What the Union should do for Kosovo

Date: 13/01/05

LAST month, the EU quietly took over NATO responsibility for maintaining law and order in Bosnia & Herzogovina. But, should it now also prepare to replace NATO's K-For in Kosovo, or even - as recently suggested by the German Christian Democrat MEP Doris Pack - to assume a protectorate for the territory in place of UNMIK (the United Nations Interim Administration in Kosovo)?

Certainly, UNMIK's record in Kosovo is mixed, as spelled out by Kai Eide, Norway's ambassador to NATO, who produced a devastating report last July at the request of UN Secretary-General Kofi Annan. Under UNMIK, Kosovo's economy has shrunk and the organisation was unprepared for last March's outbreak of inter-ethnic violence.

This is not the time, however, to consider a new protectorate. October's election of a new parliament and provisional government for Kosovo has already led to the handover of some of UNMIK's responsibilities, and more are likely to follow.

Yet the authority of the provisional government is fragile. Only some 300 Kosovo Serbs voted in the election, boycotted by most Serb parties, meaning that they won none of the 100 seats up for general election. Serb representation is restricted to ten seats. A further ten seats are reserved for other minorities, meaning that the Albanian Kosovars control about five-sixths of the 120-seat parliament.

The composition of the new government does not reassure the Serbs. President Ibrahim Rugova's moderate LDK party won the most seats, but without an overall majority. They formed a government with the more hard-line AAK party of Ramush Haradinaj, rather than with Hasim Thaci's PDK, seen as less hostile to the Serbs.

Haradinaj is prime minister, but perhaps not for long as rumour has it he will soon be indicted for war crimes by the International Criminal Tribunal for the former Yugoslavia (ICTY). If so, he is likely to be charged in connection with the killing of 40 Serb and Albanian civilians near his home village of Giodjane in the summer of 1998, when he was the leader of the Kosovo Liberation Army (KLA).

Haradinaj's indictment would cause a major political crisis in Kosovo. Haradinaj has been conciliatory towards the Serbs since he became premier, but neither the Kosovo Serbs nor the Serbian government in Belgrade have reciprocated.

Haradinaj, together with Rugova and most of his ministers, met the United Nations Contact Group on the former Yugoslavia (UK, US, France, Germany, Italy and Russia) in Pristina in mid-December, and pledged close co-operation with UNMIK ahead of the Final Status talks due next summer.

Haradinaj's team declared their "immediate priorities" to be "reformation of local power, increase of dialogue between communities, security for minorities, the return of internally displaced persons and the completion of reconstruction", while it asked from UNMIK the "successful transfer of competences".

The European Commission was not represented at this meeting, though its help, financial and otherwise, will be essential to successful implementation of these policies. However, this contribution will have to be larger and more focused than in the past.

A recent report by Professor John Bradley and Gerald Knaus for Berlin-based think-tank the European Stability Initiative pays the EU a backhanded compliment. It suggests that the success of efforts to help improve the economies of eastern European EU candidates through pre-accession aid has made life more difficult for Kosovo.

It has become a less attractive proposition for direct foreign investment than neighbours with rapidly expanding economies. With much of the population dependent on remittances and subsistence agriculture, Kosovo is caught in a downward spiral.

The International Monetary Fund, which in December 2001 had estimated Kosovo's Gross Domestic Product at €1.85 billion, reduced its estimate to €1.57 billion in June 2003. Six months later, UNMIK and various financial institutions, put it at €1.34 billion.

Bradley and Knaus argue that the key priority for the new government and its successors is to identify ways in which Kosovo can catch up with the rest of Europe. The first step, they argue, must be to draw up, with the co-operation and material assistance of the EU, a National Development Plan. The EU contribution would consist not only of the provision of pre-accession-style funds, but also of close monitoring, of the type to which candidate states submitted during the accession process.

If help were given on an equivalent scale, the cost to the EU would not be enormous, given that the population of the territory is not much more than two million. The cost to Europe of letting the territory collapse into an economic 'black hole' would be far greater.

Whatever decision is taken over the Final Status, the chances for Albanians and Serbs to live peacefully together can only be improved if the future economic prospects for the territory are put on a firmer footing.

• Dick Leonard is a former assistant editor of The Economist.

Analytical feature on the situation in Kosovo, which, according to the author, is characterised by economic decline and fragile political institutions.