China’s grandiose infrastructure project, the One Belt One Road Initiative (OBOR), has begun to take root in the Balkans, with regional states increasingly looking to jockey for the position of China’s most reliable regional partner. As Chinese investment takes shape, there are indications that the region will continue to slip into an illiberal democracy more akin to today’s Turkey and Russia; with potentially larger repercussions for Western investment.
A complex network of influence has been developed since the early 2000s between the Turkish central government and AKP-controlled municipalities. These opaque power structures have allowed charities linked to the ruling elite to freely operate in these municipalities, essentially operating as informal social co-optation tools used by the government.
There are concerns that a series of reforms that reduce the independence of the Romanian judiciary will impact how international and non-politically exposed commercial players are able to compete in the market. If these reforms are passed, they have the ability to set the stage for the implementation of a de facto system of crony capitalism; a system that would ultimately serve the interests of the political and economic interests of Liviu Dragnea.
Last month, the Serbian Government and France’s Vinci finalised the agreement that will put Belgrade airport in the hands of one of the world’s largest construction and concessions companies. It is reported that Vinci will pay €500 million in concession fees, and invest another €732 million over the next 25 years.
Despite his repeated demonstrations of loyalty to the current Turkish ruling elite, businessman Galip Öztürk was recently handed down a judicial sentence that will ultimately expose his assets to the government’s agenda. The case of Öztürk is important because it highlights an emerging trend in Turkey’s business environment - where the assets of even loyal businessmen are being made vulnerable to Ankara’s economic priorities.
In this third part of our series on the effects of Climate Change in the Balkans, future political, economic and social scenarios are summarised from the Report, available through the Shadow Governance Intel Report Store. This summary presents the key scnearios likely to emerge in the region as a result of Climate Change and the impact it is already having. This analysis also highlights how this phenomenon can reinforce, or undermine, the current authoritarian trends amongst the ruling elite in the Balkans.
A recent arrest in Serbia of Romania’s former senior ruling party official has revealed an intricate mechanism of informal influence in which media and information technology companies are manipulated by politically connected individuals with the aim of spreading fake news. The driving motivation is for the ruling elite to gain leverage to influence election or judicial outcomes.
Recent proposals to reform the legal framework governing Serbia’s defence sector are most likely to empower the Military Police, whilst adding layers of opacity to the country’s weapons production and acquisition plans. Shrouded in high doses of nationalism, these reforms – like many initiated by President Vucic – are yet another example of how the ruling elite are further empowering themselves, largely to the detriment of democratic accountability and an open market.
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There are strong indications that the Balkan peninsula is beginning to witness significant environmental, economic and political implications from its exposure to climate change. This analysis is a summary of a more extensive report to be released by Shadow Governance Intel on the impact of climate change on the Balkan countries – now, and future scenarios. In addition to the obvious environmental impact, the biggest concern is whether the fallout from climate change will have a detrimental impact on the political stability of an already-fragile region.
Although the Bulgarian banking system is generally dominated by international banks, a small part remains under the control of indigenous entities, some of which remain open to allegations of questionable practices and associations. There are concerns that the largest of the country’s domestic banks will contribute to wider industry instability if they continue to be regarded as politically exposed, and open to providing politically influenced loans regardless of their commercial viability.
Energy systems play a key role in the global phenomenon of climate change. The lack of modernisation and renewal of these system not only aggravate the effects of climate change, but it also has a direct impact on the population, which is exposed to higher levels of pollution. Governments in the Balkans have arguably neglected to make necessary legal changes to protect the environment, a factor that is ostensibly aggravating the exposure of this region to this global phenomenon.
The tourist sector is a key pillar of Turkey’s economy, as it has contributed approximately 5% of the country’s GDP. Although international investors dominate the most lucrative parts of this sector, they remain vulnerable to the ongoing political decision-making of the ruling elite in Ankara. As a result, Turkey’s tourist sector has felt an impact from decisions such as Turkey’s military intervention in Syria, and the negative diplomatic consequences such actions have created.