Identifier
Created
Classification
Origin
03ZAGREB376
2003-02-20 06:56:00
CONFIDENTIAL
Embassy Zagreb
Cable title:
VOJNIC: OFFERING EQUAL MISERY FOR ALL
how-toThis record is a partial extract of the original cable. The full text of the original cable is not available.
C O N F I D E N T I A L SECTION 01 OF 04 ZAGREB 000376
SIPDIS
USAID FOR ACONVERY, EUR/SCE FOR MNARDI
E.O. 12958: DECL: 02/18/2013
TAGS: PHUM EAID PREF ECON PGOV EAID PREF ECON PGOV EAID PREF ECON PGOV EAID PREF ECON PGOV HR HRPHUM
SUBJECT: VOJNIC: OFFERING EQUAL MISERY FOR ALL
REF: ZAGREB 337
CONFIDENTIAL
PAGE 02 ZAGREB 00376 01 OF 04 200658Z
CLASSIFIED BY: POLOFF MITCH BENEDICT FOR REASONS 1.5 B AND D
SUMMARY
-------
C O N F I D E N T I A L SECTION 01 OF 04 ZAGREB 000376
SIPDIS
USAID FOR ACONVERY, EUR/SCE FOR MNARDI
E.O. 12958: DECL: 02/18/2013
TAGS: PHUM EAID PREF ECON PGOV EAID PREF ECON PGOV EAID PREF ECON PGOV EAID PREF ECON PGOV HR HRPHUM
SUBJECT: VOJNIC: OFFERING EQUAL MISERY FOR ALL
REF: ZAGREB 337
CONFIDENTIAL
PAGE 02 ZAGREB 00376 01 OF 04 200658Z
CLASSIFIED BY: POLOFF MITCH BENEDICT FOR REASONS 1.5 B AND D
SUMMARY
--------------
1. (C) ONLY 50 MILES FROM ZAGREB, THE MUNICIPALITY OF VOJNIC
STANDS AS A STARK EXAMPLE OF THE ECONOMIC REALITIES FACED BY
CROATS, SERBS, AND MUSLIMS ALIKE IN CROATIA'S WAR AFFECTED
REGIONS -- RURAL COMMUNITIES LONG PLAGUED BY ECONOMIC DECLINE
AND OUT MIGRATION. THE EFFECTS OF THE 1991-1995 "HOMELAND"
WAR, PARTICULARLY THE POPULATION SHIFTS AND DESTRUCTION OF
PROPERTY, EXACERBATED AN ALREADY DIFFICULT SITUATION IN
VOJNIC. THE ARRIVAL OF NEARLY 2,000 BOSNIAN CROAT SETTLERS
-- WHO BOOSTED THE CROAT PERCENTAGE OF THE POPULATION FROM
ONE TO OVER 36 PERCENT -- HAS ADDED TO THE PROBLEMS.
2. (C) FEW ECONOMIC PROSPECTS EXIST APART FROM SMALL SCALE
AGRICULTURE. THERE ARE CURRENTLY 370 WAGE PAYING JOBS IN A
REGION WITH OVER 8,000 INHABITANTS, AND THE LARGEST EMPLOYER
IS REPORTED TO BE NEARLY BANKRUPT. MUSLIMS ARE THE HARDEST
HIT, WITH NEARLY FULL UNEMPLOYMENT. RETURN OF PROPERTY
REMAINS THE BIGGEST ISSUES FOR SERBS; OVER 500 SERB-OWNED
HOUSES REMAIN OCCUPIED, PRIMARILY BY BOSNIAN CROAT SETTLERS.
NO EVICTIONS HAVE BEEN ENFORCED TO DATE. EVEN IF THERE WERE
A COORDINATED AND COMPREHENSIVE GOVERNMENT POLICY TO ADDRESS
ECONOMIC DEVELOPMENT ISSUES -- AND THERE IS NONE -- IT IS
DIFFICULT TO ENVISION THE REGION EVER BEING VIABLE
ECONOMICALLY.
BACKGROUND
CONFIDENTIAL
PAGE 03 ZAGREB 00376 01 OF 04 200658Z
--------------
3. (U) THE MUNICIPALITY OF VOJNIC IS JUST 50 MILES SOUTHEAST
OF ZAGREB, BUT IS ANOTHER WORLD WHEN ONE COMPARES THE LIVING
STANDARDS -- ONE ALMOST FIRST WORLD, THE OTHER VERY MUCH
BACKWARD. HILLY, ISOLATED, HUGGING THE BOSNIAN BORDER,
VOJNIC REMINDS AN AMERICAN VISITOR QUICKLY OF THE HOLLOWS OF
WEST VIRGINIA. VOJNIC WAS A PART OF THE SERB CONTROLLED
KRAJINA FROM 1991-1995, AND WAS RETAKEN BY CROATIAN
AUTHORITIES IN AUGUST 1995 UNDER OPERATION "STORM."
4. (U) THE PRE-WAR POPULATION WAS JUST OVER 8,000, DIVIDED
AMONG 46 VILLAGES -- 89 PERCENT SERB, 10 PERCENT MUSLIM, AND
ONLY ONE PERCENT CROAT. INHABITANTS WERE FULLY "EMPLOYED" IN
THE SOCIALIST SENSE; MOST RESIDENTS WERE ENGAGED IN
AGRICULTURE, TIED IN WITH THE LARGE AGROKOMBINAT "AGROKOMERC"
LOCATED JUST OVER THE BORDER IN WHAT IS NOW BOSNIA (AND OWNED
BY FIKRET ABDIC, FORMER REGIONAL WARLORD, AND NOW A CONVICTED
WAR CRIMINAL). WHAT LITTLE INDUSTRY EXISTED -- A FACTORY FOR
CLAY EXPLOITATION, CERAMICS, SAWMILL, IRON AND STEEL WORKS --
WAS OUTDATED AND UNDERCAPITALIZED EVEN BEFORE THE WAR.
THE ECONOMY TODAY
--------------
5. (C) AGRICULTURE REMAINS THE PREDOMINATE ECONOMIC ACTIVITY,
ALTHOUGH ONLY 30 PERCENT OF ARABLE LAND IS BEING CULTIVATED
COMPARED TO NEARLY 100 PERCENT IN 1990. VOJNIC'S CATTLE
POPULATION IS JUST ONE-FIFTH ITS PRE-WAR LEVEL. LACK OF
FINANCIAL RESOURCES HAS LIMITED THE RECONSTRUCTION OF FARM
BUILDINGS, WHICH IS REQUIRED FOR PRODUCTION TO INCREASE.
CONFIDENTIAL
PAGE 04 ZAGREB 00376 01 OF 04 200658Z
INTERNATIONAL ASSISTANCE AND GOVERNMENT FINANCING HAS BEEN
USED TO RECONSTRUCT HOUSES, BUT ONCE THE HOUSE IS HABITABLE
RESIDENTS HAVE LITTLE ACCESS TO CREDIT FOR OTHER PURPOSES.
FOR EXAMPLE, THE MINISTRY OF SMALL AND MEDIUM ENTERPRISES AND
CRAFTS, LOCAL AUTHORITIES, AND UNDP, HAVE CO-FINANCED A LOAN
GUARANTEE FUND THAT NOW OPERATES IN EIGHT TOWNS. BANKS ARE
ENCOURAGED BY THE GUARANTEE FUND TO LEND TO INDIVIDUALS WHO
WANT TO START THEIR OWN BUSINESS. AS PART OF THE SERVICE
PROVIDED, THE FUND WILL DEVELOP FEASIBILITY STUDIES AND ACT
AS AN INTERMEDIARY BETWEEN THE BANKS AND THE BORROWER,
PROVIDING ADVICE AND TECHNICAL ASSISTANCE.
6. (C) SOME CHARGE DISCRIMINATION AT THE FUND. AN EMPLOYEE
OF THE FUND TOLD US THAT, WHILE IT MAKES APPROXIMATELY TWO
HUNDRED LOANS A YEAR, ONLY ONE HAS BEEN APPROVED FOR A SERB
RETURNEE. THE COLLATERAL THIS APPLICANT WAS REQUIRED TO
SUBMIT INCLUDED -- BUT WAS NOT LIMITED TO -- HIS HOUSE, AND A
PROMISSORY NOTE IN THE AMOUNT OF APPROXIMATELY $71,000. HE
HAD TO GET A PERSON EMPLOYED BY A GOVERNMENT ENTITY TO
CO-SIGN THE LOAN AS A CO-GUARANTOR. THE LATER REQUIREMENT,
NOT UNCOMMON FOR BANKS IN CROATIA, EFFECTIVELY ELIMINATES THE
POSSIBILITY OF A RETURNEE GETTING A LOAN. WITHOUT THE
LIMITED ASSISTANCE AVAILABLE FROM THE INTERNATIONAL COMMUNITY
-- TO BUY A COW OR PIG, REPAIR THE SHELTER, AND BUY OTHER
SMALL SCALE AGRICULTURAL INPUTS -- MOST RETURNEES SAY THEY
WOULD NOT HAVE COME BACK.
CONFIDENTIAL
CONFIDENTIAL PTQ9128
PAGE 01 ZAGREB 00376 02 OF 04 200658Z
ACTION EUR-00
INFO LOG-00 NP-00 AF-00 AGRE-00 AID-00 CEA-01 CIAE-00
COME-00 CTME-00 DODE-00 DOTE-00 SRPP-00 DS-00 EB-00
EXIM-01 E-00 FAAE-00 FBIE-00 VC-00 FRB-00 H-01
TEDE-00 INR-00 IO-00 ITC-01 JUSE-00 L-00 VCE-00
AC-01 NSAE-00 NSCE-00 OIC-02 OMB-01 OPIC-01 PA-00
PM-00 PRS-00 ACE-00 P-00 SCT-00 SP-00 SSO-00
STR-00 TRSE-00 USIE-00 EPAE-00 PMB-00 DSCC-00 PRM-00
DRL-01 G-00 NFAT-00 SAS-00 SWCI-00 /010W
-------------- 388B91 200658Z /38
R 200656Z FEB 03
FM AMEMBASSY ZAGREB
TO SECSTATE WASHDC 9491
INFO AMEMBASSY BELGRADE
AMEMBASSY LJUBLJANA
AMEMBASSY SARAJEVO
USEU BRUSSELS
USMISSION USOSCE
C O N F I D E N T I A L SECTION 02 OF 04 ZAGREB 000376
SIPDIS
USAID FOR ACONVERY, EUR/SCE FOR MNARDI
E.O. 12958: DECL: 02/18/2013
TAGS: PHUM EAID PREF ECON PGOV EAID PREF ECON PGOV EAID PREF ECON PGOV EAID PREF ECON PGOV HR HRPHUM
SUBJECT: VOJNIC: OFFERING EQUAL MISERY FOR ALL
CONFIDENTIAL
PAGE 02 ZAGREB 00376 02 OF 04 200658Z
6. (C) SALARIED EMPLOYMENT OPPORTUNITIES IN VOJNIC ARE FEW
AND FAR BETWEEN. IN THE ENTIRE MUNICIPALITY, ONLY 370
RESIDENTS ARE FORMALLY EMPLOYED, WHILE AROUND 800 ARE
REGISTERED AT THE UNEMPLOYMENT BUREAU. AND ACCORDING TO THE
MAYOR, THE VOJNIC FORESTRY FIRM, THE MUNICIPALITY'S LARGEST
EMPLOYER WITH 70 EMPLOYEES, IS FACING BANKRUPTCY. THE OTHER
LEADING EMPLOYERS ARE A CERAMIC FACTORY (40 EMPLOYEES),A
SAWMILL (20 EMPLOYEES),A CLOTHING ENTERPRISE (20 EMPLOYEES),
AND A FACTORY FOR PLASTIC PRODUCTS (15 EMPLOYEES).
MUSLIM COMMUNITY
--------------
7. (C) THE MUSLIMS OF VOJNIC ARE STRONG CONTENDERS FOR THE
MOST DISADVANTAGED OF THE REGION. ACCORDING TO IMAM DJURMIC,
THE LEADER OF THE LOCAL MUSLIM COMMUNITY, UNEMPLOYMENT VERGES
ON 95 PERCENT, ILLITERACY IS 80 PERCENT, AND THERE ARE NO
PROSPECTS FOR EMPLOYMENT. IN OUR DISCUSSION, HIS COMMENTS
WERE OFTEN HYPERBOLIC, AND HIS NUMBERS WERE OFTEN AT ODDS
WITH OTHER KNOWN FACTS -- GIVING CREDENCE TO THE ADAGE THAT
42.7 PERCENT OF ALL STATISTICS ARE MADE UP ON THE SPOT -- BUT
DJURMIC PAINTED A GENERALLY ACCURATE PICTURE. THE TWO
BIGGEST EMPLOYERS IN THE REGION, THE SAWMILL AND CERAMIC
WORKS, HE CLAIMED, EMPLOY NOT A SINGLE MUSLIM. SEVERAL
COMMUNITIES ARE WITHOUT ELECTRICITY. IN THE FIGHT BETWEEN
CROATS AND SERBS, MUSLIM HOMES WERE LARGELY LEFT INTACT, AND
SO EMPLOYMENT, RATHER THAN PROPERTY, IS THE MAIN ISSUE
CONFRONTING THE MUSLIM COMMUNITY.
8. (C) DESPITE DJURMIC'S GRIM PICTURE, THE MUNICIPALITY'S
MUSLIM POPULATION APPEARS TO BE INCREASING. MUSLIM LEADERS
CONFIDENTIAL
PAGE 03 ZAGREB 00376 02 OF 04 200658Z
CLAIM THERE ARE 1,600 MUSLIMS IN THE REGION, WHILE THE 2001
CENSUS ACKNOWLEDGES ONLY 768, OR 14 PERCENT OF THE
POPULATION. ACCORDING TO LOCAL OFFICIALS, 1,350 MUSLIMS ARE
REGISTERED IN THE MUNICIPALITY. MANY HAVE BOTH BOSNIAN AND
CROATIAN CITIZENSHIP, AND WORK IN BOSNIA. THE PRE-WAR
PATTERN OF LIVING IN CROATIA AND WORKING IN BOSNIA WAS
UNREMARKABLE WHEN ALL WERE CITIZENS OF YUGOSLAVIA; BUT NOW,
DUE IN PART TO MISSED DEADLINES, AND ALSO TO WAR AND
OCCUPATION, SOME MUSLIMS WHO MAY NOT HAVE BEEN BORN IN
CROATIA BUT HAVE LIVED HERE "FOREVER" ARE EXPERIENCING
DIFFICULTIES IN OBTAINING CITIZENSHIP AND OTHER DOCUMENTS
NECESSARY FOR RECEIVING RETIREMENT AND/OR SOCIAL BENEFITS.
ONE SERB RETURNEE, POINTING OUT HIS WINDOW TO THE LARGE NEW
HOUSE ACROSS THE STREET, TOLD US THAT MUSLIMS FROM BOSNIA ARE
BUYING UP BOTH HOUSES AND PROPERTY IN THE REGION IN THE HOPE
THAT IT WILL HELP THEM GET RESIDENCY DOCUMENTS.
9. (C) POLITICALLY, THE MUSLIM COMMUNITY IS BEING COURTED BY
BOTH THE CROATIAN DEMOCRATIC UNION (HDZ),ON THE RIGHT, AND
THE SOCIAL DEMOCRATIC PARTY (SDP),ON THE LEFT. IN A UNIQUE
TURN OF EVENTS WHICH BEGAN LAST FALL WHEN THREE SDP
REPRESENTATIVES RESIGNED FROM THE PARTY AND BECAME
INDEPENDENT, THE VOJNIC MUNICIPAL COUNCIL WAS FORMALLY
DISSOLVED IN JANUARY. THE GOC APPOINTED A CARETAKER
"COMMISSIONER," AN INDEPENDENT JUDGE FROM NEARBY KARLOVAC, TO
RUN THE MUNICIPALITY UNTIL BY-ELECTIONS, WHICH MUST BE HELD
BY MID-APRIL. ONE RESULT OF THE ENSUING POLITICAL VACUUM WAS
THAT USAID'S PARTNERSHIP AGREEMENT (MOU) WITH THE
MUNICIPALITY LAPSED. WITH SUCCESS HEAVILY DEPENDENT ON THE
POLITICAL WILL AND COOPERATIVENESS OF THE MAYOR AND COUNCIL,
USAID WAS RELUCTANT TO EXTEND THE MOU PRIOR TO A BY-ELECTION.
CONFIDENTIAL
PAGE 04 ZAGREB 00376 02 OF 04 200658Z
SERB RETURNEES
--------------
10. (C) REPOSSESSION OF PROPERTY REMAINS ONE OF THE MOST
SIGNIFICANT BARRIERS TO RETURN. ACCORDING TO USAID SOURCES,
BY LATE 2002 OWNERS HAD SUBMITTED 385 REQUESTS FOR RETURN OF
PROPERTY. OVER 600 PRIVATELY OWNED HOUSES AND 66 APARTMENTS
WERE DAMAGED IN THE WAR. AT THE END OF 2002, APPROXIMATELY
300 REQUESTS FOR RECONSTRUCTION ASSISTANCE WERE STILL
PENDING. AS A RESULT OF THE WAR AND ENSUING OBSTACLES TO
RETURN, THE SERB POPULATION HAS BEEN REDUCED TO APPROXIMATELY
ONE THIRD ITS PRE-WAR LEVEL -- FROM OVER 7,000 TO UNDER 3,000
INHABITANTS.
11. (C) DRAGAN VUCKOVIC, 57, REPRESENTS A TYPICAL SERB
RETURNEE IN THE VOJNIC AREA. THE HEAD OF AN EXTENDED FAMILY
OF FOUR, WITH ONE CHILD, VUCKOVIC RETURNED TO HIS RESIDENCE
"SPONTANEOUSLY" (THAT IS, WITHOUT GOVERNMENT OR NGO
ASSISTANCE) IN 2001. HIS HOUSE HAD NOT BEEN OCCUPIED, BUT
WAS DAMAGED IN THE WAR. ALL FARM-RELATED EQUIPMENT AND
SUPPLIES WERE LOST. PRIOR TO THE WAR HE WAS A RELATIVELY
PROSPEROUS FARMER, MANAGING 18 HECTARES AND A HERD OF CATTLE.
OFF FARM EMPLOYMENT WAS AVAILABLE, PROVIDING A CUSHION TO
SOFTEN THE VAGARIES OF AN AGRICULTURAL EXISTENCE. NOW,
CONFIDENTIAL
CONFIDENTIAL PTQ9134
PAGE 01 ZAGREB 00376 03 OF 04 200659Z
ACTION EUR-00
INFO LOG-00 NP-00 AF-00 AGRE-00 AID-00 CEA-01 CIAE-00
COME-00 CTME-00 DODE-00 DOTE-00 SRPP-00 DS-00 EB-00
EXIM-01 E-00 FAAE-00 FBIE-00 VC-00 FRB-00 H-01
TEDE-00 INR-00 IO-00 ITC-01 JUSE-00 L-00 VCE-00
AC-01 NSAE-00 NSCE-00 OIC-02 OMB-01 OPIC-01 PA-00
PM-00 PRS-00 ACE-00 P-00 SCT-00 SP-00 SSO-00
STR-00 TRSE-00 USIE-00 EPAE-00 PMB-00 DSCC-00 PRM-00
DRL-01 G-00 NFAT-00 SAS-00 SWCI-00 /010W
-------------- 388BA8 200659Z /38
R 200656Z FEB 03
FM AMEMBASSY ZAGREB
TO SECSTATE WASHDC 9492
INFO AMEMBASSY BELGRADE
AMEMBASSY LJUBLJANA
AMEMBASSY SARAJEVO
USEU BRUSSELS
USMISSION USOSCE
C O N F I D E N T I A L SECTION 03 OF 04 ZAGREB 000376
SIPDIS
USAID FOR ACONVERY, EUR/SCE FOR MNARDI
E.O. 12958: DECL: 02/18/2013
TAGS: PHUM EAID PREF ECON PGOV EAID PREF ECON PGOV EAID PREF ECON PGOV EAID PREF ECON PGOV HR HRPHUM
SUBJECT: VOJNIC: OFFERING EQUAL MISERY FOR ALL
HOWEVER, THERE ARE NO OFF FARM EMPLOYMENT OPPORTUNITIES, AND
CONFIDENTIAL
PAGE 02 ZAGREB 00376 03 OF 04 200659Z
THE VUCKOVIC FAMILY RETURNED TO CROATIA WITH NO IMMEDIATE
PROSPECT OUTSIDE THE PROMISE OF INTERNATIONAL ASSISTANCE AND
A MONTHLY PENSION OF APPROXIMATELY $55.
12. (C) THANKS TO PRM PROGRAMS, VUCKOVIC RECEIVED ASSISTANCE
FOR SHELTER REPAIR AND FOR AGRICULTURAL EQUIPMENT. USAID
PROVIDED A SMALL AND MEDIUM ENTERPRISE LOAN, WHICH WAS USED
TO BUY FOUR DAIRY COWS. WITHOUT THIS ASSISTANCE VUCKOVIC
WOULD NOT HAVE BEEN ABLE TO RETURN. WITH HIS FEW COWS AND
SMALL MILK COOLER AND THE ADVICE AND ASSISTANCE OF A
USAID-FUNDED NGO AND THE VINDIJA AND KIM COMPANIES, WHICH
HAVE ORGANIZED MILK COLLECTION FOR THE REGION, VUCKOVIC HAS
INCREASED HIS INCOME TO NEARLY $300 PER MONTH. HE IS
INCREASING HIS HERD AND TRYING TO FIND WAYS TO REPAIR FARM
BUILDINGS. ALTHOUGH HE HAS A LONG WAY TO GO, HE IS GLAD TO
BE BACK IN HIS HOUSE, REPORTS GOOD RELATIONS WITH LOCAL
CROATS, AND IS PLANNING FOR A BETTER FUTURE.
BOSNIAN CROAT SETTLERS
--------------
13. (C) OVER 500 BOSNIAN CROAT FAMILIES FROM NORTHWESTERN
BOSNIA ARE ACCOMMODATED IN SERB-OWNED HOUSES IN THE
MUNICIPALITY. SOME WOULD LIKE TO RETURN TO BOSNIA, BUT
EITHER CANNOT OR ARE UNWILLING, GIVEN HOUSING, EMPLOYMENT, OR
SOCIAL PROBLEMS THEY WOULD ENCOUNTER IN BOSNIA. EMPLOYMENT
IS NOT THE PRIMARY ISSUE FOR SETTLERS -- THEY HAVE OBTAINED
STATE AND STATE SUPPORTED JOBS, AND FACE ECONOMIC PROSPECTS
LITTLE DIFFERENT THAN THOSE OF THE AVERAGE CROATIAN IN THE
REGION. HOUSING IS THE BIG ISSUE. BOSNIAN CROATS RECOGNIZE
THEY ARE VIEWED AS A PART OF THE PROBLEM, AND WHILE THE
CONFIDENTIAL
PAGE 03 ZAGREB 00376 03 OF 04 200659Z
MAJORITY WANTS TO RESOLVE THE ISSUE RAPIDLY, THEY ARE NOT
GOING TO VACATE HOUSES WHEN THEY HAVE NO OTHER PLACE TO GO.
IN ADDITION, THEY ARE NOT INCLINED TO LET THIS GOVERNMENT OFF
THE HOOK FOR PROMISES (HOUSING, JOBS, ETC.) MADE BY THE HDZ
GOVERNMENT TO INDUCE THEM TO SETTLE IN CROATIA.
14. (C) ONE BOSNIAN CROAT LEADER AFFILIATED WITH THE
ASSOCIATION OF CROATIAN SETTLERS, WHICH CLAIMS TO SPEAK FOR
APPROXIMATELY 60 PERCENT OF SETTLERS, HAS SAID THAT
COMMUNICATION WITH THE GOVERNMENT CONSISTS OF BOSNIAN CROATS
BEING TOLD "YOU MUST..." FOLLOWED BY "SOMETHING BAD."
CONSERVATIVE POLITICALLY, THE VAST MAJORITY OF BOSNIAN CROATS
REMAIN SUPPORTIVE OF THE NOW OPPOSITION CROATIAN DEMOCRATIC
UNION (HDZ) PARTY OF FORMER PRESIDENT FRANJO TUDJMAN. IN A
SENSE THEY REPRESENT AN UNWANTED CASTE -- ALL BUT ABANDONED
BY THE GOVERNMENT OF THEIR ETHNIC "HOMELAND," SCORNED BY THE
INTERNATIONAL COMMUNITY BECAUSE OF THE OBSTACLE THEY
REPRESENT TO THE RETURN PROCESS, DIFFERENT FROM THEIR NEW
CROATIAN CROAT NEIGHBORS BOTH CULTURALLY AND SOCIALLY, AND OF
COURSE, DESPISED BY THE SERBS WHOSE HOMES THEY OCCUPY.
COMMENT
--------------
15. (C) VOJNIC IS NEITHER ALONE NOR SPECIAL IN ITS
PREDICAMENT; IT IS ONE OF MANY MARGINAL RURAL AREAS THAT WERE
IN DECLINE WELL BEFORE THE WAR, WHICH SERVED TO HASTEN AND
COMPLICATE AN ALREADY CHALLENGING ENVIRONMENT FOR
DEVELOPMENT. THE BORDER AREAS OF THE KRAJINA, LIKE THOSE OF
THE DALMATIAN HINTERLANDS, POSE A SERIOUS ECONOMIC CHALLENGE
FOR CROATIA. THE WAR ACCELERATED WHAT OTHERWISE WAS A LONG,
CONFIDENTIAL
PAGE 04 ZAGREB 00376 03 OF 04 200659Z
SEEMINGLY INEVITABLE DECLINE. SOME REGIONS, FOR EXAMPLE, BY
1990 HAD DECLINED TO LESS THAN HALF THEIR PRE-WORLD WAR II
POPULATIONS. AND PART OF WHAT KEPT THE REGION VIABLE DURING
TITO TIMES WAS THE FINANCIAL BOOST PROVIDED BY MILITARY BASES
AND FACILITIES -- AN ECONOMIC STIMULUS NO LONGER PROVIDED.
16. (C) THE CURRENT GOVERNMENT'S CHALLENGE IS DAUNTING.
ACCORDING TO UNDP, THE GOVERNMENT HAS NEITHER A POLICY NOR
ANY IDEA WHAT TO DO. WE SEARCHED IN VAIN FOR A GOVERNMENT
INTERLOCUTOR WHO IS TASKED EITHER TO WORK ON ECONOMIC
DEVELOPMENT ISSUES GENERALLY, OR SPECIFICALLY ON WAR-AFFECTED
AREAS. THE JULY 2002 AMENDMENTS TO THE LAW ON AREAS OF
SPECIAL STATE CONCERN (THE SO-CALLED WAR AFFECTED AREAS)
IMPLICITLY RECOGNIZED THAT THERE IS LITTLE REASON TO KEEP
BUILDING AND RECONSTRUCTING HOUSES WHEN THERE ARE NO
EMPLOYMENT OPPORTUNITIES, AND A COMMISSION WAS SUPPOSED TO BE
ESTABLISHED SPECIFICALLY TO ADDRESS ECONOMIC DEVELOPMENT
ISSUES. TO DATE, IN WHAT IS A PATTERN FOR THIS GOVERNMENT,
THERE HAS BEEN NO ACTION TAKEN. THE FACT REMAINS THAT NO
MATTER HOW WELL THE RETURN PROCESS MAY SUCCEED, IN THE END
NEITHER THE INTERNATIONAL COMMUNITY NOR THE GOVERNMENT ARE
LIKELY TO HAVE SUFFICIENT SWAY OVER ECONOMIC INCENTIVES TO
REVERSE THE DECADES OF DECLINE IN VOJNIC AND THE KRAJINA.
17. (U) BELGRADE MINIMIZE CONSIDERED.
CONFIDENTIAL
CONFIDENTIAL PTQ9136
PAGE 01 ZAGREB 00376 04 OF 04 200659Z
ACTION EUR-00
INFO LOG-00 NP-00 AF-00 AGRE-00 AID-00 CEA-01 CIAE-00
COME-00 CTME-00 DODE-00 DOTE-00 SRPP-00 DS-00 EB-00
EXIM-01 E-00 FAAE-00 FBIE-00 VC-00 FRB-00 H-01
TEDE-00 INR-00 IO-00 ITC-01 JUSE-00 L-00 VCE-00
AC-01 NSAE-00 NSCE-00 OIC-02 OMB-01 OPIC-01 PA-00
PM-00 PRS-00 ACE-00 P-00 SCT-00 SP-00 SSO-00
STR-00 TRSE-00 USIE-00 EPAE-00 PMB-00 DSCC-00 PRM-00
DRL-01 G-00 NFAT-00 SAS-00 SWCI-00 /010W
-------------- 388BAD 200659Z /38
R 200656Z FEB 03
FM AMEMBASSY ZAGREB
TO SECSTATE WASHDC 9493
INFO AMEMBASSY BELGRADE
AMEMBASSY LJUBLJANA
AMEMBASSY SARAJEVO
USEU BRUSSELS
USMISSION USOSCE
C O N F I D E N T I A L SECTION 04 OF 04 ZAGREB 000376
SIPDIS
USAID FOR ACONVERY, EUR/SCE FOR MNARDI
E.O. 12958: DECL: 02/18/2013
TAGS: PHUM EAID PREF ECON PGOV EAID PREF ECON PGOV EAID PREF ECON PGOV EAID PREF ECON PGOV HR HRPHUM
SUBJECT: VOJNIC: OFFERING EQUAL MISERY FOR ALL
ROSSIN
CONFIDENTIAL
PAGE 02 ZAGREB 00376 04 OF 04 200659Z
CONFIDENTIAL
SIPDIS
USAID FOR ACONVERY, EUR/SCE FOR MNARDI
E.O. 12958: DECL: 02/18/2013
TAGS: PHUM EAID PREF ECON PGOV EAID PREF ECON PGOV EAID PREF ECON PGOV EAID PREF ECON PGOV HR HRPHUM
SUBJECT: VOJNIC: OFFERING EQUAL MISERY FOR ALL
REF: ZAGREB 337
CONFIDENTIAL
PAGE 02 ZAGREB 00376 01 OF 04 200658Z
CLASSIFIED BY: POLOFF MITCH BENEDICT FOR REASONS 1.5 B AND D
SUMMARY
--------------
1. (C) ONLY 50 MILES FROM ZAGREB, THE MUNICIPALITY OF VOJNIC
STANDS AS A STARK EXAMPLE OF THE ECONOMIC REALITIES FACED BY
CROATS, SERBS, AND MUSLIMS ALIKE IN CROATIA'S WAR AFFECTED
REGIONS -- RURAL COMMUNITIES LONG PLAGUED BY ECONOMIC DECLINE
AND OUT MIGRATION. THE EFFECTS OF THE 1991-1995 "HOMELAND"
WAR, PARTICULARLY THE POPULATION SHIFTS AND DESTRUCTION OF
PROPERTY, EXACERBATED AN ALREADY DIFFICULT SITUATION IN
VOJNIC. THE ARRIVAL OF NEARLY 2,000 BOSNIAN CROAT SETTLERS
-- WHO BOOSTED THE CROAT PERCENTAGE OF THE POPULATION FROM
ONE TO OVER 36 PERCENT -- HAS ADDED TO THE PROBLEMS.
2. (C) FEW ECONOMIC PROSPECTS EXIST APART FROM SMALL SCALE
AGRICULTURE. THERE ARE CURRENTLY 370 WAGE PAYING JOBS IN A
REGION WITH OVER 8,000 INHABITANTS, AND THE LARGEST EMPLOYER
IS REPORTED TO BE NEARLY BANKRUPT. MUSLIMS ARE THE HARDEST
HIT, WITH NEARLY FULL UNEMPLOYMENT. RETURN OF PROPERTY
REMAINS THE BIGGEST ISSUES FOR SERBS; OVER 500 SERB-OWNED
HOUSES REMAIN OCCUPIED, PRIMARILY BY BOSNIAN CROAT SETTLERS.
NO EVICTIONS HAVE BEEN ENFORCED TO DATE. EVEN IF THERE WERE
A COORDINATED AND COMPREHENSIVE GOVERNMENT POLICY TO ADDRESS
ECONOMIC DEVELOPMENT ISSUES -- AND THERE IS NONE -- IT IS
DIFFICULT TO ENVISION THE REGION EVER BEING VIABLE
ECONOMICALLY.
BACKGROUND
CONFIDENTIAL
PAGE 03 ZAGREB 00376 01 OF 04 200658Z
--------------
3. (U) THE MUNICIPALITY OF VOJNIC IS JUST 50 MILES SOUTHEAST
OF ZAGREB, BUT IS ANOTHER WORLD WHEN ONE COMPARES THE LIVING
STANDARDS -- ONE ALMOST FIRST WORLD, THE OTHER VERY MUCH
BACKWARD. HILLY, ISOLATED, HUGGING THE BOSNIAN BORDER,
VOJNIC REMINDS AN AMERICAN VISITOR QUICKLY OF THE HOLLOWS OF
WEST VIRGINIA. VOJNIC WAS A PART OF THE SERB CONTROLLED
KRAJINA FROM 1991-1995, AND WAS RETAKEN BY CROATIAN
AUTHORITIES IN AUGUST 1995 UNDER OPERATION "STORM."
4. (U) THE PRE-WAR POPULATION WAS JUST OVER 8,000, DIVIDED
AMONG 46 VILLAGES -- 89 PERCENT SERB, 10 PERCENT MUSLIM, AND
ONLY ONE PERCENT CROAT. INHABITANTS WERE FULLY "EMPLOYED" IN
THE SOCIALIST SENSE; MOST RESIDENTS WERE ENGAGED IN
AGRICULTURE, TIED IN WITH THE LARGE AGROKOMBINAT "AGROKOMERC"
LOCATED JUST OVER THE BORDER IN WHAT IS NOW BOSNIA (AND OWNED
BY FIKRET ABDIC, FORMER REGIONAL WARLORD, AND NOW A CONVICTED
WAR CRIMINAL). WHAT LITTLE INDUSTRY EXISTED -- A FACTORY FOR
CLAY EXPLOITATION, CERAMICS, SAWMILL, IRON AND STEEL WORKS --
WAS OUTDATED AND UNDERCAPITALIZED EVEN BEFORE THE WAR.
THE ECONOMY TODAY
--------------
5. (C) AGRICULTURE REMAINS THE PREDOMINATE ECONOMIC ACTIVITY,
ALTHOUGH ONLY 30 PERCENT OF ARABLE LAND IS BEING CULTIVATED
COMPARED TO NEARLY 100 PERCENT IN 1990. VOJNIC'S CATTLE
POPULATION IS JUST ONE-FIFTH ITS PRE-WAR LEVEL. LACK OF
FINANCIAL RESOURCES HAS LIMITED THE RECONSTRUCTION OF FARM
BUILDINGS, WHICH IS REQUIRED FOR PRODUCTION TO INCREASE.
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INTERNATIONAL ASSISTANCE AND GOVERNMENT FINANCING HAS BEEN
USED TO RECONSTRUCT HOUSES, BUT ONCE THE HOUSE IS HABITABLE
RESIDENTS HAVE LITTLE ACCESS TO CREDIT FOR OTHER PURPOSES.
FOR EXAMPLE, THE MINISTRY OF SMALL AND MEDIUM ENTERPRISES AND
CRAFTS, LOCAL AUTHORITIES, AND UNDP, HAVE CO-FINANCED A LOAN
GUARANTEE FUND THAT NOW OPERATES IN EIGHT TOWNS. BANKS ARE
ENCOURAGED BY THE GUARANTEE FUND TO LEND TO INDIVIDUALS WHO
WANT TO START THEIR OWN BUSINESS. AS PART OF THE SERVICE
PROVIDED, THE FUND WILL DEVELOP FEASIBILITY STUDIES AND ACT
AS AN INTERMEDIARY BETWEEN THE BANKS AND THE BORROWER,
PROVIDING ADVICE AND TECHNICAL ASSISTANCE.
6. (C) SOME CHARGE DISCRIMINATION AT THE FUND. AN EMPLOYEE
OF THE FUND TOLD US THAT, WHILE IT MAKES APPROXIMATELY TWO
HUNDRED LOANS A YEAR, ONLY ONE HAS BEEN APPROVED FOR A SERB
RETURNEE. THE COLLATERAL THIS APPLICANT WAS REQUIRED TO
SUBMIT INCLUDED -- BUT WAS NOT LIMITED TO -- HIS HOUSE, AND A
PROMISSORY NOTE IN THE AMOUNT OF APPROXIMATELY $71,000. HE
HAD TO GET A PERSON EMPLOYED BY A GOVERNMENT ENTITY TO
CO-SIGN THE LOAN AS A CO-GUARANTOR. THE LATER REQUIREMENT,
NOT UNCOMMON FOR BANKS IN CROATIA, EFFECTIVELY ELIMINATES THE
POSSIBILITY OF A RETURNEE GETTING A LOAN. WITHOUT THE
LIMITED ASSISTANCE AVAILABLE FROM THE INTERNATIONAL COMMUNITY
-- TO BUY A COW OR PIG, REPAIR THE SHELTER, AND BUY OTHER
SMALL SCALE AGRICULTURAL INPUTS -- MOST RETURNEES SAY THEY
WOULD NOT HAVE COME BACK.
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CONFIDENTIAL PTQ9128
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ACTION EUR-00
INFO LOG-00 NP-00 AF-00 AGRE-00 AID-00 CEA-01 CIAE-00
COME-00 CTME-00 DODE-00 DOTE-00 SRPP-00 DS-00 EB-00
EXIM-01 E-00 FAAE-00 FBIE-00 VC-00 FRB-00 H-01
TEDE-00 INR-00 IO-00 ITC-01 JUSE-00 L-00 VCE-00
AC-01 NSAE-00 NSCE-00 OIC-02 OMB-01 OPIC-01 PA-00
PM-00 PRS-00 ACE-00 P-00 SCT-00 SP-00 SSO-00
STR-00 TRSE-00 USIE-00 EPAE-00 PMB-00 DSCC-00 PRM-00
DRL-01 G-00 NFAT-00 SAS-00 SWCI-00 /010W
-------------- 388B91 200658Z /38
R 200656Z FEB 03
FM AMEMBASSY ZAGREB
TO SECSTATE WASHDC 9491
INFO AMEMBASSY BELGRADE
AMEMBASSY LJUBLJANA
AMEMBASSY SARAJEVO
USEU BRUSSELS
USMISSION USOSCE
C O N F I D E N T I A L SECTION 02 OF 04 ZAGREB 000376
SIPDIS
USAID FOR ACONVERY, EUR/SCE FOR MNARDI
E.O. 12958: DECL: 02/18/2013
TAGS: PHUM EAID PREF ECON PGOV EAID PREF ECON PGOV EAID PREF ECON PGOV EAID PREF ECON PGOV HR HRPHUM
SUBJECT: VOJNIC: OFFERING EQUAL MISERY FOR ALL
CONFIDENTIAL
PAGE 02 ZAGREB 00376 02 OF 04 200658Z
6. (C) SALARIED EMPLOYMENT OPPORTUNITIES IN VOJNIC ARE FEW
AND FAR BETWEEN. IN THE ENTIRE MUNICIPALITY, ONLY 370
RESIDENTS ARE FORMALLY EMPLOYED, WHILE AROUND 800 ARE
REGISTERED AT THE UNEMPLOYMENT BUREAU. AND ACCORDING TO THE
MAYOR, THE VOJNIC FORESTRY FIRM, THE MUNICIPALITY'S LARGEST
EMPLOYER WITH 70 EMPLOYEES, IS FACING BANKRUPTCY. THE OTHER
LEADING EMPLOYERS ARE A CERAMIC FACTORY (40 EMPLOYEES),A
SAWMILL (20 EMPLOYEES),A CLOTHING ENTERPRISE (20 EMPLOYEES),
AND A FACTORY FOR PLASTIC PRODUCTS (15 EMPLOYEES).
MUSLIM COMMUNITY
--------------
7. (C) THE MUSLIMS OF VOJNIC ARE STRONG CONTENDERS FOR THE
MOST DISADVANTAGED OF THE REGION. ACCORDING TO IMAM DJURMIC,
THE LEADER OF THE LOCAL MUSLIM COMMUNITY, UNEMPLOYMENT VERGES
ON 95 PERCENT, ILLITERACY IS 80 PERCENT, AND THERE ARE NO
PROSPECTS FOR EMPLOYMENT. IN OUR DISCUSSION, HIS COMMENTS
WERE OFTEN HYPERBOLIC, AND HIS NUMBERS WERE OFTEN AT ODDS
WITH OTHER KNOWN FACTS -- GIVING CREDENCE TO THE ADAGE THAT
42.7 PERCENT OF ALL STATISTICS ARE MADE UP ON THE SPOT -- BUT
DJURMIC PAINTED A GENERALLY ACCURATE PICTURE. THE TWO
BIGGEST EMPLOYERS IN THE REGION, THE SAWMILL AND CERAMIC
WORKS, HE CLAIMED, EMPLOY NOT A SINGLE MUSLIM. SEVERAL
COMMUNITIES ARE WITHOUT ELECTRICITY. IN THE FIGHT BETWEEN
CROATS AND SERBS, MUSLIM HOMES WERE LARGELY LEFT INTACT, AND
SO EMPLOYMENT, RATHER THAN PROPERTY, IS THE MAIN ISSUE
CONFRONTING THE MUSLIM COMMUNITY.
8. (C) DESPITE DJURMIC'S GRIM PICTURE, THE MUNICIPALITY'S
MUSLIM POPULATION APPEARS TO BE INCREASING. MUSLIM LEADERS
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PAGE 03 ZAGREB 00376 02 OF 04 200658Z
CLAIM THERE ARE 1,600 MUSLIMS IN THE REGION, WHILE THE 2001
CENSUS ACKNOWLEDGES ONLY 768, OR 14 PERCENT OF THE
POPULATION. ACCORDING TO LOCAL OFFICIALS, 1,350 MUSLIMS ARE
REGISTERED IN THE MUNICIPALITY. MANY HAVE BOTH BOSNIAN AND
CROATIAN CITIZENSHIP, AND WORK IN BOSNIA. THE PRE-WAR
PATTERN OF LIVING IN CROATIA AND WORKING IN BOSNIA WAS
UNREMARKABLE WHEN ALL WERE CITIZENS OF YUGOSLAVIA; BUT NOW,
DUE IN PART TO MISSED DEADLINES, AND ALSO TO WAR AND
OCCUPATION, SOME MUSLIMS WHO MAY NOT HAVE BEEN BORN IN
CROATIA BUT HAVE LIVED HERE "FOREVER" ARE EXPERIENCING
DIFFICULTIES IN OBTAINING CITIZENSHIP AND OTHER DOCUMENTS
NECESSARY FOR RECEIVING RETIREMENT AND/OR SOCIAL BENEFITS.
ONE SERB RETURNEE, POINTING OUT HIS WINDOW TO THE LARGE NEW
HOUSE ACROSS THE STREET, TOLD US THAT MUSLIMS FROM BOSNIA ARE
BUYING UP BOTH HOUSES AND PROPERTY IN THE REGION IN THE HOPE
THAT IT WILL HELP THEM GET RESIDENCY DOCUMENTS.
9. (C) POLITICALLY, THE MUSLIM COMMUNITY IS BEING COURTED BY
BOTH THE CROATIAN DEMOCRATIC UNION (HDZ),ON THE RIGHT, AND
THE SOCIAL DEMOCRATIC PARTY (SDP),ON THE LEFT. IN A UNIQUE
TURN OF EVENTS WHICH BEGAN LAST FALL WHEN THREE SDP
REPRESENTATIVES RESIGNED FROM THE PARTY AND BECAME
INDEPENDENT, THE VOJNIC MUNICIPAL COUNCIL WAS FORMALLY
DISSOLVED IN JANUARY. THE GOC APPOINTED A CARETAKER
"COMMISSIONER," AN INDEPENDENT JUDGE FROM NEARBY KARLOVAC, TO
RUN THE MUNICIPALITY UNTIL BY-ELECTIONS, WHICH MUST BE HELD
BY MID-APRIL. ONE RESULT OF THE ENSUING POLITICAL VACUUM WAS
THAT USAID'S PARTNERSHIP AGREEMENT (MOU) WITH THE
MUNICIPALITY LAPSED. WITH SUCCESS HEAVILY DEPENDENT ON THE
POLITICAL WILL AND COOPERATIVENESS OF THE MAYOR AND COUNCIL,
USAID WAS RELUCTANT TO EXTEND THE MOU PRIOR TO A BY-ELECTION.
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PAGE 04 ZAGREB 00376 02 OF 04 200658Z
SERB RETURNEES
--------------
10. (C) REPOSSESSION OF PROPERTY REMAINS ONE OF THE MOST
SIGNIFICANT BARRIERS TO RETURN. ACCORDING TO USAID SOURCES,
BY LATE 2002 OWNERS HAD SUBMITTED 385 REQUESTS FOR RETURN OF
PROPERTY. OVER 600 PRIVATELY OWNED HOUSES AND 66 APARTMENTS
WERE DAMAGED IN THE WAR. AT THE END OF 2002, APPROXIMATELY
300 REQUESTS FOR RECONSTRUCTION ASSISTANCE WERE STILL
PENDING. AS A RESULT OF THE WAR AND ENSUING OBSTACLES TO
RETURN, THE SERB POPULATION HAS BEEN REDUCED TO APPROXIMATELY
ONE THIRD ITS PRE-WAR LEVEL -- FROM OVER 7,000 TO UNDER 3,000
INHABITANTS.
11. (C) DRAGAN VUCKOVIC, 57, REPRESENTS A TYPICAL SERB
RETURNEE IN THE VOJNIC AREA. THE HEAD OF AN EXTENDED FAMILY
OF FOUR, WITH ONE CHILD, VUCKOVIC RETURNED TO HIS RESIDENCE
"SPONTANEOUSLY" (THAT IS, WITHOUT GOVERNMENT OR NGO
ASSISTANCE) IN 2001. HIS HOUSE HAD NOT BEEN OCCUPIED, BUT
WAS DAMAGED IN THE WAR. ALL FARM-RELATED EQUIPMENT AND
SUPPLIES WERE LOST. PRIOR TO THE WAR HE WAS A RELATIVELY
PROSPEROUS FARMER, MANAGING 18 HECTARES AND A HERD OF CATTLE.
OFF FARM EMPLOYMENT WAS AVAILABLE, PROVIDING A CUSHION TO
SOFTEN THE VAGARIES OF AN AGRICULTURAL EXISTENCE. NOW,
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CONFIDENTIAL PTQ9134
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ACTION EUR-00
INFO LOG-00 NP-00 AF-00 AGRE-00 AID-00 CEA-01 CIAE-00
COME-00 CTME-00 DODE-00 DOTE-00 SRPP-00 DS-00 EB-00
EXIM-01 E-00 FAAE-00 FBIE-00 VC-00 FRB-00 H-01
TEDE-00 INR-00 IO-00 ITC-01 JUSE-00 L-00 VCE-00
AC-01 NSAE-00 NSCE-00 OIC-02 OMB-01 OPIC-01 PA-00
PM-00 PRS-00 ACE-00 P-00 SCT-00 SP-00 SSO-00
STR-00 TRSE-00 USIE-00 EPAE-00 PMB-00 DSCC-00 PRM-00
DRL-01 G-00 NFAT-00 SAS-00 SWCI-00 /010W
-------------- 388BA8 200659Z /38
R 200656Z FEB 03
FM AMEMBASSY ZAGREB
TO SECSTATE WASHDC 9492
INFO AMEMBASSY BELGRADE
AMEMBASSY LJUBLJANA
AMEMBASSY SARAJEVO
USEU BRUSSELS
USMISSION USOSCE
C O N F I D E N T I A L SECTION 03 OF 04 ZAGREB 000376
SIPDIS
USAID FOR ACONVERY, EUR/SCE FOR MNARDI
E.O. 12958: DECL: 02/18/2013
TAGS: PHUM EAID PREF ECON PGOV EAID PREF ECON PGOV EAID PREF ECON PGOV EAID PREF ECON PGOV HR HRPHUM
SUBJECT: VOJNIC: OFFERING EQUAL MISERY FOR ALL
HOWEVER, THERE ARE NO OFF FARM EMPLOYMENT OPPORTUNITIES, AND
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PAGE 02 ZAGREB 00376 03 OF 04 200659Z
THE VUCKOVIC FAMILY RETURNED TO CROATIA WITH NO IMMEDIATE
PROSPECT OUTSIDE THE PROMISE OF INTERNATIONAL ASSISTANCE AND
A MONTHLY PENSION OF APPROXIMATELY $55.
12. (C) THANKS TO PRM PROGRAMS, VUCKOVIC RECEIVED ASSISTANCE
FOR SHELTER REPAIR AND FOR AGRICULTURAL EQUIPMENT. USAID
PROVIDED A SMALL AND MEDIUM ENTERPRISE LOAN, WHICH WAS USED
TO BUY FOUR DAIRY COWS. WITHOUT THIS ASSISTANCE VUCKOVIC
WOULD NOT HAVE BEEN ABLE TO RETURN. WITH HIS FEW COWS AND
SMALL MILK COOLER AND THE ADVICE AND ASSISTANCE OF A
USAID-FUNDED NGO AND THE VINDIJA AND KIM COMPANIES, WHICH
HAVE ORGANIZED MILK COLLECTION FOR THE REGION, VUCKOVIC HAS
INCREASED HIS INCOME TO NEARLY $300 PER MONTH. HE IS
INCREASING HIS HERD AND TRYING TO FIND WAYS TO REPAIR FARM
BUILDINGS. ALTHOUGH HE HAS A LONG WAY TO GO, HE IS GLAD TO
BE BACK IN HIS HOUSE, REPORTS GOOD RELATIONS WITH LOCAL
CROATS, AND IS PLANNING FOR A BETTER FUTURE.
BOSNIAN CROAT SETTLERS
--------------
13. (C) OVER 500 BOSNIAN CROAT FAMILIES FROM NORTHWESTERN
BOSNIA ARE ACCOMMODATED IN SERB-OWNED HOUSES IN THE
MUNICIPALITY. SOME WOULD LIKE TO RETURN TO BOSNIA, BUT
EITHER CANNOT OR ARE UNWILLING, GIVEN HOUSING, EMPLOYMENT, OR
SOCIAL PROBLEMS THEY WOULD ENCOUNTER IN BOSNIA. EMPLOYMENT
IS NOT THE PRIMARY ISSUE FOR SETTLERS -- THEY HAVE OBTAINED
STATE AND STATE SUPPORTED JOBS, AND FACE ECONOMIC PROSPECTS
LITTLE DIFFERENT THAN THOSE OF THE AVERAGE CROATIAN IN THE
REGION. HOUSING IS THE BIG ISSUE. BOSNIAN CROATS RECOGNIZE
THEY ARE VIEWED AS A PART OF THE PROBLEM, AND WHILE THE
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PAGE 03 ZAGREB 00376 03 OF 04 200659Z
MAJORITY WANTS TO RESOLVE THE ISSUE RAPIDLY, THEY ARE NOT
GOING TO VACATE HOUSES WHEN THEY HAVE NO OTHER PLACE TO GO.
IN ADDITION, THEY ARE NOT INCLINED TO LET THIS GOVERNMENT OFF
THE HOOK FOR PROMISES (HOUSING, JOBS, ETC.) MADE BY THE HDZ
GOVERNMENT TO INDUCE THEM TO SETTLE IN CROATIA.
14. (C) ONE BOSNIAN CROAT LEADER AFFILIATED WITH THE
ASSOCIATION OF CROATIAN SETTLERS, WHICH CLAIMS TO SPEAK FOR
APPROXIMATELY 60 PERCENT OF SETTLERS, HAS SAID THAT
COMMUNICATION WITH THE GOVERNMENT CONSISTS OF BOSNIAN CROATS
BEING TOLD "YOU MUST..." FOLLOWED BY "SOMETHING BAD."
CONSERVATIVE POLITICALLY, THE VAST MAJORITY OF BOSNIAN CROATS
REMAIN SUPPORTIVE OF THE NOW OPPOSITION CROATIAN DEMOCRATIC
UNION (HDZ) PARTY OF FORMER PRESIDENT FRANJO TUDJMAN. IN A
SENSE THEY REPRESENT AN UNWANTED CASTE -- ALL BUT ABANDONED
BY THE GOVERNMENT OF THEIR ETHNIC "HOMELAND," SCORNED BY THE
INTERNATIONAL COMMUNITY BECAUSE OF THE OBSTACLE THEY
REPRESENT TO THE RETURN PROCESS, DIFFERENT FROM THEIR NEW
CROATIAN CROAT NEIGHBORS BOTH CULTURALLY AND SOCIALLY, AND OF
COURSE, DESPISED BY THE SERBS WHOSE HOMES THEY OCCUPY.
COMMENT
--------------
15. (C) VOJNIC IS NEITHER ALONE NOR SPECIAL IN ITS
PREDICAMENT; IT IS ONE OF MANY MARGINAL RURAL AREAS THAT WERE
IN DECLINE WELL BEFORE THE WAR, WHICH SERVED TO HASTEN AND
COMPLICATE AN ALREADY CHALLENGING ENVIRONMENT FOR
DEVELOPMENT. THE BORDER AREAS OF THE KRAJINA, LIKE THOSE OF
THE DALMATIAN HINTERLANDS, POSE A SERIOUS ECONOMIC CHALLENGE
FOR CROATIA. THE WAR ACCELERATED WHAT OTHERWISE WAS A LONG,
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PAGE 04 ZAGREB 00376 03 OF 04 200659Z
SEEMINGLY INEVITABLE DECLINE. SOME REGIONS, FOR EXAMPLE, BY
1990 HAD DECLINED TO LESS THAN HALF THEIR PRE-WORLD WAR II
POPULATIONS. AND PART OF WHAT KEPT THE REGION VIABLE DURING
TITO TIMES WAS THE FINANCIAL BOOST PROVIDED BY MILITARY BASES
AND FACILITIES -- AN ECONOMIC STIMULUS NO LONGER PROVIDED.
16. (C) THE CURRENT GOVERNMENT'S CHALLENGE IS DAUNTING.
ACCORDING TO UNDP, THE GOVERNMENT HAS NEITHER A POLICY NOR
ANY IDEA WHAT TO DO. WE SEARCHED IN VAIN FOR A GOVERNMENT
INTERLOCUTOR WHO IS TASKED EITHER TO WORK ON ECONOMIC
DEVELOPMENT ISSUES GENERALLY, OR SPECIFICALLY ON WAR-AFFECTED
AREAS. THE JULY 2002 AMENDMENTS TO THE LAW ON AREAS OF
SPECIAL STATE CONCERN (THE SO-CALLED WAR AFFECTED AREAS)
IMPLICITLY RECOGNIZED THAT THERE IS LITTLE REASON TO KEEP
BUILDING AND RECONSTRUCTING HOUSES WHEN THERE ARE NO
EMPLOYMENT OPPORTUNITIES, AND A COMMISSION WAS SUPPOSED TO BE
ESTABLISHED SPECIFICALLY TO ADDRESS ECONOMIC DEVELOPMENT
ISSUES. TO DATE, IN WHAT IS A PATTERN FOR THIS GOVERNMENT,
THERE HAS BEEN NO ACTION TAKEN. THE FACT REMAINS THAT NO
MATTER HOW WELL THE RETURN PROCESS MAY SUCCEED, IN THE END
NEITHER THE INTERNATIONAL COMMUNITY NOR THE GOVERNMENT ARE
LIKELY TO HAVE SUFFICIENT SWAY OVER ECONOMIC INCENTIVES TO
REVERSE THE DECADES OF DECLINE IN VOJNIC AND THE KRAJINA.
17. (U) BELGRADE MINIMIZE CONSIDERED.
CONFIDENTIAL
CONFIDENTIAL PTQ9136
PAGE 01 ZAGREB 00376 04 OF 04 200659Z
ACTION EUR-00
INFO LOG-00 NP-00 AF-00 AGRE-00 AID-00 CEA-01 CIAE-00
COME-00 CTME-00 DODE-00 DOTE-00 SRPP-00 DS-00 EB-00
EXIM-01 E-00 FAAE-00 FBIE-00 VC-00 FRB-00 H-01
TEDE-00 INR-00 IO-00 ITC-01 JUSE-00 L-00 VCE-00
AC-01 NSAE-00 NSCE-00 OIC-02 OMB-01 OPIC-01 PA-00
PM-00 PRS-00 ACE-00 P-00 SCT-00 SP-00 SSO-00
STR-00 TRSE-00 USIE-00 EPAE-00 PMB-00 DSCC-00 PRM-00
DRL-01 G-00 NFAT-00 SAS-00 SWCI-00 /010W
-------------- 388BAD 200659Z /38
R 200656Z FEB 03
FM AMEMBASSY ZAGREB
TO SECSTATE WASHDC 9493
INFO AMEMBASSY BELGRADE
AMEMBASSY LJUBLJANA
AMEMBASSY SARAJEVO
USEU BRUSSELS
USMISSION USOSCE
C O N F I D E N T I A L SECTION 04 OF 04 ZAGREB 000376
SIPDIS
USAID FOR ACONVERY, EUR/SCE FOR MNARDI
E.O. 12958: DECL: 02/18/2013
TAGS: PHUM EAID PREF ECON PGOV EAID PREF ECON PGOV EAID PREF ECON PGOV EAID PREF ECON PGOV HR HRPHUM
SUBJECT: VOJNIC: OFFERING EQUAL MISERY FOR ALL
ROSSIN
CONFIDENTIAL
PAGE 02 ZAGREB 00376 04 OF 04 200659Z
CONFIDENTIAL