Serbia's new government to focus on EU, Kosovo

Serbia's new nationalist-led government was sworn in Friday after the new prime minister vowed to focus on EU integration, continuing talks with breakaway Kosovo and boosting the floundering economy. "Our goal is the acceleration of the process of European integration with a maximum effort to get a date for the start of EU accession talks," Prime Minister Ivica Dacic said as he unveiled his government in parliament Thursday. After a marathon debate that lasted until the early hours, lawmakers voted in the coalition made up of the nationalist Serbian Progressive Party (SNS) -- founded by President Tomislav Nikolic -- and Dacic's Socialists. Some critics have warned that the coalition is a throwback to the late 1990s when the Socialist SPS -- then led by late strongman Slobodan Milosevic -- governed with Nikolic during its crackdown against ethnic Albanians in Kosovo. Dacic, who transformed the party after Milosevic's death in 2006, has always vigorously denied there would be "a return to the 1990s" marked by the bloody wars that tore apart the former Yugoslavia and led to international isolation for Belgrade. "Serbia wants to be a factor of peace and stability in the region... all outstanding issues should be resolved peacefully," Dacic told parliament. "Serbia is extending its hands in reconciliation with everyone. We will not concern ourselves with the past, let's concern ourselves with the future," he urged. Belgrade was given EU candidacy status in March, and improving relations with Kosovo -- which unilaterally proclaimed independence from Serbia in 2008 -- is a key condition for it to secure a date for EU entry talks. Both Dacic and Nikolic, a former ultra-nationalist who once said he would rather see Serbia as a province of its traditional ally Russia than an EU member, are now firmly pro-European Union. While insisting that "Serbia will not recognise the independence of Kosovo", Dacic said Belgrade would respect agreements reached in EU-brokered talks with Pristina that began in March last year. "It is necessary to implement all that was agreed in the technical dialogue with Pristina and to continue the talks on a political level with the participation of the highest state officials," he said. Dacic added that Belgrade was ready to continue the talks "immediately, without conditions". The new cabinet also vowed to tackle the "very difficult" economic situation by trying to bring in foreign investment. The 2012 budget forecasts 1.5 percent economic growth but the International Monetary Fund has a much lower estimate of only 0.5 percent. Serbia also has one of the highest unemployment rates in Europe at over 20 percent, while the average monthly wage is around 340 euros. Dacic said Serbia would continue talks with the IMF and the World Bank "to assure macro-economic stability" for the country. In August last year Belgrade and the IMF agreed a one billion-euro ($1.2 billion) stand-by loan for an 18-month period. However the deal was frozen in February because Serbia did not keep to figures agreed for the 2012 budget with the IMF. Dacic also holds the post of interior minister in his 19-member cabinet. SNS leader Aleksandar Vucic, who took over the party helm after Nikolic stepped down when he became president, will be deputy prime minister -- one of four -- and defence minister. Ivan Mrkic, a former ambassador to Japan and Cyprus who is not affiliated with any party, becomes foreign minister.