Serbia Returns to the Arms Trade

A long-running joke in Serbia goes that the country’s most successful export products are berries, grains, maize, and world-renowned tennis players like Novak Djokovic and Jelena Jankovic.

But things appear differently when one takes a look at the country’s economic statistics, which show that there is one profoundly stable and steadily rising industry in Serbia: the military industry, which has witnessed an export growth of 30 percent annually, providing jobs for close to 9,000 workers.

"We've sold this year's production of our sniper rifles in advance," Rade Gromovic, head of the Zastava weapons factory, told IPS. The factory is situated in the central Serbian town of Kragujevac and specializes in rifle production for both military and civilian purposes.

"Our prime export items are machine guns, submachine guns, automatic rifles, CZ 999 pistols, and automatic or semi-automatic snipers," he added. The factory has been licensed by the United Nations (UN); most of its products are used by UN peace-keeping forces in Iraq, Afghanistan, and several African countries, Gromovic said. In several meetings with journalists earlier this month, Serbian Defence Minister Dragan Sutanovac explained that the major export products of the military industry are "ammunition… M-92 automatic machine guns and M- 84, gunpowder, rocket fuel, explosives, bullet-proof vests and protective body armor, and the training aircraft ‘Lasta’ (sparrow)."

Sutanovac stated that the annual figure of exports rose from 75 million dollars in 2007 to 183 million dollars in 2008, and again, to 246 million dollars in 2009.

For many Serbs, the extent of the country’s military industry was little known until recently. Some of Serbia’s most important arms and ammunition factories were destroyed by NATO bombing in 1999, including the Utva small aircraft factory in the town of Pancevo near Belgrade. It is in the reconstructed Utva factory that the training aircraft ‘Lasta’ are being produced.

But Serbia has traveled a long road since 1999, through changing a war- mongering regime in 2000, joining the Partnership for Peace (PfP) NATO program, and obtaining funds for reconstruction of its military industry.

According to Sutanovac, 38 million dollars were invested in reconstruction of the industry in the past five years, with another 61.2 million planned for the next few years. Investors are hopeful that the industry can recover to the level that it reached 20 years ago, during the time of former Yugoslav federation, when the joint military industry brought billions of dollars into state coffers.

The statistics of state-owned Yugoimport-SDPR, the company that coordinates the exports of the military industry, show that, since 2007, the top purchasers of rifles and ammunition were Iraq, with 300 million dollars worth of purchase, the United States, with 90 million, and Afghanistan, with 30 million, followed by European countries such as Belgium (25 million), Bulgaria (17 million), Italy (16 million), and Cyprus (15 million).

Aside from military purposes, arms, ammunition, and equipment are sold to police forces in Cameroon, Indonesia, Jordan, and the former Yugoslav Republic of Macedonia.

Several training aircraft "sparrows" have landed in Iraq recently, and Iraqi Mi-17 helicopters are now being mounted with adequate Serbian weaponry that would turn them into gunships.

"Self-propelled howitzers ‘Nora B-52’ are already sold in Africa, and some Arab countries show great interest in our howitzer," Sutanovac said, but would not disclose which Arab nations he was referring to.

This year may witness big ventures for Serbia: it is close to signing a 500 million dollar agreement to build a military hospital in at least one Arab country; three military factories are to be built in Algeria; and Sutanovac said that he hopes Serbia will win a 400 million dollar contract to modernize 150 M-84 tanks that Yugoslavia exported to Kuwait in 1991.

The tanks were typical of former Yugoslav cooperation, as they were assembled in Croatia from components made throughout the federation. Now the ties are being restored, and Serbian, Bosnian, and Macedonian arms companies are working together. A Serbia-Croatia defense agreement signed in June also envisages co-operation.

If Serbia wins the Kuwait contract, Sutanovac said, some of the work will most likely be shared between Bosnian, Croatian, and Slovene companies  -- a cooperative effort that looks forward, to the future.

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