Financial Times FT.com

Forestry: Widespread corruption fells timber export hopes

By Christian Jennings

Published: December 11 2007 06:42 | Last updated: December 11 2007 06:42

It may sound hard to believe in a country as full of trees as Bosnia-Herzegovina, but foreign investors in the wood-processing industry often import timber from neighbouring Croatia.

There are two main reasons. First, wood harvested in the Serb entity, Republika Srpska, is sold as a priority to companies in the same entity, not to those in the Muslim-Croat Federation, the other entity recognised under the Dayton Agreement. Second, logging is plagued by crime and corruption, which is a constant concern for foreign investors.

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