Serbia’s New Leaders Face a Test of Political and Economic Reform

Serbia’s parliamentary election on 25 October has opened a new chapter in the country’s politics, with the student-backed Student List defeating the alliance led by the Serbian Progressive Party (SNS) of Aleksandar Vučić. The result followed nearly two years of anti-government protests, which gathered momentum after the collapse of a railway station canopy in Novi Sad in November 2024 killed 16 people. The disaster became a focal point for public demands for accountability, greater transparency in public procurement and action against corruption.

With almost 99% of the votes counted, the Student List had secured 52.7% of the vote, compared with 39.2% for the SNS-led alliance, according to figures reported by Reuters. The result gives the movement 139 seats in the 250-member parliament, providing it with a parliamentary majority. Vučić conceded defeat, ending a period in which he had dominated Serbian politics as prime minister or president since 2014.

The victory, however, does not automatically translate into an established governing structure. The Student List emerged from a broad protest movement rather than a conventional political party, bringing together candidates from academia, public service and other professional backgrounds. Its collective approach helped it attract voters dissatisfied with the existing political establishment, but it leaves questions about the selection of a prime minister, the distribution of responsibilities and the mechanisms through which competing priorities will be reconciled.

The immediate challenge is to turn public expectations into institutional change without losing the coalition that brought the movement to power. Its supporters have demanded more accountable government, while some voters remain uncertain about who will exercise authority and how the new leadership intends to govern. The transition will therefore test not only the movement’s reform programme but also its ability to establish clear decision-making procedures and maintain public confidence.

Anti-corruption measures and institutional accountability

Anti-corruption reform is central to the Student List’s programme. The movement has proposed changes to policing, public appointments, asset recovery and the supervision of infrastructure projects. Among its plans are an independent police unit accountable to prosecutors rather than the Interior Ministry, merit-based appointments to state-owned companies and restrictions preventing convicted officials from holding public office.

It has also pledged greater scrutiny of major infrastructure contracts and measures allowing authorities to investigate the origins of officials’ wealth and recover assets acquired illegally. These proposals respond to the concerns that fuelled the protests, particularly over the relationship between political influence, public spending and accountability for failures in state-supervised projects.

Implementing such measures will require more than changing legislation. Investigations and prosecutions depend on the independence of the judiciary, the effectiveness of oversight bodies and the willingness of public institutions to act without political interference. The new leadership will also have to demonstrate that accountability mechanisms apply consistently, including to officials associated with the previous administration and to members of its own political coalition.

The transition could face resistance from established networks within the state administration and public enterprises. At the same time, an expansive anti-corruption campaign will need credible procedures and sufficient evidence to distinguish legitimate investigations from political retaliation. The treatment of public contracts, police conduct and judicial independence will provide early indications of whether the movement can deliver the institutional changes it has promised.

Kosovo and the limits of European integration

Relations with Kosovo present one of the most difficult foreign-policy questions for the incoming government. The Student List maintains that Kosovo, which declared independence from Serbia in 2008, remains an integral part of Serbian territory. During the campaign, its candidates described the territory as occupied and argued that its reintegration could be pursued through peaceful means, diplomacy and dialogue.

The movement has prioritised preventing the departure of Serbs from northern Kosovo and strengthening Serbian-funded institutions, particularly in healthcare and education. It has also rejected previous agreements with Kosovo’s authorities in Pristina concerning energy, vehicle licence plates and the use of the Serbian dinar. This position could complicate efforts to resume normalisation between Belgrade and Pristina, a central element of Serbia’s European Union accession process.

For Brussels, the issue extends beyond bilateral relations. Progress towards EU membership requires Serbia to normalise relations with Kosovo, while the wider dispute continues to affect political stability across the Western Balkans. A government that takes a more confrontational approach to existing agreements could make accession negotiations more difficult, even if it advances domestic reforms in other areas.

The Student List has deliberately placed domestic reform ahead of a definitive decision on European integration. Prominent candidates have argued that Serbia should concentrate on completing the necessary reforms and closing negotiating clusters before asking citizens to make a final choice on membership. This approach leaves room for continued engagement with the EU but does not resolve the underlying tension between the movement’s position on Kosovo and the conditions attached to accession.

Russia, energy security and relations with the West

Serbia’s relationship with Russia presents a second strategic challenge. The country remains dependent on Russian gas, while its energy sector is exposed to the consequences of international sanctions and changes in ownership. The Student List has opposed imposing sanctions on Moscow over Russia’s war against Ukraine and has said it does not intend to align its foreign policy automatically with EU positions.

This stance limits the scope for rapid convergence with Brussels on foreign and security policy. Serbia’s EU accession ambitions require closer alignment with the bloc’s common foreign policy, including its approach to Russia. The incoming government will therefore have to manage the gap between its political commitments and the practical requirements of maintaining access to European markets, investment and energy supplies.

The position of the Petroleum Industry of Serbia (NIS), which operates the country’s only oil refinery, illustrates the economic dimension of the problem. The company’s exposure to US sanctions has made the handling of Russian ownership and the future of crude oil supplies particularly important. Serbia’s ability to maintain operations depends partly on sanctions arrangements and the proposed transfer of Russia’s stake to Hungary’s MOL.

Gas supplies create an additional vulnerability. Russia remains Serbia’s principal gas supplier, and the movement has described this dependence as an economic constraint rather than a political alignment. Nevertheless, reducing that exposure would require alternative supplies, infrastructure investment and potentially higher costs during the transition. These decisions could affect industrial competitiveness and household energy bills, making energy diversification both a strategic and domestic economic issue.

The Student List has also pledged to stop Serbian arms exports to war zones, including sales to intermediaries that subsequently transfer weapons to Ukraine. Implementing such a policy could affect defence-industry revenues and Serbia’s relationships with foreign customers. More broadly, the government will have to determine how it intends to balance its stated neutrality with the competing expectations of Russia, the United States and European partners.

Economic pressures and the cost of living

The incoming government will take office amid continued economic growth forecasts but renewed inflationary pressure. The International Monetary Fund has projected Serbia’s economy to expand by 3% in 2026 and 4% in 2027. However, inflation rose to 4.1% in September, compared with 2.2% in August, while the central bank’s benchmark interest rate remained at 5.75%.

These conditions complicate the movement’s promises to improve living standards. Its economic programme seeks to reduce the influence of large retail businesses on consumer prices, restructure taxation in favour of lower-income households and strengthen workers’ rights. It has also proposed limiting the permitted duration of temporary employment, a measure intended to reduce insecure working arrangements.

The programme represents a shift in emphasis away from a growth model heavily associated with state-backed infrastructure projects and comparatively inexpensive labour. The proposed alternative places greater weight on domestic purchasing power, employment security and oversight of public expenditure. Yet the effectiveness of these measures will depend on their design, enforcement and interaction with investment and business costs.

Tighter oversight of public contracts could reduce opportunities for waste and improve the use of state resources. However, savings from anti-corruption measures are uncertain and may not immediately provide enough funding for the movement’s wider spending commitments. Tax changes would also need to be calibrated against revenue requirements, while measures targeting retail concentration would have to address the causes of high prices without creating additional distortions in supply.

Social policy and the challenge of youth emigration

The Student List has linked economic reform to a broader effort to address emigration and declining confidence in public institutions. Its proposals include affordable housing for young couples, teachers and healthcare workers, free school textbooks and cheaper medicines supported by state subsidies.

These commitments respond to concerns that employment insecurity, housing costs and the quality of public services are encouraging younger Serbians to seek opportunities abroad. The movement’s ability to improve these conditions will be important to its long-term legitimacy, particularly among voters who supported it because established parties had failed to deliver tangible improvements.

Affordable housing would require a sustainable funding model and coordination between central and local authorities. Education and healthcare measures would similarly depend on budget allocations, administrative capacity and the availability of qualified staff. If implemented effectively, they could help improve access to essential services; if delayed or underfunded, they could deepen frustration among the same constituencies that drove the electoral change.

The government will also need to balance social spending against fiscal constraints and other priorities, including energy security, institutional reform and the maintenance of public infrastructure. These demands are interconnected: stronger public services require reliable financing, while improved governance and procurement controls could help ensure that allocated funds deliver measurable benefits.

Implications for the European Union and the Western Balkans

Serbia’s political transition matters beyond its borders. As a major country in the Western Balkans, it influences regional relations, the stability of communities divided by unresolved disputes and the pace of European integration in south-eastern Europe. The new leadership’s decisions on Kosovo, relations with Russia and domestic institutional reform will therefore be closely watched by EU governments and neighbouring states.

For Brussels, the election presents an opportunity to engage with a leadership whose political mandate is closely associated with demands for accountability and institutional change. European Commission President Ursula von der Leyen has indicated that the EU is prepared to support reforms involving the rule of law and media freedom. Turning that willingness into progress will depend on concrete measures, including the independence of public institutions, implementation of legal reforms and movement on the normalisation of relations with Kosovo.

At the same time, the Student List’s positions on sanctions against Russia and Kosovo suggest that a change of government will not necessarily produce an immediate change in Serbia’s geopolitical orientation. Its emphasis on domestic reforms may create scope for cooperation with European institutions, but disagreements over foreign policy could continue to limit the pace of accession.

The transition also raises questions about how the movement will organise itself once the electoral campaign is over. A broad coalition can unite voters around demands for accountability, but governing requires decisions on budgets, appointments, international agreements and competing economic interests. Its ability to maintain internal cohesion while establishing clear lines of responsibility will be as important as the content of its programme.