The pandemic has become a major geopolitical opportunity for Serbia

Incredulity prevails on the Belgrade streets and in restaurants. As the waiter of a restaurant in Svetogorska Street put it – “Is it possible that this time we were the most capable country compared to the rest of Europe?” And yet, the latest data from Bloomberg seem incontrovertible: as of February 26, Serbia had administered 20 doses of the vaccine per 100 inhabitants, with 12.4% of the population receiving at least one dose and 7.1% already got the booster vaccine. On the other hand, Italy and Germany had only 2.3% of the population receiving the booster vaccine. Following the decision to distribute at least one dose to as many people as possible, England, which administered 29 doses of vaccine per 100 inhabitants, boasts only 1% of the population having been inoculated with the booster vaccine. Not even the United States, with 29 doses per 100 inhabitants and more than 45 million doses administered, comes close to Serbia’s data – 6.5% of of the U.S. citizens are fully protected thanks to vaccines.

The waiter, who believed that Serbs should face this calamity with the usual resilience which they have been building during the last thirty years of wars and economic crises, or rather by tightening their belts while muttering the usual hope-invocation “biće bolje” (“it will get better”), begins to show a touch of pride: “In fact, we have four vaccines: Pfizer, Astra Zeneca, Sputnik V and the Chinese one. Why did Europe reject Russian and Chinese vaccines to find itself in such difficulty?” Political issues, long speech. Let’s have a coffee.

Undoubtedly, the current success of inoculation in Serbia is also, if not primarily, a political matter.

Vaccine diplomacy

On December 10, 2020, in her statement, Prime Minister Brnabić seemed to surrender to fatalism: “Yesterday, I had a meeting with a pharmaceutical company and they told me that we will be able to get the vaccines in the last quarter of 2021 because all the stocks have already been sold out“. Around the same time, Health Minister Lončar was more confident and talked about the first significant inoculations taking place after April.

Something has changed since then. A diplomatic and commercial offensive was launched that changed the direction of these forecasts in a few days. On December 22, the first 4,875 doses of Pfizer-BioNTech vaccine arrived in the country, followed in January by a contingent of 360,000 doses.

On January 5, vaccination with the Russian Sputnik V vaccine began with the first 2,400 doses, followed in subsequent weeks by about 200,000 doses to date. On January 10th, the first half million Sinopharm vaccines landed in Belgrade, the same amount on January 17th and again on February 10th for a total of one and a half million doses. In February, deliveries have been constant from all manufacturers: February 15th 40,950 doses Pfizer-BiOntech, February 19th 150,000 vaccines produced by Astra Zeneca and in the following days, other batches of vaccines Sputnik V (50,000 doses), Pfizer (46,800 doses), while there are already guaranteed 1.2 million doses Pfizer-BioNTech for the second quarter. In total, nearly two and a half million doses have arrived in a country with a population of less than 7 million in less than two months, between the end of December 2020 and the end of February 2021 – an unquestionable diplomatic and organizational success. Brnabić summarized the government’s message to the population: “If we had waited for the European Union, we, as a country that is not a member, would have received vaccines the last.”

The vaccination center set in Belgrade Fair

There are three factors important for these numbers: a multilateral diplomatic strategy cultivated by the country for decades, President Vučić’s personal relationships at the international level, and the country’s level of digitization, which has made it possible to smoothly manage the process of applying for and administering vaccines.

If the European Union has decided not to consider or at least to postpone the use of Russian and Chinese vaccines for geopolitical reasons, focusing almost exclusively on Pfizer-BiOntech and AstraZeneca, and started buying Moderna vaccine only on February 17th, Serbia has activated not only the traditional friendship with Russia and China, but has opened a channel of exchange of information and best practices with Israel. It has also been able to enter the global race to get the Pfizer-BioNTech vaccine, obtaining almost half a million doses in late February. In this case, the ability to reach top executives of these pharmaceutical companies also counts. Vučić was certainly helped by the relationship that the UAE has with Pfizer, which uses the Emirates planes for global distribution of its vaccine.

Finally, digitization, on which the country has decidedly been focusing in recent years, has made it possible to manage a centralized process of registration and application for vaccines with relative ease and smoothness, managing the logistics of vaccine administration with very complex and differentiated storage methods. Each vaccine is digitally labelled so it is clear where and by whom it will be used. All relevant data, which will be very useful for future epidemiological studies, are stored in the new national data centre in Kragujevac.

How much do vaccines cost the country?

The Serbian government has never made official statements about the costs of the vaccines. However, on the basis of prices declared by pharmaceutical companies and on the quantities of vaccines delivered so far to Serbia, we can estimate a cost to the state budget of not less than 60 million dollars, four-fifths of which should have been absorbed by the expensive Sinopharm vaccine, sold to the Chinese state (which controls the same pharmaceutical company) at $30.75 per dose, but offered on the global market at $144 for the first injection and booster.

According to these estimates, inevitably approximate, to immunize at least 70% of the population over 14 years, Serbia should invest no less than 600 million euro.

Not being able to count on the funds of the Next Generation EU, this effort can only rely on the limited state budget and the benevolence of friendly countries such as Russia and China with regard to possible deferment of payments, along with other forms of financial aid from UAE. If we consider that the budget law of the Republic of Serbia for 2020 had allocated 277.81 million euro to health care sector (about 40 euro per capita, compared to about 1,900 euro per capita in Italy), it is possible to understand the enormity of the effort that Serbia intends to make to get out of the pandemic quickly. And these figures do not take into account the investments in the so-called COVID clinics in Batajnica and Kruševac, the two salary increases for medical staff in April and December 2020 and the purchases of protective equipment.

This is why the country never completely shut down except few weekends during the spring 2020, letting everything run more or less as it did before at least until eight o’clock in the evening. After the round of aid for companies disbursed between April and September 2020, the Serbian state budget was almost exhausted and the lockdown risked blowing up the disbursment of pensions and civil servant salaries. Although reduced, economic activity made it possible to limit the GDP decline and thus also the decline in state revenues. Since February 1st, 2021, companies have also been paying the deferred taxes and payroll contributions paid between April and June 2020 in 24 instalments, with economic forecasts putting the economic decline at 1.4% in 2020 and predicting GDP growth of between 5 and 6% in 2021.

It is a well-known fact that countries that emerge from the pandemic sooner will gain a better position in global competition. But Serbia has an additional strategic goal – to increase its weight of influence in the region.

The geopolitics of the coronavirus in the Balkans

Except for Serbia, the level of vaccinations in the Balkans is depressingly low – in Romania 3.1%, while in Croatia only 1.4% of the population has completed the vaccination process. For Bosnia, Albania, Kosovo and Bulgaria and North Macedonia no data are even available. In this framework, Serbia can also afford to offer vaccination to non-resident foreigners, who can freely apply for inoculation on the portal https://imunizacija.euprava.gov.rs/ .

Did you read that Miro Blažević, the coach of the Croatian national soccer team, also came to receive the vaccination in Serbia?” the waiter reminds me, smiling. The news of the bunch of Croatians coming to vaccinate in Serbia has been widely reported in the Serbian media. But it’s not just propaganda: the agreement between the Russian Gamaleya Institute and the Serbian Torlak Institute, signed in Belgrade and negotiated by Minister Nenad Popović, is expected to allow an annual production of up to twenty million Sputnik vaccines in Serbia, with about three-quarters of the production being distributed in the region starting in the fourth quarter of 2021. At the moment, at least through 2021, the Torlak Institute will be the only production center for Covid-19 vaccines in all of Southeast Europe, giving Serbia an advantage and weight that cannot be compared to any country in the area. In this case, not only will the country boost its ability to access the vaccine for its citizens and anyone who wants to have it administered in Serbia, but it will also benefit from having its own production site, a strategic production infrastructure in a world that is expected to be increasingly plagued by waves of new pandemics.

Aleksandar Vučić has thus initiated a sort of vaccine diplomacy. In the interview to the Croatian television RTL on February 19th, Vučić used extremely friendly and conciliatory tones: “Croatia is a wonderful country with which Serbia wants to be in agreement“, while extolling his role: “Things do not come out of nowhere – to get the vaccines I had many phone calls and exchanged eight letters with President Xi Jin Ping, I asked Putin for support and we immediately had a first shipment of 50,000 doses of Sputnik vaccine followed by another of 50,000. I negotiated with the British and the Astra Zeneca vaccine will be delivered too. I also signed a bilateral agreement with Pfizer anticipating the same programme for the EU.” He was also reassuring: “Serbia and Croatia have a joint future, and I’m not talking at the state level or similar snafus.” Vučić also did not shy away from sowing among the Croatian audience some doubts: “I’m not disappointed with the EU. We expected this to happen.”

Beograd, 29th of January 2021 – First deployment of Sputnik V vaccines welcomed at Belgrade airport by Minister of Innovation Nenad Popovic. . FOTO TANJUG/ SAVA RADOVANOVIC/bs

Covid-19 will deepen the hiatus between the European Union and Serbia. It certainly does not help that the Serbia-EU committee of the European Parliament, led by Tanja Fajon, has recently remarked on all the delays in Belgrade regarding the rule of law, media freedom, the rights of the opposition, and abuses of power, corruption and scandals of members of the ruling party. For its part, Serbia sees its multilateral foreign policy rewarded in the Covid-19 emergency, while the last year of Merkel’s chancellorship will be dedicated to making up for what the super pro-European Guy Verhofstadt has explicitly defined as the Von der Leiden Commission’s fiasco in the procurement of vaccines. This fiasco that will weaken the Union economically and politically in the years to come, will also weaken the EU’s position in the Balkans. Angela Merkel’s exit from the scene, the resistance that Macron will meet to impose himself as the new continental leader, the urgency of implementing the Next Generation EU plan will lead to freeze sine die any hypothesis of enlargement. Only a greater American commitment would allow NATO countries to be able to counter the influence of Russians, Chinese, Turks and Emiratines in the area. But every US intervention always leads to an increase of tensions in the area.

In this scenario, Serbia is aiming to expand its room for maneuvering in order to realize its ambition to increase its relative regional clout, both vis-à-vis non-EU states and those who are already members. Vaccine diplomacy has already begun in November 2020 with the memorandum signed by Serbia, Albania and North Macedonia regarding joint response to the pandemic, purchase of vaccines, economic exchange and acceptance of Albanian and North Macedonian patients in Serbian hospitals. Serbia has boosted steady donations of vaccines: 5,000 Pfizer BioNTech vaccines on February 19th and another 3,510 on February 24th delivered to North Macedonia and 2,000 Sputnik V vaccines delivered to Montenegro on February 16th.

Serbian President Vucic and North Macedonia Prime Minister Zaev at the cerimony of donation of Pfizer-BioNTech vaccines.

For now, these are symbolic donations of essentially political value, but what will the European Union react if the use of Russian or Chinese vaccines becomes predominant in the region? Faced with large numbers, and the fact that Greece already seems inclined to allow entry into its country to those who have chosen Russian and Chinese vaccines, the EU will have to rethink the timing and modalities of the diplomatic confrontation behind the authorization of these vaccines.

The immunization process in the Balkan countries will also become a factor in the political pressure on the EU.

The challenge of the third wave

But the number of hospitalized patients and those in intensive care (much more objective parameters for assessing the severity of the pandemic of simple positives) has been growing in Serbia for two weeks now. The extraordinary mobilization and the good results in the vaccination will not be enough to avoid the recrudescence of the third wave, which by now, as you can see from the graphs, has already restarted.

Covid-19 patients on ventilators from March 2020 until February 23rd 2021

In March, Serbia will have to implement new containment measures to brake the curve and succeed in the enterprise of vaccinating at least one million citizens in order to stabilize the pandemic in the spring and crush the curve also thanks to the summer.

Maintaining or increasing the advantage accumulated so far would means being able to become the only possible destination for those who have chosen to invest in Southeast Europe, but also becoming the reference of the entire Balkan area in the field of vaccines, as well as a return of international image and soft power on which the political leadership has already begun to bet on. Above all, it would mean being able to listen with a certain complacency to the criticism that will continue to come from Brussels, reminding the EU, in a certain instrumental way but not without merit, that in times of need other countries have proved to be helpful.

Vaccines are also an instrument of power and geopolitical conflict, but certainly, until two months ago, it was unthinkable that Serbia would be the leader in Europe for number of vaccinations and economic growth.

As usual, the coffee was great. “Da li je bilo sve u redu?” (“Was everything to your satisfaction?”), the waiter asks, dismissing me, now that he is reassured to show his pride, with less fear that, as usual, it will turn out to be illusory and misplaced.

By Biagio Carrano

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