The appointment of Sinisa Mali to the post of Serbian Finance Minister in May has controversial undertones. An experienced political player with strong ties to the inner circle of President Vucic, there is little doubt that Mali will help Vucic remove any remaining barriers to securing systematic control over every part of the state’s administration. Already flagged by various international watchdogs and institutions as a jurisdiction with weak financial integrity and rule of law, and systemic corruption, this move may further undermine political stability.
Authorities in Serbia have been using businessmen as fixers and go-betweens to maintain informal communication channels with key political players in Kosovo. Arguably this is to ensure that ethnic Serbs who live in the north remain loyal to Vučić and his political protégés, but it has also had an impact on the investment environment; contributing to opacity, and the uncompetitive awarding of lucrative projects.
Montenegro under Đukanović has inspired the rise of autocracy in the Balkans. Whilst this small state has seamlessly shifted allegiances between the EU, US, Russia, Turkey and other external influence since independence, it has rather effectively given the façade of democratic stability. More aptly, however, it has evolved into a ‘stabilocracy’ and shows how security in the region is given precedence over the rise of illiberal and authoritarian regimes that simultaneously exert significant influence over the investment and business environment.
A failed Kurdish peace process, and the power struggle with the Gülen Movement, have forced President Erdoğan to secure new political allies. Ironically, Erdoğan has found support from the very (informal) ultra-nationalist groups that he had purged less than a decade ago. With this emerging alliance, Erdoğan is further darkening Turkey’s security apparatus increasing the chances of human rights violations and power abuse for the security forces.
Bulgaria’s Prime Minister, Boyko Borissov, has spearheaded recent legal reforms aimed at fighting public and private sector corruption. These reforms include the creation of a new anti-corruption unit with the remit to wiretap senior state officials. Although these efforts appear positive in their aims; given the trajectory of Borisov’s own political influence, there are concerns that a new anti-corruption unit with significant powers could be utilised against opposition groups, whilst further placing the private sector and judiciary under his influence.
Driven by a religious ethos, government-linked foundations operate under low levels of accountability, a factor that has allegedly exposed some of them to questionable activities carried out by government officials. In addition to becoming embroiled in allegations of corruption, Turkey’s charities have also used been utilised as a resource distribution tool; more specifically, as a place where government loyalists are rewarded with employment.
Liviu Dragnea has started a public campaign of defamation against anti-corruption institutions that have accused him of leading a criminal organisation. To legitimise his position, Dragnea is using autocratic methods, whereas he is the protector of the national interests empowering him to manipulate the judiciary and security systems.
The formation of a 4-party coalition in Northern Cyprus aspires to limit Ankara’s influence over TRNC’s political affairs. Despite having the political will, there are major regional political dynamics that might undermine the autonomy of the 4-party coalition; particularly the reality that Ankara has already demonstrated its capacity to use informal mechanisms to alter political behaviour in Northern Cyprus.
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.
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.
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.