Südosteuropa 57 (2009), H . 2/3, S . 235-260
DEMOCRACY AND MARKET ECONOMY
ILIR DEDA
Kosovo: Internationalized Democracy-Building
Abstract. By taking stock of the situation in early 2009 and the preceding two years, the present article investigates the quality of democracy, market economy and political management in Kosovo . The article is based on ambitious conceptsof “constitutional democracy”, “sustainable market economy” and “strategic management” that have been defined and operationalized to guide a biannual global expert survey of democracy and market economy conducted by the Bertelsmann Foundation . The democracy questions of this survey not only refer to free and fair elections, but also to the freedom of the media, the rule of law, the institutional, rep- resentative and cultural consolidation of democracy and the state framework of democratic rule . The quality of market economy is assessed by a set of questions that assess welfare, fairness, environmental and education policies in addition to the functioning of free markets and property rights . Finally, the questions on strategic management seek to evaluate whether and through what means political elites are able to develop state capacity, build broad societal support, use external advice and cooperate with neighbors and in international organizations .
Ilir Deda is the Executive Director of the Kosovar Institute for Policy Research and Develop- ment (KIPRED) in Prishtina, Kosovo . He holds an M .A . in International Affairs from The New School, New York .
Introduction
The period covered in this study (2007-2009) marks significant changes in Kosovo and the crucial time during which Kosovo’s final status shifted from international administration to the declaration of independence and the con- solidation of the new state . The new Kosovo’s institutions are overseen by the International Civilian Office (ICO), the North Atlantic Treaty Organization-led (NATO) Kosovo Force (KFOR), and the European Union (EU) rule of law mis- sion, EULEX . The international presence has helped build democratic institu- tions, but has also severely limited the discretion of elected political representa- tives in Kosovo, which tends to undermine their democratic accountability and reinforce a culture of dependency . The consolidation of the state faces serious difficulties because of state’s questionable international legitimacy, weak gov- 236 Ilir Deda erning institutions to support the rule of law and the market economy, and the control neighboring Serbia has over the Kosovo Serbs and the northern part of the country .
History and Characteristics of Transformation
Kosovo became an independent state on 17 February 2008 with the declara- tion of independence from UN administration and subsequent recognition by most Western countries . In the former socialist Yugoslavia, Kosovo was an autonomous province, the status of which was gradually enhanced from the Federal Constitution of 1946 to the one of 1974 . The enactment of the latter ren- dered Kosovo a constituent entity of Yugoslavia, as one of the two autonomous provinces of Serbia, with far reaching autonomy and effective veto powers at both the Serbian and the Federal levels 1. Furthermore, it required a consensus of the Republics and the Autonomous Provinces for all decision-making issues, including the alteration of the Constitution .2 In 1989, Belgrade abolished Kosovo’s autonomy, in violation of both Kosovo’s and the Federal Constitution, and established a repressive police and military regime . Kosovar Albanians were expelled from the public service . Throughout the 1990s, Kosovo was ruled directly from Belgrade, with the local Serb com- munity playing a significant role in implementing Serbia’s rule over Kosovo . The majority of Kosovar Albanians, led by the Democratic League of Kosovo (Lidhja Demokratike e Kosovës, LDK), chose peaceful resistance that aimed at defying the exercise of Serbia’s authority over the territory and at building a system of “parallel government institutions” . The failure of peaceful resistance to provide a political solution, combined with increasing repression from Bel- grade, culminated in armed conflict in 1998, with the emergence of the Kosovo Liberation Army (Ushtria Çlirimtare e Kosovës, UÇK) . The conflict was brought to an end through NATO’s military intervention in the spring of 1999 . Following the end of the war, in June 1999, an international administration was established in Kosovo through UN Security Council Resolution 1244, which governed the territory until early 2008 . The United Nations Interim Administration Mission in Kosovo (UNMIK) was designated as the authority holding civilian responsi- bility over Kosovo, while NATO’s presence in Kosovo (KFOR) was responsible for the security portion of this international mission 3.
1 Cf . the Constitution of the Socialist Federal Republic of Yugoslavia (1974), Articles 1 and 2 . 2 Arhiv Jugoslavije, available at
Interethnic clashes in March 2004 left many Serbs fearful for their future . The March riots led to a growing belief among much of the international community that continuing failure to resolve the final status of Kosovo would lead to yet more insecurity and instability . The result was the 2005 report by the United Nations (UN) special envoy and Norwegian diplomat, Kai Eide, who called for the settlement of Kosovo’s final status . That same year, the Secretary General of the United Nations appointed Martti Ahtisaari, the former Finnish President, as the Special Envoy of the Secretary General on Kosovo’s future status . In March 2007, after a year of negotiations with Belgrade and Pristina, Ahtisaari recommended independence as the best way to promote stability and security in Kosovo in the long run 4. The plan envisaged the end of UN Resolution 1244, provided for UNMIK’s departure and the transfer of its remaining powers to the Kosovo government, . It also mandated that the European Union (EU) deploy a political mission to oversee the implementation of the settlement (the International Civilian Of- fice / European Union Special Representative), a police and justice mission to strengthen the rule of law, as well as a continuing military mission to guarantee overall security under a NATO-led international military presence . Due to Rus- sia’s threat to use its veto power if Ahtisaari’s proposal was introduced at the UN Security Council, the UN Secretary General mandated that a “troika” (United States, European Union, Russia) undertake another four months of negotiations with Prishtina and Belgrade on Kosovo’s final status . The “troika’s” mandate ended in December, without achieving an agreement between the parties . In coordination with Washington and Brussels, Kosovo’s Assembly adopted a Declaration of Independence on 17 February 2008, declaring Kosovo a sov- ereign state . This ended the almost decade-long United Nations protectorate . Sixty four states have recognized the independence of Kosovo as of December 2009, including 22 of the 27 EU member states . Kosovo’s authorities pledged to fully implement the provisions of Ahtisaari’s Comprehensive Status Proposal . The Assembly invited the EU to deploy its rule of law mission (EULEX), and the establishment of the International Civilian Office (ICO) to supervise the implementation of the Ahtisaari plan . United Nations Secretary General Ban Ki-moon ordered the UN and its Kosovo mission UNMIK to operate under a “status neutral” framework days before Kosovo’s Constitution came into effect in June . The period under international administration has been characterized by competing goals when it comes to state-building . The international administra- tion was guided by a vague aim to establish substantial autonomy, as ambigu-
4 Letter dated 26 March 2007 from the Secretary General addressed to the President of the Security Council, available at
Democracy
Stateness
Despite Kosovo’s declaration of independence, its democratic institutions do not have a full monopoly on the use of force, instead sharing authority with the international security presence in the country . From June 1999 to June 2008, the United Nations Interim Administration Mission (UNMIK) in Kosovo was designated as the authority holding civilian responsibility over Kosovo, whereas NATO’s presence (KFOR) was responsible for the security portion of this international mission . During this period, the Kosovo Police Service (KPS) was created and made fully operational alongside UNMIK Police . The UNMIK Police ceased to exist in December 2008 with the deployment and starting of operations of EULEX . In January 2009, a gendarmerie formation – the Kosovo Security Force – was created under the auspices of NATO 7. This duopoly of force, shared by Kosovo’s authorities and the international security presence, is seriously challenged by illegal operations of Serbia’s po- lice and intelligence operatives 8. The situation is critical in the divided city of
5 UNSCR 1244 (above fn . 3), Article 10 . 6 Report of the Secretary General on United Nations Interim Administration Mission in Kosovo, S/2008/354, Paragraph 12, 12 June 2008, available at
Mitrovica and the Serb-controlled north of Kosovo .This area suffers from a total absence of the rule of law, reflected in the inability of the international commu- nity and Kosovar government institutions to impose law and order . Moreover, Serbia reacted to Kosovo’s declaration of independence by instigating Kosovar Serbs in northern Kosovo to burn border posts in the area and pressing them to leave Kosovo’s police force and all civil service posts .9 Belgrade organized “municipal elections” in Kosovar Serb areas on 11 May 2008, which were de- clared illegal by UNMIK and the government of Prishtina . The radical forces, which won the elections, created an “Assembly of Associations of Municipalities of Kosovo and Metohija” in June 2008 10. With the creation of this body, Serbia aimed to establish a representative body of Serbs in Kosovo 11. The change of government in Belgrade resulted in the loss of influence of this Assembly, as the new Serbian Ministry for Kosovo and Metohija, composed of members of the Democratic Party (Demokratska stranka, DS) of President Boris Tadić took over the decision making 12. Kosovo is an ethnically diverse state of 2 .1 million people in which Albanians constitute 92 % of the total population, Serbs 5 .3 %, and Bosniaks, Turks, Roma, Ashkali and Egyptians combined comprise 2 .7 %13 . The Constitution establishes Kosovo as a multiethnic state with a civic character and guarantees the highest standards of equality for all communities 14. All inhabitants of Kosovo who have lived within its territory since 1 March 1998 have an automatic right to citizenship and are also entitled to double citizenship . The Albanian majority community and the non-Serb minority com- munities accept the Kosovar state as legitimate . Most of the Serb community opposes the statehood of Kosovo . Kosovo is defined as a secular state, and religious dogmas are excluded from political life . The state’s basic infrastructure extends throughout most of the ter-
9 Report of the Secretary General on the United Nations Interim Administration Mission in Kosovo, S/2008/211, Paragraphs 7 and 8, available at
Political Participation
Since 2000, Kosovo has created a tradition of credibly free and fair elections . The most recent general, municipal, and mayoral elections were held on Novem- ber 17, 2007 . While approximately 40 percent of the Kosovar electorate voted, the Kosovo Serb community largely boycotted the elections16 . With the declaration of independence, Kosovo’s authorities assumed the responsibility over the Central Election Commission (CEC) . The adoption of new electoral laws – the Law on Local Elections and the Law on General Elec- tions – as well as the coming into force of the Constitution in June 2008, ended the Organization for Security and Cooperation in Europe’s (OSCE) responsibility for the organization and implementation of elections . Democratically-elected representatives have the effective power to govern within the framework of supervised independence . Possible extra-governmental veto powers, such as powerful businessmen or former UÇK groupings, have so far not threatened the elected government’s authority from outside the system, but have generally chosen to operate within it . The new multi-ethnic Kosovo Security Force (KSF) is subordinated to KFOR and is widely seen as the embryo of a future Kosovo Army . The mission of the KSF is to conduct crisis response operations in Kosovo and abroad, civil protection operations within Kosovo, and to assist the civil authorities in responding to natural disasters and other emergencies 17. The freedom of the media in Kosovo is protected by an advanced legal framework, and there is a rich diversity of media outlets . Nevertheless, the
15 Ilir Deda, Kosovo at a Crossroad: Decentralization and the Creation of New Mu- nicipalities, Policy Brief 14, July 2009, available at
Rule of Law
Kosovo has in place a constitutionally well-defined system of checks and balances between the legislative, executive and judiciary branches, yet thes checks and balances are not fully effective in practice . The Assembly of Kosovo is relatively weak in adopting legislation and overseeing the work of the execu- tive . Legislation deriving from the Ahtisaari plan has passed in the Assembly with special procedures whereby the MPs did not get a chance to debate this package of laws . Also, with the two main political parties united in a govern- ing coalition, the opposition has been left voiceless and powerless in its role in the Assembly 20. The judicial branch is formally separated from the executive and legislative branches, but there are widespread perceptions of corruption and political interference in the criminal justice process . Furthermore, the judicial system is among the least advanced of the three branches , and as such it faces difficul- ties in its operational structure . It is also exposed to political influence from the government in its operations and is unable to ensure independent and unbi- ased judgments . Moreover, the judicial system is not entirely independent as it depends on the EULEX mission for cases dealing with war crimes, corruption and other highly sensitive cases 21.
18 Background Report – Human Rights, Ethnic Relations and Democracy in Kosovo (Summer 2007 – Summer 2008), 30, available at
The judicial system is regarded as the weakest of Kosovo’s institutions 22. Therefore, the European Union decided to deploy the EULEX mission in Kosovo, in order to strengthen the rule of law in the country 23. The EULEX mission holds a number of executive powers that supersede those of the Kosovo Government in the fields of corruption, organized crime and interethnic crimes . Dozens of cases of war crimes and grave human rights breaches remain unaddressed 24. Corruption and general criminality are widespread problems in Kosovo 25. Inadequate protection of witnesses is a serious deficiency of the judicial sys- tem . Serious violations of human rights, such as those related to the right to a tribunal established by law, a trial within a reasonable amount of time, liberty, and access to justice continue to characterize the judiciary 26. Among the major concerns are: an extreme backlog of cases, coupled with a lack of oversight and case management tracking mechanisms in the courts; virtually non-existent witness protection and relocation mechanisms in an environment where regular incidents of witness intimidation take place; a lack of qualified judges and prosecutors; passive investigative practices; poor coordination among police, prosecutors, and judges; poor collaboration between international and national elements of the system; problematic detention and sentencing practices; the structure of the courts; adequate allocation of judges and prosecutors; malfunctioning of court administration; lack of professional- ism; and corruption . The absence of a constitutional court creates legal uncer- tainty as to the interpretation of law . However, the judicial system in Kosovo has also seen some positive changes in recent years . The Kosovo Special Prosecutor’s Office became operational in spring 2007, whereby six prosecutors were appointed . Co-operation between the judiciary, the treasury and the private banking sector has advanced, which has improved the enforcement of judgments . The establishment of an auto- mated court management system was completed in all five district courts for the management of penal cases . Witness protection equipment and ISDN links have been installed in all district courts to enable video conferences to be held .
22 Ibid . 23 Council Joint Action, 2008/124/CFSP, 4 February 2008 on the European Union Rule of Law Mission in Kosovo, EULEX Kosovo, available at
Important improvements such as smoother proceedings for civil disputes and sexual assault cases were recently noted .27 Prosecution of office abuse in Kosovo is rare and is not an accepted rule of governance . The newly established Anti-Corruption Agency (AKK) has inves- tigated a considerable number of cases of public officeholders and delivered suspicious cases to the related courts, but the judicial system has not reacted thus far . In 2007 a political advisor to then-prime minister Agim Çeku and the head of a bank were arrested on money-laundering charges 28. The complexity of the applicable law, ambiguities within available legal texts and the very divergent practice of application of the legal corpus have created a substantial legal uncertainty, which results from the failure to specify which provisions of the formerly-applicable law were replaced by those of UNMIK and subsequently by the Constitution of Kosovo and other laws adopted by the Kosovo Assembly . As a consequence of the flawed judicial system, civil rights continue to be abused and not properly implemented throughout the country . Although the UN Covenant on Civil and Political Rights has been made part of the applicable law in Kosovo since 1999, the situation vis-à-vis access to effective legal remedies and the fair trial guarantees in Kosovo has been per- ceived as highly critical .29 The number of missing persons remains high . The commitment of the authorities at all levels is not sufficient to achieve objective and efficient investigations in this area, regardless of the ethnic background of the missing persons 30. Cases of domestic violence are quite widespread . Aggravating circumstances include: the persistence of traditional attitudes concerning gender roles within Kosovar society, an under-reporting of incidents of domestic violence, the low number of domestic violence convictions, the limited capacity of victim assist- ance programs, and the absence of a comprehensive evaluation of the effective- ness of measures to combat domestic violence 31.
27 Mevlyde Salihu / Nikola Gaon, Feature: Striving for Bigger Improvements to Kosovo’s Justice System, OSCE Background Report, 11 May 2007, available at
Despite the above-mentioned deficiencies, a number fo positive developments can be noted, such as the establishment of various advisory bodies on human rights and the creation of human rights units within the Ministries . In the area of access to justice, the legal-aid commission charged with administering and monitoring the legal-aid system is in place . Unitsexamining alleged procedural and minor offences by the police were established and are operating in the Kosovo Police Service (KPS) . Every resident is entitled to submit complaints about police offenses to these units . In several cases, police officers have been dismissed as a result of such complaints 32.
Stability of Democratic Institutions
The framework of democratic institutions was completed in February 2009 with the establishment of a Kosovo Intelligence Agency and a Kosovo Security Council . The International Civilian Office (ICO) is mandated to oversee the implementation of Ahtisaari’s package, while EULEX is in charge of assisting, monitoring and advising the rule-of-law institutions . EULEX also has executive powers in fighting corruption and organized crime and in the persecution of war crimes . UNMIK does not have an administrative role since December 2008, but it represents Kosovo in multilateral forums, where the independence of Kosovo is contested . It also reports to the UN Security Council on political develop- ments and aims to facilitate a dialogue with Serbia . The biggest challenge for the Ahtisaari plan and the Constitution is the implementation of decentraliza- tion and the inclusion of northern Kosovo within Prishtina’s legal authority .33 The reconfiguration of the international presence – i . e . the end of UNMIK’s mandate and the full establishment of ICO and EULEX – faced many challenges . UNMIK could not transfer its authority to the Kosovo Government, ICO and EULEX because the UN Security Council did not endorse the Ahtisaari Plan and Kosovo’s statehood remained contested . But UN Secretary General Ban Ki-Moon informed the Security Council members on 12 June 2008 that he would initiate the reconfiguration of UNMIK and thus enable the deployment of the EULEX under “a UN umbrella” .34 The Secretary General placed the United Nations
32 Commission of the European Communities, Kosovo (under UNSCR 1244) 2007 Prog- ress Report, available at
Political and Social Integration
The party system in Kosovo is quite new and is relatively inexperienced . Therefore, political parties have not developed to the degree that their competi- tion for seats in the parliament would offer different solutions based on different
35 Ibid . 246 Ilir Deda values and ideologies . While there are some signs of such an affiliation, one can also note that there is no clear profiling of political parties . Policies of political parties are not in harmony with their proclaimed ideological affiliation and are not argued on ideological grounds 36. Political parties seem to be misreading the citizens’ mood and some of their representatives are granting insufficient atten- tion to what citizens want and expect . As a result, overall turnout is decreasing, as is the overall accumulation of votes by major parties, both of which point to serious dissatisfaction 37. In the parliamentary elections of November 2007, the Democratic Party of Kosovo (Partia Demokratike e Kosovës, PDK), led by Hashim Thaçi, received 34 .3 percent of the votes and emerged as the strongest political force . The late president Ibrahim Rugova’s Democratic League of Kosovo (Lidhja Demokratike e Kosovës, LDK) won 22 .6 percent, losing for the first time after 18 years of be- ing the largest Kosovo Albanian political party . These two parties created a coalition government led by Thaçi, while Fatmir Sejdiu of LDK was re-elected as President of Kosovo . The political landscape appeared to be stable in the wake of the 2007 elec- tions . The split of the well-established LDK into two parties — the LDK and Nexhat Daci’s Democratic League of Dardania (Lidhja Demokratike e Dardanisë, LDD) — a year after president Rugova’s death in early 2006 had been somewhat predictable and has not affected the fundamental stability of the party system . Broadly speaking, the LDK, LDD, and Ramush Haradinaj’s Alliance for the Future of Kosovo (Aleanca për Ardhmërinë e Kosovës, AAK) are conservative or centrist parties, the New Kosovo Alliance (Aleanca Kosova e Re, AKR) is centrist, and Thaçi’s PDK has its roots on the left . Thaçi and Haradinaj are both former UÇK senior commanders . Rugova and the LDK long symbolized non-violent political resistance to Serbian rule, a policy that was ultimately discredited dur- ing Milosevic’s crackdown in favor of the UÇK’s program of armed resistance . Rugova nonetheless remained widely respected and retained the presidency until his death, and the well-established LDK remained a single party as long as he was alive . Unions and employers’ associations have been quite active in pressuring the government in Kosovo since 2004 . Initially, the umbrella association Trade Unions of Kosovo demanded a collective agreement, followed by separate trade unions that have since advocated for better pay for workers . Most vocal of all
36 Kushtrim Shaipi / Agon Maliqi, Party Attitudes Towards Economy: Privatisation, Fiscal Policies and Development, FES Policy Analysis Report 2, September 2008, 41, available at
38 The Union of Independent Trade Unions of Kosova, available at
Market Economy
Institutional Framework
The institutional foundations ensuring market-based competition have been put in place . A number of the institutions in place are fraught with low institu- tional capacities, corruption and occasionally selective implementation of the rule of law . Bazaar capitalism, micro-enterprises, and a large informal sector remain im- portant . Out of 90,000 registered businesses, onlyabout 35,000 are operational 44. Foreign trade has been extensively deregulated, and there is no fundamental state intervention in free trade . This particularly applies to the treatment of foreign investments and stockholding . There are no restrictions or controls on payments, transactions, transfers, or repatriation of profits . UNMIK signed Kosovo up for membership in CEFTA prior to independence, but Serbia and Bosnia and Herzegovina, where the Serbian entity has a veto over many state policies, have blocked the import and transit of independent Kosovo’s goods since 3 December 2008 . No measures were taken to prevent imports from Serbia or Bosnia and Herzegovina . Kosovo’s financial sector has been built on completely new foundations since 1999 . All banks are now private, and foreign-owned banks hold 83 percent of total assets . Since January 2002, Kosovo has used the euro as an official cur- rency, although it is not a member of the European Monetary Union and does not issue its own euro coins . The euroization eliminates exchange rate risks but also rules out the possibility of currency devaluation . Property rights and property acquisition in Kosovo today are regulated by an adequate legal framework that defines and protects het acquisition, use, benefits and sale of property . However, there are several issues that are yet to be resolved, mainly stemming from the constant amendment of UNMIK Regulations and the lack of clarity in how pre-UNMIK laws and UNMIK regulations interact . These issues complicate the legal framework and cause confusion regarding how to apply and implement property laws . The authorities in Kosovo and the UN Habitat program are working to clarify property ownership issues, but
43 Ibid . 44 Interview by the author with Besim Beqaj, President of Kosovo Chamber of Commerce (OEK), 01 September 2009 . Kosovo 249 progress is slow and the legal situation is often unclear . Out of 40,623 claimed cases, 55 .7 % have been resolved as of August 2009 .45 Privatization in Kosovo is in its final stages . By mid-June 2008, the Privatiza- tion Agency of Kosovo (PAK) had tendered 551 new companies . However, this process has been followed by a large number of irregularities and has failed to yield the estimated foreign investment plans .46
Socioeconomic Performance
Kosovo is the poorest state in Europe with a per capita income of approxi- mately 1,500 euros 47. The World Bank noted in its 2007 poverty assessment that 45 % of the population reported consumption below the national poverty line (43 euros per adult equivalent per month, 2002 prices) 48. The poor tend to be concentrated in rural areas, have large families and a low level of education . Some regions are more affectedhan t others . Poverty tends to be decreasing in urban areas and growing in the countryside . Kosovo’s “slow and volatile growth” makes it difficult for families to work their way out of poverty, or for the government to have a sufficient revenue base to provide an appropriate social safety net . Many people live just above or below the poverty level . Most of those living in poverty are thus close to lifting themselves out of it, while at the same time many just above the line are vulnerable to sinking below it in times of adversity 49. Registered unemployment stands at 43 % of the economically active popu- lation .50 Women, minorities, and young people remain vulnerable in the labor market . Some 30,000 young people enter the job market each year, with un- employment rates five times the EU average . The economy obviously cannot absorb the new job seekers at current growth rates .51 Government policy has not focused particularly on inflation, but inflation could have serious political and social implications if the international economic situation becomes worse . The government applied to join the IMF in July 2008,
45 Kosovo Property Agency, Claims Total Decided Caseload, available at
Welfare Regime
Social networks are somewhat developed, but do not cover all risks for all strata of the population . Considerable portions of the population are still at risk of poverty . Centralized social protection programs are in place to provide pensions, assistance to the needy, payments to veterans and their survivors, and job-finding assistance Poor. households are entitled to social assistance . In addition, there are programs for disability pensions and benefits to war invalids . The European Commission concluded in its November 2008 report that “the social protection system is financially unsustainable, not organized efficiently” and is open to fraud . The study notes that 45 % of the population lives in pov- erty and 18 % in extreme poverty . The social protection system covers 325,000 people in a country without any properly trained professional social workers 56. The assembly has yet to pass legislation setting up a health insurance system, which has huge implications for the quality of access to health care and potential incidence of catastrophic expenditures .
52 IMF Staff Visit to Kosovo, February 11-17, 2009, ide-Memoire,A available at
Kosovo has developed an extensive legal framework for the protection of equal opportunity rights, as well as other mechanisms to achieve gender equal- ity, especially at the central and local levels 57. A report by UNMIK’s Office of Gender Affairs notes, however, that women face “persistent gender gaps and sizeable obstacles” throughout public life, including in the political parties, where they are underrepresented .58 The NGO Kosovo Women’s Network was set up in 2000 to bring women’s organiza- tions from all over Kosovo together and to work with women’s organizations abroad .59 The Law Against Discrimination provides a legal basis for the promotion and protection of human rights .60 This law was complemented by secondary legis- lation establishing institutional mechanisms mandated by its implementation . For the purpose of protection and promotion of human rights, the principle of non-discrimination and protection of equal opportunities, the government has established human rights cells within all government ministries and most municipalities in Kosovo . The situation, however, is less encouraging when it comes to equal opportu- nity rights for non-protected groups . The administration is plagued by nepotism, political bias and plain corruption . The process of bidding or hiring in public institutions is very fragile and is easily exposed to lack of fair play . Despite the institutional and legislative achievements, there is still a lack of capacity to ensure equal opportunity for all .
Sustainability
Protection of the environment does not rank high among the priorities of the government, although it is present . The multitude of social and economic problems affecting the country force the government to neglect environmental policy priorities . Nevertheless, Kosovo continues its efforts to align its regula- tions with EU environmental legislation, institutions and standards and has made progress in several areas . An Environmental Protection Strategy was ap- proved by the Government in 2004 . The Ministry of Environment and Spatial
57 Ibid . 58 Maddalena Pezzotti, UNMIK Focus Kosovo, Equal in All Walks of Life?, available at
Planning has drafted a five-year environmental action plan for Kosovo, while the government has managed to develop an environmental legislative framework 61. Since the end of the 1999 conflict, education in Kosovo has undergone many reforms affecting every part of the system . The law provides for compulsory basic education from ages six to fifteen, and non-attendance entails consequences for the parents . Secondary education in Kosovo consists of grammar schools and vocational schools . Higher Education (university and postgraduate) in Kosovo is of a mixed nature, with the establishment of 33 private universities in the past three years . The current educational system in Kosovo has more or less failed to relate to the labor market, to ensure better education and capable workers, while the governments have not been very successful in creating favorable employment conditions for graduates 62.
Management
Level of Difficulty
Since the declaration of independence the government has been faced with challenges of state recognition, ethnic divisions, control of territory, poverty, low economic development, unemployment, rule of law, corruption, ineffective state institutions, complex international administrative structures with overlapping mandates, weak political culture and underdeveloped civil society . Kosovar civil society has its roots in the history of the shadow state of the 1990s, and NGOs are present in large numbers . However, trust in public institutions and commitment to the development of civil society is very low in Kosovo .
Steering Capability
Since the parliamentary elections of 17 November 2007, a coalition govern- ment led by Prime Minister Thaçi’s PDK and the LDK has been in office . Thaçi’s government has to deal with a range of issues – from political, economic and social problems, to overall stability of the country, preserving territorial integrity and increasing the international legitimacy of the new state . The government has been largely unable to translate its priorities into policy actions . Long-term objectives are subordinated to short-term politics and party benefits . This refers to the entire political elite in the government, the assembly and the opposition
61 Assembly of Kosovo, Law No . 2004/30, On Air Protection, available at
63 EU Commission 2007 Progress Report (above fn . 32), 39 . 64 Ilir Deda, Nations in Transit . 2009 Kosovo Report, available at
Resource Efficiency
None of the Kosovo governments since the reestablishment of democratic institutions in 2001 have optimally used the country’s available economic and human resources . Due to economic devastation during the 1990s and the war of 1998-99, public administration became the main source of employment . The privatization process of socially-owned and public enterprises has been misman- aged and delayed due to status issues . This process has been managed by the EU Pillar IV of UNMIK .67 There was no strategy to attract foreign investors or to utilize privatization for sustainable economic growth . Employment is largely dominated by the public sector (35 %) and small and medium enterprises, while the service sector covers the rest . Public employees were not recruited according to professional criteria, but based on political loyalty, partisan affiliation and nepotistic connections . The general attitude of the ministers is to replace senior civil service staff with party loyalists . At the same time, low salaries in the civil service do not attract highly qualified experts to join the government . This has adversely impacted the management of human and budgetary resources . All governments have consistently abused the budgetary line of goods and services by excessively spending on expensive vehicles and office furnishings68 . This has created a culture of luxury that does not correspond with the overall poor economy of Kosovo . Capital investments, on the other hand, have been largely misused . On top of this, these investmentshave not been properly priori- tized to meet the soaring demands for the development of public infrastructure . To make matters worse, there are large budgetary surpluses recorded each year,
66 For further information, cf . Ilir Dugolli, Laws Without Policy – Waste, Dead Letter and Futility, KIPRED Policy Brief 4, November 2006, available at
69 For details please see: Support for Improvement in Governance and Management (SIGMA), Kosovo: Public Expenditure Management System, Assessment May 2008, available at
Consensus-Building
All political parties and social groups in Kosovo agree on the aims of EU and NATO membership . In 2006, the main ethnic Albanian parties formed a five- member Unity Team to present a united front in negotiating with the interna- tional community and with Serbia over Kosovo’s future status . In April 2007, the Unity Team signed the Pocantico Declaration at an American-sponsored conference in the United States, by which the Unity Team agreed to continue working together in implementing key aspects of the Ahtisaari Plan during the first 120 days of independence .75 After the 2007 elections, they reaffirmed their intention to maintain unity until independence was achieved in February 2008 and the constitution took effect in June .76 Conflict management in Kosovo is a matter of coordinated efforts between the political leadership and the international community . There are continu- ous social tensions in society, and the leadership has proved to be ineffective in resolving these issues . However, the government is in a dialogue with most disaffected groups while continuing to preserve the status quo . The interethnic divisions in society have existed for the past decades . Due to the pressure coming from Serbia, the Kosovar Serb community is reluctant to fully engage in dialogue with Kosovo’s political leadership . One strategy of con- flict regulation has been the decentralization process, which foresees the creation of new municipalities where ethnic minorities will constitute a majority with
73 EU Commission 2007 Progress Report (above fn . 32), 11 . 74 Deda, Nations in Transit . 2009 Kosovo Report (above fn . 64) . 75 Pocatino Conference Center of the Rockefeller Brothers Fund, Developing a Strategy for Kosovo’s First 120 Days, available at
77 Republic of Serbia, Ministry of Foreign Affairs, Daily Survey, “Tribunal Sentences Are Too Severe”, says [Serbian prime minister Mirko] Cvetkovic, 26 February 2009, available at
UN Security Council . Rather, the governing coalition insisted on holding the next elections in 2011 .78
International Cooperation
The political leadership fully complies with bilateral and multilateral in- ternational donors and uses international assistance wisely . On 11 July 2008, representatives of 37 countries and 16 international organizations attended a Donors’ Conference in Brussels . They pledged a total of more than 1 .2 billion euros, which the Kosovar government plans to use funding its Medium Term Expenditure Framework for 2008-2011 .79 The donors were instrumental in building institutions and introducing democratic governance in Kosovo . This is a gradual process because the institutions in Kosovo were created from scratch by the international community, which in early stages held all administrative and executive powers . With the empowerment of Kosovo’s institutions, the administrative and executive powers were transferred accordingly . This transfer of competencies, however, has not resulted in full government ownership or independence in the domestic reform agenda . On the contrary, it has created an alarming dependency that calls into question the sustainability of local institu- tions once the international community leaves Kosovo . The international com- munity has effectively paralyzed any domestic moves for a greater autonomy in the decision-making process . The government is a credible and reliable partner in relations with the interna- tional community . Tensions with Serbia are kept low due to heavy international intervention, the aim of which is to contain Serbia’s destabilizing role in Kosovo . Kosovo, in a way, is a trusteeship of the international community . In this regard, due to the lack of full international legitimacy and contested statehood, UNMIK represents Kosovo and its interests in various multilateral forums . Kosovo has been recognized as an independent state by many states of the region, excluding Serbia, Bosnia, Romania, and Greece . Greece, however, fos- ters diplomatic and economic cooperation with Kosovo, and does not block Kosovo’s representation or the EU integration process . Kosovo, via UNMIK, is a full participant in almost all regional cooperation initiatives, such as CEFTA, the Regional Cooperation Council (RCC), regional energy treaties, etc .80 How- ever, Kosovo does not participate in regional cooperation initiatives related to
78 Statement from the International Civilian Representative, Pieter Feith, on the issue of elections in Kosovo, available at
Strategic Outlook
Kosovo’s independence has raised expectations among the population and has brought responsibilities upon the political leadership that they had never exercised in the past . Contrary to certain expectations, the growing number of countries that have recognized the independence of Kosovo has contributed to the stability of the Balkans 81. Nevertheless, regional stability is still undermined by the fragility of the situation in Bosnia, Macedonia and the Serb-controlled northern part of Kosovo . The next three to five years will prove critical to overall regional stability in general and the successful completion of state-building and European integration prospects for Kosovo in particular . In the medium term, Kosovo’s government and the international presence should ensure full implementation of Ahtisaari’s Comprehensive Status Pro- posal . This does not only depend on internal actors, but also on the behavior of Serbia and the recognition of independence by the remaining five EU member states who have not yet done so . In the long-term, comprehensive reforms are needed to strengthen the rule of law, to facilitate sound and sustainable economic development, to match the skill structure of the labor force with the needs of the labor market, to fully integrate the Serb community within Kosovo’s institutions, to increase investment in strategic research and development areas, and, finally, to reform public administration, health and education . These much needed reforms should not be abandoned due to a perceived threat of instability . The political leadership should develop a more autonomous policy-making capacity and gradually remove its dependence from the international presence in Kosovo . The transformation strategy should focus on the following key elements: Strengthening statehood: The Kosovo government should develop a comprehen- sive plan that would outline and specify a realistic strategy to include northern Kosovo within a single legal and political framework . Simultaneously, this plan should also address the empowerment and development of Serb settlements in other parts of Kosovo . The international community should sincerely commit to solving these problems, and should not undermine Kosovo’s stability and development to preserve the power of the political leadership in Serbia . The International Civilian Office (ICO) and EULEX should resolve their dichoto-
81 See the speech by French Foreign Minister Bernard Kouchner, First Anniversary of Kosovo’s Independence (17 February 2009), available at