Home
Insights
Serbian Elections
Edition

Serbian Elections

February 2024

Executive Summary

  • Election and Political Landscape: Serbia's December 2023 elections have further engrained the authoritarian grip on power by Aleksandar Vučić and his Serbian Progressive Party (SNS), which poses risks for businesses operating in Serbia, such as operational continuity concerns.
  • Russian Disinformation and Control: Russia’s control over the media in Serbia has fostered a negative view of the West. This growing negative sentiment heightens the risk of Western firms being exposed to legal and reputational risks in Serbia.
  • Business Environment Risks: Serbia's EU integration process, initiated in 2009, faces obstacles due to ongoing tensions with Kosovo, democratic backsliding, and corruption. A further rift has been caused by the expansion of Russia’s influence operations in the region, which could expose businesses to new risks and economic uncertainty. Sanctions, legal inconsistency, weak currency, and political favouritism all constitute risks that businesses must learn to navigate when operating in the Western Balkan region.

The contested nature of Serbia's presidential election underscores the country's heightened levels of corruption and democratic backsliding.

In December 2023, Serbia elected the national representatives and the representatives in Belgrade. Controversy and mass protests have since followed the apparent victory of incumbent President Aleksandar Vučić, who only a month prior had resigned as the leader of his political party, the Serbian Progressive Party (SNS). The SNS is characterised as autocratic, populist, and right-wing and both the party and Vučić have historically been linked with the Kremlin. Significant Russian influence and democratic backsliding have been observed inside the former Yugoslavian nation-state, hindering the country’s ambitions of EU membership.

Mass Protests

Since the publication of results, there have been mass protests throughout the country with tens of thousands participating in the call for a re-vote. The Organisation for Security and Co-operation in Europe (OSCE), which serves as an independent observer in democracies that make up its members, reported the elections as ‘unsatisfying’. While these protests have largely been peaceful in nature, the availability of illegal arms in Serbia has heightened concern that these incidents of unrest will turn violent. Over 2.69 million guns are believed to be in Serbia despite its population size of 6.7 million and strict gun restrictions. While the presence of guns poses a limited risk to businesses at present, there will remain a latent risk of a firm’s employees or storefronts in areas known for domestic unrest being indirectly impacted by the protests. Such incidents could result in damage to a company’s assets and/or reputation.

Business continuity is negatively impacted by the logistical complexity of having large-scale protests in the most vital cities throughout the country. Additionally, differing political views can be a cause of friction within the workplace, placing further strain on business continuity and operational capability. Serbia’s current geopolitical landscape mirrors that of Ukraine’s in 2014; following the annexation of Crimea, the Revolution of Dignity resulted in widespread political change as well as civil unrest and destruction of property. Any business whose allegiances are perceived negatively, regardless of whether this is by working with the Serbian government or as a representation of Western influence, is at a heightened risk of experiencing similar risks, e.g. property damage or targets by protesters.

Abuse of Power

SNS as the ruling party has continually abused its powers to silence and suppress democratic political opposition, most notably against the opposition parties. For instance, over the most recent governing period, SNS continually levied fines and penalties against these parties, for alleged violations of Serbia’s strict rules on speech and decorum within the parliament, despite breaking these rules themselves. In addition, the last-minute scheduling of sessions on legislation (24 hours), ensures that the opposition cannot prepare or be present for voting. This political recourse creates uncertainty for business continuity as legislation that impacts local and foreign business capabilities can be amended at any time.

The ruling SNS is also accused of influencing public opinion towards Serbia’s opposition via the media. The media landscape in Serbia, and primarily the co-ownership of two news agencies by the state, (Večernje novosti andPolitika), has continually aided in the SNS’s control of the domestic political narrative. SNS has used this control to draw the media’s focus solely towards its policies and successes, with Reporters Without Borders and the Associated Press finding thatVučić had ten-fold the airtime of all other presidential candidates in the recent elections combined.

Some outlets have shown signs of being influenced by the SNS and its propaganda, those independent outlets that cannot be influenced, however, are being actively intimidated by the ruling party. The Independent Journalist Association of Serbia (NUNS) database shows that attacks against journalists increased from 23 in 2013 to 119 in 2019. This trend highlights the unfavourable operating environment that the SNS and its propaganda have created for companies with dissident opinions. While this threat appears to be mainly focused on news outlets and journalistic organisations, there is a heightened risk that firms endorsing these dissenting views or financially supporting these organisations could be targeted by these acts of violence as well.

The ruling party has also utilised financial or reputational tooling to silence dissenting opinions. Journalistic organisations have become increasingly more reliant on public funds in recent years; however, the ruling party is known to distribute these funds in an untransparent manner. This has pushed journalists and editors towards self-censorship, portraying the ruling party positively, and/or merely not publishing any criticism. In concert, the SNS also cites oppositional journalists in press statements, making them targets for online or physical abuse by the party’s supporters. There are currently no notable examples of high-profile Western companies being targeted via these routes. However, there is a latent risk of Western firms or their executives being perceived as expressing dissident opinions about the SNS being targeted via these channels. Such propaganda narratives will heighten the risk of physical targeting and present potential reputational concerns.

Ties with Russia

Despite a significant number of Serbians showing a preference for closer relations with the EU, the country maintains strained relations with the West and historically strong ties with the Russian Federation. Since Moscow’s 2014 invasion of Crimea – and the subsequent 2022 Ukraine invasion, the Kremlin has become increasingly more politically and economically closed off from the international community. According to the NATO report “Russia's Strategic Interests and tools of influence in the Western Balkans”, Moscow targeted the Western Balkans (WB) - especially Serbia – with disinformation to achieve three major strategic goals, namely: preserving Russia’s status as a great power on the international stage, its influence over former Soviet Union countries and use it to build support for their policies. This continuous targeting via disinformation has begun to sow friction between Serbia and the West.

The Serbian-Russian connection & disinformation in the Western Balkan region will exacerbate fears about Moscow’s influence over Serbian political and business landscapes.

Serbia remains a fertile ground for Russian disinformation due to their close social and cultural norms and values, including those regarding the Orthodox Church or Slavic ethnic identity. As a result, the Russian elite has built strong ties with influential people within the Serbian political and business world, especially those who control the local media. This relationship allows Moscow to use a two-pronged approach against Serbia. First, they disseminate the propaganda through popular media controlled by the Russian government, such as Sputnik. Second, Russia uses influential local pro-Russian outlets – e.g.Sputnik Srbija, Kurir, Alo, Informer, or Sprski Telegraf. These Serbian newspapers and news websites repeat Russian disinformation storylines in not only their products (TV broadcasts, newspapers, etc.) but also on social media sites i.e. Facebook to further propagate the propaganda.

These routes of disinformation have proven exceptionally effective in influencing public opinion in Serbia. A 2021 European Council on Foreign Affairs (ECFR) poll unveiled that 54% of Serbians viewed Russia as a good ally. The invasion of Ukraine did little to impact this perception negatively. Another ECFR poll in 2022 illustrated that 51% of Serbs consider Russia the country's most vital partner, with 61% believing that the West was responsible for the conflict in the first place. There are currently no observed Russian propaganda campaigns targeted aimed at negatively influencing public opinion towards Western businesses. However, the pre-existing campaigns present fertile ground from which such supplementary campaigns could arise and generate negative sentiment towards Western firms in industries strategic for Russia, such as energy or defence, to present Russian firms as a better alternative to their Western counterparts.

While these propaganda campaigns transverse a range of different topics, an underlying concern that Russia continues to exploit is Serbia’s ongoing tensions over Kosovo. Kosovo unilaterally declared independence from Serbia in 2008 and has since gained recognition from 104 members of the United Nations. Despite many Western states’ recognition of Kosovo, Belgrade does not recognise Kosovo’s independence and still considers it a part of the Autonomous Province of Kosovo and Metohija. Russia would likely take any opportunity to completely integrate Serbia into Russia’s sphere of influence, increasing tensions with Kosovo and the West. This would heighten the risk of Serbia resembling a state such as Georgia, with a population that desires EU ascension and closer ties with the West, but a corrupt political class that suppresses such desires. In such a scenario, western businesses could face a more unfavourable operating environment, heightening the risk of untransparent judicial practices, e.g. favouring domestic firms during court cases.

Forecast

The ongoing civil unrest, political instability, Russian influence operations, and tensions surrounding Kosovo will continue to remain long-term geopolitical considerations, putting a strain on diplomatic relations between Serbia and the EU. As a result, the business operating environment for Western firms in Serbia will likely face a multitude of risks including logistical disruptions due to civil unrest, decreased labour productivity, potential sanctions, reputational damage by association, and resultant economic instability.

Indeed, there is a heightened risk of Moscow increasingly utilising its hybrid warfare tactics – e.g. disinformation - in Serbia, as they did before in Georgia, to create an anti-West and pro-Kremlin environment. The region near Kosovo will remain a key concern, with this area most likely to experience civil unrest and violence. This will likely incur a high cost and physical risk to companies and their employees operating near the border region.

What Now?

Ensuring your business is able to maintain good operational continuity requires long-term planning and monitoring of the political developments between Serbia and Russia. Between Russian disinformation, an ambition to join the EU, and the Trojan Horse risk Vučić and his party form, Serbia’s business environment is likely to remain unstable and a high risk for the foreseeable future. However, for businesses wishing to maintain full operational capabilities in Serbia, leadership will need to implement certain measures, such as:

  • Monitoring subtle forms of government intervention or foreign influence operations, which could lead to anti-Western sentiment.
  • In concert, build out or hire a robust screening team that is knowledgeable of the West Balkan’s unique geopolitical environment. This screening process would undergo a due diligence process on a company’s employees to check – amongst other things – whether they subscribe to Russian propaganda that could put them at a higher risk of engaging in Moscow-directed threats such as corporate espionage or sabotage.

Proximities can help you gain these key insights and turn them into tangible material. Using our ‘What?’, ‘So What?’, ‘What if?’ and ‘What Now?’ narratives, we help partners and clients not only understand the importance of trends and events but, more specifically, to understand what it means for you and your business from strategic to operational consequences. Curious and interested to see how we could help you? Don’t hesitate to contact us, we will be happy to support you.

Stay ahead

subscribe to our
insights

Subscribe to our monthly insights and receive
the latest security insights straight to your inbox

request
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.