SERBIAN PARLIAMENT APPROVES STABILIZATION AGREEMENT WITH EU

UNCLAS SECTION 01 OF 02 BELGRADE 000929 SENSITIVE SIPDIS E.O.12958: N/A TAGS: PGOV PREL SR SUBJECT: SERBIAN PARLIAMENT APPROVES STABILIZATION AGREEMENT WITH EU AND ENERGY DEAL WITH RUSSIA REF: A) BELGRADE 426, B) BELGRADE 773 Summary -------------- ¶1. (SBU) On September 9, Serbia's Parliament approved both the Stabilization and Association Agreement with the EU and its energy deal with Russia, ending months of gridlock over the two agreements. Getting the SAA agreement approved was a priority of the new pro-European government led by the Democratic Party (DS). Approving the energy deal favorable to Russia simultaneously with the SAA permitted the DS to protect its right flank from opposition criticism. Now that Serbia has ratified the SAA, the government hopes that the EU will soon decide to implement the interim trade agreement, allowing Serbia to move one step closer toward its goal of European integration. End Summary. Parliament Passes Agreements -------------- ¶2. (SBU) Serbia's parliament on September 9 approved the Law on Ratification of the Stabilization and Association Agreement (SAA), as well as the Law on Ratification of the Interim Trade Agreement with the EU. A total of 140 MPs voted in favor of the SAA and the interim agreement (out of 168 present). Twenty-eight deputies from the Democratic Party of Serbia and New Serbia (DSS-NS) voted against. Rather than highlighting the deepening cracks in their party (septel),deputies from the Serbian Radical Party (SRS) abstained. The energy agreement with Russia, including the sale of 51% of Serbia's national oil company NIS to Russia's Gazprom, passed with 214 votes in favor, 22 opposed, and one abstention. The next step in implementing the energy agreement will be negotiations with Russia on the details of the NIS purchase (septel). Kosovo Resolution Withdrawn -------------- ¶3. (SBU) Unable to win political consensus from all parties in the parliament, on September 8 the government withdrew its draft resolution on the continuity of the state policy on Kosovo. Minister for Kosovo Goran Bogdanovic told local media on September 9 that the withdrawal of the government proposed resolution did not signify a change in the government's Kosovo policy, stating that Serbia will never recognize Kosovo's independence. Instead of the resolution, an SRS - sponsored amendment which confirms Serbia's territorial integrity was added to the law ratifying the SAA. "Serbia... understands the provisions of the SAA as confirmation that the SAA does not hamper the territorial integrity of Serbia, particularly the status of Kosovo-Metojiha (as part of Serbia),which is guaranteed in UNSC Resolution 1244," stated a government press release after the vote. Next Steps with the EU -------------- ¶4. (SBU) Now that it has ratified the SAA and the Interim Trade Agreement, Serbia is hoping that the EU will decide to implement the latter when EU foreign ministers meet on September 15. When the two EU agreements were signed in April 2008 (Ref A) in an effort to boost Serbia's pro-Western parties on the eve of parliamentary elections, the EU conditioned the implementation of the agreements upon Serbia's full cooperation with the Hague Tribunal (ICTY). Since the arrest of ICTY indictee Radovan Karadzic in late July (Ref B),Serbia's leaders have argued that implementing the interim trade agreement would show the EU's good faith toward Serbia and recognition of its ICTY cooperation efforts. ICTY prosecutor Serge Brammertz is expected in Belgrade on September 10, and Serbia is hoping that he will issue a positive assessment of Serbia's cooperation with the Tribunal prior to the EU's September 15 meeting. "I hope that we will receive a positive evaluation from Prosecutor Brammertz on our cooperation with the Hague Tribunal, which is very important for implementation of the trade agreement," President Boris Tadic said on September 3 while in Brussels lobbying on Serbia's behalf. Comment -------------- ¶5. (SBU) Despite protracted obstruction from opposition parties in parliament, Serbia's new government succeeded in passing the SAA by linking it to the controversial Russian energy deal as a shield against opposition criticism. As a result, the government has successfully delivered on one of its major campaign promises from the spring. Less certain, however, is whether the EU will consider Serbia's efforts to cooperate with The Hague sufficient to implement the interim trade agreement. Without a positive assessment from Brammertz or the quick arrest of ICTY indictee Ratko Mladic, Serbia has little ability to influence the EU decision. End Comment. BELGRADE 00000929 002 OF 002 MUNTER