The government is trying to privatize and sell Hidrogradnja at a fire-sale price, thereby destroying the firm
By: Dženana Karabegović
February 17th, 2014
For three weeks citizens have been demanding their rights on the streets of Bosnia-Herzegovina’s cities. The majority of them are workers of former commercial giants which were destroyed by illegal and criminal privatizations.
Among them are workers from Sarajevo’s Hidrogradnja, a company which before the fall of Yugoslavia built bridges, roads and hydroelectric plants all around the world, with profits in the millions of dollars. Today all that remains of the firm is but a shadow of its former glory. For 11 years workers have not been paid benefits, they are without health insurance, and their wages are months late in being paid.
The current government, according to the NGO sector, is doing everything it can to devalue the company as much as possible, and then sell it for a very low price, preferably to someone with party affiliations; this all follows a well-tested recipe.
“We are here to fight for our jobs, not because of a strike.”
For over a year, workers from Hidrogradnja have been trying to get an answer regarding when their back wages will be paid, and when their health insurance will be returned to them.
Despite holding strikes and protests at their firm, and then protests in front of the Federation government building in Sarajevo, the workers have not seen any concrete results.
Some of them have been employed in the firm for over 30 years, but they cannot retire as their employer has not made pension contributions for 11 years.
One of them is Selim Selamović. He is 51 years old, and his salary, when it is paid, is 300 euros (about 650 KM). We asked him how he survives:
“Four members of my family living off of 650 KM. I rent my apartment, my two children go to university, only I work. That’s how, I know how I do it. As one of our friends says—I’m on the verge of stealing and murdering.”
Dževad Hamza, who works as a mechanic at Hidrogradnja, finds himself in a similar situation. He has been employed in the firm for 36 years, and is four years from retirement. However it questionable whether he will be able to retire when the firm has not made pension contributions for 11 years:
“If I’m offered the opportunity to work on weekends, I normally take it. How else could I survive. If I find some work on the side like fixing someone’s car, I have to do it. How else could I get by? I’m not willing to go rob and steal and take things from others. Even if I tried to do that, there’s no one to steal from.”
Decades of unsuccessful attempts to sell the firm
Sarajevo’s Hidrogradnja is a construction firm that once built bridges, roads and hydroelectric plants all around the world, with profits in the millions of dollars. We asked the president of the company’s union, Redžep Tufekčić, why the firm now finds itself in such a catastrophic situation. He responded:
“This is a firm from the old system, from our old state (Yugoslavia). No one is very interested in such a firm. People are only interested in the fact that we have licenses, or that our firm carries a certain image in the world. The government is guilty here, I guarantee you that with my life, because they hired irresponsible people who are not capable of anything. The losses are enormous, and yet no one has been charged with anything.”
The state of BiH owns a majority share of Hidrogradnja, while the rest is in the hands of shareholders. The workers do not know who the shareholders are. The firm currently employs over 800 workers, and the majority of them are suing the firm seeking 10 million euros. However their suit has been sitting idle in the drawers of the courts for years, says worker Dževad Hamza:
“We have been at court for a few years. Nothing ever comes of it. The prosecutor has been sitting on the case, and has probably buried it somewhere in their filling cabinets. Someone is arranging it this way.”
For over ten years the government has been trying to sell the firm, so far unsuccessfully. In 2002, the first attempt to sell a tender for 67% of the state’s capital, totaling 24 million euros, was declared unsuccessful. Two further attempts, in 2006 and 2012, were both fruitless.
Because of accumulated debts of around 8 million euros, the firm is becoming less and less attractive to buyers. But exactly that fact is promising to the current government. According to a well-tested recipe, the government is devaluing the firm as much as possible, in order to sell it later at the lowest price to someone friendly to the ruling party.
Eldin Karić, a member of the NGO Anti-Corruption Network says: “The estimated value of Hidrogradnja in 2007 was around 100 million KM. The firm’s value now stands at almost zero. This means that over seven years the state has lost 100 million KM in the Hidrogradnja case, to say nothing of the workers who lost years of benefits and pension contributions that were not paid. This is the best example of how the political parties responded to this problem over the last seven years.”
In Sarajevo Canton alone, over 400 construction firms are registered which work under the table, without reporting their workers or respecting the law. The construction sector in Bosnia-Herzegovina is on its knees, and for this all former and current governments are responsible. They have all sponsored criminal privatizations, not only in this industry, but in many other sectors of the economy.