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Post-Merkel Cooperation

Some of the topics that top the bilateral agenda include strategic cooperation in the field of climate change, as well as in the field of research and innovation. These themes are of lasting importance to mutual cooperation between the two countries and will hopefully outlive any election outcomes

Germany’s 25th September elections were from the very beginning dubbed “the most unpredictable elections in years”, as they indeed usher in a new era after Chancellor Angela Merkel’s 16 years in office. The outcome, which was watched closely around the globe, is of particular importance for the Western Balkans, and probably for Serbia in particular, as Chancellor Merkel’s policy had a strong impact on all aspects of political and economic life in Serbia. Some observers, such as Simon Ilse, director of the Heinrich Böll Foundation’s Belgrade office, think that her objective of eventually bringing Serbia closer to the EU has failed and state that “it is now high time for a fresh, new start to Germany’s relationship to the key enabler or blocker of a European future for the region – Serbia”.

Indeed, Merkel’s attitude towards the Western Balkans was a key shaper of European Union policy towards the six countries of the region. It will obviously take some time before we can discern how the European and Balkan policies of Markel’s successor will look and whether the Western Balkans will remain a German strategic interest.

Merkel certainly intrigued many with her decision to devote one of her last foreign visits in her capacity as chancellor to Belgrade and Tirana. Some believe that she wanted to deliver a critical message regarding future bilateral relations between these two countries, while others are of the opinion that she wanted to support President Vučić ahead of upcoming elections. Some interlocutors emphasise in particular her message related to the exploration of lithium. It remains to be seen which of these reasons is correct.

German investors increasingly see the Western Balkans and Serbia as places to invest in more complex activities

If one turns to hard data, there is one area that shows strong and unambiguous evidence in all aspects: over recent years, German companies have invested around €3 billion in Serbia, creating more than 65,000 jobs and turning a significant number of Serbian SMEs into supplier companies of the German car industry. As a result, the trade exchange between the two countries is growing constantly, reaching 5.3 billion euros in 2020.

According to the German-Serbian Chamber of Commerce, German investors see Serbia as a suitable destination for investment. According to the results of the opinion poll that’s regularly conducted among German companies in Serbia, the investment climate is good and the business environment is slowly but surely improving.

Another sign of progress in mutual relations is the shift from labourintensive activities to those that are at a higher technical level. Furthermore, suppliers are today working on much more complex projects than they were previously, while the topics occupying the interest of political leaders from both sides include cooperation in the field of climate change and in the field of research and innovation. These are all good news items.

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