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Serbia and Russia: Is Ukraine a Façade for South Stream?


Serbian Prime Minister Aleksandar Vucic during his visit to Serb Orthodox Cathedral in Sarajevo, 13May2014.
Serbian Prime Minister Aleksandar Vucic during his visit to Serb Orthodox Cathedral in Sarajevo, 13May2014.

The following comes from a radio report aired on June 27 about Serbian Prime Minister Aleksandar Vucic's upcoming trip to Moscow. It addresses the delicate situation Serbia faces in pleasing both Russia, its longstanding partner and ally, and the EU, with whom Serbia is in accession talks.

It addresses Belgrade's frustrations at being caught between the two entities, possible tactics in dealing with its situation, and the opinions of informed observers on everything from Serbia’s stance on the Ukraine crisis to its dilemma regarding the construction of the South Stream pipeline, issues which leave Serbia caught in the middle between Russia and the EU.

Vucic will visit Moscow exactly three weeks after Russian Foreign Minister Sergei Lavrov visited Belgrade.

Serbian government officials said that the meetings, scheduled for July 7, will contribute to "the strengthening of friendly relations between the two nations." But observers of Russian-Serbian relations think that with this move Russia wants to “tighten their collar” around Serbia’s neck. Serbia is trying to diplomatically avoid such an outcome with its neutral stance on the Ukrainian crisis.

But Serbia’s fears on this score might become reality. Will Russian President Vladimir Putin and Prime Minister Dmitry Medvedev, who will welcome Vucic in person, ask Serbia to change its official position? Former Serbian ambassador to Moscow Jelica Kurjak warns that no one should stick to a black-and-white perspective.

“It may seem now that Russia doesn’t want Serbia to explicitly state that it is supporting Ukraine’s territorial integrity while the European Union is asking Serbia to align its position with that of the EU,” says Kurjak .

Aligning its position with the EU would mean that Belgrade would have to apply Brussels’ sanctions against Russia.

“We must take into account the exact wording. If we say that the EU expects Serbia to bring its position closer [to that of the EU], it does not mean that Serbia must explicitly say that they are for this or for that. Their views don’t have to be absolutely the same as the EU views. But they would expect Serbia to align its views [with those of the EU] and to state its position more specifically, provided that Serbia will probably not be asked to impose sanctions," said Kurjak.

On the other hand, if anyone is trying to define future Russian interest in Serbia, the former ambassador said to bear in mind that Serbia will be presiding over the OSCE next year.

“Russia is certainly very keen to ensure that Ukraine doesn’t become a paramount topic of discussion at the OSCE sessions or the OSCE summit. It will surely be one of the most important topics, but I think that right now both sides are simply talking about it and positioning themselves. It is clear that Serbia’s position will be closer to the EU, but it also needs to make sure that it is not an attitude that will in some way change its original position towards Russia," says Kurjak.

So, Serbia is see-sawing between Russia and the EU without choosing to settle on either side. The precarious ambivalence of the Serbian position apparently wasn’t disturbed even with a somewhat less equivocal statement from Serbian Minister of Foreign Affairs Ivica Dacic:

“They are objecting to our relationship with the Russian Federation while France is selling warships to Russia and one of them is called Sevastopol. And they object when an orchestra called Sevastopol holds a concert in Serbia. They can’t deal with Serbia that way”.

Or the even more pointed comments of Serbian Prime Minister Vucic, who tried to blame the EU’s recent accusations of media censorship in Serbia on its dissatisfaction with the Serbian attitude toward the Russian-Ukrainian crisis:

“Some are bothered by the fact that we don’t want to impose sanctions on Russia because we are the only country in this part of Europe that hasn’t done so. If this is a problem, then tell us that this is a problem and don’t invent [the idea] that someone censored some website about which I don’t have any idea. I don’t know what you are talking about,” he said.

[The reference is to the pescanik.net website, a recent victim of a hacking attack]

Yet according to some observers, so much passion expended in determining Serbia’s position toward Ukraine may come to seem like a waste of political power.

“I think that Ukraine is only a façade and that we are not crucial here. Nor is Serbia’s support for Russia over Ukraine particularly significant,” warned a journalist of the weekly, “Nin”, Katarina Preradovic. She emphasizes that when Vucic meets Putin and Medvedev, their focus can easily be directed not to the East, [and the immediate Ukraine crisis], but to the south of Europe: "The South Stream is the first and most important issue for the Russian side," she adds.

The Southern gas stream is the most important and also the most problematic issue at the moment. The EU is asking for regulation of the [South Stream] gas distribution to be brought in line with existing European regulations, which would prevent Gazprom’s monopoly in southeastern Europe. Bulgaria is currently dealing with the issue. This European Union member is subject to the same requirements as Serbia, and if profit is the principal motive at the heart of all these discussions, as some insist, including the forthcoming talks between Serbia and Russia in Moscow, then it is very likely that Russia will insist on their demands as vehemently as Brussels has done.

“Russia could even insist [that Serbia] start working on the South Stream even though such a start would be meaningless if the same work were not starting in Bulgaria as well. Of course I don’t expect that our side will accept it easily. In addition, I expect that Russia will insist on the terms of the original energy agreement, on the basis of which they acquired the Petroleum Industry of Serbia (NIS), including the right to pay Serbia only 3 percent in transit renal charges until 2035. They want these privileges to be respected regardless of the fact that the second part of the agreement has yet to be fulfilled, given that South Stream is already late and it’s even questionable whether it will be completed in such circumstances,” says Preradovic.

Vucic could, for instance, raise the question of the gas transit rental charges that are set as low as 3 per cent. Indeed there are legitimate grounds for opening discussion on that topic, given that in Russia itself the standard charge is 22% for the same service. But the energy sector is facing additional problems that are pressing on both sides, and might have repercussions for the Electric Power Company (EPS) of Serbia.

“The government has announced its plans to privatize EPS, and there are several interested parties. One is a German company, which has openly declared its ambitions, but there are also a number of Russian state companies rumored to be interested in a minority stake in the EPS, which would eventually become a majority. That could be another topic for discussion [with Russia],” says Preradovic.

There remains the distinct possibility that any disagreements over energy issues will spill over into the political sphere. That could jeopardize Serbia’s neutrality on Europe’s most sensitive issue. Meanwhile, although the official Serbian position is constantly being revised, there is some doubt whether ‘neutrality’ is the most accurate designation for it, says Kurjak:

“I would not say that [Serbia’s stance] is a completely neutral position. If Serbia has said that it will not impose sanctions on Russia, that amounts to taking a clear stand. If Serbia has declared its support for the territorial integrity of Ukraine, that is also a very clear position."

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