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          • Year: 2018
          • Do We Know What We Are Buying?

          • BCSP Researcher Katarina Djokic wrote for Pescanik.net about issues related to the current practices regarding procurement for the purposes of Serbian Armed Forces.

        • There is a lot of talk about procurement for the needs of Serbian Armed Forces, but not much is known. Concern is that national leadership treats these purchases as some kind of “surprise gift“, not only for the citizens who finance them, but for the army that should be planning them.

           

          The recent exercise “The Century of Winners” was an opportunity to praise the operational capabilities of the Serbian Armed Forces and opportunity for bragging with the expected deliveries of weapons. In addressing the media from one of the polygons, president Vučić said that Serbia is buying three assault Mi-35 helicopters, two Mi-17 transport helicopters, as well as armed drones of Chinese production. It is not problematic itself that the president wants to praise himself for investing in the country's defence capabilities, however, everything else is controversial.

           

          The Ministry of Defence does not publish written information on when procurement of weapons is being carried out, which are not applicable to the Law on Public Procurement, so the only official information for the citizens are statements of  President and the Minister of Defence for the media. These statements intertwine with exclusive publications in tabloids according to the principle "unofficially heard from the top of the Ministry of Defence". It is simply impossible to determine what wishes are and what has already been paid, how much and what it costs and when it should be delivered. It's a real detective business to get information of public importance.

           

           

          This is illustrated by the case of the latest procurement of helicopters from Russia. At the beginning of December last year, after a regular meeting with the General Staff, the president announced that procurement of six Mi-17 transport helicopters is planned and that negotiations with the Russian state-owned arms exporter “Rosoboronesport“ are already in progress. Given that this was announced a few days before the Draft law on the budget for 2018 arrived in the Assembly, it was expected that this procurement would be included in the annual plans of the Ministry of Defence and the Serbian Armed Forces, including financial plans. In the meantime, in February of this year, some media exclusively announced that the Ministry will actually buy Mi-35 assault helicopters. The difference between two helicopters is not insignificant - it is different in purpose and price (Mi-35 is more expensive). The next turnover follows in April, when the media report that Minister Vulin began negotiations with Russian colleague Shoigu about the purchase of four Mi-17 helicopters and four Mi-35. In August, during a media event on the occasion of the test flight of two MiG-29 aircraft from the Russian donation, President Vučić casually announced that "we paid for and we will get" four Mi-35 and three Mi-17. Finally, during the last military exercise, Vučić stated that Serbia "is buying" (therefore, it has not yet bought?) three Mi-35 helicopters and two Mi-17 helicopters. The readers who have lost themselves in numbers so far should be consoled by the fact that the journalists themselves did not manage to cope. As reported by the specialized portal Tangosix, Vučić gave two different information on the numbers of the ordered helicopters during the same address. And not just that number is uncertain. The whole procurement is for now a mystery: there is no official confirmation that the contract was concluded at all, no information with whom it was made (perhaps with Rosoboroneskort?), and neither the President nor the Ministry of Defence officials haveannounced the public of value for this contract.

           

          When procuring weapons, some data are justifiably classified as secret because of groups that are considered a threat to the security of the country would not receive an unwanted advantage. However, even secret procurement is foreseeable: it is known why something is purchased, what is being procured, when it is procured and those who decide can be both politically and even criminally responsible if their decisions prove to be harmful. The problem with the procurement of weapons in Serbia is that they are not only secret, but also completely mysterious for both the citizens and the defence system. This mystery is best summarized in the presidential statement in August this year: "We with our friends from the Russian Federation have [another] arrangement that we are not talking about, we do not like to talk about, we want to surprise our people, our citizens, and our soldiers a little bit."

           

          There are several circumstances that allow this mystery. First, unlike many countries, even in the region, in Serbia the long-term and mid-term plans for the development of the defense system - which define what the army wants to procure in given period and which capabilities to build - are completely secret, so it is impossible to compare the planned with the purchased. Although the military has developed (though not transparent) system of analyzing its needs and determining the economically most sophisticated options to satisfy them, in recent years in practice defense investments, instead of analyzes, are often based on opportunistic, ad hoc decisions. In the meantime, bad practice is legally protected, as the new regulation on the equipment of the army from 2016 introduces a category of "emergency programs", which ignores the whole system of planning military needs.

           

          A particular problem is the lack of transparency in the arms procurement. Key purchases are not shown separately in the budget of the Ministry of Defense, but there is a relatively general item called Budget Fund for Arms and Military Equipment. This fund is not charged from the budget, but from the own revenues of the Ministry of Defense - from the sale of assets and the provision of services on the market (for example, MMA services, repair centers of the Army, etc). Since the beginning of this year, the fund has been reduced from about 2 billion dinars (about 19 million US dollars) to about 400 million, of which nearly 225 million (nearly 2.2 million dollars) have been spent. As stated by those who are better informed, a new Mi-35M helicopter costs about 20 million dollars. If the helicopters ordered are fully paid, it is clear that they have not been paid from this fund. Maybe an advance was paid only, but then that was supposed to be said.

           

          If procurement of weapons should serve the public interest, mystery is not necessary. Soldiers should not be surprised, they should be asked what they need and how it is best to provide it. Citizens do not need surprise gifts paid by their money, they need timely informations and taking into account how this money is spent and what they got for it.

           

          Translated by BCSP intern Branislav Cvetkovic.

        • Tags: procurement, military, military equipment, Katarina Djokic
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