In the article you wrote for CNN, you said that the increasing dependency of Greece on external funds to survive have led to an unprecedented degree of national humiliation and destabilization of the political system. Serbia is dependent on EU and other external funds as well. So, do you think that Serbia might face similar challenges in the future?
Greece is an exceptional case in that it combines many problems of massively increasing debt, very high fiscal deficit and lack of competitiveness. For five years, Greece’s economy has been in recession and this has resulted in major political, social and economic problems. Greece has been the centre of world attention and its economy has threatened to derail the wider European economy, the future of the euro and Europe’s potent position in the world.
Serbia is not yet a member of the eurozone and that gives the country more flexibility to manage its fiscal planning and to devalue its currency for more competitiveness. But Serbia is also part of the European periphery and as such it shares some similarities with the European South, with a strong and clientelistic state, more corrupt practices, a less competitive economy, a spending economic pattern and massive dependency on foreign direct investment. Similarly Serbia shares the high levels of unemployment with other Southern European countries with a potentially explosive society which is disaffected and alienated from its political class.
With these in mind, there are common issues and problems between Serbia and Greece but the degree of international pressure and dependency does not have the same impact as is the case of Greece.
Do you think that states dependent on external funds are losing their sovereignty?
I do not think that states which are dependent on external funds are necessarily losing their sovereignty. From Greece’s experience, states lose their sovereignty when they allow themselves to spend much more than what they produce and get into deeper debts and when their political elites are very bad managers of the economic resources of the country. Greece lost its sovereignty long before the start of the economic crisis in 2009, when the country was increasing its debt levels and was growing its public deficit so high that the country run out of independent choices. The post-2009 economic dependency and vulnerability to international markets was the outcome of a long process of economic mismanagement and missed opportunities for reform.
In your opinion what will be the outcome of the Greek debt crisis?
So far and for the time being, Greece is not allowed by Europeans to default or leave the euro because this would be a very expensive and potentially a disastrous option. So the Troika (IMF, European Central Bank and European Commission) have been sustaining the country economically by dripping funds aiming to marginalise the problem and make it less contagious to other European states. Some think that the recent debt restructuring and the new bailout package will not remedy the situation but is a slow death which will eventually lead to the country defaulting on its payments due to the unstoppable recession that austerity is generating. Others believe that the country has gained a breathing space and has the chance to survive. I believe that the country may have a chance to recover as long as there is a reorientation of the current policy towards less austerity and more growth. It is the non-stop ruthless austerity which has led the country to an unprecedented recession, not to mention ofcourse the slow reaction and wavering of Greek politicians to grapple with the situation.
You mentioned that the national parliament, the symbol of representative and competitive democracy in Greece, has become “purely symbolic and procedural in the way it votes for its austerity laws”. Has the parliament lost its primal role?
Paradoxically, even under conditions of immense external pressure, the Greek parliament continues to be at the centre of the decision making process and the main arena for the party political debate. So it could be argued that the economic crisis has led to the strengthening of the national parliament in that the government need political parties to vote and legislate the toughest of austerity measures and all the required reforms. At the same time, the debates in the parliaments have become more polarised and are conducted under the pressure of revolting masses in the streets. Also the political class in Greece has lost its appeal and popularity and has been undermined by recent developments. The downfall of Papandreou and Berlusconi in Italy is clearly a victory of the markets over national parliaments in Italy or Greece, no matter how justified or useful this change may have been.
Let’s talk about South East Europe... In your opinion what major challenges will the region face in the future?
First and foremost, like many other peripheral countries of Europe, the region needs a sustainable growth strategy different from that pursued during the 2000s when the region was growing largely on consumerist investment. Secondly, the region needs to solve the various bilateral problems which haunt many of its states and avoid being hostage to remaining problems of nationalism, territorial questions and ethnic politics. Finally, the biggest challenge which is common to all states is the European integration and membership in the EU bearing in mind that this in itself is not the solution to all the problems of the region but the beginning of new responsibilities and enhanced need for reform. South East European governments and political elites have to become more responsible and rational in their choices and calculations, and avoid taking their people down populist, clientelistic or nationalistic paths.
Do you think that the Western Balkan countries will become EU members soon or is there a European plan B for that region?
The accession of Croatia in 2013 and the recent candidacy of Serbia show that there is no plan B but a path dependency pattern of enlargement and accession to the European Union. The Western Balkans is a firm part of Europe, it has often been characterised as the EU’s “unfinished business” and as such it should be expected that the region will be part of the European Union in the future. What remains uncertain is how long this process may take as a result of all the pending bilateral, ethnic and nationalistic issues in most of the region’s national agendas. What this crisis has revealed is that the EU has the power to impose decisions on members or candidate countries but it does not have to power to implement them and this is a responsibility that lies with national governments and their people. The European Union has two faces: it is the ideal world of norms and values and financial support for the weaker, but it is also a world of power politics and the stronger versus weaker states, and the sooner the countries of the region understand this reality the better.
Serbia has become a candidate country. What does that actually bring to the country -foreseeable future or does it bring more dependency?
Becoming a member of the EU leads unavoidably to the loss of sovereignty in many policy areas which are traditionally regarded as the domain of the national governments. But this is also a necessary process in order for the European states to survive in an increasingly competitive world. Serbia can benefit from the European Union as long as it plays by the established EU rules and learns how to create alliances with other similarly minded countries when negotiating such rules. But being an EU candidate or member is not a one way street and there are winners and losers of such a process. In the end, it should be evident that in a peaceful Balkan region which is part of a peaceful and cooperative Europe, the benefits are much bigger than the losses.