A shock win for a former ultranationalist in Sunday, May 20's Serbian election is indicative of frustration at economic malaise and apathy among an electorate disillusioned by the political elite. Despite the hard-right background of Tomislav "Toma" Nikolic and an acrimonious campaign, Serbia will continue its move towards the European mainstream after the presidential election, but the new president will face serious economic, political and diplomatic challenges.
The bitterly-contested poll was a run-off pitting incumbent Boris Tadic, who is seen as western-leaning and has overseen the country's progress towards EU membership status, against Nikolic, formerly a fire-breathing nationalist but now supposedly a moderate. That both candidates espoused EU accession is a sign of the changes that have taken place in Serbia since the ouster of strongman Slobodan Milosevic in 2000.
With 40% of the votes counted, Nikolic had secured 50.21% of the vote, with Tadic conceding defeat not long after the polls closed. Low turnout probably helped Nikolic, who can rely on a core of enthusiastic support. Many voters who leaned towards Tadic may have stayed at home due either to apathy or the expectation that he was a shoo-in.
The result is a big surprise. Tadic was widely expected to win; Nikolic's confidantes were said to be sceptical of his chances. But Nikolic's win highlights once again that a substantial proportion of Serbia's population is uncomfortable with the direction the country has been taking.
While Serbia won official EU candidate status in March, the country's economy is sluggish and lacks clear long-term direction, and the populace is disillusioned with a political elite seen as corrupt and remote. Then there is the issue of Kosovo, the region which declared independence in 2008, which both Tadic and Nikolic claim - in public at least - they see as an inalienable part of Serbia.
In the first round of the election, Tadic won 25.31% of the vote and Nikolic 25.05%. Candidates from other parties took the remainder.
What now for the parliament?
Much rests on what parliamentary government takes shape under Nikolic. While Nikolic's Progressive Party narrowly won a parliamentary poll held concurrently with the first round of the presidential election, and has 73 seats in the 250-member parliament to the 67 held by Tadic's Democratic Party (DS). But the DS is thought likely to team up with its allies from the last parliament, most notably the Socialists (SPS), who performed remarkably strongly, to form a workable majority.
Constitutionally, the Prime Minister has more power than the President, but Tadic has effectively taken control of the government in his eight years as President. Nikolic may have less opportunity to to do the same in a situation of cohabitation with a DS-SPS led coalition.
Headlines declaring that Tadic lost the election, rather than that his opponent won, are not far off the mark. The soon-to-be ex-president, once allegedly dubbed the "George Clooney of the Balkans" by Silvio Berlusconi, cuts an urbane figure, and is an energetic and telegenic campaigner. He has successfully steered a course towards the EU while maintaining Belgrade's opposition to Kosovo's independence. Many see this as a contradictory stance, given that it is unlikely that Serbia can join the EU without conceding on Kosovo's sovereignty. Tadic and his allies are widely seen as having privately given up on Kosovo while saying otherwise to the Serbian public, an impression that probably has some basis.
Rather more importantly, Tadic has presided over Serbia during the ongoing economic crisis. With unemployment over 20% and meagre GDP growth of 0.5% expected this year, Serbia continues to suffer, despite successes in attracting investment such as Fiat's large and glitzy revamped plant in Kragujevac, which opened in April. Furthermore, Tadic is accused of allowing corruption and favouritism to run rampant. While his supporters strongly deny this, the impression of cronyism appears to have stuck.
A Tadic victory would have meant more of the same for Serbia; the commencement of accession negotiations with the EU, a very gradual move towards conciliation with the Albanian-dominated Kosovan government in Pristina, and a broadly pro-investment economic strategy.
But particularly given parliamentary arithmetic, a Nikolic presidency may differ more in style than substance from Tadic's leadership. The president-elect was swift to reaffirm his commitment to Serbia's EU membership.
In contrast to the smooth Tadic, Nikolic is seen as somewhat uninspiring, and has little talent for public speaking. A bizarre and abortive attempt at a hunger strike to call for early elections in spring last year has become something of a joke for many Serbs. But Nikolic has attempted to portray himself as a man from outside the political elite.
Nikolic was defeated by Tadic at the last presidential election, in 2008, when the former was standing as the candidate of the ultranationalist Serbian Radical Party, espousing a rejection of the EU, no compromise on Kosovo, and a turn towards Russia.
Just four years later, having left the Radicals and founded the Progressives, Nikolic stood as a moderate conservative, supporting EU accession albeit with a harder line on Kosovo. Nikolic's volte-face, and the poor showing of the formerly powerful Radicals in the recent parliamentary poll, is indicative of the shift of Serbian politics towards a pro-European centre ground.
In policy terms then, there is not a huge gulf between the two men and their parties, unlike 2008, when Serbia faced a clear choice between ultra-nationalism and pro-Western liberalism. Nikolic's main advantage is that he is opposing the ruling coalition and Tadic, and thus can gain support from those looking to punish the government for Serbia's economic difficulties and widespread corruption.
Despite his change of heart on the EU, Nikolic also gained some support from those who disavow accession. In May, he made a pact with the Democratic Party of Serbia, which opposes EU membership, in a clear bid for Euro-sceptic votes. But the agreement merely states that the parties will work towards having a referendum on the EU. Not only is this a vague proposal, but such a referendum would be likely to support accession.
While Serbia's sloughing off of its troubled past continues, the new government will face serious challenges. Much of the population continues to scrape by on low wages, which average only around €400 per month. The Kosovo issue remains unresolved, and the process of EU accession will be long and difficult - membership is not expected before 2020, and will necessitate much judicial, administrative and economic reform.