YUGOSLAVIA'S INDUSTRIAL POTENTIAL

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80-00809A000600270621-2
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 21
• Document Creation Date: December 22, 2016
• Document Release Date: September 19, 2011
• Sequence Number: 621
• Publication Date: December 23, 1949
• Content Type: REPORT

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CIASSIFICATI N SDCRY?T
CENTRAL INTELLIGENCE
INFORMATION FROM'
FOREIGN DOCUMENTS OR RADIO BROADCASTS
COUNTRY
SUBJECT
HOW
PUBLISHED
WHERE
PUBLISHED
DATE
PUBLISHED
LANGUAGE
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50X1-HUM
CD NO.
DATE DIST..73 Dec 1949
SUPPLEMENT TO
REPORT NO.,
THIS IS UNEVALUATED INFORMATION
I
The availability in Yugoslavia of raw materials, the exploitation of which
is being intensified, the assistance offered by Russia, which sent materials and
above all technicians, the rebuilding and expansion of old installations destroyed
or damaged during the war, the eu netipn. of new industrial plants, and the
orientation of the Five-Year Plan toward the industrialization of the country
suggest that before long Yugoslavia will have at its disyosal such industrial re-
sources as to permit it to meet all national industrial regnirdmente.
Certain particular provisions ao-oted during the execution of the Five-Year
Plan, together with the building of underground factories, clearly ahoy how the
development of industry is largely subject to military directives for an ever-
increasing offensive and defensive military potential.
According to a recent estimate, Yugoslav industry is well provided with such
ordinary machinery as milling cutters, lathes, perforators, presses, etc. Pre-
cision Instruments, however, are lacking. Electrical equipment and ball bearings
are in particularly short supply.
Of the 14,000 machines Yugoslavia -cceived from Germany as reparations,
12,000 were assigned to military industries and 2,000 left for'civilian industry.
The equipment of 200 factories is still scheduled ?.o be sent to Yugoslavia as
reparations from Germany, but the British authorities stubbornly oppose this.
4
All Yugoslav industrial activities arcs under the con'crol of the Ministry of
Industry, the headquarters of which are in Belgrade.
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I
a
to the Ministry of Industry, which delegates the control of the factories of
national. significance to them.
Belgrade are known: Mechanical Industry, Metallurgical Industry, Motor Industry,
Agricultural Machinery Industry, Electrical Equipment Industry, Chemical Industry,
Textile Industry, Tobacco Industry, Cement Industry, Mining Industry, Leather
administrations of which control local industry of regional importance.
The directives of the then Minister of Industry Kidric called for the cre-
ation of new factories and the modernization of those in existence, so as to
assure the complete independence of the country from abroad in the industrial
sector by the end of the second Five-Year Plan, which was to follow immediately
after the first.
specialists in industrial problems, to draw up the plan: Doctor of Engineering
Hercegoni, and Engineers Stetenovic, Vu(-o, Prica, Lazarevic, and Hanzecovic.
The factories of fundamental importance were to be set up in such a way that
any one could be transformed into a war industry within a maximum of 6 months.
The new factories were to be so located as to permit an easy defense of the
installations and to assure the protection and continuity of operation in any
contingency. In particular the buildings of each factory were to be separated
from one another by a distance of at least 200 meters and were not to be placed
in the some diractdon. The buildings were to have the appearance of hospitals,
museums, o- apartment houses rather than of factories.
These last requirements were presented by the Army General Staff to Minister
Kidric, who ordered the planners and builders to adapt the General. Staff directives
to industrial needs.
The time allowed to the engineers for presenting their respective plans was
very short. Thus each of them presented his own project without details and
without coordination with the others. All the plans presented were approved by
the Council of Ministers and translated into lava, after which each plan was
elaborated in detail and its relative cost estimated. The total sum for the
realization of the various plans turned out to be beyond the financial capacity
of the country (Engineer Hanzecovic's plan would hive cost 8J billion dinars,
while the others varied from 6 to 8 billion). Thus each planner was obliged to
cut down on the installations and machinery of each factory planned, while leaving
the number of actual factories unchanged. For example, the Zeleznik factory
would, according to the initial project, have been twice as extensive as it was
when actuslly completed.
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However much ti.. original plans were reduced, the Ministry of Finances still
tremendous increase in Taxation, which resulted in indescribable discontent among
the people. The government, although aware of this discontent, kept its deter-
necessary. This included tho necessity of exporting such products of prime
necessity as grain and fats to acquire machinery, to such an extent as to deprive
the people of them almost totally.
In 1946 Yugoslavia was very short of such products as cement, bricks, and
of exporting. This was responsible for the failure of the plan for the first year
of the Five-Year Plan. The government, thinking that the failure of the plan at
its beginning would cause general discontent and would discredit it before the
people, stopped sending the above materials to Russia and tried during the second
year to make up for lost time; but it failed again because of a shortage of man-
power, skilled and unskilled. (According to many observers, this failure to de-
liver materials to Russia was probably one of the causes of the Tito-Cominform
ment in 1947 invented the institution of "extraordinary compulsory labor without
compensation." If the government succeeds in keeping this system in force, it
will attain the goals fixed by the plan in 1949; however, it will meet vigorous
opposition from the workers concerned.
The Five-Year Plan includes a plan for the expansion of the city of Bel-
grade as far as the station and airfield in Zemun< The airfield will be moved
to the vicinity of Batajnica, about 15 kilometers west of Zemun. The new Govern-
ment Building is now being built according to this plan on the left hank of the
Save, opposite the Zemun railroad station.
The expansion of the city of Belgrade will prove very expensive and will
proceed slowly, as the subsoil is sandy. At present about 2,000 youth are
working as volunteers leveling the ground. Details on the plan for expanding
Belgrade are not available, although details on the expansion of Zagreb, also
provided for by the Five-Year Plan, are at hand.
Military industry also has its five-year plan, the details of which are known,
however, only to persons of proved political fidelity who are directly interested
in the subject. All that is known is that of the 14,000 machines received from
Germany as reparations, at least 12,000 have been assigned to military industry,
which has priority over civilian heavy industry,
Belgrade Area
1. "Rogozarski" Aeronautical Workshop
This workshop, located in Belgrade at U1. Knez Danila 29, was in exist-
ence before the war and during 1941 produced 10G aircraft. Present production,
the details of which are not known, consists of fighter aircraft of modern type
and of spare parts.
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"Zmaj" Aircraft Factory
not far from Belgrade, is now engaged in the construction of light aircraft, of
which 10 to 12 are prof'..uced per year, with a labor force of about 300 workers.
This factory also existed before the war and in 1941 had attained an annual pro-
research on foreign aircraft and eventually copying them. With this in view, all
aircraft shot down during the war have been taken there. As a result, the
factory has built an unknown number of Spitfire-type aircraft. In July 1947,
two aircraft prototypes, namad "XX Oktobar," were under construction at "Ikarua."
They were low-wing two-seaters, of mixed construction, with 100-horsepower Gipsy
lists of the construction of duralumin airframes for military aircraft, at a
rate of three per day for fighter types and two per day for bomber types.
meters from the Belgrade-Zagreb railroad line. Its production has never been of
a well defined character and has never been done serially. At present it con-
3. "Ikarus" Aircraft Factory
The factory is under rigid military control and is ntrictly guarded. It
is not mod.'u, and the workshops are small. The labor force varies from 1,200
to 1,500 workers.
There is a building in U1. Knez MihaJlo in Belgrade -- it does not look
much like an industrial establishment -- in which a ball-bearing factory is
supposed to be set up. The machinery has not yet arrived from abroad.
5. "Teleoptik" Workshops
The "Teleoptik" Workshops are about 2 kilometers from Zemun on the
Zeman-Zagreb Highway, next to the local cavalry barracks. These workshops produce
precision optical instruments, telemeters, and sights for bomber and fighter
aircraft. About 100 instruments are produced there per month.
"Teleoptik" employe about 300 specialized workers, almost all Germans,
as are the managers. They York by contract. The few Yvroslav workers are all
militarized.
The workshops are old, but have been substantially enlarged.
6 Aeronautical Workshop in Zemun
This workshop, near the Zemun Airfield, is equipped for snall and medium
repairs on aircraft and engines. It employs 700 German specialists, including
200 mechanics who were prisoners of war.
Besides the above enterprises, the following establishments are located in
the Belgrade area, but details on them are not known: the "Pancevo" Factory; a
cannon and artillery projectile factory; workshops for the production of aero-
nautical equipment, spare parts for engines, and aircraft arnowanr1es; the aero-
nautical workshop at the Pancevo Airfield for testing the aircraft of the field
itself; and the glass factory in Pancevo.
Exact data on the aeronau'-ical enterprises in this area are not known.
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At present the "Bata" Factory in Borovo is engaged chiefly in producing
footwear and tires for military use. If the entire production were diverted to
military needs, it wou'd satisfy all the requirements of the Armed Forces.
Brdc.?fie Area (near Bkofja Loka)
The plywood factory in this area is also engaged in aircraft production.
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There is a small factory in this area which makes ammunition for light weapons.
Celle Area
"Western" Factory
Breza Area
Details on the aircraft enterprises in this area are not known.
Kotor-Oroko--c Area
This factory is located 500 meters north of the railroad station of the
Maribor-Celle line, and occupies a rectangle 1,000 by 500 meters. Its production
conslnts of manufactured copper, zinc, and iron products and of red lead and rust-
proofing paints. It is the only zinc-manufacturing plant in Yugoslavia. Its
zinc production, consisting of plate, is sufficient to satisfy Yugoslav needs. It
produces about 3,000 to 4,000 tons per year of copper products for railroads and for
locomotive boilers. Its Iron production consists of 10,000 tons per year of kitchen
utensils, enough to meet Yugoslav needs. The factory also produces radiators and
boilers for theraosiphons.
The "Western" Factory obtains its raw materials primarily from the Bor mines.
It employs 3,000 persons working on three shifts. The factory is antiquated, and
no expansion or modernization is planned. However, it has one modern section, a
special polishing section. The machinery is unsuitable for producing war materiel,
as it is not adapted to precision work.
A workshop which has been observed in theCelje area is probably intended for
testing aircraft. u
niJ~t- ?~a..
1. Refinery of th^ General Administration for Petroleum and Gas
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latons and machinery, except ror slight modifications, are the same as before,
and are in poor condition because of a shortage of spare parts. The equipment
f th"R
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section is incomplete, while that of the "Contatto" (Contact)
section, though satisfactory, is now out of service because of the lack of
specialist personnel resulting from the departure of the Italian technicians
and workers who took advantage of the right option.
this source appear to have been cut off cuupletely as a result of the Tito-C.omin-
form break, At present, the petroleum is obtained from Iran
and is of the beet
,
quality. Every 20 - 25 days the tanker Jajce (sold to Yugoslavia by England) puts
The daily production of the refinery amounts to out 150 - 200 one
of gasoline, 100 tons of kerosene, 40 - 50 tons of heavy oil, chid 200 tons alto-
shipped every day to Belgrade, Zagreb, and Sarajevo in railroad tank care with
ith a
They are carefully controlled by iiDB [secret police) personnel who mingle amon
them se
tl
Th
g
cre
y.
e manager of he enterprise is Engineer Cernoochi, the
assistant manager a certain Biagini Nello, both of Italian origin.
2. "A. F.ankovic" Torpedo Factory
The "A. Rankovic" Torpedo Factory in Rijeka was established by Italy.
It was largely destroyed during the war, and completely restored and equipped
with a new pavilion of reinforced concrete. However
for lack of machiner
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y,
only 16 of the 32 sections making up the prewar torpedo factory appear to be in
operation now.
Nev models of to'"pedoes are not being produced at present, but inten-
sive efforts are being made to perfect those invented by Italian engineers, using
modifications suggested by torpedoes found recently. There is a stockpile of
200 to 250 torpedoes near the torpedo factory at present.
W.te recently, work we being carried on by advanced specialists, in-
cluding some Germans, toward adapting Stuka aircraft engines to Yugoslav Navy
submarine chasers. The tests appear to have given gratifying rer lts.
The torpedo factory is considered to be a military enterprise, and is
under the jurisdiction of the local command of the Yugoslav Navy.
Ilidza Area
The beginning of eonstructio of a large factory scheduled to produce aluminum
goods, insulating materials, plumbing fixtures, etc., has been observed in this
area.
Indija Area
There is a parachute and flight clothing factory in this area.
Jesenice Area
1. "Jesenice" Factory
This factory is engaged almost exclusively in the construction of pass-
enger railroad cars. Its production capacity will be one car per day when its en-
tire machine inventory has beer put into operation. At present its capacity is 18
20 cars per month. It produces serially, using a Ford-type production line.
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in case of necessity it could produce tank parts, tractor tracks, and pressed
metal parts with its present wachinery.
The "Jesenice" Factory is now being expanded. At present an iron shed
126 by 90 meters in area is being set up. It was brought from the Krupp Works
in Essen. An administration building and a building to be used as a school for
apprentices are also under construction.
The enterprise now has about 600 machines at its disposal, including
four or five special hydraulic presses from Czechoslovakia. Another 300 ma-
chines, including stamping machines, planerc, and milling cutters. are on order iron
the Sve-Export Company in Stockholm. Each of 'these machines will cost from 3 to 5
million dinars.
The wheels and axles for the railroad carp are supplied by the factory
at Osovich, near Zecica, in Bosnia. The electrical equipment is furnished by
the British Western House factory in Southampton, which sends 20 sets per month,
or about one for each car. Negotiations are now under way for a contract for
springs from the largest Polish manufacturer of railroad equipment.
C
The factory has no foundry, but it has a power plant scheduled to have
works, and also, to some extent, from Germany and Czechoslovakia.. The latter
supplies iron plate. Before the Tito-Cominform split, materials were also re-
ceives? from Russia, but th.:y proved to be of increasingly poor quality.
The entire production of the "Jesenice" Factory is absorbed by internal trade,
but is not sufficient to meet the ?emsnd. The quality of the products is falling
off. Serious railroad accidents occur frequently in Yugoslavia as a result of
the poor quality of the rolling stock and because of inadequate maintenance of
the lines. These accidents are not reported to the public.
The cars produced by the factory are marked wi-~;h the letters CHH. About
3,000 workers are employed. This number will be increased to 5,000 when the
current expansion and modernization of the factory are completed.
There is a small independent establishment for the production of automobile
and truck bodies annexed to the "Jesenice" Factory. It has a production capacity
of five bodies per month. They are fitted with engines from the factories at
Rakovica and Teznoe
2. Jesenice Ironworks
This plant is located in the city of Jesenice, in a depression near the
railroad station. It has only one blast furnace in operation. Another will be
built during 1949; however, production will not increase proportionally because
the present machinery will not permit it. The inventory of machinery consists at
present of about 90 machines, including four large laminating machines and pneumatic
and hydraulic hanwere. Some of these machines came from the Krupp Works in Essen
and were repaired in the Zeleznik works. These machines include stamping machines
that can cut 80 pieces per minute, and research is in progress on others that can
cut 200 per minute, regardless of thickness. It is planned to use tools of "Vidia"
material on all the machines. There are rather few tools of this material at the
plant at present.
Besides the blast furnace the .Teaenicg Irnnvnrke haw a Martin f~~rnwre for
the production of special steel and three electric furnaces for makiig ingots. Each
furnace has a capacity of three to four 3-ton charges per day. The blast furnace
and the Martin furnace burn coke. There are also a few small gas furnaces for
special operations. The machinery is run by electricity supplied by one of the four
power plants on the Draw.
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for 1951, will permit a definite imprcvement in the quality of production.
of foreign currency.
melts up scrap iron. In 1946-47 it also received iron from Sweden and Austria,
but since then Yugoslavia has Lad to do without this source of supply for lack
I SMSJ Area
This factory, the largest of its kind in Yugoslavia, is situated in the
suburbs east of the city, between the Kragujevac-Belgrade railroad and the Jeponica
River. It consists of about 25 buildinge?within an area of 1,500 by 1,000 meters.
It is regarded as a military establishment and is directly uuder the jurisdiction
of the Ministry of Defense.
At present the factory produces light arms and small-caliber ammunition,
but it is being equipped for the production of antiaircraft machine guns and
antitank gun. Its arms production consists at present of the following models
(the daily output for each model, in the absence of direct knowledge, is computed
from the capacity of the machinery, of the labor force, and of the raw materials
used): 75- and 80-millimeter antiaircraft guns, two per day; 34- and 37-millimeter
antiaircraft guns, 30 per day; 20-millimeter single-barrelled antiaircraft machine
guns, with a horizontal magazine containing 50 cartridges divided among five clips
of ten cartridges each, 20 per day; and Russian-type submachine guns with vertical
cartridges, about 2,500 per day. The entire Yugoslav Army is scheduled to be
equipped with this last type of gun.
Besides these weapons, hand grenades and various typed of ammunition are
being produced. Data is not available oA their quantity and quality. The present
produc ion is superior to the prewar and to that of the war period. The factory
also repairs and remodels old-type weapons.
'he factory buildings are now being modernized, but they are not scheduled to
be enlarged, although they are insufficient for production needs. The machinery
inventory consists of about 5,500 machines, and has been largely renovated with
machinery sent from Germany as reparations. Many other machines are available but
cannot be installed for lack of space. Each machine operates independently of the
others as it has its own electric motor. The current is supplied by the thermal
power plant in Belgrade and by a hydroelectric power plant in Bosnia.
Ordinary raw materials are supplied by the foundries at Jesenice and at
Zenice. Special ray materials came from Czechoslovakia until recently. In 1946
a sma11 amount of materials from Russia were also used, but their quality was
poor.
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employed on three 8-hour shifts. The whole city of Kragujevac may be said to
earn its living from the factory.
technicians include some German ballistics experts. About 30,000 workers are
The only obstacle to production at the factory results from the lack of
raw materials, ac there is sufficient manpower.
factory with a large depot attached have also been noted in the Kra6ujevac area,
Kral evo Area
ready equipped to make them. The machinery for building the Decauville cars will
be transferred tc the factory under construction at Smederevo, which will use it
for the production of tractors.
ten per may, The Decauville cars will be produced by the "14 Oktobar" Factory
in Kruaevac and by the fact^ry in Slavonski '-Slav .ski Brod? 7, which ere al_
At present the factory produces one railroad car and ten Decauville cars
per day, as well as 2,500 tons of building machinery per year. When the factory
is modernized as planned, its production will be limited to railroad cars, about
in 1949 and 1950 they will. be replaced by masonry buildings.
This factory is situated one kilometer north of the city of Kraljevo and
a like distance from the Belgrade-Xraljevo railroad line, to which it iscoonecLed
by a siding. At oresent it consists of several buildings, all made of wood, but
Plans have been made for modernizing the factory's machinery and the in-
stallation of many new machines that are to be taken from a total of 2,000 me-
chines received as reparations from Germany, now stored in the village of Batain-
ica, 100 meters from the Zeman-Zagreb railroad line.
The current to operate the machinery is supplied by the hydroelectric
power plant near Dubrovnik and the thermal paver plant in Belgrade. Production
is often hampered by shortages of raw materials.
The labor force varies from 2,000 to 3,000 workers. The number will re-
main the same after the factory is modernized, as operations will be better
mechanized. The technical director of the factory is Engineer Hilutinovic.
The following enterprises have also been noted in the Kraljevo area:
An aircraft accessory factory, located about one kilometer northeast of
the city near the Kraljevo-Krusevac railroad line. In 1941 this factory was the
most important Yugoslav factory producing aircraft. It employed about 1,000
workers and produced one aircraft per day on a single-shift schedule;
Workshops with modern equipment for the production of Soviet-type aero-
nautical equipment.
Kranj_Area
"Franj" Rubber Products Factory
This factory produces waterproof garments, sanitary articles, and inner
tunes. Its machinery is not modern but is satisfactory. Shortages of raw materials
interfere with production.
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The factory is of modest proportions. It employe about 1,200 workers
As neither the "Bata" nor the "Kranj" Factory produces synthetic rubber,
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there is nn synthetic rubber factory in Yugoslavia.
Krusevac Area
which it is connected by a siding. Ito annual production consists of 2,400
Decauvllle care and 1,500 tons of machinery fo: making cement. Production is
somewhat hampered by a shortage of manpower, but is 50 percent greater than be-
"14 Oktobar" Factory
The factory io not supposed to be converted into a war industry, as
it is an old establishment without precision machinery.
It employs 2,000 workers, who work on three shifts. Some of the tech-
Lesce Area
The machinery for making screw which is now at the General Iron Con-
struction Factory in. Maribor, scheduled to be demolished, will be given to the
recently. It produces iron chains and screws, the latter being its specialty.
"Verig" Factory
Ljubljana Area
"Litostroj" Factory
This is the largest factory in Slovenia. It is very well constructed
architecturally, but has technical defects. Its construction was begun In 1947.
The factory has already begun production, although its construction has not yet
been completed.
The factory was designed for the construction of centrifugal pumps and
turbines. It is supposed to produce f'.ve 50,000-horsepower turbines per year.
The first ones will be used for the modernization of the electric power plants at
Mariborski Otok, Dravograd, and the old Fala power plant on the Drava.
The factory is located In the outskirts of lubljana, near the Ljubl-
jana-Sv Vid railroad line, to which it is connected by a siding. About one kilo-
meter away, on the Ljubljana-Sv Vid highway, there is a wcrkere' village con-
sisting of eight large blocks of housing. A school for apprentices is planned.
The personnel includes German technicians and a Swiss technician from
the "Becher Vies" Factory, who is exployed on a 2-year contract. The technical
director of the factory is Engineer Zoricic, the political director Franz Pecar,
a former worker.
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during the war and carry on research and experiments on railroad equipment. The
machinery is rather antiquated but the personnel for the most part is good.
industrial installation of the kind in Yugoslavia. Although designed for the
production of locomotives, at present they merely repair locomotives damaged
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1. Railroad Workshops
"Rutter" Textile Factory
The "Hvtter"Factory is located in the eastern part of Maribor near the
At present it employs about 3,000 workers.
This Is the largest textile factory in Yugoslavia, the only one capable
of satisfying the textile requirements of the country to any considerable extent.
During 1945 and 1946 the factory produced cloth for military clothing and also
made the garments. It is not known whether it still does so.
This factory is 10 kilometers from Maribor, on the Drava. It produces
acetylene and other gases for autogenous welding.
Maribor-Tezno Industrial Area
This area is about 8 kilometers southeast of the center of Maribor, ear the
Tezno railroad station. It is regarded as one of the most important industrial
areas in Yugoslavia, if not in the entire Danube basin.
1. "V.D.M." Engine and Motor Vehicle Factory
The construction of this factory was begun in 1942 by the Germans. Accord-
ing to their plan, it was to build 2,700 aircraft engine parts per month. The
necessary machinery was removed during the war from Italian, French, and Czech-
oslovak factories, but at the end of the war they had to be returned and replaced
by others sent as reparations from Germany. At present the factory is fully
equipped with machinery.
Production for Yugoslavia was begun in 1946, when the factory was equipped
to produce ten Praga-type 2k-ton trucks. Goosenecks, connecting rods, and steering
assemblies were to have been imported from the "Praga" Factory in Czechoslovakia;
but they never arrived because of Russian influence, and therefore only one truck
a week could be produced. To eliminate this difficulty and to raise production to
the planned level, a workshop is being built at the factory to produce the parts
that were to have been imported. However, even when this workshop is ready to
operate, production will be seriously hampered by the shortage of skilled labor.
At present the factory employs 2,500 persons working in two shifts, and
it will be able to employ 5,000 when the above-mentioned workshop is completed.
The internal organization of the factory is defective, and exaggerated police con-
trol is in force. A large housing community for the workers at "V.D.M." and at
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for its adaptation to the production of aircraft and motor vehicle parts. How-
ever, it will not produce aircraft engines, for which the factory was originally
designed. The factory has been divided into two sections for future production,
Although the factory now produces only Praga-type trucks, the plan calla
50X1-HUM
the General Iron Construction Factory is well under way. Th technical director
it roduces, with the exception of magnetos and. electrical equipment, which are
imported. The gears are now built by a factory in Rakovica, which also tempers
engine parts. However, "V.D.M." Is fully equipped both for making gears and for
This section is located in a large loft. It is already completely equipped with
machinery and has begun to operate. Two other sections for assembling railroad
bridges, cranes, and windlasses, to be built very soon, should increase production
to 40,000 tons per year.
Thus far the factory has built two large bridges for the Samac-Sarajevo
railroad, several smaller bridges, three large cranes, one of which has been sent
to the "Litostroj" Factory in Ljubljana and one to the factory in Zeleznik, and
six 100-cubic meter gasoline tanks, which have been sent to Titograd.
A worksh - for making screws and bolts is annexed to the factory. This
workshop will be destroyed and the machinery transferred to the "Verig" Factory
in Lesce. The other sections called for by the plan for the expansion of the
factory will'be built on its site.
The factory employs about 2,400 persons working on two shifts. Plane
call for a possible increase in the labor force of 3,000 more workers. In case
the factory is converted into a war induatiy, it will be able to produce tank parts.
3. `Motor Oil" Refinery
This small refinery is opposite the Tezno railroad station and is care-
fully camouflaged. Until 1946 its production consisted of 15 to 20 tons of gaso-
line of various types and 5,000 kilograms of oil per day. The crude petroleum
comes from the wells at Lendava.
Its present products are renovated machine oil end greases for industrial
use. About 40 tons of regenerated oil are produced per week, while the production
of grease varies according to the amount of residue left after the renovating
process. The refinery has six underground tanks, four large and two small, with a
total capacity of one million liters. In the future "Motor Oil" will continue
this kind of production, while refining petroleum will remain a monopoly of the
refinery in Rijeka.
p r
to the factory. This year ,presumably 1948 or 1949) it will produce 24,000 tons.
primarily equipped for making major iron construction materials. In 1948 it
rodueed 10 00O tons of such material. The same year a large section was added
2. General Iron Construction Factory
Nis Area
There are workshops for overhaulin., aircraft in the outskirts of Nis, not far
from the airfield.
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This factory is being built in the outskirts of Novi Sad east of the
city, on Futog U1, near the Novi Sad-Sombor railroad station, to which it is
connected by a siding. It Is expected to produce 350 tons of drill points,
600 tons of cutting tools, and 300 tone of aaaorted measuring instruments per
The section for making drill points will begin operation this year.
The factory will have about 900 machines, most of them imported. The
following deliveries are now expected: 30 special machines from the S.I.P.
Factory in Geneva; 19 pressure threaders from the "Rishaner" Factory in Zurich,
Factory; 10 - 12 rectifiers from the Swiss "Kelemberg" Factory; a complete
electric furnace section and equipment for tempering tools, from the "Sivert"
Swedish "Johannson" Factory in Eskilstuna; 4 small precision machine tools from
the Swiss "Studer" Factory; 10 - 12 small "Centerlex" machines from Sweden;
various polishers, mill cutters, and hydraulic presses from the "Zbrojovka" Factory
in Brno, Czechoslovakia (to be imported through Sweden); milling machines and
mechanical save from "Skoda" in Czechoslovakia; 32 precision cutters and 40 Pitler-
type cutters, the latter patented by a German firm in Brandenburg, from the
"Liberta" Factory in Prague; and 3 electric furnaces for tempering, from the
"Foliman" Factory in Prague.
Parts for the above machines, especially for those from Czechoslovakia,
have already arrived.
The Jesenice Ironworks will furnish "Jugo Alat" with special profiled
materials. What enterprises will supply the other necessary raw materials is not
known. The electricity 'fill come from the thermal power p-snt in Belgrade.
The factory will employ about 1,300 workers. Its total productiot. is
expected to be three times the national requirements, so extensive export to all
the Balkan countries is planned.
Details are not known concerning the "VoJvodjanska Livnica" (Vojvodina
Foundry) and the "Jedinstvo" Factory in the Novi Sad area.
Petrovac Area (about 15 kilometers east of Skoplje)
There is a email foundry for the production of duralumin in this area.
Rakovica Area (about 9 kilometers south of Belgrade)
1. Heavy Motor Vehicle Engine Factory
This factory is equipped with machinery acquired as war booty. It pro-
duces four-cylinder 45-horsepower gasoline engines for tractors at a rate of 12
to 15 per day. In the past it made aircraft engines for the "V.D.M." Factory
in Tezno.
The Five-Year Plan provides that the factory should be able to produce
about 12 to 15 tank engines per day. It is also equipped with the necessary tools
for making aircraft enginer in cooperation with other enterprises.
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tempering work in all Yugoslav industry. It also does this kind of work for the
"V.D.M." Factory in Tezno.
in the suburbs south of Belgrade near Topcider Park. In 1941 they were equipped
with all the most modern tools and produced 100 aircraft engines per year, with
chinery, a 5-month job, was carried out under the direction of Soviet technicians,
and since then by Yugoslav engineers assisted by experts and technicians who were
formerly prisoners of war and now are employed on contracts at premium pay. The
section has recently beguq c produce aircraft engines for the Yugoslav Air Force.
As the installations and equipment came from Russia and were installed according
to Soviet methods, the engines produced may be expected to be similar to, if not
identical with, Russian engines, especially the AM-42, designed by the Russian
engineer, A. A. Mikulin.
The works employ 1,700 workers, including 400 German specialists, on two
shifts. The management personnel includes four German engineers who have probably
worked on V-1 and V-2 weapons.
Recently a special military aircraft section was established at the
works. Until 2 months ago the installation of the technical equipment and ma-
during the war, and machine guns and aircraft guns were assembled.
These works are equipped tc construct, assemble, and overhaul YAK air-
craft engines. Until recently the materials were obtained from Russia. Here re-
pairs were made on Allied aircraft shot down or burned on Yugoslav territory
Sarajevo Area
"Kombinat" (Combine)
This factory was designed for various types of machine construction,
primarily for civilian and secondarily for war industry. It is assigned t. make
machinery and spare parts for the "Bata" Shoe Factory in Borovo, as well as wood-
working machinery and small precision instruments for working metals. Its military
production will consist of precision light arms, telemeters, telescopes, and
artillery Instruments.
The combine is now under construction 5 kilometers south of Sarajevo,
near the mountain where the sources of the Bosna River rise. It was designed by
three German engineers, Engineer Ribenean, who planned the foundry, Engineer Pawner,
who planned the machinery, and Engineer Halase, who planned the buildings. These
engineers are now in-the British zone of Berlin.
The factory was to have been put into operation at the end of 1948, but
the plans for the machinery are not yet complete, and the machines themselves,
which -!ere to have been imported from Switzerland, have not yet arrived. However,
the foundry section is near completion. It consists of fully modern electrical
equipment for melting special metals in small quantitieu. Each of the electrical
furnaces will cost from 30 to 40 million dinars. They are products of the Manfred
Weiss Company in Budapest. A coke blast furnace for ordinary metals, with a capac-
ity of 12,000 tone a year, is being built. Of this tonnage, 6,000 will be used in
the factory and the other 6,000 tons furnished to other enterprises.
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_-y -- ......w o,wc -cac.y 11Rlsneo.
The political director of the factory is one Luzner.
Sisak Area
The combine will be a model of technical. perfection in its field. Near
the factory A hnnainn Ae..e, w. w.
Works for overhauling aircraft engines have been noted in this area.
elavc'nskl Brod Area
Steam Boiler and Iron Bridge Factory
quated and its pavilions are rather far apart. Its productionconsistsof steam
boilers, small industrial locomotives, gasoline tanks, and iron bridges. Until
recently Decauville cars also were produced. The factory's present production is
25,000 tons per year. By the end of 1951 it is scheduled to produce 40,000 tons'.
The factory is fully equipped with machinery. recently r..n,,.A+e1
The labor force consists of 6,000 persons working on three shift-%.
Enterprise for Machine Construction in Smederevska Palanke
This enterprise produces motor vehicles, motorcycles, anu aluminum spare
parts for aircraft.
Two new factories to built very soon in the Smederevo area are a factory
for building farm tractors end tank tracks and a factory that will make agricultural
implements. Construction of the former is well advanced.
Split Area
The existence of an enterprise for the production of liquid hydrogen in this
area has been noted but not confirm'd.
Stara Pazova Area
large 'knrke for assembling aircraft have been established in this area. These
works use the Zeman Airfield for test flights.
The Ironworks is about 300 meters from the Store railroad station, to which
it is connected by a siding. It is located between two hills beyond the Voglajna
River, and consequently cannot expand. There is a kiln for refractory brick near
the Ironworks.
The Ironworks processes scrap iron only. It has no blast furnaces, but
only special furances for melting scrap and a Bessemer furnace with which it.produces
steel by an antiquated process. Its maxim mm annual production ib 100,000 tons of
iron and ordinary steel.
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Its labor force consists of 9,500 peranna working on three shifts.
The Ironworks has 300 machines, operated by current from the Fels
ow
r
p
e
plant on the Drava. The Ironworks and its products are not slated for military
Aluminum Factory
-
tric motors and high-capacity conductors is delaying the completion of the factory.
Construction was begun 'n 1942 by the Germans, who planned a production
capacity of 100,000 tone per year. At the time of the German withdrawal about
half of the factory had been completed. It is now being finished according to
plans calling for somewhat smaller proportions then the German plan. The factory
will be finished this year. Some of the machinery left by the Germans will be
used, othe?- machinery required for the last stage of the chemical production
process, will be furnished by Brown-Boveri in Zurich. The lack of powerful elec
The chemical process for producing aluminum, invented by a German pro-
fessor, has been laboriously reconstructed by Yugoslav chemists. Although it
cannot be called the best method, it is suita'`_e for Yugoslavia as it requires
very little electricity.
Twenty 150-cubic meter tanks. covered with a cement roof, are now under
construction. They will be use. for mixing the bauxite with water. By means
of an electrochemical process, the aluminum product can be converted into dura-
luxin.
Production will begin in 1950 and will amount to 50,000 tone per year of
sheet met,1 and .jars with various cross sections. The raw material will came from
the bauxite mines in Bosnia. Electric power will be supplied by the new power
plant on Mariborski Otok, which was built on the Drava expressly for the needs of
this factory.
A labor force of about 1,000 workers will be employed.
Topusko Area
There are aeronautical enterprises in this area, but no details are known.
Tuzla Area
There are aeronautical enterprises in this area, but no details are known.
ViseFad Area
The first Five-Year Plan calls for the construction of cn agricultural ma-
chinery and tool factory in this area. In 1947 a site 500 meters southwest of
the city of Visegrad was selected and levelled.
An annual production of 5,000 tons of plows, sowers, and other agricultural
implements is scheduled. The machinery has already been ordered abroad.
The factory will employ 600 workers. It can be converted into a war industry.
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Koncar" furnishes: electric motors for the machinery produced by the "1 Ma,"
Factory in Zagreb.
equipment so as to compete with the Siemens plant. At present, however, it can
produce only about 1,000 motors and 1.00 transformers per year, because of a
shortage of manpower and materials, especially ball bearings, Most of the trans-
formers are for the hydroelectric power plants being built on the Drava. "Rade
stet of 10-horsepower electric motors, transformers of up to 100,000 volts, tele-
phones, and electrical equipment. In l946 it also built army field telephones.
The factory is scheduled to extend its activity over the whole :"'old of electrical
50X1-HUM
Novi Sad, which also furnishes it with stators for its motors. It obtains other
materials from abroad and electric cables from an enterprise in Zagreb.
to reach 9,000 when the factory is able to operate at full capacity. The ma-
chinery inventory is complete, and consists chiefly of new machines of the best
This enterprise is near Zitnjak, about 5 kilometers east of Zagreb, and
adjoins the Steam Boiler Factory. The two factories give the appearance of a
single establishment.
The factory is assigned to serial production of industrial tools and
precision machines'of up to 6 tons for working metals. It will also serially
produce a machine tool of the Centerlex type, invented by Engineer Walter in the
corresponding factory in Zeleznik. The factory is now under construction. Its
production capacity will be 25,000 to 30,000 tons of machinery and spare parts
per year. The factory will be finished in 1951. It will have its own completely
independent foundry, and will employ about 2,000 workers.
The new "1 Mai" Factory will replace an old enterprise of the same name
now in existence in Zagreb, which is slated to be absorbed by t`b?' new establish-
ment. The old enterprise now produces about 1,500 tons of machine tools per year
and employs about 200 workers, who will form the nucleus of the skilled labor force
in the new factory.
This factory, only one section of which is now under construction, is
slated to be built near the "1 Mai" Factory. It will produce enough steam boilers
for industry, for heating, and for road rollers to meet all Yugoslav needs. It
will not need massive machinery, but only pneumatic hammers and equipment for
electric welding.
The factory will employ a maximum of 600 workers. It is not expected to
meet any problems that would hinder production.
4.. Electrical Conductor Factory
This factory is in the city of Zagreb, but its exact location is not known.
It produces electrical conductors for railroads and for bydroeiecrric power plants
on a small scale. It obtains its raw materials from the "Western' Factory in Celle.
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built by the Germans, the current activity of which 19not known;.a small tire
factory; an antitank and antiaircraft gun factory, details for which are not known;
and an underground factory begun by the Germane for the construction of aircraft
and engines. The last-named factory appears to have been completed and equipped
1. Youth Factory
This factory, built in 1947 by Yugoslav youth, produces aircraft engines,
automatic arms, and heavy tools. It is now in process of reorganization, and no
data is known concerning its production, but it will be one of the largest factories
in the Balkans. German machine guns and small cannon, to be mounted in aircraft,
2. "Ivo Lola Ribar" Factory
The factory is about 2 kilometers southwest of the city of Zeleznik, be-
tween two hills, and it Is connected with the narrow-gauge Zeleznik-Belgrade rail-
road line by a siding. It is divided into two plants, 13A and 13B. It has a tech-
nical management, a section for research or models, and warehouses.
There is a school for apprentices at the factory, where 120 apprentices
per year are enrolled in the 3-year course. Political supervision of the workers
is rather strict and is carried on by members of the UDB who mingle with the workers.
Each worker has a political card kept by the political director, Buda. The tech-
nical director of the enterprise is Engineer Resic? the director of production is
Engineer Oberschmidt, formerly director of the railroad works in Slavonaki Brod.
a. Section 13A
The construction of this section was begun on 1 June 1947, and shortly
afterward the installation of machinery was begun. On 1 January 1948 the section,
finally completed, was formally opened by Marshal Tito and began production.
According to the Five-Year Plan, 13A is to produce 15,000 tons of
machinery annually, but because of shortages of materials and skilled manpower, its
production will be limited to 12,000 tons. Thus far 25 power hammers weighing 300
kilograms, six machines for pulverizing paper, and a certain number of cogwheels of
a maximum diameter of 5 meters have been built. The production does not follow a
well defined plan, but varies with the requirements of Yugoslav industry.
The "Ivo Lola Ribar" Factory was so designed by Engineer Hanzekovic,
according to instructions from the Ministry of Industry, that it could be converted
in 3 months to a war industry producing 50-ton tanks, with a maximum output of five
tanks per lay. In such a case 13A would build the heavy parts and 13B would make
accessories.
Section 13A occupies an area of 134 by 90 meters. It now employs 1,400
persons working on two shifts, but could employ up to 2,700. Most of the personnel
are Yugoslavs, but there are about 200 Germans, including a few very capable engi-
neers, and about 15 Istrisaa. The machinery consists of about 120 heavy machines,
each of which works independently of the others because it has its own electric
motor.
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Iron. Each blast furnace can accommodate five or six'2~f-ton charges per day. Two
Herold-type electric foundries for steel and a small electric foundry for special
metals are ;!.so planned. The former will have a smelting capacity of 250 to
500 kilograms. The machinery for these foundries has already been ordered from
the Manfred Weiss Factory in Budapest, but has not yet arrived.
Walter, a German engineer at "Ivo Lola Ribar," has invented a Center-
chine. It is scheduled to be serially produced for export by the "1 Maj" Factory
in Zagreb. The Yugoslav Ministry of Industry rewarded Engineer Walter for this
invention by a cash payment equal to 20 months' pay. He also invented a new
device for jeparating molten metals ":?om the slag; but as the Ministry of Indus-
try refused to give him a reward, he refused to build the machine and surrender
This section occupies an area of 126 by 80 meters. It is to be com-
pleted and ready to begin production toward the end of this year.
10 tons, at a rate of 13,000 tons per year. Its production will consist of boring
perforators which perforate up to 80 millimeters, German Stoss-type machine tools,
heavy vertical milling cutters cooled from the German Birnaski-type model 500, and
machines for working cogwheels of large diameter, up to 2 meters.
Most of the machinery for 13B will come from Germany as reparations.
The raw materials will be supplied by the ironworks at Jesenice, Zenice, and Store.
A workshop for making spare parts and maintenance materials for the section it-
self will be built next to the section.
The labor force will consist of 2,800 to 3,000 persons working in
three shifts. When the section is operating at full capacity, it will have
5,500 workers. A village being built for the workers will have a capacity of
30,000 persons. It consists of 250 large buildings and will also house families.
The Zenica Ironworks is in the suburbs to the east and west of the city.
It is about 1C kilometers from the Bor mines, from which iron, copper, and silver
are obtained.
The annual production of the Zenica Ironworks consists of 1,200,000 to
1,500,000 tons of bars, mostly of iron and steel. However, this total plus the
production of the two other ironworks, at Jesenice and Store, is not sufficient
to meet the demands of Yugoslav industry. The products of the Zenlra Ironworks
are inferior in quality to those of Jesenice, but superior in quantity, as it
produces about a million tons of ordinary steel.
At present there ;.ce only two blast furnaces in operation. A third will
be built this year and a fourth in 1951. When the fourth blast furnace begins
to operate, the Zenica Ironworks will produce about 3 million tons per year. All
the 'blast furnaces burn coke, about 350 tons a day. The coal is imported from
Czechoslovakia. It is loaded aboard ship at Bratislava, carried down the river
to Belgrade, and transshipped': to Zenica by rail. Thus far, coal deliveries have
not been interrupted, but in case this should happen, a chemical section has been
formed in the Ministry of Industry to study the possibility of deriving industrial
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3 million tons per year because, on the one hand, deliveries of Czech coal are
hampered by the shortage of transport facilities, and, on the other, the lack of
adequate tools at the Bor mines seriously interferes with one production. At
present production is sometimes slowed down by the irregular delivery of ore,
especially iron.
The machinery consists of about 1,000 aachiues, largely modernized_
by the factory in Z-eleznia.
production has increased 100 percent since the war -- a plan has been submitted
mines has been planned.
shifts. Electricity is furnished by a power plant near Dubrovnik. The products
transportation may be considered satisfactory.
Aircraft enterprises have been noted in the Zenica area, but no details
are available.
Since the Tito-Cominform break, Yugoslavia has stopped carrr~Ing out the
huge-scale commercial exchanges it had maintained with the USSR ai:d its satel-
lites. However, commercial exchanges are continuing with some of the satellites
on a reduced scale, exactly how much is not known.
USSR, Rumania, Bulgaria, Albania, Poland
No commercial exchanges are now taking place with these countries.
A commercial agreement concluded before the Tito-Cominform break is still in
force between Hungary and Yugoslavia. It calls for exports of wood worth 600
million dinars to Hungary, in exchange for electrical machinery from the Manfred
Weius Factory in Budapest. Much of the wood has already been sent and the rest
is still being delivered, as is the case with the electrical machinery, some of
which was ordered for the factory in Zeleznik.
Czechoslovakia
Before the Tito-Cominform break, commercial exchanges with Czechoslovakia were
very active, as Yugoslavia had decided to buy most of the machinery needed for its
industrialization program in Czechoslovakia. At present these exchanges are re-
duced to practically nothing, except for deliveries of Czech coal to the ironworks
at Jesenice and Zenica.
corn and a debit of about 30 million crowns solely for the acquisition of machinery
and special metals. The credit balance in Yugoslavia's favor will certairly be
used up in the purchase of other machinery.
a
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Exchanges between the two countries are always extremely active. In December
1948 they were regulated by a commercial agreement to last for one year. Through
Sweden, and specifically through Sve Export in Stockholm, Yugoclavia also obtains
Czech machinery. Sve Export ships Czech machinery as though it were'its own, at
a markup of 2 or 3 percent above the purchase price.
Switzerland
It cannot be determined exactly how much the commercial exchange between
Yugoslavia and Switzerland amount to at present, but there is known to be a
commercial agreement between the two countries. There it considerable export-im-
port activity, consisting of shipments of fats from Yugoslavia and precision
machinery from Switzerland.
There is no rea_'; t formal commercial treaty between Great Britain and
Yugoslavia, but individual agreements for imports and exports are made from
time to time. Yugoslavia sends poultry to Great Britain, and this far has re-
ceived 32 special machines for making ball bearings and perforators in exchange,
via Sweden. Also the British factory Western House in Southampton has sent and
is still sending Yugoslavia electrical equipment for lighting railroad cars and
other electrical materials which coat more from Switzerland and Sweden.
Italy and France
Very small exchanges are made between these countries and Yugoslavia.
United States
The United States sends Yugoslavia gasoline, special oils, and radio equip-
ment. They are unloadtd et Sibenik. Particulars are laying.
Yugoslavia is known to be very eager to cultivate commercial relations with
all the Western countries, but is seriously hampered by the scarcity of worthwhile
currency.
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