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Kiss, Yudit. 2004 ‘Selected Company Case Studies: Average Trajectories - Zastava Oružje.’ Small Arms and Light Weapons Production in Eastern, Central, and Southeast Europe, p. 34. Geneva: Small Arms Survey, the Graduate Institute of International and Development Studies, Geneva. 1 October

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Selected Company Case Studies: Average Trajectories - Zastava Oružje

Zastava Oružje (Kragujevac, Serbia and Montenegro) is the oldest military plant in the territory of the former Yugoslavia. It was founded in 1853 by the Serbian state to produce cannon. During the 1960s, when military-related demand was relatively low, the company launched civilian cars, tools, and machinery production and transferred its heavy weaponry production to Travnik, in Bosnia. From the early 1990s, in the framework of a conversion project, sports and hunting weapons were introduced. At present the company's main products are small arms. While 92 per cent of the company's output was military-related in the late 1980s, the share is now around 40 per cent.

Weapons produced include a range of bolt-action and semi-automatic rifles aimed at the hunting market, available in a wide variety of calibres, from .22 to .458 Win Mag; double-barrelled and pump-action shotguns in 12- and 16-gauge; a range of semi-automatic pistols of varying calibres, including the M-57, M-70, and CZ-99; and revolvers from .22 to .44 Magnum. The company also produces a wide variety of military weapons, including a number of Kalashnikov-derivative assault rifles, two of which are chambered for NATO 7.62 mm and 5.56 mm ammunition. Sniper rifles in 7.62 mm, anti-materiel rifles in 12.7 mm, machine guns of 7.62 mm and 12.7 mm, and 30 mm automatic grenade launchers are also produced.

Zastava Oružje belongs to Zastava Works, a large group of heavy industrial companies. It is a completely state-owned holding that shares an industrial estate with several other Zastava branch companies, including the famous car maker. During the NATO bombing in 1999, several parts of the industrial estate were destroyed, but the weapons-producing facilities remained unscathed…

Due to a lack of demand and resources, at present the company only uses around 33 per cent of its productive capacity. There have been no new investments in the last ten years and the company's financial situation is so fragile that it is often unable to pay service bills. Despite its precarious state, in the last few years the company has managed to develop some new weapons, for example an advanced version of a police revolver (based on a US design) and a 30 mm automatic grenade launcher.

Between 1975 and 1990, the 'golden age' of the Yugoslav defence industry, the company exported its products all over the world and employed around 9,000 people. Since then, both foreign and domestic markets have shrunk dramatically, and the number of employees has dropped to about 4,500. The main customers remain the Ministry of Defence and the police.

ID: Q5401

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