Serbia 2015

In January 2014, the strongest party in parliament – the Serbian Progressive Party (SNS) - called for early elections on March 16, just two years after the previous ones, held in May 2012. The elections ended by an overwhelming victory of the SNS-led coalition (48.4% of the votes, resulting in 158 out of 250 seats). The SNS built a coalition with the Socialist Party of Serbia (SPS), creating a more than four-fifths majority in the Parliament. Those elections could be described as free and highly competitive. The biggest concerns are related to the intimidation of voters by the representatives of the governing parties at some polling stations, to the lack of critical and analytical reporting in the mainstream media (both printed and electronic) and to continuing shortcomings in the

Authorities in Serbia have effective power to govern without interference of the unconstitutional veto players. However, corruption among the officials, organized crime and very low level of prosecutions by the judiciary creates a space for unconstitutional activities within the state. Serbia declined in Transparency International’s 2014 Corruption Perceptions Index for six places, ranking now as 78 out of 175 countries, because anti-corruption measures adopted by the government still didn’t bring success. Serbian Orthodox Church (SPC) showed in the past that it can have significant influence on public opinion. However, due to scandals by the church high-ranking officials during recent years, the capacity of the SPC to influence is seriously reduced. Police forces successfully dealt

The freedom of the press in Serbia further deteriorated. Despite adopting three media laws which would streamline the country’s legislation with EU legislation in the course of EU accession, the implementation has not occurred. The state still controls media through the advertisement market. Self-censorship among journalists is still widespread. The Balkan Investigative Regional Network (BIRN) as a source for free and independent media faced threats and attacks by state officials while criticizing the government of the Prime Minister Aleksandar Vučić. He himself labeled the network as “liars” and “spies” who were spreading false information. Hate speech remains a fact in Serbian media, especially in the online-media. Although the general idea of privatizing media is

The situation in judiciary remains the most important stumbling block for the rule of law in Serbia. There was no major improvement in 2014 and there hardly would be any soon - several sequential reform attempts proved counterproductive and compromised the very idea of “reform”. Nonetheless, the official “strategy of judicial reform 2013-2018” is still valid and partially implemented. Judiciary is far from independent or efficient. There is a lot of political influence on the courts or public prosecutors. But occasional direct political pressure is near neglect as compared to corruption or criminal or crypto-political control over parts of justice system. Backlog of cases rose to 3 million. Repealed sentences and re-trials are rather a rule than an exception. The usual length of

Current government of the PM Aleksandar Vučić owes much of their popularity and domination to hopes for corruption-free country which they awoke in 2012. However, previously arrested tycoons did not have their trails concluded. Meanwhile, numerous revelations on the members of the ruling majority showed their conflict of interest, or suspicious ways they had obtained university diplomas or various benefits, or other indicators of direct or indirect corruption. Giant infrastructure projects, as well as management of the major public-owned companies, are kept away from public eye, mainly via contracts with foreign partners whereby parts of the domestic legislation are suspended, via direct government intervention circumventing the institutions in charge, or even via direct pressure

Overall human rights situation in Serbia is stagnant, halfway between the horrible 1990s and the desired EU standards. Disappearances and extrajudicial killings seem to be a matter of the past. But occasional police brutality, arbitrary arrests and ill treatment in custody remain as problems. The conditions at workplace and lack of rights to unionize in much of the private - especially in huge grey economy - sector, child or other forced labour and sex trafficking are worrisome. Freedom of assembly, opinion and expression, highly valued amid memories of the 1990s, is recently often curtailed to undesired critics of government. De facto bans to some gatherings or indirect pressure on media and websites not least hinder the normal political dialogue but also nourish the anyway aggressive

Private property is not adequately protected in Serbia. The main problems within the judiciary system are strong out-of-the-court influences on the judiciary, mostly by persons connected to the political elite, as well as partiality of the courts in their rulings. Enforcement of contracts is very ineffective, due to slow, uncertain and expensive legal processes. Corruptive practices are widespread, including in the judiciary. The practice of a long restructuring process of state owned enterprises (SOE), which are legally exempted from collections from their creditors during the restructuring, seriously restricts property rights. Furthermore, the executive power can pose itself above the rulings of the Constitutional Court, which ruled the above mentioned practice to be unconstitutional,

Size of government in Serbia is excessive, with the government consumption reaching 46.3% of GDP. Lower public revenues led to high budget deficit, which has accumulated in a high public debt of 72.2% of the GDP in 2014, tripling in absolute measures within the last seven years, far above the current fiscal rules limiting the level of public debt at 60% of GDP. Fiscal austerity measures introduced in 2014 were further increased in order to combat one of the highest deficits in Europe (reaching 6.3% of GDP) by a 10% cut in public sector wage bill and pensions. Good fiscal performance could make some of these measures now look obsolete. However, when non-permanent factors are taken into account, there can be no successful consolidation without these measures. Transfers to households, most

The business environment in Serbia is not very much oriented toward entrepreneurial activities. Starting a business is an efficient process, being fast and inexpensive, but administrative requirements for business activities are complicated and burdensome. Obtaining a construction permit is a long lasting and extremely expensive procedure, while getting electricity also incurs high costs. Compliance with tax procedures is also burdensome, due to complicated and sometime contradictory regulations and high number of annual payments. The process of licensing is widespread in certain industries, limiting competition and creating rents for license holders. Restrictive regulations of the National Bank regarding international payment operations online are burdensome for the sector of micro and

Freedom of trade is generally upheld in Serbia, which is, alongside Bosnia and Herzegovina, one of the few countries in the region not being a member of the World Trade Organization (WTO), whereby the main reasons for slow accession are non-compliance with the GMO regulations and a dispute with Ukraine on the export of wheat. Its main trade partners are EU countries (most notably Italy and Germany), followed by neighboring countries of the region. The bulk of Serbian international trade is conducted under the SAA with the EU and under Central Europe Free Trade Agreement (CEFTA). The Russian Federation is also a major trade partner, important for being the main energy supplier but also as a market for Serbian agriculture exports. Russian embargo on agricultural imports from the EU in the