Kosovo Fallout Continues in Serbia

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Alexa Stankovic / AFP / Getty

Serbian Prime Minister Vojislav Kostunica address the media during a news conference in Belgrade on March 8, 2008.

Serbia's coalition government collapsed Monday, brought down by the political aftershocks of Kosovo's declaration of independence. Moderate nationalist Prime Minister Vojislav Kostunica dissolved his government, citing irreconcilable differences with pro-Western President Boris Tadic over relations with the European Union following the Kosovo secession. The issue will be put to the electorate in early parliamentary elections, scheduled for May 11, which may be Serbia's last chance to either regain stability or move further down the road of confrontation with its neighbors and the West.

"The government no longer has a united stance regarding its policy towards Kosovo," Kostunica told a news conference on Saturday, adding that early elections were the only rational way out of the stalemate. Dissolved after less than a year in office, this was the shortest-lived government in Serbia's history, although Kostunica had also served as Prime Minister in the previous cabinet. The country's deep divisions were reflected in the results of February's presidential election, which Tadic won by a margin of 2% — less than 200,000 votes — over the candidate of the nationalist Radical Party, Tomislav Nikolic.

Serbia's government has been paralyzed since February 17, when Kosovo's ethnic-Albanian majority declared independence, triggering a wave of riots across Serbia in which a number of Western embassies were attacked and one person died. Kostunica advocates tough retaliatory measures against countries that recognize Kosovo, including the United States and most member states of the European Union, but his coalition partners urged a more cautious approach. The dispute became so intense that cabinet members stopped talking to each other, except to exchange insults and even threats. "The government is unable to perform," said a short statement after a cabinet meeting on Monday.

The final breakdown came after Kostunica proposed effectively freezing Serbia's efforts to join the E.U. in protest over Kosovo. President Tadic, whose Democratic Party controls such key ministries as defense and foreign affairs, blocked the move, triggering the government's collapse. "It wasn't the disagreement over Kosovo that brought the government down, but the fact that we couldn't agree over E.U. integrations," Tadic said in a televised interview on Sunday, adding that he still opposes Kosovo's independence.

The breakdown of the government reflects rift within the electorate over whether to move Serbia into Europe. Kostunica has been the swing vote between the hard-core nationalists of the Radical Party, whose chairman, Vojislav Seselj, is on trial for war crimes in the Hague, and the pro-Western Tadic. Kostunica refused to support Tadic in the presidential election, and may be ready to forge an alliance with the Radicals. The Radicals hold almost a third of the seats in parliament, and were only kept out of power by Kostunica agreeing to share power with Tadic. Now that the deal is off, Serbia's voters are being asked to make a choice that could shape their country's future for many years to come.

While Tadic advocates continuing the E.U. accession process despite the loss of Kosovo, Kostunica and the Radicals instead advocate aligning with countries that oppose Kosovo's secession, such as Russia and China. Recent opinion polls give Tadic's Democrats and the Radicals each around 30% of support among the voters. Kostunica's own party has been steadily losing support in the past months, and can now count on just about 7%. Several other small parties will also be running, making the outcome even more uncertain.

"This may look like a final battle, but I'm afraid that the result would again turn out to be inconclusive," Dragoljub Zarkovic, the editor in chief of the Vreme political weekly tells TIME. "Neither the pro-Western nor the nationalist bloc can achieve a clear victory, so the next government will likely be another fragile coalition, and it may take several election cycles before we see some stability," he says.

Already, Serbia is coping with a sharp falloff in foreign investment and rising inflation that analysts attribute to political instability. "Everybody is talking about Kosovo, while they should really be talking about jobs and prices," says Danica Popovic of Belgrade's Economic Institute. "If things don't cool down, no serious foreign company will want to invest here." But within the next few months, at least, the political climate in Serbia is likely to get even hotter.