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DE RUEHBW #0913/01 2520715
ZNR UUUUU ZZH
P 080715Z SEP 08
FM AMEMBASSY BELGRADE
TO RUEHC/SECSTATE WASHDC PRIORITY 0380
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RHEHNS/NSC WASHDC
RUZEJAA/JAC MOLESWORTH RAF MOLESWORTH UK
RHMFISS/HQ USEUCOM VAIHINGEN GE

UNCLAS SECTION 01 OF 02 BELGRADE 000913 
 
SENSITIVE 
SIPDIS 
 
E.O.12958: N/A 
TAGS: PGOV PREL SR
SUBJECT: SERBIA: FORMER PM KOSTUNICA'S PARTY IN DISARRAY, LEAVES 
VACUUM ON THE RIGHT 
 
REF: A. BELGRADE 677, B. BELGRADE 844, C. BELGRADE 904 
 
Summary 
------- 
 
¶1.  (SBU) Following its poor showing in the May parliamentary 
elections and its failure to form a governing coalition with the 
Socialist Party, former Prime Minister Kostunica's Democratic Party 
of Serbia (DSS) is struggling to find a new political niche.  Many 
inside the party believe that Kostunica must resign if DSS is to 
reinvent itself and return to being a constructive center-right 
party.  The lack of clear direction from the top has left DSS 
rudderless in both the National Assembly and the Belgrade Assembly, 
relegated to joining the Radical Party in obstructionist tactics 
rather than enunciating an alternate point of view.  The ripple 
effects from what could be called the implosion of DSS are even 
being felt in the Serbian Orthodox Church and the Islamic community, 
where many observers see a link between internal conflicts and the 
new political balance of power.  End summary. 
 
 
Disarray within Democratic Party of Serbia 
------------------------------------------ 
 
¶2.  (SBU) In the weeks following the July 7 formation of Serbia's 
new government (Ref A) by President Tadic's Democratic Party and 
Ivica Dacic's Socialist Party, there has been widespread speculation 
that former Prime Minister Vojislav Kostunica would step down or be 
forced out as leader of the Democratic Party of Serbia.   With a 
paltry 21 seats in the new parliament, compared to 53 at its height 
in 2003, the DSS is the weakest it has been since Kostunica defeated 
Serbian strongman Slobodan Milosevic in October 2000.  The former 
Prime Minister has rarely appeared in public since leaving office, 
leaving DSS parliamentary whip Milos Aligrudic the party's 
day-to-day spokesperson. 
 
¶3.  (SBU) Kostunica is clearly sensitive to speculation that he is 
losing influence and has attempted to counter the rumors.  His 
August 25 meeting with party leadership was hyped in the 
DSS-oriented media as evidence that Kostunica remains firmly in 
control of a united party.  In an interview published in Politika on 
September 4, Kostunica declared that he had never considered leaving 
politics and alleged that the idea had come from "abroad."  He went 
on to claim that the governing coalition lacked moral authority and 
political legitimacy because it did not reflect the will of the 
voters. 
 
¶4.  (SBU) Kostunica's desperate tone in the interview tracks with 
what Zoran Drakulic, president of East Point Holdings and a major 
financer of DSS until 2007, told us on August 26.  He described 
Kostunica as desperate to hold on to power but without a plan to do 
so.  Drakulic said he was disappointed that Kostunica had not 
stepped aside to allow the party to rebuild.  Although there were 
individuals with the ability to take over the leadership of the 
party, in particular former Energy Minister Aleksandr Popovic, 
Drakulic saw no one strong enough to force Kostunica out if he did 
not want to go.  He said that DSS had already lost the financial 
support of prominent businessman Vojin Lazarevic, who was now 
funding G-17 Plus instead. 
 
¶5.  (SBU) Others in the party have shared similar thoughts with us. 
DSS Deputy Speaker of Parliament Rade Obradovic told us in mid-July 
that his party was in a "period of adjustment" and needed to concede 
defeat in order to be able to move forward; Kostunica and other 
top-ranking party leaders needed to withdraw from politics in order 
to save the party.  On September 2, DSS official Milan Parivodic 
told us that he hoped to lead a reformed DSS in which Kostunica 
still played a role.  When we told him that the U.S. government 
would not be able to work with his party under such circumstances, 
Parivodic indicated that he might form a new center-right party. 
(Drakulic and others have told us that Parivodic has almost no 
support within DSS, however.) 
 
¶6.  (SBU) In contrast to Obradovic and Drakulic, Nenad Popovic 
(president of Moscow-based ABS Holdings and a DSS member of 
parliament) appears to believe that there is no need for Kostunica 
to resign.  Although Popovic dodged our direct question about 
whether Kostunica would step down, he told us that being in 
opposition was a "healthy opportunity" for the DSS to restructure 
and cleanse itself and predicted that Kostunica would take a seat in 
parliament by the end of the year.  (Popovic, who was appointed head 
of the DSS Economic Council after the elections and recently 
published a book on the Kosovo economy, is seen as the party's main 
liaison to Moscow.) 
 
 
DSS Adrift in Parliament, Belgrade Assembly 
------------------------------------------- 
 
BELGRADE 00000913  002 OF 002 
 
 
 
¶7. (U) DSS is adjusting slowly to its new role as an opposition 
party in the National Assembly.  It has thus far refused to enter 
into a formal parliamentary coalition with Tomislav Nikolic's 
Serbian Radical Party (SRS).  Many political analysts, including 
Vladimir Vuletic, have predicted that any effort to form a united 
opposition would result in a battle for primacy between the DSS and 
SRS.  DSS would run the risk of losing its identity if it associated 
itself too closely with the SRS. 
 
¶8.  (U) The DSS and SRS cooperated to block debate on the 
Parliament's agenda from July 16 until September 3, however.  The 
parties used a series of procedural maneuvers to take the floor and 
discuss issues not on the agenda, resulting in a decision by Speaker 
of Parliament Slavica Djukic-Dejanovic (SPS) on July 21 to adjourn 
until September 2.  On August 9, DSS and SRS called jointly for 
Djukic-Dejanovic to resign over what they termed her threats of 
repressive measures. 
 
¶9.  (SBU) Nenad Komatina, head of the DSS's Belgrade committee and 
seen by some inside the party as a future leader, told us on August 
25 that DSS was in a "difficult" position in the Belgrade City 
Assembly (Ref B) where, as on the national level, it found itself in 
opposition with the SRS.  Komatina foresaw no prospects for a united 
opposition, as the two parties were simply too far apart on a wide 
range of issues.  He also judged any future cooperation with the DS 
at the city level as unlikely, despite a track record of several 
years of fruitful cooperation in the previous coalition government. 
 
 
Broader Impact in Society 
------------------------- 
 
¶10.  (U) Many observers see ripple effects from DSS's instability 
elsewhere in society, including the Serbian Orthodox Church (Ref C). 
 The press has claimed that the DSS's loss of power has had an 
impact on the ongoing dispute between Bishop Artemije, who has close 
ties to the DSS and SRS, and Metropolitan Amfilohije, who is 
associated with the DS. 
 
¶11.  (SBU) Similar power struggles within the Islamic community may 
also have a political aspect.  There are indications that the 
parallel organization created with Kostunica's support, the Islamic 
Community of Serbia headed by Mufti Adam Zilkic and previously 
backed by former Novi Pazar mayor Sulejman Ugljanin, is losing 
influence.  At the August 24 opening of the Mudzahir mosque in 
Subotica, Mufti Muamer Zukorlic of the Islamic Community in Serbia 
(the older organization which acknowledges the authority of the Reis 
in Sarajevo) stated that his orgnization was the true 
representative of Islam inSerbia.  Embassy participants observed 
that the Zilkic representative at the event, Mufti Muhamed 
usufspahic of Belgrade, showed clear deference to ukorlic. 
 
Comment 
------- 
 
¶12.  (SBU) Serbiahas traditionally lacked a responsible 
center-riht party, and Kostunica's journey from national her in 
2000 to nationalist demagogue in 2008 prevened the DSS from 
assuming that role.  Now, aftr the party's dismal performance in 
the 2008 elections, some members of the DSS yearn for the party to 
espouse pro-European, pro-business, conservative values and 
interests, but understand that Kostunica and his rabid nationalist 
acolytes stand in the way.  None of the relatively progressive DSS 
members with whom we've spoken is yet ready to pull the knife on 
Caesar.  But the longer they wait, the greater the possibility that 
the party could actually disappear.  Evidence of this crisis: the 
DSS is now the only party in parliament actively resisting closer 
ties with the European Union, and this indicates a stunning 
misreading of public preferences in Serbia.  Wiser DSS leaders know 
that the DSS has opportunities if it can resolve its leadership (and 
identity) crisis: Tadic's ruling coalition of the center-left has 
only a slim majority in parliament, and tensions between DS and its 
coalition partners SPS and G-17 Plus already beginning to show.  We 
believe Serbia needs a responsible party on the right.  Kostunica's 
fate will determine whether that responsible party is the DSS.  End 
comment. 
 
MUNTER