It survived the shells and shortages of a 3.5-year siege. But Sarajevo's newspaper equivalent of a war hero is now facing the perils of peacetime economics - which could prove fatal. Oslobodenje (pronounced Oslo-bodjenya), Bosnia's oldest daily newspaper, won 14 international publishing awards for the bravery and persistence of its staff, who managed against the odds to bring out an issue every day of the war. 'But now our big problem is to keep going in peace time,' said Mehmed Halilovic, editor of Oslobodenje since 1994, who was in Hong Kong for a conference at City University earlier this month. The name of the newspaper - which was founded at the height of World War II, in 1943 - means 'liberation'. 'So it is ironic,' Mr Halilovic said, 'that liberation could be the very reason we might have to close more than half a century later.' Figures look bleak for this newspaper that is co-owned by its staff, rather than by the government or a Bosnian equivalent of Rupert Murdoch. Circulation is down from a pre-war 80,000 to 30,000, more than one-third of which are sent directly to refugees in Germany. Advertising is still at a minimum in a country with more than 40 per cent unemployment and full of people who have lost their homes, their families, their savings. And the debts are more numerous than Mr Halilovic can count. 'During the war we used up all our assets,' he said. 'And then we used up some more.' At the very beginning of the war, he explained, when the city was surrounded by Serbian forces, the staff held a meeting and decided on their priorities. 'Most of our journalists were united in their desire to keep going. We felt we had an obligation to the readers, and to ourselves as reporters.' The immediate problem was location. The main building was just 100 metres from the front line. 'They shelled it very early on, not just because it was close but because it was symbolic.' After a few months the offices were levelled, with the only remaining area a small nuclear shelter built in the 1970s. How they had joked about this crazy communist idea in the 1980s when they found themselves in a building with a shelter. And how thankful they had been in the 1990s, when it saved their lives. They kept that building going, with three teams of people changing round on a weekly basis, on duty practically 24 hours a day. There were a newsroom, a dining room and a sleeping room. The building is still 'a cascade of broken concrete', Mr Halilovic said, adding that plans are to keep the site as it is now, a desolate memorial to the war and to the courage of journalists. When the Pope drove into the city from the airport last April, he pointed at the ruin - which manages to stand out from the dozens of other shelled buildings for the energy that had gone into its destruction. 'He turned to his cardinal and asked: 'Is that Oslobodenje?' ' Mr Halilovic said with pride. Most of the work was done downtown, with meetings held in coffee shops. 'We moved coffee shops six times. We were lucky. One got blown up just after we left.' They were particularly targeted because Oslobodenje had journalists from all ethnic groups - indeed one of their main columnists was a Serb - the only political line it was advocating was the end of civil war, and its editors had refused to be caught up in the media-led hate campaign which preceded the main war, Mr Halilovic said. Four journalists from Oslobodenje died. 'Two were killed from the shelling, one was deliberately taken and killed because he was our correspondent. The other was in a bus going to our office and she was shot by a sniper.' You learn about snipers, Mr Halilovic said. 'And about shells. I had been a war correspondent for many years, but I still didn't know that much about heavy artillery. The first time I heard it in Sarajevo I thought it was really close, but later I learned what close was.' Oslobodenje's is an extraordinary story of working with almost insurmountable obstacles. There were, for example, almost no energy supplies into Sarajevo, which meant some reporters were given the job of negotiating for fuel on the black market. 'It sometimes cost around US$15 [about HK$116] a litre, and we needed about 100 litres a night for the minimal layout and printing.' To eke out the supplies they used to write by candlelight, using old typewriters instead of the up-to-date computer equipment they were used to. Everything was honed to the bare essentials - formatting, number of copies, non-critical features were all cut. Most of the time Oslobodenje was an eight-page paper, with 2,000 copies a day. Paper was so scarce that sometimes it was blue, sometimes pink, sometimes green 'and sometimes all three'. 'It didn't matter what it looked like as long as it came out. 'For a while they said only bread and Oslobodenje were available for sale in Sarajevo. Then the bakery closed down.' The journalists rarely received any salaries: like almost all residents of Sarajevo, they depended on humanitarian aid from outside, Mr Halilovic said. 'Two or three kilos of flour, a third of a litre of oil, and rice, a lot of rice,' he said with a grimace. 'Most people don't really like rice anymore,' he joked. In a way, he said, he had some advantages. His wife and youngest daughter left for Zagreb in Croatia early on. 'I was able to go out and back because I could go with the UN forces using press accreditation. But whenever I was away I felt uncomfortably relaxing. I wanted to be back in Sarajevo: I had work to do.' His oldest daughter, then 23, and his 19-year-old son opted to stay. They both spoke good English and worked as interpreters. 'They didn't want to leave in the beginning: nobody believed it could last so long or be so brutal. My daughter wanted to stay because she had a boyfriend in Sarajevo. He was killed in the May after the war started.' Mr Halilovic lost his older sister in the second year of the war. 'I think most people in Sarajevo lost somebody,' he said, listing the casualties of war. More than 11,800 died in Sarajevo, mostly civilians. And throughout the country a quarter of a million were killed and 1.2 million expelled from their homes. 'Everyone went through crisis times. I felt the job was a reason not to give up.' Mr Halilovic was more used to war than most. For many years he had been Oslobodenje's correspondent in the Middle East. But this one was dirtier than anything he had seen, including the Iran-Iraq conflicts in the early 1980s. 'It was definitely worse, because it was not between two armies, but between ordinary people. And ethnic cleansing was the first target.' Since the war ended in 1995, the city of Sarajevo has begun to recover slowly. Showing the dry humour that kept them going during the siege, its citizens call their roofless houses 'cabriolets', and wait for more outside money to flow in before they can even think of rebuilding them. Meanwhile, a daily newspaper has become a luxury rather than a necessity, and Oslobodenje is finding it hard to rebuild its circulation. 'We made glory and we made debts while running this paper during the 1,367-day siege. Glory isn't really helping us now though and our situation is vulnerable,' Mr Halilovic said. 'If we wanted to be a government newspaper that would be easy, or if we wanted to be bought by one owner that would also be quite easy. But we want to run ourselves, despite the debts. 'And I think that will be very difficult indeed.'