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Key Economic Data
  2003 2002 2001 Ranking(2003)
Millions of US $
GNI per capita
 US $ 106
Ranking is given out of 208 nations - (data from the World Bank)

Update No: 115 - (22/12/06)

Serbia is facing a profound test in the New Year, whether it is becoming truly democratic or not. There are hopeful signs that it is - but with an abundance of problems as always. 

Electoral impasse likely
Weeks before parliamentary elections in Serbia, set for January 21st, only three parties are sure to pass the five per cent threshold and the polls are likely to produce political deadlock which would make it difficult for any party to form a government. According to the latest survey, commissioned by the US-based International Republican Institute, the ultranationalist Serbian Radical Party (SRS), currently the biggest single group in parliament, was expected to come out on top again, with 32 per cent of votes, with a possible stretch to 37 per cent.

President Boris Tadic's Democratic Party (DS) is second with 23.7 per cent, followed by Prime Minister Vojislav Kostunica's Democratic Party of Serbia (DSS) with 16.5 per cent.

According to the survey, the Democratic Party could at best get 28 per cent and Kostunica and his coalition with two minor parties 22 per cent, which would give them a narrow margin to form a government. But the problem is that Kostunica is already running as a candidate for prime minister and is conditioning participation in any coalition with retaining the post. The democrats, on the other hand, insist that prime minister should be nominated by the party which gets more votes.

Dragoljub Zarkovic, commentator for the influential daily Politika, said it might take months of political wrangling before the new governing coalition was formed. 

Tadic's democrats and DSS are arch-rivals in the so-called "democratic bloc" and there are strong animosities towards each other in both parties' ranks. The Radicals, whose leader Vojislav Seselj is standing trial before the Hague-based International Criminal Tribunal for Former Yugoslavia (ICTY) has been for years the strongest single party, but are unlikely to come to power because no parties of the "democratic bloc" want to enter a coalition with them.

Apart from the three leading parties, everything else is up in the air and a real battle is being fought at the bottom of electoral list for the five per cent census. The best chance is given to former president Slobodan Milosevic's Socialist Party of Serbia which currently stands at 4.97 per cent in the survey. Milosevic was also indicted for war crimes by the ICTY and died in his jail cell last March. The party elected new leader Ivica Dacic last month and is likely to pass the threshold, if it avoids a split in the internal power struggle following Dacic's election, analysts said.

The other two parties close to passing the census are the G-17 Plus, led by Mladjan Dinkic, who was a finance minister in Kostunica's government until he resigned in October, and former vice-premier Cedomir Jovanovic Liberal Democratic Party (LDP), with 4.7 and 4.5 per cent in the survey respectively. But analysts say neither party is sure to pass the threshold, because they have already taken all they could from the "democratic bloc".

The thinning out of the smaller parties 
The expected election results would obliterate from the political scene a host of small parties that formed the first democratic government after toppling Milosevic from power in October 2000. Most notably, the Serbian Renewal Movement of foreign minister Vuk Draskovic, standing in the survey at three per cent, has already been written off by political analysts.

The main battle will be fought in the coming weeks between G-17 Plus and LDP, who more or less appeal to the same electorate, predominantly young and business oriented people. Jovanovic and his coalition of small parties are openly advocating independence for southern Kosovo province, demanded by majority ethnic Albanians. The idea is a blasphemy for all other parties and Serbian public in general and it remains to be seen how it would ultimately affect LDP chances.

"Those who fail to pass the five per cent census this time, will forever disappear from the political scene and will be absorbed by other parties," Zarkovic concluded.

Balkan nations sign expanded free trade 
There is a very positive project that Serbia can offer the Balkans unfolding right now, a prop to the nationalist Kostunica's electoral appeal, that subtly transcends nationalism. Balkan leaders signed an expanded free trade agreement on December 19th that aims to help nations hoping to join the European Union reform their economies.

The pact, which currently groups Romania, Bulgaria, Croatia and Macedonia and is known as the Central European Free Trade Agreement, or CEFTA, will be expanded to include Albania, Bosnia, Moldova, Serbia, Montenegro and Serbia's U.N. administered province of Kosovo.

The EU has urged southeast European countries to sign the deal as a way of boosting business, increasing exports and attracting foreign investment.

After signing the agreement at a meeting in Bucharest, EU Expansion Commissioner Ollie Rehn described the pact as a "very nice Christmas present" and said it demonstrated Balkan countries' cooperation with the EU.

Serbian Prime Minister Vojislav Kostunica said it showed Serbia was a step closer to EU membership. The deal would also "help harmonize trade, make it more transparent," he said. He hoped the agreement would spur Serbia's economic growth, estimated at over six percent this year.

CEFTA was set up in the early 1990s by Poland, Hungary, Slovenia, Slovakia and the Czech Republic as they prepared for EU membership, as a tool to liberalize trade and promote economic reform ahead of EU membership. The five left the pact in 2004 after they became EU members, and Romania and Bulgaria will also leave CEFTA when they join the EU in January.

The new agreement is expected to become effective by May 2007 after ratification by member states.

Serbia, Russia condemn Iran for Holocaust denial conference
Serbia and Russia on November 13th joined international calls condemning a gathering of Holocaust deniers hosted and sponsored by the Iranian government in Tehran.

Serbia called the conference a "damaging and pseudo-scientific" event.

The Balkan country's Foreign Ministry said in a statement that the two-day conference that began Tuesday in Tehran is an "attempt to deny undeniable facts about the tragedy of the Jewish people during World War II."

Participants at the gathering, supported by Iran's President Mahmoud 
Ahmadinejad, have questioned the Holocaust's death toll of 6 million or if it took place at all.

Serbia's government considers the gathering a "damaging and pseudo-scientific manifestation that cannot contribute to dialogue between cultures and religions," it said.

During the Nazi occupation of Serbia and other parts of the then Yugoslav Kingdom, tens of thousands of Jews died. Less than half of Serbia's 30,000-strong Jewish community before World War II survived the Holocaust. Many later moved to Israel or to the West. 

Meanwhile, Russia's Foreign Ministry on Wednesday criticized Iran for hosting a conference of Holocaust deniers, saying Moscow opposed "the concealment of the truth about the monstrous crimes of the Nazis."

In a statement posted on the ministry's Web site, spokesman Mikhail Kamynin said Russia had condemned Tehran and President Mahmoud Ahmadinejad in the past for threatening Israel and denying the systematic killing of 6 million Jews by the Nazis during World War II.

Russia opposes "the distortion of historic events, the concealment of the truth about the monstrous crimes of the Nazis, and revision of results of humanity's most difficult struggle against Nazism," he said. "Russia shares the determination of the UN general assembly not to allow the denial of the Holocaust. "Russia has itself had a troubled history with anti-Semitism. Some scholars estimate that as many as 2 million Jews from the Soviet Union died in the Holocaust following the Nazi invasion of the country in World War II. Russian Jewish leaders also condemned the conference. Authorities "should unambiguously state their rejection of such issues," Borukh Gorin of the Federation of Jewish Communities in Russia, was quoted by Interfax as saying. He also asked whether "an Iran headed by a maniac with an atomic bomb is advantageous or safe?" The two-day conference in Iran sparked widespread and angry condemnation in Israel and across Europe, where many countries have made it a crime to publicly deny that the Holocaust happened. 


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