The military-industrial complex of former Yugoslavia was the largest in Southeast Europe during the Cold War period. At the height of its export, the Yugoslav military industry sold 4% of the world's arms which represented the great success, given the size of the country. Many Western European countries have exported less weapons than Yugoslavia.
Since the fall of the Berlin Wall, Yugoslavia has lost its privileged position in the world and the country became undesirable in the new uni-polar world, formed on the territory of the European continent. Once powerful military-industrial complex, scattered throughout the six former Yugoslav republics, was crippled by civil wars, sanctions and foreign aggression. In the meantime, many ambitious projects were lost because the development was possible only through the synergy of all republics.
After the collapse of the Yugoslav state, the remnants of its military-industrial complex continued to operate in a smaller scale and found markets for their survival, in some cases even for further expansion. Serbia and Croatia, the two largest post-Yugoslav states, have shown that they can do the best in this field, largely due to the fact that they have retained most of facilities, factories and scientific centers. Individually, Serbia inherited the largest part of the Yugoslav military-industrial complex. The arms industry did not cease even sanctions during the 1990s, although somewhat reduced in quantity. Still, ten years of sanctions and wars had the impact on the quality and scientific-productive potential.
During the 2010s, the signs of recovery and development of new weapons on a larger industrial scale are remarkable. The biggest problems in development don't lie in the scientific field, but in the lack of new production capacities needed for realization of such challenging projects, as well as in the inability to finance them. Another phenomenon has proved to be a norm in developing more expensive combat systems: due to the lack of financial resources, the systems are first exported, and then introduced in the Serbia's Armed Forces in limited numbers. Let's start with the most ambitious project.
The most ambitious project currently being developed by Serbia's arms industry is the ALAS system (Advanced Light Attack System). The ALAS was first displayed in 2007 as a missile system without carrying platform. The idea of the system is to destroy point targets on the front line or at a depth of 25 km, during the combat operations. The ALAS system has shown a great potential in terms of its capabilities comparing to the similar competitors in the world. The system can be deployed by any suitable platform, including stationary (most primitive), trucks, wheeled or tracked armored vehicles, helicopters, or patrol boats and smaller ships.
The underlying problem for the Serbian defense industry is the lack of investment, which resulted in suspension of several important projects. Because of this issue, Serbia's defense industry can not be self-sufficient in developing the ALAS and some other systems, thus development continued in international cooperation. When the new foreign policy was formulated under Aleksandar Vučić, then Minister of Defense and First Deputy Prime Minister, he declared the United Arab Emirates as Serbia's strategic partner. The cooperation with this Arab country continued in various spheres, with the defense industry being just one of them, and can be described as the symbiosis of Serbian science and the UAE money. In order to enable the development, the UAE invested roughly $220 million in the ALAS system, the dreamy amount for Serbian government alone. As a result of this cooperation, the UAE will be the first country outside of Serbia to obtain (and probably even produce) the system for their own needs. It is also indicative that the public demonstration was carried out from the Emirates-produced NIMR armored vehicles.
The greatest power of this system is its potential for further modernization, with an increased range. More precisely, the manufacturers have introduced a system with new booster engines that make the ALAS as two-stage missile and increase its range from 25 to 60 km. A conjunction with unmanned aerial vehicle makes such missile a serious step forward in warfare, especially in aiming point targets like enemy's command centers and artillery systems. Probably the main advantage of the ALAS system is that missile communication is realized via thin optical cable with two channels, which provides a high degree of safety from interference.
Another trump of the Serbian defense industry is the Lazar armored vehicle, made in several variants and named after the famous Serbian medieval ruler who was killed in the battle against the Ottomans. During the development of this eight-wheeled armored vehicle, the focus was placed on a protection against mine blast which proved to be one of the main defects of Yugoslav armored vehicles in the wars of the 1990s. The Lazar armored vehicle belongs to a family of personnel carriers and it can carry nine infantrymen into battle, but several additional systems can be mounted on it, including main 30 mm auto-cannon, secondary 7.62 mm gun, grenade launchers, and anti-tank missiles.
Putting aside the primary role of the Lazar vehicle, it is significant that newer versions have independent suspension which allows the platform to be customized to different roles, including installation of various types of weapon systems like the ALAS, as shown at the latest International Defense Exhibition in Abu Dhabi. In the past few years, the Lazar systems have been exported to several countries (Iraq, Pakistan and Kenya), so its practical application will soon be known. As such, the Lazar armored vehicle competes internationally with similar systems like Switzerland's Piranha, Austria's Pandur, and Finland's AMV Patria and Russia's BTR-90.