Despite favorable geographical conditions and some economic progress, Serbia remains stuck in a cycle of stagnation, hindered by historical legacies and cultural factors. While other countries in Central and Eastern Europe have advanced, Serbia’s economic growth is still far behind. Professor Milojko Arsić from the Faculty of Economics in Belgrade presented an analysis highlighting the country’s challenges in overcoming the centuries-old lag.
One of the key barriers to economic development is Serbia’s difficult historical legacy. A large portion of the 20th century was marked by wars, sanctions, and political instability, which has had lasting effects on the country’s economy. Serbia spent a third of the 20th century in conflict and under sanctions, making it the European record holder for such disruptions. These turbulent times have also shaped a culture in which personal connections hold more value than laws, creating a significant obstacle to building a society based on the rule of law.
The country has not had a long history of stable statehood, with only the last 150 years of the past millennium being marked by sovereignty. This lack of long-term statehood tradition has hindered the development of formal institutions and urbanization, which is crucial for economic growth. Serbia’s urbanization rate in the 19th and early 20th centuries was particularly low compared to other Balkan countries. This delayed urbanization has contributed to a culture where informal institutions and personal relationships often outweigh formal systems and laws, making it difficult to foster progress.
Geography and climate, while favorable compared to some other countries, also present challenges. Climate change, for example, will have significant effects on sectors like agriculture, energy, and tourism, requiring substantial investments in adaptation. However, a short-term political mindset has prevented Serbia from addressing these long-term challenges.
Cultural factors further complicate Serbia’s path to progress. A strong collectivist culture, where personal relationships often take precedence over laws and regulations, has fostered an environment where corruption and unfair competition thrive. This mistrust in institutions and the rule of law impedes progress, as citizens are less inclined to believe in the democratic process or trust state-run institutions.
The key to overcoming these barriers is developing a strong rule of law, independent institutions, and a shift in cultural values. While countries like China have progressed without democratic institutions, Arsić argues that Serbia cannot follow the same path. Only by changing its culture and placing greater importance on legal frameworks and institutional development can Serbia hope to close the gap with more developed nations. The question remains: How can Serbia replace its reliance on rulers with the rule of law? The answer, it seems, lies in a transformation that begins with the people themselves.
