Russia & EAEU Looking To Free Trade Agreement With Bosnia & Herzegovina

Posted by Written by

Russia trying to shore the country up as difficulties arising in Balkans with BiH nearing political fracturing

By Chris Devonshire-Ellis

Russia’s Foreign Minister Sergey Lavrov met with Turkish Foreign Minister Mevlut Çavuşoğlu on the margins of the G20 summit in Rome last week.

Bosnian Political Issues
The discussion focused on coordinating the two countries’ efforts to further stabilize the situation in the Balkans and Transcaucasia. The possibility of joint steps to contribute to a Bosnia Herzegovina (BiH) settlement, including through multilateral formats, were discussed.

Russia and Turkey are parts of international mechanisms taking care of BiH, including the Peace Implementation Council, but are not a part of the ongoing efforts of the EU and the US to find a solution for election law and constitutional changes in BiH. The country is in danger of fracturing and descending back into war as differing opinions between Russia and Turkey as powers of influence, and between the EU and Unted States are having a negative impact on regional stability.

Bosnia Herzegovina Stability

BiH was formed in 1992 after the breakup of the Soviet Union and the disillusionment of Yugoslavia. The regions ethnic groups then divided along religious grounds with the largest, the Bosniaks, being Muslims, the Serbs Eastern Orthodox and the smaller minority of Croats being Catholics.

This is why Russia and Turkey are jointly involved as they have both the experience and some authority to deal with the religious clashes and subdue the potential for conflict. That has recently come under threat by the EU and United States appointing a “High Representative” to BiH as part of its political and security oversight in the form of Christian Schmidt, a German politician with Catholic leanings. He was appointed in August this year with his authority being rejected by both BiH itself as well as Russia and Turkey, who all demand he be removed.

The EU and United States demand that BiH should be secular, and that Schmidt’s appointment is apolitical, however this is not how it is viewed on the ground. Consequently, tensions have risen, with the Serbian population apparently prepared to split the BiH military, form their own army, and reunite the eastern BiH territory of Republika Srpska with neighboring Serbia.

That would require another round of international peacekeeping troops from NATO to enter BiH and ensure no fighting broke out. The Catholic Croats would almost certainly join the Serbs, leaving BiH as a Bosniak Muslim state on the EU border with Croatia, with its predominantly Catholic population. With Serbia unlikely to offer assistance or particular friendship to a BiH now divided to have become a purely Muslim state, the EU would face the political problems of keeping the peace and dealing with Islam right on its southern borders. Schmidt, as a Christian Unionist with Catholic leanings, is therefore considered not the right man to represent the EU and US positions in being the “High Representative” for the BiH. A better appointment would have been a Serb with Muslim sympathies. The United Nations were warned just two days ago that Bosnia Herzegovina is in danger of fracturing.

A division of the country consequently appears highly likely, potentially leaving the EU with no choice but to be largely responsible for a Muslim nation with a population of about 1.5 million.

Bosnia Herzegovina Free Trade

BiH Foreign Trade and Economic Relations Minister Staša Košarac has also attended a meeting of the co-chairs of the Commission for Trade and Economic Cooperation between BiH and Russia. The Russian side emphasized the commitment to provide support to BiH in the process of concluding a free trade agreement between BiH and the Eurasian Economic Union (EAEU), the Russian backed free trade zone that also includes Armenia, Belarus, Kazakhstan and Kyrgyzstan.

The EAEU already had a Free Trade Agreement with Serbia and is in negotiations with Turkey. Were the BiH to fracture, Russia would partially alleviate the EU having to support it, an outcome that may be the best outcome for Brussels and help keep the peace.

However, the EU and US would prefer not to have a new Muslim state, backed by Russia and Turkey on its doorstep and would prefer to retain a secular BiH inclusive of Bosniaks, Serbs and Croats. Having appointed a High Representative with Catholic Christian leanings has thrown the whole scenario into flux. Someone is being extremely naïve over the regional fault lines – and it doesn’t appear to be either Russia, Serbia or Turkey.

Related Reading


About Us

During these uncertain times and with sanctions in place, our firm helps Russian companies relocate to Asia. We also provide financial and sanctions compliance services to foreign companies operating in Russia. Additionally, we offer market research and advisory services to foreign exporters interested in doing business in Russia as the economy looks to replace Western-sourced products. For assistance please email or visit