Bosnia Serb PM makes disputed sell-off deals public

The sale of oil refinery Brod, lubricants producer Modrica and fuel retailer Petrol to a Russian investor, and the joint venture between RITE Gacko thermo-power plant and Czech state power company CEZ were initially hailed as success stories.

But investors, activists, financial market analysts and media said the government had conducted the negotiations in secrecy, failed to provide timely and accurate accounts, and had agreed to terms that hurt the interests of small shareholders.

Bosnian Serb Prime Minister Milorad Dodik had rejected the accusations, saying the government clinched good deals for firms that had been facing bankruptcy.

But on Wednesday he agreed that officials from the Transparency International corruption watchdog should in future monitor all privatisations of strategic companies, from the moment tenders are issued to the moment contracts are signed.

“It should have been much more simple, and there would have been much less criticism if the tender documentation had been prepared in a proper manner and the tenders had been published,” said Boris Divjak, the head of the Bosnian office of Transparency International, after meeting Dodik.

Dodik handed to Divjak documents relating to the past deals.

Financial experts have said the controversy around the privatisations hurt the regional stock exchange and dented the country's image as an investment destination.

The Banja Luka bourse BIRS index fell from a record 4801.94 at the end of April to 2614.36 at the end of October.

(Reporting by Olja Stanic, writing by Daria Sito-Sucic; Editing by Ellie Tzortzi and Ralph Boulton)