By Gordana Filipovic - Oct 8, 2014

The European Union said it is “crucial” for Serbia to work on normalizing relations with Kosovo and uphold the rule of law.

The biggest former Yugoslav republic should implement “in good faith” all agreements reached with Kosovo, its breakaway province, for the accession talks to “proceed smoothly,” the European Commission said in its annual progress report on countries aspiring to join the 28-member bloc.

Serbia “sufficiently meets the political criteria,” and the government should continue to focus on “the rule of law, full exercise of freedom of expression, public administration reform and economic governance,” the EU said. Changing the constitution in the initial stages of membership talks would “represent decisive progress in the accession negotiations.”

Serbia formally opened EU accession talks on Jan. 21 and is still waiting to start talks under the first of 35 policy chapters. Premier Aleksandar Vucic’s six-month-old administration is trying to keep the nation on its path to the EU while maintaining close political and economic ties with Russia, its main political ally in preventing full international recognition of Kosovo, which declared independence in 2008.

“Serbia needs to step up its efforts toward alignment” with the EU especially “in the fields of energy – including on the South Stream gas pipeline, environment, climate change, state aid, health and social protection system and asylum policies,” the report said. In the foreign and security policy area, Serbia needs to “progressively align its policies and positions with the EU ones, in the period up to accession.”

Serbia and other EU hopefuls face a long way to full membership. Johannes Hahn, the nominee to become the EU’s enlargement commissioner, said on Sept. 30 that no further enlargement would take place through 2019.

“Significant efforts” are needed to address “the very high budget deficit by streamlining government spending, restoring fiscal discipline and improving tax collection,” the EU said.