for carving the stone and many people are coming here from different parts of Bosnia and Herzegovina to learn how to carve stone.

Then, I am so happy with the ending of the ethnic conflicts. There are no longer barriers preventing people to move, to invest and to walk. As I said, we register a great success with the infrastructure projects. During the war, seven bridges were destroyed. Nowadays we are still looking for money for one of these bridges, all the others being reconstructed or being under reconstruction. The most important element is to change minds because it's not only the issue of reconstruction but also the one of transition, from socialism to market economy. I am also very proud that we have increased the number of the twin program with other cites. Before the war, Mostar had a twin program with Split in Croatia and Kragujevac in Serbia. Now we have Saragossa in Spain and Monte Grotto in Italy. Next week we are going to Maribor in Slovenia, and a few days ago, we signed an agreement with Keiser in Turkey. Then there are projects with a Chinese city, Heidelberg and Bordeaux. The mayor of Graz in Austria is also coming next month to Mostar. And we can learn so much on the results of those city organisations, administrations and functioning modes as modern cities. We are very optimistic, even if it is not easy to fight against the local forces that want to preserve the existing situation and their power. For some people it is always better to have two separate markets to rule better. We also expect a lot regarding the legal structure granted by the Canton and the Federal government regarding the complexity of the city and municipality authorities.

Finally, I use to say that Mostar was the last multiethnic city after the war in Bosnia and Herzegovina because the city was divided. We have strong communities (approximately 43% Croatians , 42% Bosnians and 6% Serbs). In all other cities you have a majority of one group, like in Sarajevo (90%), in Tuzla (90%) of Bosnians, in Banja Luka (95%) of Serbs. Then it's easier to solve this inter-ethnic issue. Here you have the "co-system" of Co-mayors, directors, and deputy director necessary for the transition. We have to spend a lot of time to negotiate, but optimism is always present!

Note: World Investment News Ltd cannot be held responsible for the content of unedited transcriptions.

 Read on 

© World INvestment NEws, 2002.
This is the electronic edition of the special country report on Bosnia published in Forbes Global Magazine. .
Developed by AgenciaE.Tv