Nations in Transit
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Democracy Score(1 = best, 7 = worst)
National Democratic Governance(1 = best, 7 = worst)
Electoral Process(1 = best, 7 = worst)
Civil Society(1 = best, 7 = worst)
Independent Media(1 = best, 7 = worst)
Local Democratic Governance(1 = best, 7 = worst)
Judicial Framework and Independence(1 = best, 7 = worst)
Corruption(1 = best, 7 = worst)
Population: 7.3 million
GNI/capita, PPP: US$11,700
Source: The data above was provided by The World Bank, World Development Indicators 2011.
*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.
NOTE: 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.
The Republic of Serbia managed to maintain stability in 2010 despite being governed by a complex coalition of political parties that often lacked unity on key issues. The government generally stayed on a course of implementing reforms required for European Union (EU) membership. The ongoing economic crisis forced the government to focus on market reforms and sustainable fiscal policies, sometimes at the expense of social reforms. Budgetary restraints accelerated measures to streamline healthcare and the pension system, causing public discontent and demands for greater accountability and transparency in the work of central and local government.
Overcoming resistance from right-wing groups, the government adopted a declaration condemning the 1995 Srebrenica massacre, a critical step in dealing with the wartime legacy of Slobodan Miloševic’s regime. Cordial exchanges between Serbia’s president, Boris Tadic, and Croatia’s new president, Ivo Josipovic, improved diplomatic relations between the two states. Attempts by Serbia’s opposition to trigger early elections were unsuccessful.
The authorities continued to cooperate with the International Monetary Fund (IMF), whose bailout loan to Serbia required that the country improve its fiscal discipline. Most institutions complied with the adopted policy on modernizing public services and strengthening the rule of law, although the country’s judiciary remained a weak link in the overall reform process.
Serbia maintained its refusal to recognize the secession of Kosovo, even after it was declared legitimate by the International Court of Justice (ICJ). The Court’s ruling, however, led to a more cooperative stance regarding the need for dialogue with the former province, and Belgrade worked together with the EU on a resolution presented to the UN General Assembly that recognized the need to improve relations with Kosovo.
Frequently debated changes to Serbia’s constitution to allow decentralization of power, regionalization, or autonomy for certain areas remained blocked by perceived risks to the territorial integrity of the country, particularly after Kosovo’s declaration of independence. Efforts to reduce corruption were marked by an occasional success in the work of police and prosecutors, although systemic sources of corruption remain.
National Democratic Governance. Serbia’s centrist government stayed its pro- EU course in 2010, working on multiple fronts to bring the country closer to accession. The ruling coalition of diverse political parties managed to maintain its unity and repel demands for early elections by right-wing as well as leftist opposition parties, thus preserving the stability needed to lead the economy out of recession and implement IMF-mandated austerity measures. The government also worked on further reconciliation with former foes in the Balkan region, adopting a declaration that condemned the 1995 massacre in Srebrenica and also improving relations with neighboring Croatia. Legislative activity was strong in 2010, despite frequent challenges to already-adopted laws before the Constitutional Court. Serbia maintained its refusal to recognize Kosovo as a state, although it slightly softened the stance following an ICJ opinion and presented (with the EU) a resolution to the UN General Assembly agreeing to open dialogue with the former province. Despite a generally positive record in navigating numerous political and socioeconomic challenges in 2010, while largely staying on its declared course toward further democratization and EU-oriented reforms, Serbia’s national democratic governance rating remains at 3.75.
Electoral Process. Only local votes were held in Serbia in 2010; these featured the participation of national and locally focused parties that formed preelection and postelection coalitions independently of the coalition arrangement in Belgrade. Early in the year, the landscape for political parties changed with their reregistration. This reduced the number of parties from several hundred to 72. There was no meaningful progress toward increasing transparency in party financing in 2010, as the long-awaited new law on campaign funding was not adopted. The existing regulations enable some scrutiny over party financing by the country’s Anti- Corruption Agency, but its findings so far have not led to binding measures. Owing to the static electoral environment, Serbia’s electoral process rating remains unchanged at 3.25.
Civil Society. Serbia’s civic sector increased its visibility in 2010 by stepping up its work on consumer protection, restitution, and labor issues, in addition to the existing priorities concerning human rights, the environment, and minority rights. With an already well-developed network, the country’s civil society responded effectively to challenges that emerged in 2010, including the need to fight against trade monopolies and their connections with the political elite. Activists secured badly needed protection for LGBT participants in the Pride Parade in Belgrade against violent opponents, while trade unions more actively represented the interests of both the working population and pensioners against the government’s austerity measures. Nongovernmental organizations (NGOs) spearheaded demands that Serbia finally begin restitution of property confiscated during the Communist era. Owing to improvements in both the scope and intensity of civic engagement, which led to increased popular support for the sector, Serbia’s civil society rating improves from 2.50 to 2.25.
Independent Media. With Serbia’s media sphere in an advanced stage of privatization, continued diversification of the media industry in line with market trends offered consumers a wide range of information sources. The scope and accessibility of media formats slightly improved with the expansion of online options, while the market for traditional print and broadcast media did not change significantly, despite the financial impact of the economic downturn and diminished revenue from advertisers. Serbia’s controversial Law on Public Information remained in place, but without significant impact on media outlets. Owing to the stability of the media scene, in which independent outlets prevail over state-owned media, and despite some attacks on journalists, Serbia’s independent media rating remains at 4.00.
Local Democratic Governance. Decentralization of Serbia was effectively suspended in 2010 as government and society focused resources on overcoming the effects of the global economic crisis. A dramatic decline in domestic and foreign investments depleted central budgets, consequently suspending some transfers of tax money to the local level. Municipal assemblies retained the authority to impose, increase, decrease, or suspend local taxes and levies. Future decentralization in the country remains uncertain due to sharply divergent views in society, from outright rejection based on perceived risk to territorial integrity, to vocal demands for local autonomy. The governance prerogatives of the autonomous Vojvodina province did not change substantially from the previous year. The status quo regarding decentralization and lack of substantial change in the way local authorities handled local governance issues keep Serbia’s local democratic governance rating at 3.50.
Judicial Framework and Independence. Serbia’s judiciary remains a particularly weak component of democratic capacity and practice, lagging behind and impeding broader efforts to ensure rule of law in the country. A sweeping review of judges turned into a fiasco, only adding to the confusion and revealing the extent to which arbitrary decisions still dominate the justice system. Efforts to secure more judicial independence backfired as some of the key pillars showed a lack of capacity to fulfill the role. Additionally, backlogs of cases remained a problem in virtually every part of the court network, damaging the government’s efforts to present Serbia as a stable environment for investors. Shortcomings were evident even in the higher levels of the judiciary, such as the Constitutional Court. Serbia’s judicial framework and independence rating remains at 4.50.
Corruption. While systemic sources of corruption have yet to be addressed, Serbia’s progress in fighting graft in 2010 was evident in improved operational use of existing capacities, following adjustments in the legal framework that made this progress possible. Some of the newly-found resolve to combat corruption sprang from financial necessity; however, institutions showed a genuine commitment to tackling the issue, particularly after public pressure increased to sever links between big business and the political elite. The police and prosecutors conducted a series of high-profile operations targeting corruption in healthcare, education, and other fields. Owing to some achievements in reducing corruption, Serbia’s corruption rating improves from 4.50 to 4.25.
Outlook for 2011. Serbia’s 2011 priorities will undoubtedly be dominated by economic issues as the country struggles to restore the economy to its pre-crisis level, a precondition for most other reforms. The fiscal restrictions in place carry some risk of public unrest that could be exploited by the opposition ahead of the general elections expected in 2012, while the ruling coalition may also resort to short-term populist measures to improve its sagging popularity. The country’s general course toward EU integration is not likely to come into question since most opposition groups share the same goal, with some differences remaining over possible NATO membership and the pace of reforms. Efforts to reduce corruption may be enhanced in 2011 with further legislative reforms.
The Serbian government remained relatively stable during 2010, adhering—with few deviations—to its proclaimed priority of bringing the country closer to the European Union (EU). Authorities also kept economic issues at the top of their agenda as they sought to minimize the damage from the global economic crisis. The government coalition, which was formed in 2008 by political parties that originally had little in common, survived repeated attempts by the opposition to vote it out of office and trigger early elections. The government also succeeded in adopting more than 200 new laws in 2010 with its slim majority in the national assembly.
Legislative procedures, in most cases, continued to be extremely time-consuming, resulting in long delays even when adopting undisputed bills crucial for the attainment of goals such as foreign financial aid or the legislation of broadly accepted social and economic reforms. Debates in the parliament (or National Assembly), normally broadcast live on the state-run Radio-Televizija Srbije, were often marred by opposition filibustering; as a result, on several occasions the government resorted to the so-called urgent procedure to pass laws, sidestepping obstacles and delays at the expense of extensive debate.
The urgent procedure was applied, among other instances, to adopt the landmark declaration condemning the 1995 Srebrenica massacre in eastern Bosnia- Herzegovina, where up to 8,000 Muslim men and teenage boys were killed. The declaration was passed on the last day of March by a narrow margin, with 127 out of 250 deputies voting in favor. The document was proposed by members of the ruling Democratic Party and its allies but was criticized by nationalist groups that demanded equal condemnation of crimes against ethnic Serbs in Bosnia in the same conflict. Meanwhile, more pro-Western and liberal parties said the declaration did not go far enough and that the mass killing should have been referred to as genocide.
In February 2010, Serbia’s National Assembly adopted the Law on the National Assembly, introducing an independent budget and financial autonomy for the parliament, which had previously depended on allocations defined by the government. The law also introduced the practice of calling a parliamentary collegium—a “mini assembly” that may be convened for consultative purposes at short notice, bringing together the assembly’s speaker, deputy speakers, and chief lawmakers representing parties in parliament. The new law also streamlined the number of parliamentary committees from 30 to 19 in order to make them more efficient; however, this change will be applied only after the next general elections (due in 2012).
There was public controversy over the cost of live television broadcasting of parliamentary sessions, which amounted to €3.3 million between 1 January 2006 and 31 July 2010. While the financial dimension of the dispute between the assembly and the state-run broadcaster was defused within weeks, the argument again exposed divisions in Serbian society about having direct, democratic insight into the work of lawmakers. Serbian citizens—especially bloggers, journalists, officials, and politicians—engaged energetically on both sides of the debate; some argued that the broadcast was merely giving publicity-seeking politicians free air time and a platform to polemicize and slow the work of the legislature, while others defended the importance of being able to follow the work of the assembly. It was a reminder that while most democratic practices are now well-established in Serbia, there are still extremely divergent views over what level of transparency is expected from elected officials.
The contentious issue of Kosovo’s independence continued to distract some Serbian lawmakers from the business of consolidating and stabilizing democracy at home. In a blow to Belgrade, the International Court of Justice (ICJ) answered Serbia’s request for a ruling on the subject by stating in July that Kosovo’s declaration of independence in 2008 had not violated general international law. The Serbian parliament consequently adopted a decision reiterating Belgrade’s policy of nonrecognition of Kosovo, supporting the government’s initiative to see the issue referred to the UN General Assembly. This led to temporary deterioration of relations with the EU, whose 22 out of 27 member states have recognized Kosovo; however, the Serbian government and the EU jointly presented a resolution to the UN General Assembly, adopted on September 9, which acknowledged the content of the ICJ opinion and accepted the EU offer to facilitate dialogue between the two sides. The talks were postponed until after general elections in Kosovo, which were held in December 2010. The compromise to hold the talks on technical, non-status matters helped to maintain Serbia’s EU integration trajectory, which remains vital to further social and economic reforms in the country. This was reflected in the latest annual Progress Report on Serbia published by the European Commission in November 2010.
Serbia-EU relations flared up again when Belgrade decided to boycott the annual award ceremony for the Nobel Peace Prize, won by Chinese dissident Liu Xiaobo. The initial decision, made out of respect and loyalty to China, which has consistently backed Serbia’s position on Kosovo and other issues, triggered strong criticism from nongovernmental organizations (NGOs) as well as the EU. The controversy ended in yet another compromise—Serbian authorities decided to dispatch ombudsman Saša Jankovic instead of Serbia’s ambassador to Oslo to attend the ceremony. The outcome epitomized Belgrade’s inclination to halfway solutions.
Most other policy decisions of 2010 aligned with EU views, reflecting the prevailing mood among Serbian citizens on joining the bloc. According to a June- July survey by the Gallup-Balkan Monitor in partnership with the European Fund for the Balkans, 63 percent of Serbian citizens said they would vote in favor of their country joining the EU, even though just 41 percent of respondents believe the EU truly wants Serbia to become a member.
The government in 2010 made extensive efforts to comply with the provisions of Serbia’s €3 billion Stand-By Arrangement (SBA) with the International Monetary Fund that began in 2009 and is set to expire in April 2011. The loan served as a bailout vehicle for the country, which faced an acute liquidity crisis caused by the global economic crisis. The resulting measures to step up fiscal discipline, curb public expenditures, and limit the budget deficit according to IMF targets met with public resistance, but the authorities launched a wide campaign to explain the need for austerity measures. The cabinet, meanwhile, did not show consistent unity on all points of the IMF agreement, with discord on public sector wages and pensions. Quarterly revisions of Serbia’s compliance with IMF terms, conducted by visiting IMF officials, were concluded with positive results, despite some delays by the Serbian parliament in adopting additional legislation required by the multinational lender.
The central government also made progress in areas of Serbia’s international relations, adopting in February the National Strategy for Incorporation of Serbia into the Clean Development Mechanism under the Kyoto Protocol. Serbia also became a member of the European Patent Organization in October and ratified several international conventions, including the European Patent Convention. On December 15, Serbia’s parliament abolished mandatory military service for men, which had been in place in various forms since 1945; as of January 1, 2011, Serbia will maintain a professional, all-volunteer army.
Serbia’s coalition government dodged opposition demands for early general elections in 2010. Only a few local votes were held in the country during the year, and these were conducted without irregularities or contested results. Coalitions formed in advance of municipal elections in Bor differed significantly from allegiances seen on the national level, confirming that the balance of power in Belgrade does not necessarily determine the composition of local governments.
In January 2010, the process of reregistering political parties was completed under newly revised rules that increased the minimum number of signatures to register a party to 10,000. The threshold to form a group representing ethnic minorities was set at 1,000 signatures. This reduced the number of active political parties to 72, including 42 representing national minorities. Previously, there were nearly 600 different parties, groups, and organizations.
Despite widespread expectations, Serbia’s political elite failed to adopt an improved law on party financing. Several drafts were prepared, including some by NGOs, but a lack of consensus prevented adoption of the proposal submitted to parliament by Tomislav Nikolic, leader of the Serbian Progressive Party. The bill was in parliamentary procedure at year’s end, as were amendments envisaging strict control on party financing. One of the key provisions requires political party membership fees and contributions exceeding a monthly average salary (defined by the state Statistics Office) to be declared and posted on the websites of the parties and supervising state bodies. Minor violations would be punished by decreasing the amounts that registered political parties normally receive from the state as reimbursement of essential costs. In 2010, the state Anti-Corruption Agency reported eight political parties for failing to provide accounts of their expenditures and donations in local elections.
Another issue discussed intensely during the year was the widespread practice of so-called blank resignations, in which every politician elected to the national or a local assembly on a party ticket must deposit a written resignation with the party before taking the seat. The party may then activate the resignation and replace the member in case of disloyalty or outright defection. The concept of blank resignations has long been criticized by liberal groups for suppressing individual integrity, while most mainstream parties defend it as necessary.
The issue eventually reached the Constitutional Court, which specifically responded to conflicts over the mandates of the Serbian Radical Party. In April, the court made the landmark ruling that, in local elections, blank resignations and postballot allocation of seats by political parties are unconstitutional. However, the opportunity to bring clarity to the fundamental question for Serbia’s fledgling democracy on the national level was missed, as the court gave no clear guidance on blank resignations in general elections. The debate is likely to continue through the next general vote, scheduled for 2012. Additionally, Transparency International Serbia called for a resolution of discrepancies in the broad authority political parties enjoy in distributing mandates on both the local and national levels.
In 2010, nongovernmental organizations (NGOs) in Serbia actively engaged with society on human rights and minority issues, efforts to increase transparency in state institutions, environmental protection, trade union activism, education reform, and protection of property rights. Furthermore, the government gradually agreed to give more power to agencies formed by the National Assembly that operate independently from the executive branch and defend the rights of citizens, including the Commission for Protection of Competition, the Anti-Corruption Council, and the Office for Roma Inclusion. Also supporting and complementing civil society activities were the Commissioner for Information of Public Importance and Personal Data Protection, and the Commissioner for Protection of Equality.
Great attention was given during the year to consumer protection, which had been a nonissue in Serbia for decades. Thus a whole new front opened for civil society activists, with a strong response among citizens and broad grassroots support. Along with efforts to upgrade standards on product safety, the associations spearheaded demands to eliminate monopolies and curb the power of Serbian tycoons, who exert excessive influence on the economy and also on political parties through often undisclosed donations. The battle for consumer protection gained a whole new dimension in the country as the long-awaited Law on Consumer Protection finally came to the top of the parliamentary agenda. The law was adopted in October, introducing Western-style provisions that protect the rights of the consumer while also strengthening the role of Serbia’s Commission for Protection of Competition. The parliamentary debate prior to the vote coincided with a sudden milk shortage, prompting more action from consumer organizations; consequently, Serbia’s Agriculture Ministry took action against perceived dominance of the dairy chain Imlek, owned by Danube Foods Group, a unit of the London-based Salford Capital Partners Inc., which was investigated and accused of manipulating the market to artificially inflate the prices of its products. (The company denied the accusations.)
Consumer associations initially formed as small, local groups in cities and districts joined forces under national umbrella organizations, such as the Serbian Consumer Center (Centar Potrošaca Srbije), Serbian Consumer Association (Asocijacija Potrošaca Srbije), and Serbian National Organization of Consumers in Serbia (Nacionalna Organizacija Potrošaca Srbije), which cooperate with Consumers International and The European Consumers’ Organization. Their unity enabled further efforts to protect the rights of borrowers. The National Bank of Serbia worked on drafting additional provisions to regulate lending, which were met with much resistance from the banking sector.
The single most important event in 2010 concerning minority rights in Serbia was the Pride Parade in Belgrade on October 10. A previous gathering of the lesbian, gay, bisexual, and transgender (LGBT) community in 2001 ended in violent attacks against the participants, while a 2009 parade was canceled for security reasons. The 2010 parade received sufficient support from state bodies, notably from the Interior Ministry. Serbian riot police secured the perimeter of the venue in downtown Belgrade where roughly 1,000 people had gathered. Some 1,500 police officers managed to keep the several hundred opponents at a distance, repelling their attacks and using tear gas in violent clashes. More than 150 policemen and 20 attackers were injured, while parade participants remained protected. For the first time, the state took decisive steps to protect the minority against violent opponents, and many public figures spoke out in favor of tolerance and acceptance of the LGBT community. Furthermore, criminal charges were brought against those who led or took part in the attacks, a sign that the government is no longer a bystander in the social liberalization process beginning in Serbia, even after years of delay.
Right-wing extremists existed in Serbia before the 1990s but gained prominence during the violent land grab triggered by the breakup of Yugoslavia, particularly as state security agencies, successors to the Communist secret police, maintained links with criminals, soccer hooligans, and various illiberal groups. The ouster of President Slobodan Miloševic in 2000 did not immediately change this environment—many of those who served under him switched to the pro-democracy camp just in time to survive the regime change. This became a huge problem for Serbia’s reformist Prime Minister Zoran Djindjic, who sought to suppress these elements and was assassinated in 2003 by crime gangs and commandos who served under Miloševic. A massive police raid on the groups that followed Djindjic’s murder diminished their influence to some extent, but the process fizzled out after Djindjic’s Democrats were defeated in the ensuing elections.
The Democrats’ return to power in 2008 boosted Serbia’s progress toward greater social tolerance and more liberal values. Illiberal groups are now an undercurrent in society, sometimes gaining strength on divisive issues, such as Kosovo and Serbia’s territorial integrity, but losing public support when their actions are exposed as damaging and counterproductive to society as a whole. The street violence, looting of shops, and destruction of property that followed Kosovo’s declaration of independence in 2008 has galvanized institutions to take stronger measures against such groups; the 2010 Pride Parade was one case where the government felt compelled to take a strong stand. Initiatives were also renewed to ban some of the groups, though few are formally registered or have a legal identity that could be targeted by a ban.
NGOs spearheaded a campaign in 2010 for restitution in Serbia, a long overdue process to compensate the victims of communist-era property confiscation. The struggle gained momentum when the EU, after years of being relatively low-key on the topic, suddenly declared that restitution is essential before Serbia’s application for membership in the bloc may be considered. Brussels’s motivation for highlighting the issue may have come from EU businesses interested in investing in Serbia, where companies often face the problem of conflicting claims over land, real estate, mineral wealth, and so forth. The authorities made a brief effort in 2007 to compile more than 100,000 property claims, yet the drive to finally adopt a restitution law is currently led by nongovernmental activists.
Trade unions broadened the scope of their work in 2010 by representing not only workers but also pensioners in the country, as all were affected by the government’s austerity measures. In June, as part of its agreement with the International Monetary Fund (IMF), Serbia imposed a freeze on public sector wages and on pensions paid from the dominant state pension fund. A key condition of the IMF’s €3 billion bailout was a strict cap on Serbia’s budget deficit (4.8 percent of GDP in 2010); this suspended any adjustment for inflation in public sector wages and pensions, even as inflation accelerated in the second half of the year to more than 9 percent. Meetings between government officials and union leaders were largely unsuccessful, as the unions, like the government, had little choice but to follow the IMF guidelines. Approval and support from the multinational lender remained crucial for Serbia’s reputation among other lenders, particularly commercial banks from which the country continued to borrow.
Serbia made little progress in 2010 toward improving protection of personal data. The Commissioner for Information of Public Importance and Personal Data Protection, Rodoljub Šabic, filed complaints in November against fourteen cabinet ministers for failing to implement a 2008 law on protection of personal data. Although the parliament adopted the Strategy for the Protection of Personal Data in August—under which all registers containing personal data must be fully protected in order to safeguard the privacy of citizens—Serbia’s 15 ministries failed to implement the provisions. Šabic blamed weak results on central government inertia and lack of competence on an issue that it apparently regards as a non-priority.
On December 14, 2010, the European Court of Human Rights made a landmark ruling on the protection of small, nontraditional religious communities. In the case of Života Milanovic vs. Serbia, the court stated that the authorities had failed to properly investigate acts of violence against Milanovic and other members of the local Hare Krishna group. The Court recommended that €10,000 (US$14,500) be paid in compensation to the plaintiff. As in the case of violence against the Pride Parade in Belgrade, the ultranationalist, far-right organization Obraz was named responsible for the death threats and physical attacks against Milanovic and other Hare Krishna followers in Serbia.
Electronic media were broadly available in Serbia in 2010, with six national television networks, five national radio broadcasters, and more than a hundred regional and local electronic outlets, licensed by Serbia’s Broadcasting Agency. Additionally, the demands of the market drove the continued expansion of cable providers, along with a range of foreign programs. Print media were also freely sold, and broadband internet was available nationwide, without restrictions on domains or websites. Serbia’s internet penetration steadily increased, with 55.9 percent of the population having access in 2010 compared to 14.3 percent only four years earlier.
The increasing use of the internet also helped to further diversify the ways Serbian citizens receive information, with most media encouraging citizen journalism and soliciting contributions from readers/viewers/listeners in various formats (text, visuals). However, a troubling law was passed in 2010 that may affect mobile and online communication. The Electronic Communications Law permits authorities to maintain a database on citizens’ electronic communications, and allows security and police forces to access the database without prior permission. Media groups expressed concern that this law could negatively affect investigative journalists, particularly regarding the protection of sources.
Now in an advanced stage of privatization, Serbia’s media sphere was able to sustain an overall plurality of information in 2010, though not always within individual outlets. Remaining bias in general news coverage by local and national outlets reflects either the preferences of founders/shareholders or the outlet’s financial dependence on advertisers. There are no binding regulations in Serbia that would limit the influence of advertisers on the editorial policies of the media in which they advertise.
The controversial Law on Public Information, adopted in August 2009, remained in place, despite a July 2010 ruling by the Constitutional Court (on motions filed by the State Ombudsman and other organizations) that some of its provisions violate the Constitution. Among these are restrictions on the right of domestic legal entities to establish public outlets, and heavy fines for perceived breach of privacy or defamatory comments.
The original intention of the law was to increase media’s responsibility for information they publish, after a rash of unsubstantiated claims appeared in Belgrade-based tabloids. The EC Progress Report released in November 2010 said that “implementation of the law on public information and its amendments has continued, producing some positive effects such as greater responsibility for distribution companies, founders of media outlets and editors-in-chief as well as increased accountability for breaking the presumption of innocence and violating the rights of minors.” The report, however, also noted that some “provisions of the law include excessive fines for the violation of professional standards and for non-registration of media outlets,” which the Serbian Constitutional Court had effectively outlawed.
Lawmakers initially envisaged fines of up to RSD20,000,000 (US$290,000) for libel but then halved that amount before the 2009 law was adopted. Still, the two largest journalist associations in Serbia, Udruženje Novinara Srbije (UNS) and Nezavisno Udruženje Novinara Srbije (NUNS), maintained that the provisions could lead to self-censorship. The law leaves room for liberal interpretation of libel and also exposes outlets to the risk of being sued for carrying statements by third parties. The provisions regarding penalties were rarely applied in practice in 2010, although the potential threat remains until the National Assembly reconciles the legislation with the court ruling.
The Serbian judiciary took a number of decisions in favor of journalists in 2010. In Niš, the High Court ruled in favor of two journalists from the daily newspaper Narodne Novina, appealing a previous defamation ruling. Journalist Dragana Kocic and editor in chief Timošenko Milosavljevic had been fined for defamation after publishing quotes from official documents. In August, the Belgrade Court of Appeals confirmed a 16-month prison sentence against Miloš Radisavljevic for death threats against Serbia’s leading investigative journalist, Brankica Stankovic, marking the first time prosecutors used a 2009 law that makes “endangering the safety of a journalist” a crime. The threats were made after B92 Television broadcast Stankovic’s documentary on the links between organized crime and violent soccer fans, and after the initial criminal charges were overturned by a lower-level district court. (Stankovic was given police protection.) An appellate court also confirmed a 15-month prison sentence in September for Stefanu Hadži Antic for threatening Stankovic on Facebook.
Despite these judicial improvements, physical attacks on journalists continued in 2010. One particularly high-profile case involved Vreme weekly columnist Teofil Pancic, who was severely beaten by two extremists. The perpetrators were arrested and sentenced to three months in prison. The verdict came as a disappointment for the public and for journalist associations, who demanded longer prison terms for the attackers. Prosecutors appealed the verdict, demanding harsher punishment. Other cases involving political pressure and physical assaults on journalists were reported during the year, largely outside of the capital. In February, the Minister of Infrastructure, Milutin Mrkonjic, slapped and verbally abused Milan Ladjevic from Kurir, later saying he “only gently stroked the head” of the journalist. In October, Blic journalist Gvozden Zdravic was hospitalized for head injuries, following a physical assault by the driver of the mayor of Aleksandrovac. Zdravic had been photographing the town courthouse.
Political pressure on media was also felt in 2010. In Zajecar, the mayor sought to prevent all directors of public institutions from speaking to the media without his prior consent. The town of Pirot withdrew financial support from a local weekly, Pirotske Novine, following critical reporting. Finally, the mayor’s office of Novi Pazar sought to influence editorial policy at the local TV Jedinstvo through the termination of a contract.26]
Decentralization of power to Serbia’s districts and municipalities made little progress in 2010, as the economic crisis changed the nation’s priorities. A dramatic decline in domestic and foreign investments depleted central and local budgets, consequently suspending some of the planned reforms. The €3 billion Stand-By Arrangement between the government in Belgrade and the International Monetary Fund (IMF) entailed strict limits on budget deficits. After IMF officials and Serbian leaders agreed that Serbia’s deficit must not exceed 4.8 percent of GDP in 2010, the question arose whether this would apply only to the central budget or also to the local levels. IMF officials initially did not want to reduce the financial freedom of the local authorities, but when it became apparent that any exemption could derail the success of broader budget cap efforts, the limit was applied to all levels. New rules did not affect the preexisting freedom of municipalities to impose and adjust levies on locally registered businesses, which constitute significant revenue. Some local authorities drew strong criticism from the business community for excessively taxing local businesses, while others showed great flexibility toward investors, offering free land for industrial development and generous tax breaks of up to five years for greenfield investments.
One of the biggest promoters of foreign investment in Serbia, Economy Minister Mladjan Dinkic, made it his official political platform in 2010 that Serbia should be administratively divided into seven regions, and his United Regions of Serbia (URS) campaign advocated an overhaul of the administrative system. The URS won the most votes in early local elections held in the eastern city of Bor in June 2010, although it is uncertain how the group will fare in the 2012 general elections.
Serbia’s only autonomous province, Vojvodina, received defined competencies in late 2009 with a special statute, which came into force in January 2010. However, the country still needs legislation on public property to allow Vojvodina to fully exercise its competencies. Once adopted, the law will determine which assets are exclusively owned by the northern province. Serbia’s current regulation on public property is a 1995 law under which most assets are controlled by the central government. Relations between the more than a dozen different ethnic and religious communities in Vojvodina remained stable in 2010, with only marginal incidents.
In the southern area of Serbia known as Sandžak, which covers several municipalities but lacks a regional administration, tensions increased during the year due to the continuing rivalry between local leaders representing the 420,000-strong community of ethnic Muslims, or Bosniaks. After a decade of relative stability marked by simmering tensions between Rasim Ljajic of the Sandžak Democratic Party and Sulejman Ugljanin of the Party of Democratic Action of Sandžak, a third and more radical leader, Muamer Zukorlic, emerged in an underdeveloped part of Sandžak. Originally a protégé of Ugljanin, Zukorlic gained prominence after Ugljanin joined the central government along with Ljajic, who had been a cabinet minister in Belgrade for almost a decade.
Unlike Ljajic and Ugljanin, Zukorlic has a religious background and serves as the chief mufti of the Islamic Community in Serbia. Now seeking to become the top representative of the entire Sandžak community, Zukorlic has found a support base mostly among the disenchanted youth in Sandžak, where unemployment exceeds 40 percent. Tensions escalated in Sandžak in June after the first direct elections for the National Minority Councils were held across Serbia. The councils are supposed to improve representation of all ethnic minorities in the country and provide guidance on matters concerning minority languages, education, media, and culture.
The councils were successfully formed for more than a dozen other minority groups, but a controversy developed for the Sandžak Council, as Zukorlic’s de facto political group, Bošnjacka Kulturna Zajednica (“Bosniak Cultural Community”), won 17 out of 35 seats. The remainder of 18 seats went to Ugljanin and Ljajic loyalists, with 13 and 5 seats respectively.
The vote itself was assessed by the Organization for Security and Cooperation in Europe (OSCE) as meeting international standards, but no single faction won the majority needed to constitute the council. Later, two representatives from Ljajic’s ticket switched to Zukorlic’s camp, but Serbia’s Ministry for Human and Minority Rights then decided that a two-thirds majority was needed to form the council. This triggered bitter protests from Zukorlic and his followers, who claimed discrimination and demanded a revote with foreign monitors. Zukorlic also urged local residents to show civil disobedience and demanded autonomy for Sandžak. On September 4, Zukorlic’s supporters and police clashed at a protest rally organized by the Islamic Community over claims that the municipal administration in Novi Pazar, the main Sandžak city, had illegally stripped the community of a piece of land. Four police officers were injured in ensuing riots.
Zukorlic’s calls for Sandžak autonomy drew condemnation not only from Serbs but also within the Muslim community. The French ambassador to Belgrade, François Terral, stated, “some people think that after Kosovo, the next open question with Serbia will be Sandžak. Well, it won’t happen, and this is not only the position of France but also of other EU member states. We see the situation in Sandžak as a local question.” The government in Belgrade has sought to stay publicly neutral in what it regards as an intra-community feud.
Unlike in 2009, the three municipalities in southern Serbia with a sizable ethnic Albanian community remained relatively calm and succeeded in forming their National Minority Council following direct elections. The council, however, is not yet functional since rival ethnic Albanian political parties have yet to agree on the distribution of seats. The European Commission in its annual Progress Report on Serbia described the situation in the area, also known as the Preševo Valley (Preševo, Medvedja, and Bujanovac municipalities), as “stable but tense.”
Attempts to improve Serbia’s judiciary in 2010 only revealed the extent to which some of the institutions in charge of the reform are themselves in need of revision.
Just a few months after its establishment in mid-2009, Serbia’s High Judicial Council declared its decision to appoint 1,532 permanent judges to higher courts, including the Supreme Court of Cassation and the Court of Appeal in Belgrade. The council, which consists of three ex-officio members and another six appointed by parliament, also proposed 876 first-time judges, citing the need to increase the independence of the judiciary. As appointments were made in 2010, these sweeping changes triggered criticism and complaints by more than 800 judges who were not reappointed. The appointment of prosecutors also came under scrutiny due to allegations that some had been allowed to keep their jobs despite substandard performance and questionable handling of cases in the turbulent 1990s.
Meanwhile, the parliament approved the establishment of a new network of 34 lower-level courts, down from 138 previously, and 26 higher courts, along with 4 courts of appeal and specialized courts for matters pertaining to trade, commerce, and so forth. The prosecution service was divided into basic, higher, and appellate prosecution offices. Other institutions in the system include the Special Department for War Crimes and Organized Crime (with nearly 20 domestic cases of war crimes against 103 individuals at year’s end) and the Judicial Academy for training and continued development of judges, prosecutors, and judicial staff.
Such reforms failed to address some of the most urgent issues concerning the efficiency of Serbia’s judiciary, including a chronic backlog of cases, and endless back-and-forth between district and appellate courts. Noting these issues, the European Commission has singled out the judiciary as one of Serbia’s weakest points, likely to require special attention before the country could be considered for EU membership. In its latest progress report, the Commission stated that the “reappointment procedure for judges and prosecutors was carried out in a nontransparent way, putting at risk the principle of the independence of the judiciary,” and that “the bodies responsible for this exercise, the High Judicial Council and the State Prosecutorial Council, acted in a transitory composition, which neglected adequate representation of the profession and created a high risk of political influence.” This criticism corroborated complaints often heard from the corporate sector about the inefficiency of the courts. Foreign investors were often discouraged from venturing into Serbia due to the lack of legal protection in business-related disputes.
In November 2010, Justice Minister Snežana Malovic, along with members of the High Judicial Council, held a series of meetings with judges who had not been reappointed. She conceded that further efforts were needed to establish firm criteria that could be consistently applied in selecting judges in the future. The reappointment decisions, however, were not reversed, only deferred to the Constitutional Court, which is handling hundreds of complaints filed by the dismissed judges. So far, it has only ruled in the case of judge Zoran Saveljic, overturning the initial decision on procedural grounds. The Court’s president, Bosa Nenadic, tried to justify this slow record by saying that the Saveljic case required special attention and should serve as the precedent for related cases. The controversy escalated further when the NGO National Association of Judges (Društvo Sudija Srbije) publicly questioned the accuracy of court records and statistics used to assess the efficiency and professionalism of judges in the reappointment process. On December 23, Nenadic announced she would not seek a new mandate as the president of the Court, citing conditions that prevent her from achieving the expected results.
The Constitutional Court was also widely criticized for its backlog of nearly 7,000 cases. In her interview to the Belgrade daily Blic in June, Nenadic called for yet another, fundamental reform that would narrow the scope and number of cases that come before the Constitutional Court. Currently, nearly every new bill adopted by parliament is challenged by various interest groups before the Constitutional Court. Nenadic acknowledged that the court is a bottleneck in the judicial system (up until September 2010, the Court had only 13 judges appointed to its 15-member panel), and she argued that the Constitutional Court instead should deal only with issues strictly pertaining to the constitution, serving as a last resort before an individual or organization turns to the European Court of Human Rights in Strasbourg.
Serbia made visible progress in efforts to reduce corruption in its institutions and in society in general in 2010. A primary motivation for the effort was the impact of the economic crisis on state revenue and budgets, which added urgency to the need to reduce waste in public procurement tenders that often involve inflated prices for goods and services.
Highlighting this issue, the chief of the European Union Delegation in Belgrade, Vincent Deger, remarked in December that procurements for several years have averaged €4 billion annually (15 percent of the country’s 2010 GDP), making the field extremely fertile for corruption. Deger warned the authorities that the issue would be given particular attention as Serbia strives to join the EU. The director of Serbia’s Public Procurement Office, Predrag Jovanovic, acknowledged that 20 to 25 percent could be saved if those overseeing procurement tenders would tighten controls. In October 2010, Serbian authorities appointed members of the Commission for Protection of Bidders’ Rights, which is tasked with reviewing complaints of irregularities in procurement tenders and report directly tothe parliament.
Another corruption-related concern in 2010 was the issue of multiple posts held by public officials, which often result in conflicts of interest. When restrictions were defined by the Serbia’s new Anti-Corruption Agency regarding which posts could be held by the same person at the same time, there was some confusion as to whether the ban would apply to preexisting arrangements. Some of the provisions were challenged before the Constitutional Court, which threw them out in April. The agency then filed a complaint to the court, focusing on about 100 cases that clearly involved serious conflicts of interest—for example, the case of a local assembly head who also ran a private company managed by a member of the board for public services in the same municipality. Anti-Corruption Agency Director Zorana Markovic urged citizens to report conflicts of interest and received more than 300 substantiated reports, mostly concerning the judiciary, education system, and property development. The agency also worked on expanding its register of private assets held by public officials, with declarations from around 16,000 officials posted on its website.
In December, the Anti-Corruption Agency sent a public letter to Prime Minister Mirko Cvetkovic demanding stronger measures against monopolies on the Serbian market, following a wave of price increases that pushed Serbia’s inflation rate to more than 9 percent. The open letter followed remarks by the country’s central bank governor, who said that increases in food prices were the main source of inflation. The agency warned that oligarchs maintain their monopolies through donations to political parties that allow them to manipulate the market.
According to the 2010 Gallup-Balkan Monitor survey, 67.4 percent of people in Serbia believed that political parties are involved in corruption to some degree, while 17 percent of respondents admitted to bribing a civil servant (down from 19 percent in 2009). Bribes were most common in healthcare, education, police, customs, tax authorities, and for vehicle registration, according to the survey. Of those who admitted paying bribes, about a third said they paid for services that they were normally entitled to, whereas others paid bribes in order to overcome legal obstacles.
During 2010, there was one notable individual initiative by a government official to promote transparency. Economy Minister Mladjan Dinkic announced in November, as he was relocating his home from one Belgrade apartment to a larger, more expensive one, that he would reveal the cost of the new residence as well as his sources of personal income. He urged other officials to follow suit.
Serbia also strengthened its State Audit Institution (Državna Revizorska Institucija, or DRI) in 2010 when it allowed better remuneration for the staff in order to recruit better-qualified experts. The changes helped jumpstart the work of the DRI, which in December published a 1,300-page report on budget spending and expenses of Serbian ministries in 2009. It reported hundreds of irregularities, from sloppy bookkeeping to outright violations of agreed budget spending. The report revealed that Serbia still lacks a comprehensive register of state assets, including various property and stakes in companies. The DRI also censured several ministries for excessive spending on business trips and misuse of funds, including the Agriculture Ministry, which overspent when purchasing software from Hewlett- Packard; the finding coincided with revelations from the United States that the company was under investigation for possibly paying bribes to gain various contracts overseas, including in Serbia. While Serbia has yet to deal with the deficiencies listed by the DRI, the report was the first thorough, professional review of its kind in the country.
Authorities in 2010 undertook dozens of high-profile operations against corruption in the judiciary, healthcare, police, and licensing bodies. One of the most notable operations involved the roundup of a group of oncologists who allegedly received bribes from pharmaceutical companies (including Merck and Roche) to give preferential status to their drug products. The doctors remain in custody and face long prison terms. In another case involving the state-run railway company Železnice, former general manager Milanko Šarancic was indicted for embezzlement.
The Serbian authorities showed an increased capacity for sting operations during the year. Further developing this practice, which is relatively new in Serbia, may prove crucial in the fight against corruption in the future. Serbia also needs to improve protections for whistleblowers, another innovation in local practice, as noted by the European Commission in its annual progress report.
 Nenad Popovic, “Decentralizacija ili preambula” [Decentralization or preamble], Blic Online, 21 December 2010, http://www.blic.rs/Vesti/Tema-Dana/224832/Decentralizacija-ili-preambula (in Serbian).
 European Commission, Serbia 2010 Progress Report, accompanying the Communication from the Commission to the European Parliament and the Council, Enlargement Strategy and Main Challenges 2010-2011 (Brussels: European Commission, 9 November 2010), http://ec.europa.eu/enlargement/pdf/key_documents/2010/package/sr_rappor....
 National Assembly of the Republic of Serbia, “Third Sitting of the First Regular Session of
the National Assembly of the Republic of Serbia in 2010,” 30 March 2010, http://www.
 Bojana Barlovac and Sabina Niksic, “Adoption of Srebrenica Declaration Draws Mixed Reactions,” Balkan Insight, 31 March 2010, http://www.balkaninsight.com/en/article/adoption-of-srebrenica-declratio....
 Serbian National Assembly website. http://www.parlament.gov.rs/content/lat/akta/akta_detalji.asp?Id=789&t=Z (in Serbian).
 National Assembly of the Republic of Serbia, “NARS Speaker Receives RTS Director,” 4 October 2010, http://www.parlament.gov.rs/content/eng/aktivnosti/skupstinske_detalji.a....
 T. Spaic, “Vlast sprovodi zakone samo uz ucene iz Brisela” [Authorities enforce laws to blackmail from Brussels],” Blic Online, 2 November 2010, http://www.blic.rs/Vesti/Politika/214816/Vlast-sprovodi-zakone-samo-uz-u... (in Serbian).
 Gallup and The European Fund for the Balkans, Gallup Balkan Monitor: 2010 Summary of Findings (Brussels: Gallup Europe, 2010): 16, http://www.balkan-monitor.eu/files/BalkanMonitor-2010_Summary_of_Finding....
 Savet za Borbu Protiv Korupcije (The Anti-Corruption Council), “Law on Financing of Political parties,” n.d., http://www.antikorupcija-savet.gov.rs/zakoni/Zakon_o_finansiranju.pdf (in Serbian).
 Fund for an Open Society Serbia, Finansiranje politickih partija: Izme%u norme I prakse [Financing Political Parties: Between Norm and Practice] (Belgrade: Open Society Serbia, April 2008), http://www.cesid.bgdream.com/images/Finansiranje%20politickih%20partija.pdf (in Serbian).
 Transparency International Serbia, “Canceling of indirect nature of election system and blank resignations on every level,” press release, 22 April 2010, http://www.transparentnost.org.rs/index.php?option=com_content&view=arti....
 “Ministarstvo poljoprivrede: Treci zahtev da se utvrdi monopol ‘Imleka’” [Ministry of Agriculture: third request to establish ‘Imlek’ monopoly], Press Online, 13 August 2010, http://www.pressonline.rs/sr/vesti/u_fokusu/story/129210/Ministarstvo+po... (in Serbian).
 Website for the Commissioner for Information of Public Importance and Personal Data Protection: http://www.poverenik.rs/index.php/en/public-announcement.html.
 “Electronic Communications Law,” Official Gazette no. 45/10, 30 June 2010. Available from the Association of Independent Electronic Media website, http://www.anem.rs/en/propisi/laws.html. See also “Concern over electronic communications law,” B-92, 8 July 2010, http://www.b92.net/eng/news/politics-article.php?yyyy=2010&mm=07&dd=08&n....
 European Commission, Serbia 2010 Progress Report, 48.
 International Press Institute and IFEX, “Seemingly positive media developments a step in the right direction, says IPI,” news release, 9 August 2010, http://www.ifex.org/serbia/2010/08/09/positive_developments/.
 Committee to Protect Journalists, “Serbia,” in Attacks on the Press 2010 (New York: CPJ, 15 February 2011), http://www.cpj.org/2011/02/attacks-on-the-press-2010-serbia.php.
 IFEX, “Serbian minister for infrastructure assaults ‘Kurir’ journalist,” IFEX Alert, 4 February 2010, http://www.ifex.org/serbia/2010/02/04/ladjevic_attacked/.
 IFEX, “‘Blic’ newspaper correspondent physically assaulted,” IFEX Alert, 7 October 2010, http://www.ifex.org/serbia/2010/10/07/zdravic_assaulted/.
 IPI/IFEX, “IPI alarmed at limitation on freedom of information imposed by mayor of Zajecar,” IFEX Alert, 11 August 2010, http://www.ifex.org/serbia/2010/08/11/mayor_communications_restrictions/.
 25 IFEX, “City of Pirot withdraws financial support for Serbian weekly “Pirotske Novine” after critical reporting,” IFEX Alert, 18 February 2010, http://www.ifex.org/serbia/2010/02/18/pirotske_novine_finances/.
 IFEX, “Novi Pazar mayor’s office interfering with TV Station’s editorial stance,” IFEX Alert, 23 April 2010, http://www.ifex.org/serbia/2010/04/23/tv_jedinstvo_harassed/.
 Biljana Blanuša, “Fiat Nastavlja da Ulaže u Kragujevac” [Fiat continues to invest in Kragujevac], Radio Srbija, 2 November 2010, http://glassrbije.org/index.php?option=com_content&task=view&id=73347&It... (in Serbian).
 Justin Vela, “Serbia’s Sandžak at odds with Belgrade,” Transconflict.com, 7 December 2010, http://www.transconflict.com/2010/12/serbia-sandzak-at-odds-with-belgrad....
 European Commission, Serbia 2010 Progress Report, 10.
 Ema Radosavljevic, “Nenadic: Proces ne kasni zbog nas” [Nenadic: the process isn’t delayed, for us], Th"#"$%" &'(')*+ (Evening News) (Belgrade), 17 December 2010, http://www.novosti.rs/vesti/naslovna/aktuelno.69.html:311806-Nenadic-Pro....
 31 “Nenadic: Neophodna promena Zakona o Ustavnom sudu” [Nenadic: Necessary changes of the Constitutional Court], Blic Online, 18 June 2010, http://www.blic.rs/Vesti/Drustvo/194486/Nenadic-Neophodna-promena-Zakona....
 “Dežer: Vrlo raširena korupcija u javnim nabavkama” [Dežer: Very widespread corruption in public procurement], Radio-Televizija Vojvodine, 14 December 2010, http://www.rtv.rs/sr_lat/politika/dezer:-vrlo-rasirena-korupcija-u-javni....
 Gallup and The European Fund for the Balkans, Gallup Balkan Monitor, 2010.
 A first round of arrests in the medical industry was made in July 2010, and a second in November 2010. See “5 Doctors Arrested in Corruption Case,” B-92, 4 November 2010, http://www.b92.net/eng/news/crimes-article.php?yyyy=2010&mm=11&dd=04&nav... and Bojana Barlovac, “Serbia: Six Arrested in Pharmaceutical Scandals,” Balkan Insight, 1 July 2010, http://www.balkaninsight.com/en/article/serbia-six-arrested-in-pharmaceu....