Global Insight Perspective
Significance	Pro-European incumbent Boris Tadic won the run-off presidential election held in Serbia yesterday.
Implications	Serbia has elected to focus on its European future after narrowly electing the moderate Tadic over the radical Tomislav Nikolic.
Outlook	The moderate Tadic will be a key ally to the European Union in calming tensions within Serbia once Kosovo declares independence, as well as being a key figure in promoting Union membership for the Balkan state.

On Sunday (3 February) Serbia's 6.7 million voters went to the polls in the second round of presidential voting, re-electing incumbent Democratic Party (DS) leader Boris Tadic to the post. In what has been the closest election in the Balkan country's history, Tadic beat hard-line nationalist Serbian Radical Party (SRS) deputy leader Tomislav Nikolic 50.5%-47.9%. Despite the position of President being largely symbolic within the Serbian government, the election was seen as a referendum on how Serbia would deal with the West after the imminent loss of the breakaway Kosovo, the 90% ethnic-Albanian UN-administered province in Southern Serbia. The 67% turnout confirmed the importance of the vote, having been the most heavily attended ballot since the late Slobodan Milosevic was overthrown in 2000. Tadic was essentially re-elected by the winners of the transition, with a large amount of his support emanating from the relatively affluent capital Belgrade and the northern province of Vojvodina, which has a large Hungarian minority. The losers of the transition, namely voters living in the poorer central and southern Serbia, as well as the Serbian minority in Kosovo, voted for Nikolic, who has already conceded defeat. Despite winning the elections Tadic faces a number of serious challenges to his next five years in office, all of which are likely to come to a head in the coming months.

Future Challenges: Kosovo and Internal Stability

With Serbia's biggest ballot since 2000 over, Tadic and the country will now turn their attention to Kosovo, widely seen by nationalists as the cradle of Serbian civilisation, where key decisions have been delayed pending the outcome of yesterday's elections. Furthermore, the election was pivotal in determining the country's future ties with the European Union (EU).

Tadic, who in his first three and a half years as president has largely disappointed the West and his supporters due to a constant stream of compromises struck with his coalition partners and the slow pace of reforms, must play a pivotal role in securing Serbia's European future after Kosovo's anticipated declaration of independence. Both Nikolic and Tadic oppose independence in Kosovo, an issue which dominated their election campaigns. Nikolic wanted Serbia to turn to Russia to punish the West for backing independence, while Tadic is seeking moderation of response and asking Serbs to swallow their considerable pride and pursue EU membership regardless. Kosovo and the West have delayed any decision on Kosovo in a bid to help Tadic get re-elected and avoid stoking nationalist sentiment. The policy appears to have paid off; however, tough decisions now need to be made since it is unclear for how much longer the West can contain the clear desires for independence of the Kosovars. With the EU and United States expecting to claim their reward for support during the election time, Tadic has a hard course to navigate between them and the domestic audience. He may win further support of the latter when an interim agreement with the EU is signed on 7 February, which would see steps taken towards visa-free travel for Serbs and the promotion of economic and educational exchange.

One of the key challenges to Tadic's pro-EU course is likely to come from Serbia's own government. Only Mladjan Dinkic, Economy Minister and president of G17 Plus, and the Hungarian minority parties from Vojvodina supported his re-election bid. As Tadic was re-elected with the EU and Serbia's membership of the it at the centre of his campaign, he is in a strong position to push for an alliance with the EU despite the EU's support for Kosovo independence and strong opposition to the idea from leading politicians within his own ruling coalition government. Prime Minister Vojislav Kostunica of the Democratic Party of Serbia (DSS) has made defence of Serb sovereignty over Kosovo central to his policy aims and goals, driving an uncompromising line on Kosovo with strong support from Russia, all the while making Tadic's balanced approach look near impossible. Kostunica has attacked a planned EU mission of 1,800 troops to supervise transition as violating Serbia's sovereignty, as well as insisting on a hard-line response to independence including diplomatic sanctions against the West, repudiation of the EU and measures to strangle the province economically. Furthermore, Kostunica refused to back Tadic's re-election bid because his coalition ally had rejected to commit himself to refusing a deal with the EU if the bloc supports Kosovo's independence. As Tadic pursues further close ties with the EU and United States even if they recognise Kosovo's statehood, he will face the increasing volatility of the coalition government.

Outlook and Implications

The election results, although close, have shown the desire of the slim, but important, majority of Serbs to continue on the path of pro-Western reform and closer ties with the EU, instead of heading back to nationalism and international isolation. Tadic remains the head of a state with a divided government that has failed to make significant inroads to Serbia's bid for EU membership and is likely to clash with the EU over Kosovo. Tadic as a president is institutionally weaker than PM Kostunica, but he can claim a clearer and stronger mandate than the PM after winning his election with an uncompromisingly pro-European message. The government coalition, although appearing shaky, is unlikely to falter since despite the rhetoric, all concerned recognise the potentially destabilising affects of a collapsing government at a time when unity is needed most. Relations between the EU and Serbia are likely to be strained after Kosovo's declaration of independence but with Tadic at the helm of the country the backlash will be significantly reduced and any action will be tempered by a desire to eventually join the Union.