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Tomorrow Belongs to the Radicals Ok,
what could be the economic consequences of the Radicals victory in the
next elections? Three turning points are in sight: (1) interventionism
will increase; (2) the economic reforms will stop, and (3) co-operation
with those countries which have not recognised Kosovo’s independence,
such as Russia, the Ukraine, the Far and Near East, etc., will grow.
And what would that, in fact, mean?By dr Dana Popović I’ve already mentioned interventionism, but one should not forgot that the Serbian state is currently already redistributing over 40 per cent of its gross domestic product (GDP); all of the country’s public utilities are in the hands of the state and, therefore, at first sight not too much could be destroyed here (which has not been destroyed already). Furthermore, almost half of all prices in Serbia are controlled by the Government – on somebody’s desk, and not on the market. What kind of further turnabout towards interventionism could happen? Firstly, I expect the Radicals to try to resolve the unemployment issue with public works. That will not cost them a great deal. Dinkić, with his invention, the much coveted National Investment Plan, left lots of money for voluntarily squandering, and it seems that the Radicals will like that too. Voluntary mass labour. Songs. Cameras. And behind that, we know what is waiting: inflation, growing balance-payments deficit and increasingly slower economic growth. Along with that, I expect statistics to start publishing indexes of increasing labour victories, and that we, experts, will start to find out what is really happening in the country from the indirect indexes. Nor should one forget the struggle against poverty, which will probably be based on the production of “bread for three dinars” – a promise they have announced in one (or maybe two) previous campaigns. The freezing of prices could certainly happen. My expectations are based on the fact that Vojislav �e�elj, as the out-going vice prime minister in October 2000, signed a decree on the liberalisation of all prices in Serbia, in order that the opposition, which had just come to power, would immediately experience the anger of the nation and would consequently be driven from power. Nothing could have been more wrong than that, because the market was normalised and shortages disappeared. Will such episodes be repeated? How will the exchange rate settle when people start to change all their dinar holdings into hard currencies? I don’t know. I’ve already got rid of my dinars, just in case. If the Serbian Radical Party comes to power, economic reforms should probably be forgotten. On many occasions the Radicals have strongly condemned the closing down of non-liquid banks, while privatisation, transition and theft are mostly treated as synonyms in their political language. How can we continue reforms then? How can subsidies be reduced if the employees in the dinosaur companies will lose their jobs like that? How can we limit income growth in the public sector, when they are supposed to show that with the arrival of patriotic forces to power, “traitors and foreign mercenaries” (who led the country to the very edge of disaster) should lose, and the “honest people” should become winners? How can we introduce the necessary practice of bankruptcy if, like in Hungary, the avalanche of 25,000 bankruptcy cases starts in the first year? In Hungary the Radicals were not in power, thus such a practice wiped non-liquid companies out of the country and created the basis for the arrival of Greenfield investments and rapid growth. Yes, the Radicals were not in power there. It is very likely that Serbia under the Radicals will turn towards those countries that did not recognise the independence of Kosovo, but will that only be a rhetorical shift? The Radicals will most probably leave all foreign investors in peace; they’ll let them get on with their work and will probably not interfere in their business. On that side, I think that “peaceful coexistence” will rule. Still, the question arises as to whether the situation from October 2007 will ever be repeated: when the company owned by famous Russian tycoon, Oleg Deripaska, appeared in a tender and was suddenly sold to some anonymous firm from Austria. Though I doubt this will reoccur. Only if all this comes to nothing, and the Radicals do not come to power, will Serbia have the chance to continue the reforms which will bring a better life for all of us. But if the pro-European parties win the majority at all, that will happen in spite of everything the U.S. and the EU have done to destroy every sense of European values in Serbia, and then leave the country to choose its own future.
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