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Cablegate: Bosnia: Radoncic Poised to Be a New Player In

VZCZCXRO9701
RR RUEHDBU RUEHFL RUEHKW RUEHLA RUEHNP RUEHROV RUEHSL
DE RUEHVJ #0134/01 0401233
ZNY SSSSS ZZH
R 091233Z FEB 10
FM AMEMBASSY SARAJEVO
TO RUEHC/SECSTATE WASHDC 1374
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RHEHNSC/NSC WASHDC
RUEAIIA/CIA WASHINGTON DC
RHEFDIA/DIA WASHINGTON DC
RUEKJCS/JCS WASHINGTON DC
RUEKJCS/SECDEF WASHDC
XMT AMCONSUL STRASBOURG

S E C R E T SECTION 01 OF 04 SARAJEVO 000134

NOFORN
SIPDIS

EUR/SCE FOR HYLAND, FOOKS
NSC FOR HOVENIER

E.O. 12958: DECL: 02/09/2020
TAGS: PREL PGOV PINR KDEM BK
SUBJECT: BOSNIA: RADONCIC POISED TO BE A NEW PLAYER IN
BOSNIAK POLITICS

REF: A. 06 SARAJEVO 2320
B. 09 SARAJEVO 1139
C. 09 SARAJEVO 226
D. 09 SARAJEVO 103
E. 08 SARAJEVO 1593
F. 09 SARAJEVO 1169
G. SARAJEVO 61
H. SARAJEVO 110

Classified By: Ambassador Charles English for reasons 1.4 (b) and (d).

Summary
-------

1. (S/NF) The emergence of a new Bosniak party, led by the
powerful, reportedly corrupt, and sometimes vindictive media
mogul Fahrudin Radoncic, is likely to create further rifts in
the Bosniak political scene, particularly amid the campaign
for the October 2010 general elections. Radoncic has the
support of the leader of the Islamic community. Also,
Radoncic's ownership and direct control of the most
widely-read daily newspaper in Bosnia will ensure that his
campaign message is well propagated. Radoncic's reputation
for questionable business ventures with partners from across
the political spectrum, combined with his likely desire for
influence over the judiciary to escape prosecution for
corruption, suggests that he will seek political alliances
based on lucrative personal prospects, rather than ideology
or even ethnic affiliation. Although it is too early to make
concrete predictions, Radoncic's party is poised to capture
votes primarily from Haris Silajdzic's Party for BiH (SBiH),
as well as a wide swath of apathetic voters allured by his
pledges to fix the economy. End summary.

The Man, the Legend
-------------------

2. (C) Fahrudin Radoncic rose from relative poverty and
obscurity after the 1992-95 BiH war to become the founder and
owner of Bosnia's leading publishing company, Avaz
Publishing. This company is known especially for its
production of the country's highest-circulation daily
newspaper, Dnevni Avaz, but also for a small television news
show and a number of widely-read magazines, such as Global.
The success of Avaz has given Radoncic significant control of
the Bosniak media. Avaz therefore has proven a powerful tool
against Radoncic's opponents, particularly the police
authorities investigating his role in corruption scandals.
Although not a veteran politician himself, Radoncic through
Avaz has played an active role in politics for over a decade,
with Bosniak political candidates vying for his media
support. Candidates whom Avaz endorses for the Bosniak
member of the Tri-Presidency -- most recently, Party for BiH
(SBiH) chairman Haris Silajdzic in 2006 -- usually succeed in
elections. Radoncic also cultivates wide international ties,
and Sead Numanovic, editor-in-chief of Avaz, is one of the
most well-connected people in Bosnia.

The Scandals
------------

3. (S/NF) Radoncic is widely believed to be responsible for
corrupt business practices, most notably his role in a
scandal involving the Federation Development Bank (FDB) (ref
A). Radoncic admitted to having hired Ramiz Dzaferovic --
SDA member, director of the FDB -- to conduct an audit of
Avaz through Dzaferovic's personal audit company. At the
same time, Dzaferovic through the FDB gave Radoncic a loan of
KM 22.5 million -- which the FDB had allocated for
agriculture -- for the construction of Radoncic's Avaz Tower
in Sarajevo. Separately, local media recently reported
alleged ties between Radoncic and international drug dealer
Kelmendi, which led Radoncic to launch a full-scale attack in
the pages of Avaz against the police officials working on
that case. Also, staff of the Office of the High
Representative (OHR) recently linked Radoncic to an
international money laundering scheme. This allegation,
which was leaked to the press, sparked a smear campaign in
Avaz against the Principal Deputy High Representative, a
State Department employee on detail to OHR, somewhat belying
Radoncic's claims that one of his priorities will be to

SARAJEVO 00000134 002 OF 004


cooperate with the international community.

The Entree into Politics
------------------------

4. (C) In September 2009, Radoncic launched a new Bosniak
political party, the Alliance for a Better Future of BiH
(SBB-BiH) (ref B). Radoncic is almost certainly seeking
political status in order to secure protection from the
investigation of his illegal business deals by wielding
government influence over the judiciary. Moreover, now may
be a personally appealing time for Radoncic to enter
politics, as media outlets besides Avaz indicate that
Radoncic's business is struggling and that Avaz's chief rival
daily newspaper, Oslobodjenje, is rapidly catching up to Avaz
in its sales. This suggests that the pragmatic Radoncic is
entering the political scene to seek lucrative deals wherever
he can find them, rather than choosing partners based on
ideology or even ethnic affiliation. This approach would
make him an appealing ally for Republika Srpska (RS) Prime
Minister Milorad Dodik, who also dabbles in business and is
himself under investigation for corruption. Dodik therefore
may see Radoncic as his ideal Bosniak interlocutor. Indeed,
Radoncic told the DCM in January that he has met with Dodik,
as well as Croatian Democratic Union (HDZ)-BiH President
Dragan Covic -- who has been indicted for corruption and is
forging a closer relationship with Dodik (septel) -- and has
a good relationship with both men. Moreover, the fact that
Avaz has kept mostly quiet on the very issue that it could
use to galvanize the Bosniak populace ahead of the election
-- rhetoric on a referendum in the RS -- has led to
speculation that discussions on a partnership between Dodik
and Radoncic may already be underway.

The Setbacks
------------

5. (S/NF) Despite any possible musings of a deal with Dodik,
SBB-BiH appears to be off to a rocky start. Initial polls
suggest that the party has a small following, and Radoncic
has yet to attract any well-known personalities to join his
party. His most notable party member besides himself is
former state-level PM and former SDA member Adnan Terzic,
although Terzic's following within SDA was tenuous at best
when he left the party. The other big name in SBB-BiH is
Haris Basic, a former SDA member whom the Council of
Ministers suspended as director of the Foreign Investment
Promotion Agency (FIPA) due to the BiH Court's indictment
against him for illegally issuing transport licenses.
Radoncic also has not yet managed to form a founding party
congress despite the high attendance at his kickoff rallies
in Sarajevo, Tuzla, Zenica, and elsewhere. Also, Radoncic --
whose family is rom the Sandzak region in Serbia -- carries
a stong "Sandzak" accent when he speaks, which is anathma
to many Bosnians. Moreover, he lacks persona charisma and
is generally uncomfortable and awkard with interlocutors who
are unfamiliar to him.

The Weapons
-----------

6. (S/NF) Despite these initial setbacks, Radoncic's
expectations for electoral success are high. Through public
hearings conducted by the BiH parliamentary working group on
changes to the election law, Radoncic in January proposed an
increase in the threshold for a party's representation in
Parliament from three to five percent at the state and entity
level. The parliamentary working group on changes to the
election law rejected his proposal. Radoncic's most powerful
weapon during the elections will be Avaz, and he already is
using it as an advertising venue for his party. The economy,
a major concern for Bosniak voters, is one of Avaz's key
pre-election themes, as well as the incompetence of BiH's
current leadership, particularly Bosniak tri-Presidency
member Haris Silajdzic. Amid the country-wide economic
crisis, these messages may well resonate with apathetic
Bosniak voters. Indeed, Terzic told the DCM that this is one
of SBB-BiH's key target groups in the election campaign.

The SBiH Political Vacuum
-------------------------

SARAJEVO 00000134 003 OF 004


7. (C) Radoncic's entree into the Bosniak political scene
will most likely come at the expense of the deteriorating
SBiH. SBiH garnered poor results in the 2008 municipal
elections, and our SBiH contacts continue to tell us of the
disgruntlement within the party with Silajdzic's poor
leadership. Bakir Izetbegovic, who is a friend of Silajdzic,
has suggested to us that Silajdzic may in fact be preparing
to leave the political scene. Moreover, the Islamic
community, which had previously endorsed Silajdzic, now
supports Radoncic at the expense of SBiH. Avaz consistently
maligns Silajdzic, calling him a "lying President" and a
"mafia godfather" who steals from the poor. Radoncic also is
seeking to fill Silajdzic's self-proclaimed role as the key
Bosniak interlocutor with the USG. For example, his visit to
Washington in February to attend the prayer breakfast, as
well as his speech at the U.S. Institute of Peace, received
widespread press throughout BiH, dwarfing that of the other
BiH attendees.

The Boost from the Islamic Community
------------------------------------

8. (S/NF) Silajdzic's victory in the 2006 presidential race
stemmed from the same sources Radoncic has at his disposal --
Dnevni Avaz and Islamic community head Reis-ul-ulema Mustafa
Ceric, whom Avaz quoted almost daily in the run-up to the
2006 elections and who was seen with Silajdzic at a number of
important Islamic events (ref C). Although Radoncic is not
at all devout, he and Reis Ceric have enjoyed a close
relationship for over a year, most likely tied to Radoncic's
gift of one million KM (approximately 714,000 USD) for the
construction of the Reis's headquarters and residence in
Sarajevo. Additionally, Reis Ceric is the only public figure
whom Avaz has never criticized. Avaz regularly features the
Reis on the front page, reports on his travels, and mocks
media outlets that criticize him. Avaz even posited a
"different interpretation" of the conviction in February 2009
of an imam in Travnik on charges of pedophilia (ref D).
Radoncic openly echoes the Reis's outcry against
"Islamophobia" (ref E), most recently attacking former
editor-in-chief of Federation TV (FTV) Duska Jurisic, who
reported on Radoncic's role in the FDB scandal. Radoncic
stated that "we cannot permit a person who is not Muslim to
be an editor in our Islamic community." Any overt
endorsements by Reis Ceric of Radoncic's party would give
Radoncic a boost among religious voters who see Tihic as
overly secular; conversely, Radoncic can revel in his
irreverent understanding of Islam if he so chooses. SDA
Deputy President Asim Sarajlic told us that he overheard the
Reis tell Radoncic at a reception, "People need to see you at
mosque," to which Radoncic allegedly replied, "But Reis, I
don't know any prayers!" Later, in a theatrical aside during
a lunch with DCM, Radoncic held his wine glass aloft and said
"I can't support radical Islam: I would be their first
victim!"

The Hurdle: SDA
---------------

9. (C) Although it is too early to make concrete
predictions, at this point it seems that even with the
support of the Islamic community, Radoncic will be unlikely
to make great gains in these elections at the expense of SDA.
SDA has a well-established voting base, particularly in
rural and semi-urban areas. Bosniaks considered SDA and its
first President, Alija Izetbegovic, the protectors of their
people during the war, and the limited success of splinter
parties like SBiH in recent elections suggests that Bosniaks
choose established parties over charismatic new leaders when
they feel threatened (ref F). Even with SBiH's
Tri-Presidency victory in 2006, SDA remained the largest
Bosniak party, capturing more seats in both Federation and
state legislatures than SBiH. Moreover, although Radoncic
wields significant media power, he relies on SDA for
financial support, due to SDA's connections with the FDB.
Avaz treats Tihic with caution -- including by sidelining
Tihic's repeated, direct attacks on Radoncic -- suggesting
that Radoncic recognizes the risk in burning bridges with the
most powerful Bosniak party.


SARAJEVO 00000134 004 OF 004


The Impact: Fractious Bosniak Politics
--------------------------------------

10. (S/NF) Although Radoncic treads carefully with SDA, he
bears a longstanding animosity with the other major
Federation-based party, the Social Democratic Party (SDP),
stemming largely from his personal dislike of party President
Zlatko Lagumdzija. However, Radoncic -- genuinely shocking
Avaz editor Numanovic, who was also present -- told the DCM
in January that he had recently met with Lagumdzija for over
two hours to discuss a possible post-election coalition,
which he may see as a means of sidelining SDA. Nonetheless,
Avaz's consistent disparaging of Lagumdzija and Silajdzic --
as well as Radoncic's ties to the Reis, who also is on the
outs with both men -- makes it less likely that either party
will want to work with Radoncic before or after the
elections. These inflammatory comments are likely to
increase as the year progresses, which will contribute to a
Bosniak campaign that may well be based more on personal
attacks than on any potentially unifying issue. A strong
showing for Radoncic in the elections would put him in a
position to negotiate a place in a post-election coalition.
Even if Radoncic serves in opposition, he will become one
more strong personality in Bosniak politics that could
undermine initiatives from moderate Bosniak parties.
Moreover, Radoncic is powerful, due to his business ties and
the strong influence of Avaz. He may be able to seriously
damage any party inside or outside the coalition that
challenges him. As the economic crisis shows no signs of
abating, Radoncic could become a greater force, given the
hide-bound lethargy and backward-looking politics of many of
his Bosniak opponents.

Comment
-------

11. (S/NF) The collapse of the Prud process (ref G), the
political and economic woes in the Federation (ref H), and
the battle over the mayor of Mostar (ref I) are recent
examples of the extent to which fractious Bosniak politics
contribute to paralysis at the state and Federation level.
Tihic's attempts to shore up the state have been held in
check by opposition on his right flank -- Silajdzic, the
Islamic community, and even Lagumdzija, who sees it as his
duty as opposition leader to oppose any initiative the ruling
coalition supports. If Radoncic succeeds in establishing a
foothold in a new government, Tihic will face a more
difficult battle in securing a unified Bosniak response to
anti-state behavior from the RS and in taking a constructive
approach to such initiatives as constitutional reform.
Moreover, an alliance between Radoncic and Dodik, perceived
as two of the country's more corrupt leaders, would send a
very discouraging message to those in Bosnia and Herzegovina
who are seeking the rule of law, especially the Bosniak
intellectual elite.

Comment Cont'd
--------------

12. (S/NF) At the same time -- however distasteful it may be
to us or others -- if Radoncic and gains enough authority
through the October 2010 elections to join a ruling coalition
at the state or Federation level, his comparative lack of
discord with RS leaders and pragmatic approach on issues
ranging from economic development to constitutional reform
and Euro-Atlantic integration could perhaps contribute to a
more peaceful political situation in Bosnia and Herzegovina
over the near term.
ENGLISH

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