Serbia by Aleksandra Nenadovic´ Capital: Belgrade Population: 7.3 million GNI/capita, PPP: US$11,090 Source: The data above were provided by The World Bank, World Development Indicators 2012. Nations in Transit Ratings and Averaged Scores Yugoslavia Serbia 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Electoral Process 3.75 3.50 3.25 3.25 3.25 3.25 3.25 3.25 3.25 3.25 Civil Society 2.75 2.75 2.75 2.75 2.75 2.75 2.75 2.50 2.25 2.25 Independent Media 3.25 3.50 3.25 3.25 3.50 3.75 3.75 4.00 4.00 4.00 Governance* 4.25 4.00 n/a n/a n/a n/a n/a n/a n/a n/a National Democratic Governance n/a n/a 4.00 4.00 3.75 4.00 4.00 3.75 3.75 3.75 Local Democratic Governance n/a n/a 3.75 3.75 3.75 3.75 3.75 3.50 3.50 3.50 Judicial Framework and Independence 4.25 4.25 4.25 4.25 4.25 4.50 4.50 4.50 4.50 4.50 Corruption 5.00 5.00 5.00 4.75 4.50 4.50 4.50 4.50 4.25 4.25 Democracy Score 3.88 3.83 3.75 3.71 3.68 3.79 3.79 3.71 3.64 3.64 * Starting with the 2005 edition, Freedom House introduced separate analysis and ratings for national democratic governance and local democratic governance to provide readers with more detailed and nuanced analysis of these two important subjects. NOTES: The ratings reflect the consensus of Freedom House, its academic advisers, and the author(s) of this report. The opinions expressed in this report are those of the author(s). The ratings are based on a scale of 1 to 7, with 1 representing the highest level of democratic progress and 7 the lowest. The Democracy Score is an average of ratings for the categories tracked in a given year. 476 Nations in Transit 2012 Executive Summary he Republic of Serbia made progress on its path to European Union (EU) integration in 2011 with the arrest of well-known war criminals Ratko TMladić and Goran Hadžić. In other areas identified as priorities for EU accession, reform and diplomatic efforts were only partly successful. EU-brokered bilateral trade negotitions with Kosovo broke down during the year, resulting in the postponement of a European Commission vote on Serbia’s EU membership. Dialogue with Kosovo—an important accession prerequisite—remains problematic and politically dangerous for Serbian politicians, as refusal to recognize Kosovo’s secession remains one of the few things on which all of Serbia’s political parties can agree. An ongoing conflict between President Boris Tadić’s Democratic Party (DS) and the G17 Plus party led by former minister of economic and local development, Mlađan Dinkić, challenged the stability of the government in early 2011, causing several members of parliament (MPs) to resign. Dinkić himself left the government in February after repeated clashes with the finance minister and other members of the DS. To resolve the issue, parliament approved a reshuffle in March, reducing the size of the cabinet, but keeping the G17 Plus party in government. Living standards continued to decline in 2011, though inflation stabilized after the exchange rate shocks of late 2010 subsided and is expected to remain in the single digits in 2012. In September, the International Monetary Fund (IMF) granted Serbia a substantial loan to protect its economy against market instability. In 2011 authorities adopted a law to increase transparency in the financing of political parties and election campaigns and amended key electoral legislation. The judiciary pushed to correct errors made after a 2009 decision on court re- appointments. However, the review process was controversial and heavily criticized by civil society groups. National Democratic Governance. The ruling coalition continued key EU reforms and held its mandate despite a cabinet reshuffle and the opposition’s calls for early elections. The first-ever EU-backed bilateral talks between Priština and Belgrade began in March, but had largely broken down by year’s end. Though still suffering a protracted economic crisis, Serbia concluded a sizeable loan agreement with the IMF in September. Serbia’s national democratic governance rating remains at 3.75. Electoral Process. The Law on Financing of Political Activities was adopted in 2011 with the aim of improving the transparency of political party and campaign financing in advance of the spring 2012 elections. However, it is unclear whether Serbia 477 parties will be obliged to respond to questions by nongovernmental organizations and the Anticorruption Agency regarding the sources of previous years’ funding. The new Law on Conflict of Interest aims at ending the established practice of awarding Serbian political leaders multiple elected and non-elected positions. Pending evidence that new legislation will lead to greater transparency in political party financing, Serbia’s electoral process rating remains at 3.25. Civil Society. Serbian civil society organizations have a solid record of promoting human rights and anticorruption efforts, but extremist organizations remain an ongoing issue for security in the country. In 2011, the government felt compelled to cancel not only the October Gay Pride parade but all other public gatherings, following alarming security reports from law enforcement officials that indicated nationalists and neo-Nazi extremists were planning disturbances in several parts of Belgrade. Roma continue to face frequent discrimination and attacks. Serbia’s civil society rating remains at 2.25. Independent Media. Media ownership in Serbia is generally nontransparent, and the largest outlets are government-owned. Media frequently rely on financing from political parties. Journalists face harassment and physical attack, though incidents of the latter have declined in recent years. Several outstanding cases of attacks on journalists remain unsolved. No changes were made to improve media regulations by supporting journalistic independence and professionalism. Therefore, Serbia’s independent media rating remains unchanged at 4.00. Local Democratic Governance. Serbian authorities adopted the Law on Financing of Local Government to strengthen local governance and increase financing, though some observers fear it could exacerbate the state budget deficit. Most Serbians believe crucial decisions are not made by local authorities, but rather by top party leadership and local tycoons. Disagreements between local and central governments over minority representation in the local national council led minorities to boycott the 2011 census, significantly skewing its results. Serbia’s local democratic governance rating remains at 3.50. Judicial Framework and Independence. Judicial reform continued in 2011 with the adoption of new civil and criminal procedure codes aimed at improving efficiency. The High Judicial Council reviewed the controversial 2009 reappoint- ment procedures for judges and prosecutors amidst strong criticism from the Judges Association of Serbia. During the process, many of the original decisions were revoked. One year after the court restructuring, case backlogs remain high, and civil proceedings remain slow despite attempts to improve efficiency. A lack of standard policies on sentencing in criminal cases is believed to have led to a rise in repeat offenses. Serbia’s judicial framework and independence rating remains at 4.50. 478 Nations in Transit 2012 Corruption. Efforts to combat corruption remained comparable to the previous year, with continued large-scale investigations into corruption scandals in the construction and healthcare sectors. However, political will to make use of existing anticorruption frameworks remains weak. Graft and misconduct remain serious problems in the healthcare sector and the judiciary. In December, the government backed controversial amendments to the Law on Public Procurement that ignore relevant EU directives. The government refuses to investigate several corruption cases referred by its own Anticorruption Council. With no significant gains in anticorruption efforts, Serbia’s corruption rating remains at 4.25. Outlook for 2012. The Kosovo issue and the domestic economic crisis will continue to dominate Serbian politics in 2012. The second wave of the global economic downturn is expected to further stunt the country’s economy, though short-term reform measures will likely be introduced, mainly in the banking sector. The 2012 elections will be a critical test for the country’s anticorruption efforts, as the 2011 Law on Political Party Financing comes into force. The ongoing economic crisis, the necessity for public sector and pension reform, and endemic corruption will pose long-term challenges for the new government. Serbia 479 Main Report National Democratic Governance 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 n/a n/a 4.00 4.00 3.75 4.00 4.00 3.75 3.75 3.75 Serbia’s government managed to hold onto power throughout 2011, despite a crisis within the governing coalition. Conflict between the ruling Democratic Party (DS) of President Boris Tadić and coaltion partner G17 Plus escalated in the beginning of the year, causing several members of parliament (MPs) to resign, including G17 Plus leader and Deputy Prime Minister/Minister of Economy Mlađan Dinkić, who left in mid-February after repeated clashes with the minister of finance and other DS members. Dinkić resigned on 14 February, one day after his removal was recommended to parliament by Prime Minister Mirko Cvetković. To avoid the collapse of the coalition and the need for early elections, the government reshuffled the members of its cabinet in March, restoring balance in the distribution of ministerial posts for each party, including G17 Plus. No previous Serbian government in the past decade has governed for a full, four-year term. Throughout the year, the ruling coalition pushed to harmonize national laws with European Union (EU) directives in hopes of obtaining a positive recommendation from the European Commission (EC) on Serbia’s membership bid before the end of October.