SARAJEVO, Bosnia-Herzegovina -- The Sarajevo Film Festival, which wrapped Saturday, played a crucial role in the rebuilding of the film industry in Bosnia-Herzegovina after it was decimated during the 1992-1995 Bosnian War. The festival has gone on to become a leading force in the movie biz in South-East Europe, a region of some 140 million people. Now, it is reaching out to new markets in Asia, South America and the Middle East.

At the heart of the festival's efforts to develop the region's biz is CineLink, its industry program, which is comprised of the Co-production Market and the Work in Progress section. Sarajevo's head of industry, Jovan Marjanovic, is a long-serving member of the festival's parent organization, Obala. He joined Obala more than 16 years ago, initially as a volunteer, and then becoming a member of staff at its theater, the Meeting Point. Obala, which was founded in 1984, takes its name from the Obala Arts Center, which is located on the banks of the River Miljacka in Sarajevo. (Obala means "embankment" in Bosnian.)

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By the time Marjanovic joined, Obala had become involved in a wide range of activities, including live theater, film exhibition and distribution, contemporary arts, and lectures about a variety of topics, but during the Bosnian War the film department had assumed a leading role in the organization, and the Sarajevo Film Festival -- which was set up in 1995 -- became its flagship program.

The film industry in Bosnia had been strong before the war, with Sarajevo-born filmmaker Emir Kusturica winning the Palme d'Or at Cannes in 1985 for "When Father Was Away on Business," and the best director prize at Cannes in 1989 for "Time of the Gypsies."

During the war Sarajevo was under siege by Serb forces who subjected the city's residents to bombardment and sniper fire from the surrounding hills. The conflict led to the destruction of much of the film industry's infrastructure -- film studios, equipment, film stock, archive materials and crucial paperwork, such as legal contracts -- as well as the emigration of key staff.

"Out of the whole Yugoslav cinema in the 1980s, Bosnia was the hot spot within Yugoslavia. The war just cut this in its entirety. You can't manage a film industry in the middle of a siege," Marjanovic says. "Almost all of the filmmaking capacity that the country had -- 90% of which was in Sarajevo -- was destroyed in the war."

A few filmmakers remained, and they wanted to document what was going on around them, and this generated a fresh approach to filmmaking.

"A new scene was created during the war that made films about life under the siege, and these films resonated vitally and caught the eye of the international business, and most of the auteurs that were active in those days in Sarajevo went on to create the new Bosnian scene, of which the Sarajevo Film Festival is a part. They made their films during the siege and were on the front line of this revival," Marjanovic says.

The Oscar win in 2002 for Bosnian film "No Man's Land," helmed by Sarajevo director Danis Tanovic, was a seminal moment in the development of Bosnian cinema. The Academy Award and the film's successful box office run in Bosnia, where it got around 500,000 admissions in a country of 3.7 million people, generated a new wave of enthusiasm in the country for filmmaking, and encouraged local people to engage with the movie business and to take it more seriously. Obala had distributed the film in Bosnia, which gave it further credibility as an industry leader.

"It was therefore natural that the next step for the festival would be to develop some programs that would help the industry in this region," Marjanovic says.

The new Bosnian cinema was initially auteur-driven and "more intimate," Marjanovic says, with many films dealing with the war, including traumatic personal experiences, and its aftermath. But now it is maturing, he says, and has become more diverse, with market-oriented movies being produced alongside the auteur-driven films.

However, the volume of movie production in Bosnia is still too low, he says. Between two to five films are produced a year. "The problem is the amount of financing available, and the strength of the market. People have much more to do in terms of entertainment than they did 10 or 15 years ago, before the digital revolution," he says. Piracy is also an issue.

Faced with this crisis in the local industry, Obala's approach has been to try to seek solutions without waiting for the government or the commercial sector to act, which is consistent with its overall philosophy.

"Obala is very much punk rock. These were the times from which it came, and this ethos was always there," Marjanovic says. "When we started dealing with the film industry, it was always with a DIY approach to everything."

"Over time we learned to work with the powers that be to get our own way, but, yes, a lot of the things that the festival initiated were ahead of processes run by the authorities. It was very grass-roots," he says.

"Also, a lot of things happened that helped us, like the Oscar for 'No Man's Land,' which was a film that was produced without a single penny from Bosnia-Herzegovina. Then our question was: how can you not support the local film industry after this? So, immediately after that, a new film fund was established, and a system was put in place, whereas before there was no system. The film changed the attitude of the authorities, so they thought: Okay, now we need to reorganize the cinema industry," he says.

The lack of state film financing in Bosnia -- which at best contributed 20% of the budget -- in the years after the war forced Bosnian producers to adopt a more international mind-set and to look for foreign partners for their projects. CineLink, which was launched 12 years ago, helped Bosnian producers find partners abroad through its co-production market. This was launched with the support of the Rotterdam Film Festival, whose staff shared their experience of running CineMart, the first co-production market of its kind, and Sarajevo received financial support for the first edition of CineLink's co-production market in 2003 from Rotterdam's Hubert Bals Fund.