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27/09/2016

Populism rules as Serbians go to polls

Elections

Populism rules as Serbians go to polls

Serbian Prime Minister Aleksandar Vu?i?

Serbians will vote in early parliamentary elections on 16 March. While the country's main political forces have been generous in their promises of boosting the economy and fighting unemployment, they have been silent when asked how they hope to achieve such results. EurActiv Serbia reports.

Serbia's upcoming elections are the least uncertain ones in recent memory. It is already known that the Serbian Progressive Party will win the vast majority of votes, with oponion polls suggesting figures significantly above 40%. The only unknown is with whom the Progressives’ leader Aleksandar Vu?i? will form the new government.

Vu?i? has announced he would like a broad coalition, but in recent public appearances has requested citizens to vote for him, and give his party an absolute majority.

All major campaigning parties are promising to boost the economy and fight employment. None is announcing any painful measures for a way out of the crisis, even though such measures appear as inevitable, given the difficult economic situation (see background).

The parties with the most support – the Progressives, and the Socialist Party of Serbia – promised pensioners and public sector employees that they are the only ones who needn’t worry about the reduction of pensions or dismissals if they vote for either of the two parties. Thus, Socialist Party leader and outgoing Prime Minister Ivica Da?i? said that Serbia did not have redundant workers, but rather a lack of work, whereas Progressive Party head Aleksandar Vu?i? said “pensions must not be touched.”

Neither the Progressives nor the Socialists answered EurActiv’s question regarding concrete points of their programs. A similar problem was reported by the National Alliance for Local Economic Development, which tried to gather data on the parties’ plans for the economy.

Improvement of the business environment, initiatives to develop sectors such as agriculture, energy and the automotive industry, stimulation of exports, making credit available to companies, and public works, are some of the measures proposed by parties for strengthening the economy. It remains unclear how funds will be secured for the public sector, or from where incentives for the economy and investment would come.

Thus, the Serbian Progressive Party announces major reform laws by the end of July, such as laws on labor, bankruptcy and privatization, which were withdrawn from procedure early this year. However, no mention is made about what novelties the new laws will bring about.

When EurActiv inquired about programs, concrete answers were provided by the ‘Enough Is Enough’ ticket, headed by former minister of economy Saša Radulovi?, who at the start of 2014 clashed with the ruling coalition when his proposals for reforms, primarily pertaining to privatization and bankruptcy proceedings, were withdrawn. Radulovi? recommends helping companies by cutting taxes and contributions for employees, by changing the severance pay system and simplifying dismissal, because, in his opinion, this is the only way for employers to emply people in a legal manner, with an employment contract.

The situation is similar when it comes to measures for debt reduction.  

The measures parties propose for reducing debts are mainly based on the greater collection of taxes, repayment of more expensive loans through the taking of new, cheaper ones, and on cutting of unnecessary costs in the public sector, but without any serious cuts that would include the downsizing of the state administration. Only Saša Radulovi?’s ticket advocates a thorough check-up of the public sector, so that it may be downsized in cases where it does not contribute to society. This ticket, according to opinion polls stands no chance of passing the election threshold.

The Progressive Party pinpoints cheaper loans as the magic wand, with talk of the personal connections of party leader Aleksandar Vu?i? who “secured” the recent loan from the United Arab Emirates. Among the Progressive Party’s measures are also the cutting of costs of representation and official cars and the better collection of taxes.  

The Democratic Party, headed by former Belgrade mayor Dragan ?ilas, among other things proposes that funds earned from privatization be used for the reduction of debts, whereas the New Democratic Party, founded by former Democratic Party president Boris Tadi? and a group of party members a short while before the elections, also proposes the reform of public companies and the public sector, but without downsizing. Among the measures are the professionalization of management in public companies, and the defining of equal pay grades in public administration, as well as more efficient use of state money.

The anti-European bloc, comprising the Dveri movement, the Democratic Party of Serbia and the Serbian Radical Party, mostly propose the suspension of the Stabilization and Association Agreement, the restoring of customs duties on agricultural products and turning the country toward Russia. There is no real danger from such radical measures, given that, according to forecasts, the Democratic Party of Serbia will enter the parliament with around 7%, while the other two parties enjoy much less support.

The topics that dominated previous elections – the EU and Kosovo – are not so prominent now. After the Serbian Progressive Party switched to the pro-European bloc a few years ago, the anti-European parties remained on the margins of the political scene.

While the former democrats, scattered in the Democratic Party and the New Democratic Party, as well as in the Liberal Democratic Party, emphasize their long history of engagement in Serbia’s European integration, the Serbian Progressive Party and the Socialist Party of Serbia constantly point out that it was precisely during their term in office that the negotiations on EU membership began. The Alliance of Vojvodina Hungarians stresses that issue as its priority, and United Regions of Serbia also provide full support to EU membership.

The anti-European bloc, i.e. the Democratic Party of Serbia, the Serbian Radical Party and Dveri, believes that the road to the EU is harmful to the Serbian economy.

Kosovo is also not a major issue in this campaign, since all pro-European parties have accepted the fact that there will be concessions on the matter, and concur that Serbia cannot recognize Kosovo’s independence as the only limit.

In short, the only uncertainty of the elections is whom the Progressive Party will form a government with, while subsequent measures for fixing the economy and finances will, most likely, depend on a combination of the Progressives’ political estimation, circumstances and outside pressure, with a certain amount of influence from coalition partners.

Background

Early elections were called last January by the Serbian Progressive Party, with its leader Aleksandar Vu?i? citing the need to gain full legitimacy for the reforms needed on the path towards the EU membership. In public, it was also interpreted by the desire of his party to get more power: it is the party with far strongest support, but the posts of Prime Minister and some of the key ministers are held by Socialist Party of Serbia.

The Serbian opposition is more fragmented than ever after the former leader of the Democratic Party Boris Tadi? left the organization and formed its own New Democratic Party.

Public debt in Serbia at the end of 2013 accounted for 64.4% of the gross domestic product. With weak economic growth and approximately the same number of pensioners and employees, it is clear that Serbia will need decisive measures if it wants to improve the situation. The oversized public sector with 780,000 employees, which, according to official data continues to increase on a monthly basis, is also too big a burden for the economy.

With unemployment of more than 20% and the population’s poor material situation, as well as with an underdeveloped political culture in Serbia in which there is no guarantee that any of the promises made in the election campaign will actually be fulfilled, it may not be realistic to expect more announcements of efforts and austerity measures during the struggle for votes. 

Further Reading

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