The Agrokomerc Affair
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The Agrokomerc Affair of 1987 was a banking scandal that led to political destabilization of Bosnia and Herzegovina. The Affair which the Yugoslav press compared to the American Watergate scandal was centered around Agrokomerc a food manafacturing giant located in Velika Kladuša, Bosnia and Herzegovina. It is widely believed that the scandal was fabricated in Belgrade so as to remove leading Bosnian politicians headed by Hamdija Pozderac, who was at the time the head of the Federal Constitutional Commission of Yugoslavia, in order to disturb the political power balance in Bosnia and Herzegovina. The Affair and the removal of Hamdija Pozderac from the political scene in Bosnia and Herzegovina is considered as one of the most controversial events in Bosnian-Herzegovinian politics that preceded the Bosnian War. [1] [2]
In 1980s Agrokomerc, was engulfed in questionable banking deals where the corporation issued numerous high interest promissory notes without the proper financial equity. Such practices were very common in the Yugoslav communist system and many corporations utilized this practice. The difference with Agrokomerc was that the director of the corporation Fikret Abdic lost the sense of scale as the corporation issued in excess of $500 million in "worthless" promissory notes. The problem became more acute as the press reported on it as the biggest economic affair in former Yugoslavia triggering the 250% inflation rate in Yugoslavia.
