In NATO's own back yard
Selling weapons to Saddam in NATO's Own Back Yard
The Orao affair highlighted RS's role in providing Serbia with its own off-shore island, useful as a conduit for all kinds of shady and illegal deals. According to a recently issued report by the Bosnian state auditor, the arms-manufacturing firm Orao from Bijeljina in Republika Srpska, located in the US army's own backyard in Bosnia-Herzegovina, sold for ready money to Saddam Hussein equipment worth $4.6 million during 2001- 2002 alone. The trade was organized through Belgrade's Jugoimport. The RS government, which controls the enterprise, was allowed to escape, however, with a token resignation of its representative on the B-H presidency.
Orao, through Jugoimport, sold weapons to Iraq before the Bosnian war, but apparently stopped when the war started only to resume in 2001. It managed to deliver to Saddam 40 renovated planes: 28 in 2001 and 12 in 2002. Payment, guaranteed by the Serbian government, was delivered to a bank in Belgrade.
The original deal, worth $9 million, was signed in 1989 between Jugoimport, the Iraqi ministry of defence, and the then still Yugoslav air force for the repair of 85 aircraft engines. Jugoimport and Orao then signed a separate agreement obliging Orao to repair 65 engines, of which 20 were delivered before the attack on Bosnia-Herzegovina. The rest were delivered in 2001-2.
Given that NATO is supposed to keep watch on the Serbian-Bosnian border to prevent, among other things, terrorist threats, it is surprising that the delivery of 45 aircraft engines was never detected.