Bosnia ranks as the third worst country in Europe on the Corruption Perception Index (CPI) and is at risk of entering a legal and institutional vacuum which could threaten the survival of the state, Transparency International (TI) warned on Tuesday.
The Balkan country is going through its worst political crisis since the end of a war in the 1990s after Bosnian Serbs blocked decision-making in national institutions and launched a process to withdraw from the state armed forces, tax system and judiciary.
Bosnian Croats are also threatening to boycott a general election scheduled for October unless their request for changes to the electoral law - to allow them alone to choose the Croat member of the country's tripartite presidency - is approved.
The Serbs have also indicated they could boycott the vote.
"Creating the fundamental preconditions to hold the election is an absolute priority," Srdjan Blagovcanin, chairman of the TI Managing Board in Bosnia, said. "Without that, the country would enter a total legal and institutional vacuum in which the survival of the state would be brought into question."
Post-war Bosnia is split into the Serb-dominated Serb Republic and the Federation shared mainly by Croats and Bosniaks, two highly autonomous regions linked by a weak central government.
The country placed 110th out of 180 countries on corruption watchdog TI's index, behind only Russia and Ukraine in Europe. In 2012 it ranked 72nd but has since slid.
Blagovcanin warned that the country was being run from outside of its formal institutions, given the Serbs' move to block decision making and the threat to the elections, and was at risk of "practically becoming the property" of its ethnic political leaders.
"There isn't a formal barrier for corruption anymore," Blagovcanin said. "Massive robbery of state resources, i.e of the citizens, is getting ever more intensive. The country is on the verge of complete chaos."
He said the crisis not only endangers the upcoming election but also much-needed reforms to ensure that future votes are transparently financed and independently run, without pressure on voters.
Earlier this month, the United States imposed sanctions against Bosnian Serb leader Milorad Dodik over graft and for threatening Bosnia's stability and territorial integrity, and three other former and current officials.
(Reporting by Daria Sito-Sucic; Editing by Kirsten Donovan)
