Serbs go to polls nostalgic for socialist past

PANCEVO, Serbia (Reuters) - The flea market stretches asfar as you can see, stalls and tarpaulin roofs over crammeddisplays of goods - some old, some new and some of dubiousorigin.

There are few price tags, no receipts, just the sound ofhaggling and the lingering smell of pork grilled in ramshacklestands. This is a mall for those who have missed out inSerbia's uncertain transition towards a market economy.

"I would like things to be the same as when I was young, inthe 1970s," says Stanka Velickovic, who sells bicycles in oneof the market's main drags. "Everything was better then."

Nostalgia for socialist Yugoslavia and bitterness at thefailure of capitalism to deliver for all are the unspokenfactors in the May 11 general election, the small print underthe banner issue of whether Serbia should turn to West or East.

The nationalist, populist Radicals have a good chance ofwinning the election, tapping into the discontent of millionsraised in the cosy embrace of a socialist state.

Still nominally employed in a state firm, Velickovic hasn'tbeen paid since 2000, when the fall of autocrat SlobodanMilosevic after a decade of war threw Serbia into a stop-gotransition and put an end to the sweeteners he handed out.

"My son is sick and can't work, and the state will nothelp," she says. "That's why I will vote for change, for thosewho pledge to fight corruption and improve the health system."

The market of Pancevo, a declining town notorious for itsindustrial pollution, is one of dozens that sprang up in the1990s when economic collapse and hyperinflation forced manypeople to sell what they had for food and gas.

Shiny shopping centres have since been built in the boomingcapital Belgrade, just 25 km to the south, selling expensiveforeign clothes and gadgets and featuring novelties such assushi restaurants, multiplex cinemas and bowling alleys.

But with a third of the population unemployed and averagemonthly wages just over 350 euros (276 pounds), flea marketsare still where most Serbs go to shop, rather than only browseand dream.

FOREIGN INVESTMENT FALLS SHORT

The main contenders in the election are the Radicals, whofavour state control of the economy and closer ties withRussia, and a bloc of pro-Western liberal parties that have runSerbia, in various constellations, since the fall of Milosevic.

Analysts say most people are unhappy with how things havedeveloped, their hopes for rapid improvements in salaries andliving standards dashed by waves of restructuring and layoffs.

"In underdeveloped and poor regions people perceivethemselves as losers of transition and vote for the Radicals,"says pollster Marko Blagojevic of the CESID think tank.

Investment after the fall of Milosevic has been more modestthan expected: the $13.5 billion (6.85 billion pounds) offoreign investment so far is respectable compared to poorerneighbours, but short of forecasts for ex-Yugoslavia's mostpopulous state.

Many foreign firms are still watching on the sidelines,wary of instability and halting progress towards the EuropeanUnion, largely due to lingering nationalism.

The most recent flare up was in February over theWestern-backed secession of Kosovo province, which sparkedoften violent protests and attacks on foreign embassies andfirms.

One casualty was the town of Bor, home to a debt-riddenmining complex that successive governments have tried to put onthe block: the Austrian firm due to buy it pulled out, sayingit had trouble raising funds due to the instability.

Former miner Milko, now a pensioner whose 10,000 dinar (97pounds) pension pays for a whole family, longs for a rosierpast.

"When the state controlled everything, we had the greatestprosperity," he says. "The company even paid for our holidays."

GOOD TIMES FOR SOME

Officials in the outgoing government, a coalition ofliberals and nationalists that split over Kosovo, have said theBor complex will go on sale for a third time after the vote.

They are markedly quiet on its chances, instead trumpetingsuccess in getting Fiat to agree to invest in the city ofKragujevac, home to the Zastava factory that makes the Yugocar.

Zoran Mihajlovic, a Zastava union leader and longtimepro-Western activist, said after years of broken promises, evenhe was sceptical about whether the deal would really gothrough.

"In eight years the factory has not been privatised,"Mihajlovic told Reuters, "but the sale of Zastava is mentionedin every single election campaign."

Anita Milovanovic, a 32-year-old who works for Serbia'scentral bank, said that she understands the frustrations of thepoor, but would vote for the pro-Western coalition on Sunday.

"Since 2000 my life is much better, I have a good job,money to go on holidays. It's difficult for me to even thinkhow I used to live 10 years ago," she said.

"People forget how badly we were doing, it's not possibleto change it overnight. We're on the right track now and weshould keep going, instead of turning back to the past."

(Writing by Ellie Tzortzi; editing by Keith Weir )