Serbia: cleaning up like the neighbours
4 October 2011, Financial Times
The arrest of a former mining boss on the Macedonia-Greece border might seem far from the corridors of Brussels, but the desire for EU membership takes many forms.
Serbian police in the last two days have arrested Dragan Tomic, the former head of Kolubara coal mine and 16 others for alleged embezzlement over equipment leasing. Tomic, who headed the state-owned mining company in 2004-08, was arrested on the border while apparently trying to flee to Greece.
He and the other suspects allegedly skimmed off €12m ($15.9m) from the state-owned mining complex, a prime source of coal for Serbian Electrical Power (EPS).
The arrests, along with other actions by Belgrade’s special prosecutors for organised crime, call to mind similar moves in neighbouring Croatia, which recently received the green-light to join the European Union thanks to vigorous anti-corruption efforts.
Zagreb’s entry talks, culminating on June 30 after nearly six years, have come to be seen as the template for poorer Western Balkan states to follow. There is the perception that an increased number of arrests may coincide with the desire to show to Brussels that a country has its house in order.
Yet there are clear differences in Serbia’s campaign so far compared to Croatia’s, which will include the trial of the former centre-right prime minister, Ivo Sanader, during the run-up to expected EU entry in 2013.
What is most striking – and paradoxical – about Croatia’s campaign is the heavy focus on purging the ruling party. Sanader’s successor as prime minister, Jadranka Kosor, heads the very same centre-right Croatian Democratic Union (HDZ), even if she desperately tried to make a clean break from past misdeeds.
When Kosor first vowed “zero tolerance” of corruption two years ago, it gave her a powerful tool against Sanader loyalists, helped her bring the party’s old guard under control and briefly boosted her personal popularity. But each sordid case seems to spawn three more involving her former close associates. With elections set for December 4, Kosor’s approval rating has plummeted to 20 per cent or less, according to polls.
Serbia’s ruling Democratic Party – headed by the strongly pro-EU president, Boris Tadic – is also in pre-election mode, with the current parliamentary mandate expiring early next year. But Belgrade seems to have enough targets from other parties for prosecutors to leave the Democrats and their allies alone for now.
The former Kolubara mine head, for instance, came from the nationalist-leaning party of Vojislav Kostunica (the Democratic Party of Serbia, or DSS), who was prime minister at the time but now belongs to the hard-line opposition that questions EU integration.
Other suspects include 10 other former or current Kolubara officials and six private company owners who allegedly overbilled the state on leases of coal-digging machines. CEE Bankwatch Network, based in Prague, has raised concerns about the European Bank for Reconstruction and Development (EBRD) pumping loans into the allegedly fraud-tainted mining operation.
Kostunica’s party, however, accused pro-Tadic prosecutors of ordering the arrests over differences of political opinion. “No one has the right to abuse government institutions because of the election campaign,” said Petar Petkovic, a party spokesman.
Croatia’s anti-corruption drive also started out of (to some degree cynical) political motives, combined with firm EU pressure. But it has taken on “unstoppable momentum” that will make the ex-Yugoslav country a worthy EU member, party leaders from both sides of the aisle in Zagreb say.
Some companies say they see benefits in business already, with bribes no longer being needed to stay ahead of competitors in the inner circle. “Nearly all state owned institutions have become open to transparent public contract procedures,” said Davor Bruketa, co-owner of an advertising agency.
Others, however, complain about a “witch hunt” atmosphere that is also stifling legitimate deals and making Croatia’s recession even worse. Yet nearly everyone agrees that the country will be better off in the long run.
In Serbia, similarly, the net could widen in the future, making all officials hesitate before committing crimes.