[House Document 106-277]
[From the U.S. Government Publishing Office]



                                     

106th Congress, 2d Session - - - - - - - - - - - House Document 106-277



 
                  BENCHMARKS FOR A SUSTAINABLE PEACE

                               __________

                                MESSAGE

                                  from

                   THE PRESIDENT OF THE UNITED STATES

                              transmitting

  A REPORT ON PROGRESS TOWARD ACHIEVING BENCHMARKS FOR A SUSTAINABLE 
                            PEACE IN BOSNIA




  September 6, 2000.--Message and accompanying papers referred to the 
   Committees on International Relations, Appropriations, and Armed 
                   Services and ordered to be printed
 To the Congress of the United States:
     As required by the Levin Amendment to the 1998 
Supplemental Appropriations and Rescissions Act (section 7 of 
Public Law 105-174) and section 1203 of the Strom Thurmond 
National Defense Authorization Act for Fiscal Year 1999 (Public 
Law 105-261), I transmit herewith a report on progress made 
toward achieving benchmarks for a sustainable peace process.
     In April 2000, I sent the third semiannual report to the 
Congress under Public Law 105-174, detailing progress towards 
achieving the ten benchmarks adopted by the Peace 
Implementation Council and the North Atlantic Council for 
evaluating implementation of the Dayton Accords. This report 
provides an updated assessment of progress on the benchmarks, 
covering the period January 1 through June 30, 2000.
     In addition to the semiannual reporting requirements of 
Public Law 105-174, this report fulfills the requirements of 
section 1203 in connection with my Administration's request for 
funds for FY 2001.
                                                William J. Clinton.
     The White House. July 27, 2000.
  Report to Congress on Progress Toward Achieving Benchmarks in Bosnia

     This document is divided into two parts, corresponding to 
two separate Congressional reporting requirements concerning 
SFOR operations and developments in Bosnia and Herzegovina 
(BiH). Part I responds to the requirements of section 7 of 
Public Law 105-174 and outlines the latest developments in our 
continuing efforts to achieve a sustainable peace in Bosnia and 
Herzegovina. Part II responds to the supplementary reporting 
requirements contained in section 1203(a) of the National 
Defense Authorization Act for Fiscal Year 1999. I submit these 
two reports in a single document to afford Congress a broad and 
comprehensive assessment of recent developments in BiH.

                                 PART I

     Introduction. In April 2000, I sent the third semiannual 
report to congress under PL 105-174, detailing progress towards 
achieving the ten benchmarks adopted by the Peace 
Implementation Council (PIC) and the North Atlantic Council 
(NAC) for evaluating implementation of the General Framework 
Agreement for Peace in Bosnia and Herzegovina (GFAP or the 
Dayton peace agreement). This section provides an updated 
assessment of progress toward achieving the benchmarks for the 
period from January 1 through June 30, 2000.
     the United States continues to have strong national 
interests in fostering security and stability in Southeastern 
Europe. To that end, working with our Allies and Partners, we 
are making slow but steady progress in helping BiH on its way 
to political and economic recovery. We have worked hard to 
maintain a cooperative momentum. At the PIC ministerial meeting 
in Brussels in May, ministers laid out priorities for the next 
two years for Bosnian authorities and the international 
community that focussed on achieving self-sustaining peace, 
democracy, and economic growth in BiH. Continued active 
engagement by the international community, led by the U.S. and 
our partners in the PIC, will be needed if these objectives are 
to be realized. It remains our goal to foster circumstances 
that allow the people of BiH to assume stewardship of a self-
sustaining peace process leading to full integration of BiH 
into the family of European democracies.
     The following evaluation provides a detailed account of 
progress achieved over the reporting period under each of the 
ten benchmarks. Basic structures of government now in place are 
slowly extending their reach, and Dayton-mandated central 
institutions functions with increased, though still limited, 
effectiveness. UN-sponsored training of a multi-ethnic State 
Border Service is well under way. A small, specially trained, 
multi-ethnic policy unit deployed in support of UN operations 
in East Timor. In addition, Bosnia resumed control of its upper 
airspace during the reporting period. Over the past six months, 
the international community undertook planning for intensified 
action against deep-rooted corruption in BiH. The international 
community has intensified support for increased independence of 
the still-fragile BiH police force and judicial system and has 
carried out measures against corrupt and obstructionist 
government and business officials. Nevertheless, there remains 
much room to improve these institutions and prepare them to 
contribute to establishing a truly multi-ethnic state.
    Many political figures remain committed to mono-ethnic, 
anti-Dayton visions of the future and resist taking steps that 
would ensure a European future for a multi-ethnic BiH. Key 
indicted war criminals remain at large, poisoning the 
environment in which peace is taking root. The rate of minority 
refugee returns, while registering four-fold increase in the 
first quarter of calendar 2000, remains less than satisfactory. 
Many needed economic and judicial reforms are still pending. 
The April municipal elections demonstrated that hardline 
nationalist parties remain a powerful political force, even 
though their grip is weakening. Further forceful international 
community action will be needed to eliminate the influence of 
discredited opponents of the Dayton process.
    A benchmark-by-benchmark analysis of the current situation 
follows:
    1. Military Stability. Aim: Maintain Dayton cease-fire. 
Since the July 1-December 31, 1999, assessment, BiH continues 
to be relatively calm. NATO deemed the security environment in 
Bosnia sufficiently improved to undertake substantial cuts in 
SFOR's total troop strength, reducing SFOR personnel by about 
30 percent, to approximately 23,000 (about 22,000 in Bosnia), 
by May 2000. The U.S. component was reduced to around 4,600 
troops or about 20 percent of SFOR strength. As of May 1, 2000, 
the planned reduction from 34,000 to 23,000 troops was 
complete. As a result of this drawdown, local commanders have 
to cover their assigned areas with fewer forces, which in some 
cases may be located farther from potential trouble areas. 
SFOR's new operational concept compensates for the reduction in 
troop numbers through enhanced flexibility, which permits the 
restructured force to accomplish its mission with the same 
overall effectiveness. NATO Secretary General Lord George 
Robertson reported to the PIC ministerial on May 23 that SFOR 
would ``always retain the forces necessary to get the job done, 
and in today's environment, we are at the right level.''
    Progress continued towards increasing mutual confidence 
between the entity armed forces (EAFs). The Office of the High 
Representative (OHR), OSCE, and SFOR have cooperated to 
increase the professionalism and education of the EAFs. The 
political leadership of Bosnia has agreed to formulate a common 
Bosnian security policy as a first step towards creating a 
state dimension of defense. The permanent secretariat for the 
Standing Committee on Military Matters (SCMM) made progress in 
developing its role in coordinating actions of the EAFs at the 
policy level. In addition to working on the common security 
policy, the SCMM secretariat assisted in planning and 
implementing reductions of the EAFs' budgets and military 
personnel by 15 percent. SFOR verified that this drawdown was 
completed in a report to the SCMM in May. This process was 
advanced in March, during Secretary Albright's visit to 
Sarajevo, with an agreement among the United States, Croatia, 
and the Federation to notify all future security assistance 
from Croatia and the United States through the SCMM. The United 
States implemented this arrangement immediately, and in May 
Croatia and the Federation signed an Agreement on defense 
Assistance Transparency. However, BiH still has no state 
security policy, and the SCMM will require more staff, more 
resources, and greater authority to deal with security issues 
directly, if it is to carry out its envisioned role.
    2. Public Security and Law Enforcement. Aim: A restructured 
and democratic police force in the Federation and Republika 
Srpska (RS). Signs of reform in both entities continue to be 
observed. With UN and other international training, the multi-
ethnic State Border Service began operations. The Service has 
selected its executive leadership, and the first units deployed 
at Sarajevo airport on June 6. More deployments are expected in 
the near future. In addition, a twelve-member multi-ethnic BiH 
policy unit was deployed to East Timor in support of UN 
operations there. As a result of UNMIBH's creation of the 
Standing Committee on Police Matters, on May 3, the entities 
signed an agreement to facilitate the voluntary redeployment of 
200-300 police across the Inter-Entity Boundary Line (IEBL) to 
return them to their pre-war assignments. In Mostar, local 
cantonal authorities have begun to integrate the police 
headquarters. However, organized crime and anti-Dayton forces 
remain major impediments to reform and continue to exert 
political influence on elements of the police. It was necessary 
for the OHR to remove two cantonal interior ministers for non-
compliance with Dayton-related mandates, and assistance from 
the international community and SFOR is still needed to 
effectively combat organized crime, civil disorder, narcotics 
trafficking, ethnic violence, and public sector corruption. The 
International Police Task Force (IPTF) is nearing completion of 
its human rights and transition training and is planning to 
phase out its training function. It will focus on monitoring/
advising police activities and staffing specialized units for 
helping local police deal with organized crime and corruption. 
UNMIBH continues intensive audits of local police operations 
and will vigorously enforce non-compliance and de-certification 
policies.
    3. Judicial Reform. Aim: An effective judicial reform 
program. Significant judicial reform legislation was adopted by 
the RS parliament in April and imposed by OHR in the Federation 
in May. The aim of these Entity judicial and prosecutorial 
service laws is to de-politicize the appointment and dismissal 
of judges and prosecutors by establishing judicial selection 
commissions composed of serving judges and prosecutors to 
advise legislators on all appointments and dismissals. The laws 
also provide that the Commissions will review all sitting 
judges and prosecutors over a period of 18 months. The United 
Nations' Judicial System Assessment Program (JSAP) has stated 
that it will complete its work by the end of the year. A 
follow-on program focussed on reform implementation is being 
designed by OHR. Progress was also made in the area of judicial 
training with the establishment in February of an Inter-Entity 
Judicial Training Advisory Board. The Federation Government 
established the new first instance criminal court to try inter-
cantonal crime, terrorism, and organized crime in accordance 
with a law imposed by OHR last year. OHR continued to press the 
Federation for proper funding for this court, which was not 
forthcoming. Though steady progress is being made structurally 
in the area of judicial reform, more effort is needed to ensure 
implementation of these new structures and real independence 
(political and financial) of the judiciary. Successful 
execution of judicial reforms is critical to establishment of 
the rule of law and establishing once and for all the 
confidence of all Bosnia's citizens regardless of ethnicity in 
the domestic court system.
    4. Illegal Institutions, Organized Crime, and Corruption. 
Aim: The dissolution of illegal pre-Dayton institutions. The 
new reform Government of Croatia, which emerged from elections 
this spring, has stated its commitment to transparency in its 
relations with Bosnia. The March agreement to channel support 
for the Bosnian Federation military through the SCMM (above, 
Benchmark 1) is an important example. It cuts support from 
Croatia for nationalist Croat organizations in BiH.
    Under pressure from the international community, the 
Bosnian authorities have taken a more active role in fighting 
corruption. For the first time, a Bosnian court convicted three 
former Tuzla canton officials on abuse of office charges. The 
Federation Government produced an anti-corruption strategy in 
March 2000. In the RS, Prime Minister Dodik also produced an 
anti-corruption plan and asked for assistance in implementing 
it. U.S. support to the OHR's anti-fraud unit will underwrite 
the hiring of auditors, prosecutors, and investigators. The 
United States has also increased assistance to police, 
prosecutors, judges and other legal professionals in fighting 
corruption, particularly in the banking sector. Two FBI agents 
are in Bosnia now to assist in preparing several key organized 
crime/corruption cases for prosecution and in enhancing local 
law enforcement and prosecutorial capacities in this area. 
OHR's Anti-corruption and Transparency (ACT) Group and the 
interagency Frowick Anti-corruption Task Force (FACT) continue 
to provide a valuable contribution that specifically addresses 
corruption issues.
    5. Media Reform. Aim: A regulated, independent, and 
democratic media. Progress in the course of the reporting 
period has been notable. The Independent Media Commission (IMC) 
has actively developed regulations and guidance. In January 
2000, the IMC Rule on Broadcast License Fees, an important part 
of the long-term licensing process, entered into force. The IMC 
also adopted new guidelines for equitable access to media 
during election periods and issued an Advertising and 
Sponsorship Code of Practice for Radio and Television. Most 
important, steps have been taken to remove political control 
and bias in the media. More still needs to be done.
    In February, the IMC implemented its November 1999 decision 
to shut down hardline Croat-dominated Erotel TV for failure to 
accept the terms of an IMC Provisional Broadcast License, which 
would have involved shrinkage of its coverage area and Erotel's 
turning over surplus transmitters needed to establish 
Federation Television. Thanks to OSCE international oversight, 
broadcasts during the election period covered the campaign in a 
manner more consistent with international norms than in the 
past.
    Despite these positive steps, pressures persist, including 
political pressure aimed at encouraging self-censorship by 
journalists. Individual journalists continue to receive 
anonymous threats, some of which appear to be politically 
motivated. In April, OHR and OSCE jointly condemned abusive 
publications threatening independent journalists in Livno 
(Canton 10). The international community will continue to 
insist on adherence to licensing regulations and professional 
standards of conduct in journalism and through training and 
technical assistance programs, help journalists meet those 
expectations and understand why they are important.
    6. Elections and Democratic Governance. Aim: National 
democratic institutions and practices. At the State level, all 
Dayton-mandated central institutions meet regularly, but their 
effectiveness could be enhanced. Pursuant to last November's 
New York Declaration agreed to by the Joint Presidents, a joint 
secretariat for the Presidency was created, and efforts were 
made to increase funding for the three under-funded State 
ministries. (Under a law adopted by the State Parliament, the 
number of ministries will increase to six.) In addition, BiH 
authorities have committed to issuance of a common passport and 
establishment of a central passport registry. With its 
deployment June 6, the State Border Service (see Benchmark 2) 
became the first multi-ethnic armed force under central 
government control. On June 6, the BiH House of Representatives 
approved the nomination of Spasoje Tusevljak as Chairman of the 
BiH Council of Ministers, a position which had been vacant 
since February because of the inability of the Parliament and 
the Joint Presidents to agree on a nominee. The United States 
has made clear that it intends to monitor closely Tusevljak's 
performance in carrying out critical government initiatives in 
a number of key areas of Dayton implementation.
    There is resistance, particularly from the Serb side, to 
investing State institutions with real power, as they view 
increased State power as an infringement on entity 
prerogatives. Within the Federation, the threat of the National 
Interest Clause renders the legislative process slow and often 
ineffective. The April 8 municipal elections, successfully 
supervised by OSCE with SFOR's support, yielded free and fair 
results and overall increases for more moderate parties in the 
Federation and the Republika Srpska. The BiH Parliament has so 
far rejected the OSCE-drafted Election Law, despite 
international pressure. Some opposition parties strongly 
opposed the law as well. Nevertheless, planning is underway for 
the general elections, which OSCE has scheduled for November 
11, 2000, to be held under OSCE supervision and under 
provisional rules and regulations that have been updated to 
incorporate essential elements of the draft election law. In 
November, voters will select members of the federal parliament, 
parliamentary bodies in both Entities, cantonal assemblies in 
the Federation, and the RS presidency.
    Development of stronger central institutions continues to 
be of paramount importance. Last December, OSCE rules that no 
one illegally occupying another person's property could run for 
or hold office. Some officials have already been removed from 
office for refusing to obey this order, and a number of 
candidates for the municipal elections were disqualified. Other 
officials have been removed for obstructing Dayton. In April 
and May, the administration in Livno (Canton 10), known for 
anti-Dayton activity, saw the removal from office of its 
governor, prime minister and minister of internal affairs by 
the High Representative. (See also Benchmark 5.) The President 
of the Federation Privatization Agency Management Board was 
removed in May. Enforcement of these actions by OSCE and OHR 
are supported by SFOR's continued maintenance of a secure 
environment, in which State and entity institutions can 
function and democratic elections can take place.
    7. Economic Development. Aim: Free-market reform. Progress 
continues to be slow and uneven. While obstructionist politics 
prevent the implementation of many free market reforms, 
officials within the Bosnian government increasingly accept the 
need for them. Privatization remains a key goal of the economic 
reform effort in Bosnia and Herzegovina. After the U.S. 
Government suspended privatization assistance, Federation 
authorities began to address some of the issues impeding 
privatization. Progress has been made by increasing the number 
of privatization plans submitted and approved and by protecting 
investors from restitution claims. However, the pace remains 
slow. Both entities recently bowed to international community 
pressure to conduct privatization tenders in accordance with 
international standards. The tender process will utilize 
international experts. Republika Srpska authorities are more 
cooperative and continue to make solid progress in moving the 
privatization process forward.
    Despite improved anti-corruption efforts (see Benchmark 4), 
corruption continues to be endemic in the economic systems of 
both entities. Payment bureaus, which developed in the 1950s 
and are non-transparent economic and management control 
institutions, are scheduled to be phased out by the end of 
2000, which should pave the way for establishment of a sound 
banking sector. To this end, the law was changed to remove the 
Payment Bureaus' monopoly on transferring funds. The Central 
Bank has begun preparations to take over major inter-bank fund 
transfers, and commercial banks are being licensed to do 
routine transfers. Several banks have prepared privatization 
plans, and the first should be privatized soon. Also, Banking 
Agencies in both entities are moving to assume more authority, 
though OHR had to impose the immunity legislation necessary for 
their full effectiveness. The need for sound, prudent, fiscal 
management at both the entity and national levels cannot be 
overstated. The international community strongly supports 
establishment of a treasury function at the state and entity 
levels to optimize the financial management of government 
resources. We also encourage the state to assume a stronger 
economic regulatory function to reduce investment barriers and 
help unify BiH as a single economic space. Treasury legislation 
has passed one house of parliament at the state level and 
awaits parliamentary consideration in both entities.
    8. Displaced Person and Refugee (DPRE) Returns. Aim: A 
functioning and orderly minority return process. This period 
has seen an unprecedented surge in displaced persons and 
refugee returns to pre-war homes. Minority returns to some of 
the previously most hostile regions in the RS have taken place 
and appear to be gaining momentum. Only occasionally have 
majority groups in the RS publicly resisted returnees, and even 
these demonstrations were largely orchestrated rather than 
spontaneous. UNHCR estimates that for the first quarter of this 
year 7,377 registered minority returns took place, as compared 
to 1,721 for the same period of 1999--a four-fold increase. Due 
to the nature of spontaneous returns, only anecdotal 
information is available, but there appears to be a major 
increase in these as well. The bulk of these returns, however, 
continues to be to outlying, destroyed rural villages, where 
individuals take advantage of improved security conditions 
provided by SFOR to begin rebuilding while awaiting 
international assistance. Lack of assistance funds for shelter 
repair is the greatest obstacle to sustaining these returns.
    Returns to urban areas continue to lag, particularly in the 
larger towns. One reason for the relatively slow pace of 
returns to cities has been the reluctance of local officials to 
adjudicate resolution of property claims, as well as the 
reluctance of local authorities to evict illegal occupants. 
Officials in the RS and in hardline Croat majority areas 
commonly obstruct evictions and minority reinstatements. To 
address this problem, OHR initiated a Property Legislation 
Implementation Plan (PLIP) late last year as the follow-up to 
the October package of amendments to property laws imposed on 
both entities by the High Representative. Security is no longer 
the primary concern of most returnees, with the possible 
exception of some hardline regions in the RS and, to a lesser 
extent, the Federation. According to a USAID-sponsored study, 
security and shelter remain the greatest needs for sustainable 
returns. Other important factors cited by respondents included 
employment and education, as well as infrastructure issues 
(power, water, health facilities, and transportation).
    9. Brcko. Aim: Implementation of the Brcko Final Award. The 
March 1999 Final Award issued by the International Arbitral 
Tribunal for Brcko directed that a new, self-governing District 
be created by reunification of the entire pre-war opstina 
(municipality) of Brcko, although the IEBL is to remain in 
place for the time being. On January 20 Supervisor Farrand 
established a new, unified police force to replace the three 
separate forces that have operated there since the end of the 
war. On March 9, the Supervisor put into effect a new District 
Statute that is to serve as the ``constitution'' of the 
District and appointed to office the Mayor and other officials 
who will comprise the District administration. On March 31 the 
Supervisor installed a multi-ethnic District Assembly. 
Demilitarization of Brcko was completed in March by the full 
withdrawal of RS military forces from the District. Few 
protests against any of these developments took place, freedom 
of movement is now the norm, and minorities continue to return 
to the more rural areas of the District. Despite the seeming 
ease with which these major changes have been implemented, 
SFOR's presence remains crucial to deterring attempts by 
hardliners to disrupt implementation of the Brcko Award through 
violence.
    10. Persons Indicted For War Crimes (PIFWCs). Aim: 
Cooperation with the International Criminal Tribunal for the 
former Yugoslavia (ICTY) leading to the transfer of PIFWCs to 
The Hague for trail. Thus far 49 PIFWCs have been transferred 
to The Hague for trial under open and sealed indictments. 
Acting within its mandate, SFOR has assisted in the transfer of 
indictees to The Hague and continues to support ICTY filed 
investigations in Bosnia. The most recently captured indictees, 
Mitar Vasiljevic (January 25), Dragoljub Prcac (March 5), 
Momcilo Krajisnik (April 3), Dragan Nikolic (April 21), and 
Dusko Sikirica (June 25) were detained by SFOR in Bosnia. 
Mladen Naletilic (Tuta), indicted for crimes in Herzegovina, 
was surrendered by the Government of Croatia on March 21. 
Cooperation from the parties, who are responsible for 
apprehending and turning over PIFWCs to ICTY, continues to vary 
widely. RS Prime Minister Dodik has expressed full support for 
SFOR to arrest indictees, but Bosnian Serb extremists continue 
to oppose action against PIFWCs in the RS. The RS Interior 
Minister has reportedly denied his Ministry's responsibility to 
execute ICTY warrants, while HDZ officials in BiH have openly 
supported Croat indictees. As noted above, democratic changes 
under the new government in Croatia have already made a 
positive impact in this regard.
    The United States considers apprehension and detention of 
Serb PIFWCs Radovan Karadzic and Ratko Mladic to be of the 
highest priority in serving the interest of justice and 
facilitating Dayton implementation. Their success in avoiding 
apprehension to date sustains Bosnian Serb extremism, inhibits 
the establishment of trust between ethnic communities, 
undermines the credibility of the international community, and 
erodes the rule of law.
    Conclusion. In my April report, I emphasized the critical 
role SFOR plays in providing the secure environment needed for 
democratic principles and free-market reforms to take root and 
grow. That role continues to be essential, as is noted in 
several places in this report. Progress on security and 
military stabilization has reduced our force requirements, but 
SFOR remains a vital part of the international community's 
efforts to help Bosnia and Herzegovina as it makes the 
transition from a period of military detente and reconstruction 
to emergence as an independent, democratic state with a viable 
economy. During the May 2000 PIC ministerial in Brussels, High 
Representative Petritsch, the European Commission, and the 
United States, along with other nations and international 
institutions, made clear that international assistance for BiH 
is diminishing and that in coming years its government and 
people must take ``ownership'' of their own future.
    Results in this reporting period were tenuous but moving in 
a positive direction. In the April elections voters showed 
signs of weaning themselves from ``nationalist'' loyalties and 
moving toward government based on cross-ethnic, mutual 
interests such as the economy, law and order, and a future for 
their children. Multi-ethnic police forces are being trained 
and put in place. Efforts are underway to demolish party links 
to key sectors of the economy. The democratic change of 
government in Croatia and the possibility of medium- or long-
term improvement in the FRY have removed or weakened negative 
external influences in domestic BiH politics. However, the 
continued presence of the Milosevic regime in Belgrade poses a 
threat of cross-border political manipulation and associated 
instability in the RS in the short term.
    We are at a critical juncture: democracy and market 
economics, which donor nations and international financial 
institutions seek to introduce, are new concepts for Bosnia and 
Herzegovina. Ethnic rivalries persist, and political groups 
continue to exploit them to remain in power. The High 
Representative is removing the most egregious oppontents of 
peace and democracy in greater numbers than ever before, but 
existing power cadres resist losing power wherever possible. 
The intentional community has agreed to focus its efforts in 
three major areas where this opposition is strongest: economic 
reform, building central institutions, and increased refugee 
returns. SFOR has proven its value in these areas, especially 
by fostering a more secure environment that has led to a surge 
in spontaneous returns of refugees and displaced persons. 
Through its role as a deterrent force, SFOR remains a critical 
partner in the Dayton peace process and a bulwark against the 
instability that the current FRY regime continues to generate 
in the region.

                                PART II

    Section 1203(a) of the Fiscal Year 1999 National Defense 
Authorization Act requires submission of a semiannual report to 
Congress as long as United States ground combat forces continue 
to participate in the Stabilization Force (SFOR). This report 
supplements the ``Bosnia Benchmarks'' report required by PL 
105-174 and is therefore submitted here in conjunction with 
that report. Where possible, where requirements overlap, I have 
sought to avoid duplication in the two reports. The numbered 
responses that follow correspond to specific numbered reporting 
requirements contained in section 1203(b).
    1. Expected duration of U.S. forces in Bosnia and 
Herzegovina. No time limit has been established for total 
withdrawal of U.S. forces from Bosnia and Herzegovina (BiH). 
Ongoing reevaluations of required force structure have 
significantly reduced the U.S. footprint from a high of 
approximately 20,000 in 1996 to the current level of 
approximately 4,600. While SFOR has ensured an absence of war 
in BiH between the Entity Armed Forces (EAFs), the uncertain 
timetable for implementation of the political, humanitarian, 
and economic provisions of the General Framework Agreement for 
Peace in Bosnia and Herzegovina (GFAP or the Dayton agreement) 
makes prediction of a military withdrawal impossible. 
Additionally, the destabilizing influence of FRY president 
Milosevic in the entire region and the resulting potential for 
further conflict underscore the importance of a continued 
international peacekeeping force in Bosnia. While there has 
been progress in Dayton's implementation, much remains to be 
accomplished before NATO can consider total troop withdrawal.
    During the last six months SFOR's successful restructuring, 
as approved by the North Atlantic Council, resulted in a 
manning reduction from approximately 34,000 to 23,000, a 30 
percent decrease in forces. Restructuring initiatives included 
downsizing the number of battle groups and establishing a 
dedicated ground and air operational reserve for rapid 
employment options to support COMSFOR requirements. (See Part 
I, Benchmark 1.)
    2. Percentage of benchmarks completed. No benchmark has 
been totally fulfilled to date, nor would I expect any to be 
completed in the next reporting period. Substantial progress 
has been recorded in many areas, but completing the benchmarks 
will require time and continued commitment, as described fully 
in Part I of this report.
    3. Status of the NATO ``force of gendarmes.'' The 
Multinational Specialized Unit (MSU) continues to be an 
essential component of SFOR, which provides unique capabilities 
in information gathering and crowd control. The MSU carries out 
liaison with the International Police Task Force (IPTF) and 
local police. It deters disruptive civil behavior by 
demonstrating that SFOR can deal effectively with outbreaks and 
by maintaining a police-like professional presence throughout 
BiH that is less confrontational than a military response. 
These qualities, combined with the MSU's continuous patrolling 
and cooperation with local police and community leaders, help 
to foster an atmosphere of security and rule of law. During 
1999, the MSU conducted over 300 control operations, and only 
two resulted in the use of force. There are about 470 mostly 
Italian troops assigned to the MSU in Bosnia. They operate 
under an Italian Carabinieri Commander, who oversees 
certification of specialized units from other contributing 
countries. Under recent SFOR restructuring, the MSU was to gain 
a second battalion, but due to continued manning problems, this 
has yet to take place.
    4. Military and non-military missions directed by the 
President for U.S. forces in BiH. The U.S. Government supported 
the decision of the North Atlantic Council (NAC) to task 
COMSFOR, through SACEUR, with the mission of providing a 
continued military presence in order to deter renewed 
hostilities, contribute to a secure environment, and help 
stabilize the peace in BiH. The tasks outlined below were 
identified for NATO forces deployed to BiH.
    Key military tasks:
     Maintain a deterrent military presence.
     Ensure continued compliance with the military 
aspects of the GFAP.
     Operate Joint Military Commissions (JMC) at 
appropriate levels.
     Contribute, within means and capabilities, to a 
secure environment in which the international civil 
organizations and the parties to the GFAP can carry out their 
responsibilities under the agreement.
     Ensure force protection and freedom of movement 
for SFOR.
     Monitor Entity Armed Forces activities and inspect 
Weapons Storage sites, within capabilities and in close 
coordination with relevant international organizations.
     Be prepared to coordinate turnover of 
responsibility for Airspace Management/Control to the BiH 
Department of Civil Aviation when directed. (See below, Section 
4(D).)
    Key supporting tasks, within the means and capabilities of 
SFOR:
     Provide support on a case-by-case basis to the 
Office of the High Representative (OHR) in implementing the 
civil aspects of the GFAP.
     Support the implementation of the Brcko 
Arbitration Award.
     Support the conduct of elections and installation 
of elected officials.
     Support the return of displaced persons and 
refugees by contributing to a safe and secure environment, but 
not forcibly returning them or undertaking to guard individual 
locations.
     Support the International Criminal Tribunal for 
the Former Yugoslavia (ICTY) and efforts against persons 
indicted for war crimes (PIFWCs).
     Support the OHR and International Police Task 
Force (IPTF) on a case-by-case basis in assisting local police, 
providing back-up, and contributing to a secure operating 
environment, without undertaking civil police tasks.
     Provide support on a case-by-case basis to the 
OSCE in implementing Annex 1B (Agreement on Regional 
Stabilization) of the GFAP in BiH.
     Support the continued development of the Standing 
Committee on Military Matters (SCMM).
    With regard to specific issues raised under reporting 
requirement 4:
    (A) Persons Indicted for War Crimes: During this reporting 
period numerous operations were conducted in support of the 
ICTY, including support for the exhumation of war crimes sites. 
Five PIFWCs were detained by SFOR forces and transferred to 
ICTY custody in The Hague. There was little public protest in 
the RS and no significant political reaction. (See Part I, 
Benchmark 10.)
    (B) Support to civilian police functions: As long as 
organized opposition to Dayton continues, the OHR, UN, and 
other international organizations involved in civil 
implementation will rely on SFOR to provide a secure 
environment and to provide back-up in the case of civil unrest 
fostered by Dayton opponents. (See also Part I, Benchmarks 2, 
3, 4).
    (C) Resettlement return of refugees: During this reporting 
period, SFOR continued close co-operation with the OHR and 
UNHCR to encourage returns. Minority refugee returns for the 
first quarter of 2000 registered a four-fold increase over the 
same time period in 1999. SFOR will focus on advanced planning, 
enhanced information exchange to identify hot spots, and 
maintaining a secure environment to minimize any efforts to 
intimidate returnees. (See Part I, Benchmark 8.)
    (D) Support to local and international authorities:
    Elections. SFOR continued to provide wide-area security 
during recent municipal elections. Reports of violence and 
opposition to elections were few, and SFOR's presence proved 
essential to a fair campaign and vote. (See Part I, Benchmark 
6.)
    Crime and Corruption. Crime and corruption remain 
significant threats to the secure environment in BiH, impeding 
progress in civil implementation of the GFAP. SFOR continues to 
exploit information obtained during Operation WESTAR in 1999, 
which revealed links between foreign intelligence services and 
organized crime in BiH. However, civilian authorities have 
achieved only limited progress to date in developing a proper 
legal framework and comprehensive strategy to address these 
problems. SFOR continues to support UNMIBH and OHR efforts to 
develop a State Border Service, which just began operations. 
(See Part I, Benchmarks 2, 3, 4.)
    Brcko. Since the Brcko Arbitration Award in March 1999, the 
Brcko District has been completely demilitarized with the full 
co-operation of the EAF. (See Part I, Benchmark 9.)
    Airspace Control. During January 2000, SFOR returned to 
Bosnian authorities control of the BiH upper airspace, which 
NATO had controlled, as provided for in the GFAP, since initial 
implementation of IFOR. SFOR is currently working with local 
authorities to develop a state-level approach to other civil 
aviation issues, including management of the airport in 
Sarajevo. Although progress has been slow in this area, this 
latest development is a major step closer to realization of 
full civil control of the country's aviation industry.
    5. Assessment of threats to the United States forces: The 
Secretary security situation in BiH remains stable but not 
peaceful. The EAFs generally comply with the GFAP and cooperate 
with SFOR, so maintenance of public order is normally not a 
problem. The detention of several Bosnian Serb PIFWCs, the 
announcement of a lengthy sentence for war crimes of a Croat 
General, and municipal elections in April were all conducted 
peacefully. As part of the weapons reduction initiative, the 
EAF destroyed weapons and equipment while disbanding forces in 
the Brcko District. Continued cooperation between the RS Army 
and Federation Army on civil projects and demining continues to 
improve. Following the successful completion of a 15 percent 
force reduction by both EAFs, the BiH Presidency made a 
commitment to achieve a further 15 percent reduction in 2000. 
Plans are currently being developed by the EAFs to meet this 
commitment.
    BiH authorities, civil and military, have yet to develop 
the legitimate, responsible, and accountable state institutions 
necessary to achieve the ultimate goal of a self-sustaining 
peace. However, the latest Supreme Headquarters Allies Powers 
Europe (SHAPE) and SFOR estimates view the likelihood of an 
internal military threat as remote. There has also been 
significant improvement in the external security situation of 
BiH, due to recent democratic political change in Croatia. On 
the other hand, uncertainty and instability persist in the 
neighboring FRY, particularly Montenegro, and provocations by 
the Milosevic regime and other extremist forces in Serbia will 
continue to threaten the security of BiH and the entire region. 
In the circumstances, the force for moderation and stability 
represented by SFOR remains essential for continued progress in 
civil implementation.
    6. Assessment of costs: Since FY 1996, the cost to the 
Department of Defense of the military missions that I directed 
in Bosnia and Herzegovina has been about $9.5 billion. These 
costs are summarized below (in millions):

----------------------------------------------------------------------------------------------------------------
                                                            FY 2000    FY 1999    FY 1998    FY 1997    FY 1996
                        Operation                              PB       actual     actual     actual     actual
----------------------------------------------------------------------------------------------------------------
Deliberate Forge.........................................      142.7      141.4      159.4      183.3      225.9
Joint Forge..............................................     1460.2   *1,431.2    1,792.8  .........
IFOR/IFOR Prep...........................................  .........  .........  .........    2,087.5    2,231.7
Provide Promise..........................................  .........  .........  .........  .........       21.7
Sharp Guard..............................................  .........  .........  .........  .........        9.3
Able Sentry..............................................  .........       14.0       10.5       11.7       30.9
UNCRO....................................................  .........  .........  .........  .........        0.5
                                                          ------------------------------------------------------
      Totals.............................................    1,602.9    1,586.6    1,962.7    2,282.5    2,520.0
----------------------------------------------------------------------------------------------------------------
*This reflects a correction of $48.7 million from the previously reported amount of $1,382.5 million.

    Operation Deliberate forge (follow-on to Deny Flight, 
Decisive Edge, and Deliberate Guard) involves air operations 
for maintaining the no-fly zone over Bosnia.
    Operation Joint Forge (follow-on to IFOR, SFOR, Deliberate 
Force, Joint Endeavor, and Joint Guard) is the NATO operation 
to deter the resumption of hostilities and to contribute to a 
secure environment that promotes the reestablishment of civil 
authority in Bosnia and Herzegovina. Operations financed 
include continued support of a U.S. Division headquarters by a 
U.S. Brigade Combat Team Task Force with a force capacity of 
approximately 6,200 in Bosnia, reduced to 4,600 in April 2000, 
support of approximately 600 enabling soldiers in adjacent 
countries (RIM), five base camps reduced to four by the fourth 
Quarter of FY 2000, and two troop rotations per year.
    IFOR Preparation and IFOR included the costs of preparing 
U.S. troops for deployment to IFOR, which was the peace 
implementation force in the Former Republic of Yugoslavia.
    Operation Provide Promise was the military operation that 
airlifted and airdropped humanitarian supplies into Bosnia.
    Operation Sharp Guard enforced the United Nations-
sanctioned embargo against the FRY (excluding the enforcement 
of the arms embargo against Bosnia) conducted in conjunction 
with Western European Union forces.
    Operation Able Sentry was U.S. participation in the United 
Nations preventive deployment along the Serbian/Macedonian 
border (UNPREDEP).
    UNCRO was support provided to the Zagreb hospital in 
support of the United Nations in Croatia.
    7. Status of future operation plans: As these two reports 
indicate, there has been a continued, gradual improvement in 
all aspects of civil implementation and the security situation 
in Bosnia during the reporting period. The EAFs have been 
cooperative, and implementation of the final Brcko arbitration 
decision has been uneventful. The municipal election campaign 
and vote were free, fair, and generally free of violence. 
Increasing flows of returning refugees and internally displaced 
persons continue, and national elections are scheduled for 
November 2000. To the extent that Bosnia slowly moves toward 
normalcy and as its leaders and citizens take on greater 
responsibility for implementing all aspects of the agreement, 
the requirement for an overwhelming NATO presence should 
diminish. The restructuring of forces envisioned in SFOR's 
revised OPLAN 10407 was successfully implemented and appears 
thus far to have left SFOR with means and capabilities adequate 
for continued fulfillment of its key objectives and supporting 
tasks. The reduction in SFOR forces, including U.S. forces, 
reflects an ongoing assessment at NATO and in Washington that 
the threat of a resumption of hostilities by the Entity Armed 
Forces remains low. NATO will continue to evaluate its presence 
and the forces required based on these elements. Continued U.S. 
presence and leadership in this force will remain a critical 
element of its success.
    In conclusion, the Administration is grateful for the 
support of Congress for Dayton implementation. I look forward 
to continuing to work with the Congress in pursuit of U.S. 
foreign policy goals in the Balkans.

                                
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