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EXECUTIVE
SUMMARY
Bosnia
and Herzegovina (BiH) is at a critical juncture. There is the
prospect of stronger State institutions and closer relations
between its two Entities, the Federation and the Republika Srpska
(RS). There is equally the prospect of greater respect for human
rights, democracy and the rule of law; greater social and physical
security for all inhabitants, as well as increased economic
growth. Important political changes in the region such as the
recent elections in Croatia, will also impact on BiH’s
future. Growing
ties with European institutions and improved regional alliances
through the Stability Pact for South Eastern Europe may also
contribute to BiH’s future.
However,
BiH still has the remnants of a hegemonic power structure, the
vestiges of a divisive war and the population displacement that
resulted from it. It also faces an economy stifled by beaurocratic
inefficiency.
At
this juncture, there are opportunities, but also hurdles. A
unified property registration
system
and real property market
are important tools to achieve a stable future for BiH. They
are essential if inhabitants of BiH are to fully exercise their
property rights, and if the State is to achieve a successful
transition. This is the case for a number of reasons:
-
Almost
all family assets in BiH are in land or real estate –
and property is therefore the major
commodity in the market. The efficient use and management
of this precious asset is therefore essential to a successful
transition to a market economy.
-
Foreign
direct investment is particularly important for the development
of BiH. Any investment, whether industrial, commercial or
otherwise is likely to involve an element of investment
in the domestic real estate market. Investment will not
occur until the uncertainties relating to ownership and
property title are minimised. Until this occurs, the perception
of risk will outweigh the potential investment benefits.
-
Without
a clear real estate framework, which encourages market transactions,
the full potential of the market will not be realised. Many
property owners want to transfer their property interests,[1]
though at present, it is almost impossible to find sound
advice on access to the market and banking structures do
not facilitate mortgage lending. As a result, market activity
is lower than demand, and many have not been able to find
durable solutions to their housing needs.
-
Denying
people their right to property was a cornerstone of the
war, a weapon that was used to consolidate power and to
minimise dissent. The full exercise of property rights therefore
reverses one of the worst aspects of the war, and enables
citizens to exercise greater control over their futures.
This
study proposes operational, organisational, institutional, legal
and policy reforms. It
advocates for use of information technology, more efficient
methods for surveying and mapping, improved legislation and
other measures to make information more accessible. It also
calls for concrete measures to develop a sustainable real estate
market, including licensing of private sector professionals,
better tools for information and advice, and greater involvement
of banks and other lending institutions.
Central
to this report, is the acknowledgement that the desired solutions
must be unified, in every sense. A unified approach between the
Entities would optimise results, and would assist BiH in meeting
European norms and standards. On a technical or operational level,
the system itself must be unified, the dual registration system
of the past cannot meet the needs of this modern and changing
society. On an economic front, removing any and all barriers to
the flow of information and/or the exercise of rights between
Entities will assist economic recovery and can only advantage
the users.
Some
of the operational proposals, such as the implementation of the
real property cadastre, are already in the process of being implemented
by the competent domestic bodies, though financing continues to
prove difficult. In other cases, relating more to real estate
market reforms, less work has been done, and substantive outside
expertise, in addition to resources, may also be required. While
these recommendations will only succeed if they are embraced and
implemented by the competent actors within BiH, there is a major
role for the international community in assisting BiH in this
transition. This study is one small step in the process.
[1]
See,
CRPC and UNHCR. Return,
Local Integration and Property Rights: A Study of the Preferences
and Intentions of Refugees and Displaced Persons Regarding the
Exercise of Property Rights, November 1999.
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