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International Journal of Economics & Management SciencesFOREIGN TRADE AND ECONOMIC GROWTH IN KOSOVO: TRENDS AND SOME FEATURES
|Republic of Kosovo
|Anthem: Europe 
Location and extent of Kosovo in Europe.
and largest city
|Recognised regional languages|
|-||Prime Minister||Isa Mustafa|
|Legislature||Assembly of Kosovo|
|-||Republic of Kosova||2 July 1990|
|-||UNSCR 1244||10 June 1999|
|-||UN Administration||June 1999|
|-||Declaration of independence||17 February 2008|
|-||End of Steering Group supervision||10 September 2012|
|-||Brussels Agreement||19 April 2013|
4,212 sq mi
|GDP (PPP)||2015 estimate|
|GDP (nominal)||2015 estimate|
medium · 121
|HDI (2013)||11px 0.786
|Currency||Euro (€)c (EUR)|
|Time zone||CET (UTC+1)|
|-||Summer (DST)||CEST (UTC+2)|
|Drives on the||right|
|ISO 3166 code||XK|
|a.||2014 estimate. A new estimate has been added in order to give a more correct GDP per capita.|
|b.||Preliminary results of 2011 census, which excluded four northern Serb-majority municipalities where it could not be carried out.|
|c.||Adopted unilaterally; Kosovo is not a formal member of the eurozone.|
|d.||+383 as of January 1, 2015. +381 was previously used for fixed lines. Kosovo-licenced mobile-phone providers used +377 (Monaco) or +386 (Slovenia) instead.|
|e.||XK is a "user assigned" ISO 3166 code not designated by the standard, but used by the European Commission, Switzerland, the Deutsche Bundesbank and other organisations.|
Kosovo (/, /; Albanian: Kosova; Serbian: Косово, Kosovo) is a disputed territory and partially recognised state in Southeastern Europe that declared its independence from Serbia in February 2008 as the Republic of Kosovo. While Serbia recognises the Republic's governance of the territory, it still continues to claim it as its own Autonomous Province of Kosovo and Metohija.
Kosovo is landlocked in the central Balkan Peninsula. Its capital and largest city is Pristina. It is bordered by the Republic of Macedonia and Albania to the south, Montenegro to the west, and the uncontested territory of Serbia to the north and east. In antiquity, the Dardanian Kingdom, and later the Roman province of Dardania was located in the region. It was part of Serbia in the Middle Ages, and many consider the Battle of Kosovo of 1389 to be one of the defining moments in Serbian medieval history. After being part of the Ottoman Empire from the 15th to the early 20th century, in the late 19th century Kosovo became the centre of the Albanian independence movement with the League of Prizren. As a result of the defeat in the First Balkan War (1912–13), the Ottoman Empire ceded the Vilayet of Kosovo to the Balkan League; the Kingdom of Serbia took its larger part, while the Kingdom of Montenegro annexed the western part before both countries became a part of the Kingdom of Yugoslavia after World War I. After a period of Yugoslav unitarianism in the Kingdom of Yugoslavia, the post-World War II Yugoslav constitution established the Autonomous Province of Kosovo and Metohija within the Yugoslav constituent republic of Serbia.
Long-term severe ethnic tensions between Kosovo's Albanian and Serb populations left Kosovo ethnically divided, resulting in inter-ethnic violence, including the Kosovo War of 1998–99. The war ended with a military intervention of NATO, which forced the Federal Republic of Yugoslavia to withdraw its troops from Kosovo, which became a UN protectorate under UNSCR 1244. On 17 February 2008 Kosovo's Parliament declared independence. It has since gained diplomatic recognition as a sovereign state by 108 UN member states. Serbia refuses to recognise Kosovo as a state, although with the Brussels Agreement of 2013 it has accepted the legitimacy of Kosovo institutions and its special status within Serbia. The agreement solidified that public institutions in Kosovo are exclusively operated by Kosovo's elected government, and not Serbia's.
Kosovo is not a member of the United Nations due to its lack of diplomatic recognition from 85 UN member countries. It is, however, a member of the International Monetary Fund (IMF), World Bank, International Road and Transport Union (IRU), Regional Cooperation Council, Council of Europe Development Bank, Venice Commission and the European Bank for Reconstruction and Development. Kosovo has gained full membership in many major sports federations, including the International Olympic Committee. Within the European Union, it is recognised by 23 of the 28 members. Kosovo is a potential candidate for future enlargement of the European Union.
- 1 Name
- 2 History
- 3 Government and politics
- 4 Geography
- 5 Economy
- 6 Demographics
- 7 Administrative divisions
- 8 Society
- 9 See also
- 10 References
- 11 External links
The entire region is commonly referred to in English simply as Kosovo and in Albanian as Kosova (definite form, [kɔˈsɔːva]) or Kosovë ("indefinite" form, [kɔˈsɔːv]). In Serbia, a formal distinction is made between the eastern and western areas; the term Kosovo (Косово) is used for the eastern part centered around the historical Kosovo Field, while the western part is called Metohija (Метохија) (known as Dukagjini in Albanian).
Kosovo (Serbian Cyrillic: Косово, [kôsoʋo]) is the Serbian neuter possessive adjective of kos (кос) "blackbird", an ellipsis for Kosovo Polje, 'blackbird field', the name of a plain situated in the eastern half of today's Kosovo and the site of the 1389 Battle of Kosovo Field. The name of the plain was applied to an Ottoman province created in 1864.
The official conventional long name of the state is the Republic of Kosovo as defined by the Constitution of Kosovo and is used to represent Kosovo internationally. Additionally as a result of an arrangement agreed between Pristina and Belgrade in talks mediated by the European Union, Kosovo has participated in some international forums and organisations under the title "Kosovo*" with a footnote stating "This designation is without prejudice to positions on status, and is in line with UNSC 1244 and the ICJ Opinion on the Kosovo declaration of independence". This arrangement, which has been dubbed the "asterisk agreement" was agreed in an 11-point arrangement agreed on 24 February 2012.
The current borders of Kosovo were drawn while part of SFR Yugoslavia in 1946, when the Autonomous Province of Kosovo and Metohija was created as an administrative division of the new Socialist Republic of Serbia. In 1974, the compositional "Kosovo and Metohija" was reduced to a simple "Kosovo" in the name of the Socialist Autonomous Province of Kosovo, but in 1990 the region was renamed the Autonomous Province of Kosovo and Metohija (Serbian: Аутономна Покрајина Косово и Метохија, Autonomna Pokrajina Kosovo i Metohija). By the independence declaration in 2008, its conventional long name became "Republic of Kosovo" (Albanian: Republika e Kosovës, Serbian Cyrillic: Република Косово, Republika Kosovo).
During antiquity, the area which now makes up Kosovo was inhabited by various tribal ethnic groups, who were liable to move, enlarge, fuse and fissure with neighbouring groups. As such, it is difficult to locate any such group with precision. The Dardani, whose exact ethno-linguistic affiliation is difficult to determine, were a prominent group in the region during the late Hellenistic and early Roman eras.
The area was then conquered by Rome in the 160s BC, and incorporated into the Roman province of Illyricum in 59 BC. Subsequently, it became part of Moesia Superior in AD 87. The region was exposed to an increasing number of 'barbarian' raids from the 4th century AD onwards, culminating with the Slavic migrations of the 6th and 7th centuries. Archaeologically, the early Middle Ages represent a hiatus in the material record, and whatever was left of the native provincial population fused into the Slavs.
The subsequent political and demographic history of Kosovo is not known with absolute certainty until the 13th century. Archaeological findings suggest that there was steady population recovery and progression of the Slavic culture seen elsewhere throughout the Balkans. The region was absorbed into the Bulgarian Empire in the 850s, where Christianity and a Byzantine-Slavic culture was cemented in the region. It was re-taken by the Byzantines after 1018, and became part of the newly established Theme of Bulgaria. As the centre of Slavic resistance to Constantinople in the region, the region often switched between Serbian and Bulgarian rule on one hand and Byzantine on the other, until Serbian Grand Prince Stefan Nemanja secured it by the end of the 12th century. An insight into the region is provided by the Byzantine historian-princess, Anna Comnena, who wrote of "Serbs" being the main inhabitants of the region (referring to it as "eastern Dalmatia" and the "former Moesia Superior"). The earliest reference of Albanians comes from Michael Attaleiates, who spoke of the "Arbanitai" located around the hinterland districts of Dyrrachium, modern Durrës.[not in citation given]
The zenith of Serbian power was reached in 1346, with the formation of the Serbian Empire. During the 13th and 14th centuries, Kosovo became a political and spiritual centre of the Serbian Kingdom. In the late 13th century, the seat of the Serbian Archbishopric was moved to Pec, and rulers centred themselves between Prizren and Skopje, during which time thousands of Christian monasteries and feudal-style forts and castles were erected. When the Serbian Empire fragmented into a conglomeration of principalities in 1371, Kosovo became the hereditary land of the House of Branković. In the late 14th and the 15th centuries parts of Kosovo, the easternmost area of which was located near Pristina, were part of the Principality of Dukagjini, which was later incorporated an anti-Ottoman federation of all Albanian principalities, the League of Lezhë.
In the 1389 Battle of Kosovo, Ottoman forces defeated a coalition led by Lazar Hrebeljanović. Soon after, Lazar's son accepted Turkish nominal vassalage (as did some other Serbian principalities) and Lazar's daughter was married to the Sultan to seal the peace. By 1459, Ottomans conquered the new Serbian capital of Smederevo, leaving Belgrade and Vojvodina under Hungarian rule until second quarter of the 16th century.
Ottoman Kosovo (1455–1912)
Kosovo was part of the Ottoman Empire from 1455 to 1912, at first as part of the eyalet of Rumelia, and from 1864 as a separate province (vilayet). During this time, Islam was introduced to the population. The Vilayet of Kosovo was an area much larger than today's Kosovo; it included all today's Kosovo territory, sections of the Sandžak region cutting into present-day Šumadija and Western Serbia and Montenegro along with the Kukës municipality, the surrounding region in present-day northern Albania and also parts of north-western Macedonia with the city of Skopje (then Üsküp), as its capital. Between 1881 and 1912 (its final phase), it was internally expanded to include other regions of present-day Republic of Macedonia, including larger urban settlements such as Štip (İştip), Kumanovo (Kumanova) and Kratovo (Kratova).
The Serbian position is that archives reveal an overwhelming Serbian demographic majority in Kosovo, which was reversed by the end of Ottoman rule, as Banac summarised: "Ottoman raids, plunder, slaving forays, as well as the general devastation caused by constant wars uprooted large numbers of Serbs even before the Great Serb Migration". This was followed by the transplantation of Albanian pastoralists from the highlands of Albania to the fertile valleys of Kosovo. However, Anscombe highlights that the most common archives – those derived from the Ottomans – do not clarify unequivocally the 'ethnic' character of the region's inhabitants, because the Ottomans classified their subjects along religious lines (millets). Anscombe suggests that records show that the demography of Kosovo was very much mixed, and that both Serbian and Albanian ethnic groups dominated at different times. Moreover, they seem to indicate more cases of Albanians rebelling than any other ethnicity in the region. Mainstream historiography clarifies that "there is no conclusive evidence that a people unambiguously identifiable as "Albanian" constituted the majority of the population in Kosovo prior to the Ottoman occupation". Even the relatively "pro-Albanian" history written by Noel Malcolm concedes that "the region probably had a predominantly Orthodox Christian and Slavic population from the eight to the mid-nineteenth centuries". Allowing for the possibility of some connection between the region's inhabitants prior to successive Slavic/ Serbian inflows, the Albanians who 'returned' to Kosovo in modern times were certainly not the same people, having intermarried extensively with Vlachs, Slavs, Greeks and Turks. Whilst there is little evidence of ethnic Albanian institutional presence in medieval Kosovo, they were often baptised into Orthodox Christianity and subjected to a process of "Serbianisation". Prior to Islamification, the Albanians might have existed as pastoralists inhabiting Balkan highland areas, like the Vlachs, engaging in a symbiotic existence with the predominantly agricultural Slavs who inhabited the valleys and plains.
Kosovo, like Serbia, was occupied by Austrian forces during the Great War of 1683–1699, but the Ottomans re-established their rule of the region. Such acts of assistance by the Austrian Empire (then arch-rivals of the Ottoman Empire), or Russia, were always abortive or temporary at best. In 1690, the Serbian Patriarch of Peć Arsenije III apparently led a group of 30 or 40 thousand people from Kosovo to the Christian north. In 1766, the Ottomans abolished the Patriarchate of Peć and the position of Christians in Kosovo further deteriorated, including full imposition of jizya (taxation of non-Muslims).
Although initially stout opponents of the advancing Turks, Albanian chiefs ultimately came to accept the Ottomans as sovereigns. The resulting alliance facilitated the mass conversion of Albanians to Islam. Given that the Ottoman Empire's subjects were divided along religious (rather than ethnic) lines, Islamisation greatly elevated the status of Albanian chiefs. Prior to this, they were organised along simple tribal lines, living in the mountainous areas of modern Albania (from Kruje to the Sar range). Soon, they expanded into a depopulated Kosovo, as well as northwestern Macedonia, although some might have been autochthonous to the region. However, Banac favours the idea that the main settlers of the time were Vlachs.
Many Albanians gained prominent positions in the Ottoman government; 42 Grand Viziers of the Empire were Albanian in origin, including Mehmet Akif Ersoy (1873–1936), an Albanian from Peć who in 1921 composed "İstiklâl Marşı" (The Independence March), the Turkish National Anthem. As Hupchik states, "Albanians had little cause of unrest" and "if anything, grew important in Ottoman internal affairs", and sometimes persecuted Christians harshly on behalf of their Turkish masters.
In the 19th century, there was an awakening of ethnic nationalism throughout the Balkans. The underlying ethnic tensions became part of a broader struggle of Christian Serbs against Muslim Albanians. The ethnic Albanian nationalism movement was centred in Kosovo. In 1878 the League of Prizren (Lidhja e Prizrenit) was formed. This was a political organisation that sought to unify all the Albanians of the Ottoman Empire in a common struggle for autonomy and greater cultural rights, although they generally desired the continuation of the Ottoman Empire. The Balkan League was dis-established in 1881 but enabled the awakening of a national identity among Albanians. Albanian ambitions competed with those of the Serbs. The Kingdom of Serbia wished to incorporate this land that had formerly been within its empire.
Kingdom of Serbia and the Kingdom of Yugoslavia
The Young Turk movement took control of the Ottoman Empire after a coup in 1912 which disposed of Sultan Abdul Hamid II. The movement supported a centralised form of government and opposed any sort of autonomy desired by the various nationalities of the Ottoman Empire. An allegiance to Ottomanism was promoted instead. An Albanian uprising in 1912 exposed the empire's northern territories in Kosovo and Novi Pazar, which led to an invasion by the Kingdom of Montenegro. The Ottomans suffered a serious defeat at the hands of Albanians in 1912, culminating in the Ottoman loss of most of its Albanian-inhabited lands. The Albanians threatened to march all the way to Salonika and reimpose Abdul Hamid.
A wave of Albanians in the Ottoman army ranks also deserted during this period, refusing to fight their own kin. Two months later in September of the same year, a joint Balkan force made up of Serbian, Montenegrin, Bulgarian and Greek forces drove the Ottomans out of most of their European possessions.
The rise of nationalism unfortunately hampered relations between Albanians and Serbs in Kosovo, due to influence from Russians, Austrians and Ottomans. After the Ottomans' defeat in the First Balkan War, the 1913 Treaty of London was signed with Western Kosovo (Metohija) ceded to the Kingdom of Montenegro and Eastern Kosovo ceded to the Kingdom of Serbia. Soon, there were concerted Serbian colonisation efforts in Kosovo during various periods between Serbia's 1912 takeover of the province and World War II. So the population of Serbs in Kosovo fell after World War II, but it had increased considerably before then.
An exodus of the local Albanian population occurred. Serbian authorities promoted creating new Serb settlements in Kosovo as well as the assimilation of Albanians into Serbian society. Numerous colonist Serb families moved into Kosovo, equalising the demographic balance between Albanians and Serbs.
In the winter of 1915–16, during World War I, Kosovo saw the retreat of the Serbian army as Kosovo was occupied by Bulgaria and Austria-Hungary. In 1918, the Allied Powers pushed the Central Powers out of Kosovo. After the end of World War I, the Kingdom of Serbia was transformed into the Kingdom of Serbs, Croats and Slovenians on 1 December 1918.
Kosovo was split into four counties, three being a part of Serbia (Zvečan, Kosovo and southern Metohija) and one of Montenegro (northern Metohija). However, the new administration system since 26 April 1922 split Kosovo among three Areas of the Kingdom: Kosovo, Raška and Zeta. In 1929, the Kingdom was transformed into the Kingdom of Yugoslavia and the territories of Kosovo were reorganised among the Banate of Zeta, the Banate of Morava and the Banate of Vardar.
In order to change the ethnic composition of Kosovo, between 1912 and 1941 a large-scale Serbian re-colonisation of Kosovo was undertaken by the Belgrade government. Meanwhile, Kosovar Albanians' right to receive education in their own language was denied alongside other non-Slavic or unrecognised Slavic nations of Yugoslavia, as the kingdom only recognised the Slavic Croat, Serb, and Slovene nations as constituent nations of Yugoslavia, while other Slavs had to identify as one of the three official Slavic nations while non-Slav nations were only deemed as minorities.
Albanians and other Muslims were forced to emigrate, mainly with the land reform which struck Albanian landowners in 1919, but also with direct violent measures. In 1935 and 1938 two agreements between the Kingdom of Yugoslavia and Turkey were signed on the expatriation of 240,000 Albanians to Turkey, which was not completed because of the outbreak of World War II.
After the Axis invasion of Yugoslavia in 1941, most of Kosovo was assigned to Italian-controlled Albania, with the rest being controlled by Germany and Bulgaria. A three-dimensional conflict ensued, involving inter-ethnic, ideological, and international affiliations, with the first being most important. Nonetheless, these conflicts were relatively low-level compared with other areas of Yugoslavia during the war years, with one Serb historian estimating that 3,000 Albanians and 4,000 Serbs and Montenegrins were killed, and two others estimating war dead at 12,000 Albanians and 10,000 Serbs and Montenegrins. An official investigation conducted by the Yugoslav government in 1964 recorded nearly 8,000 war-related fatalities in Kosovo between 1941 and 1945, 5,489 of whom were Serb and Montenegrin and 2,177 of whom were Albanian. It is not disputed that between 1941 and 1945 tens of thousands of Serbs, mostly recent colonists, fled from Kosovo. Estimates range from 30,000 to 100,000. There had been large-scale Albanian immigration from Albania to Kosovo which is by some scholars estimated in the range from 72,000 to 260,000 people (with a tendency to escalate, the last figure being in a petition of 1985). Some historians and contemporary references emphasize that a large-scale migration of Albanians from Albania to Kosovo is not recorded in Axis documents.
The province as in its outline today first took shape in 1945 as the Autonomous Kosovo-Metohian Area. Until World War II, the only entity bearing the name of Kosovo had been a political unit carved from the former vilayet which bore no special significance to its internal population. In the Ottoman Empire (which previously controlled the territory), it had been a vilayet with its borders having been revised on several occasions. When the Ottoman province had last existed, it included areas which were by now either ceded to Albania, or found themselves within the newly created Yugoslav republics of Montenegro, or Macedonia (including its previous capital, Skopje) with another part in the Sandžak region of Šumadija and Western Serbia.
Tensions between ethnic Albanians and the Yugoslav government were significant, not only due to national tensions but also due to political ideological concerns, especially regarding relations with neighbouring Albania. Harsh repressive measures were imposed on Kosovo Albanians due to suspicions that there were Kosovo Albanian sympathisers of the Stalinist regime of Enver Hoxha of Albania. In 1956, a show trial in Pristina was held in which multiple Albanian Communists of Kosovo were convicted of being infiltrators from Albania and were given long prison sentences. High-ranking Serbian communist official Aleksandar Ranković sought to secure the position of the Serbs in Kosovo and gave them dominance in Kosovo's nomenklatura.
Islam in Kosovo at this time was repressed and both Albanians and Muslim Slavs were encouraged to declare themselves to be Turkish and emigrate to Turkey. At the same time Serbs and Montenegrins dominated the government, security forces, and industrial employment in Kosovo. Albanians resented these conditions and protested against them in the late 1960s, accusing the actions taken by authorities in Kosovo as being colonialist, as well as demanding that Kosovo be made a republic, or declaring support for Albania.
After the ouster of Ranković in 1966, the agenda of pro-decentralisation reformers in Yugoslavia, especially from Slovenia and Croatia succeeded in the late 1960s in attaining substantial decentralisation of powers, creating substantial autonomy in Kosovo and Vojvodina, and recognising a Muslim Yugoslav nationality. As a result of these reforms, there was a massive overhaul of Kosovo's nomenklatura and police, that shifted from being Serb-dominated to ethnic Albanian-dominated through firing Serbs in large scale. Further concessions were made to the ethnic Albanians of Kosovo in response to unrest, including the creation of the University of Pristina as an Albanian language institution. These changes created widespread fear among Serbs that they were being made second-class citizens in Yugoslavia by these changes. In the 1974 Constitution of Yugoslavia, Kosovo was granted major autonomy, allowing it to have its own administration, assembly, and judiciary; as well as having a membership in the collective presidency and the Yugoslav parliament, in which it held veto power.
In the aftermath of the 1974 constitution, concerns over the rise of Albanian nationalism in Kosovo rose with the widespread celebrations in 1978 of the 100th anniversary of the founding of the League of Prizren. Albanians felt that their status as a "minority" in Yugoslavia had made them second-class citizens in comparison with the "nations" of Yugoslavia and demanded that Kosovo be a constituent republic, alongside the other republics of Yugoslavia. Protests by Albanians in 1981 over the status of Kosovo resulted in Yugoslav territorial defence units being brought into Kosovo and a state of emergency being declared resulting in violence and the protests being crushed. In the aftermath of the 1981 protests, purges took place in the Communist Party, and rights that had been recently granted to Albanians were rescinded – including ending the provision of Albanian professors and Albanian language textbooks in the education system.
Due to very high birth rates, the proportion of Albanians increased from 75% to over 90%. In contrast, the number of Serbs barely increased, and in fact dropped from 15% to 8% of the total population, since many Serbs departed from Kosovo as a response to the tight economic climate and increased incidents of alleged harassment from their Albanian neighbours. While there was tension, charges of "genocide" and planned harassments have been debunked as an excuse to revoke Kosovo's autonomy. For example in 1986 the Serbian Orthodox Church published an official claim that Kosovo Serbs were being subjected to an Albanian program of 'Genocide'.
Even though they were disproved by police statistics,[page needed] they received wide play in the Serbian press and that led to further ethnic problems and eventual removal of Kosovo's status. Beginning in March 1981, Kosovar Albanian students of the University of Pristina organised protests seeking that Kosovo become a republic within Yugoslavia along with human rights. The protests were brutally suppressed by the police and army, with many protesters arrested. During the 1980s, ethnic tensions continued with frequent violent outbreaks against Yugoslav state authorities resulting in a further increase in emigration of Kosovo Serbs and other ethnic groups. The Yugoslav leadership tried to suppress protests of Kosovo Serbs seeking protection from ethnic discrimination and violence.
Disintegration of Yugoslavia
Inter-ethnic tensions continued to worsen in Kosovo throughout the 1980s. The 1986 Memorandum of the Serbian Academy warned that Yugoslavia was suffering from ethnic strife and the disintegration of the Yugoslav economy into separate economic sectors and territories, which was transforming the federal state into a loose confederation.
On 28 June 1989, Slobodan Milošević delivered the Gazimestan speech in front of a large number of ethnic Serbs at the main celebration marking the 600th anniversary of the Battle of Kosovo at the Gazimestan. Many think that this speech helped Milošević consolidate his authority in Serbia. In 1989, Milošević, employing a mix of intimidation and political manoeuvring, drastically reduced Kosovo's special autonomous status within Serbia and started cultural oppression of the ethnic Albanian population. Kosovo Albanians responded with a non-violent separatist movement, employing widespread civil disobedience and creation of parallel structures in education, medical care, and taxation, with the ultimate goal of achieving the independence of Kosovo.
On 2 July 1990 a majority of members of the Kosovo Assembly passed a resolution declaring the Republic of Kosova within the Yugoslav Federation; in September 1991 (after the dissolution of the Assembly by Serbia) they passed a Constitution which would have given the Republic effective sovereignty but which might have also been compatible with a Yugoslav confederation if this had existed; in September 1992 they declared the Republic a sovereign and independent state. In May 1992, Ibrahim Rugova was elected president. During its lifetime, the Republic of Kosova was only officially recognised by Albania; it was formally disbanded in 2000, after the Kosovo War, when its institutions were replaced by the Joint Interim Administrative Structure established by the United Nations Interim Administration Mission in Kosovo (UNMIK).
In 1995 the Dayton Agreement ended the Bosnian War, drawing considerable international attention. However, despite the hopes of Kosovar Albanians, the situation in Kosovo remained largely un-addressed by the international community, and by 1996 the Kosovo Liberation Army (KLA), an ethnic Albanian guerrilla paramilitary group, had prevailed over the non-violent resistance movement and had started presenting armed resistance to Serbian and Yugoslav security forces, resulting in early stages of the Kosovo War.
By 1998, as the violence had worsened and displaced scores of Albanians, Western interest had increased. The Serbian authorities were compelled to sign a ceasefire and partial retreat, monitored by Organization for Security and Co-operation in Europe (OSCE) observers according to an agreement negotiated by Richard Holbrooke. However, the ceasefire did not hold and fighting resumed in December 1998. The Račak massacre in January 1999 in particular brought new international attention to the conflict. Within weeks, a multilateral international conference was convened and by March had prepared a draft agreement known as the Rambouillet Accords, calling for restoration of Kosovo's autonomy and deployment of NATO peacekeeping forces. The Serbian party found the terms unacceptable and refused to sign the draft.
Between 24 March and 10 June 1999, NATO intervened by bombing Yugoslavia aimed to force Milošević to withdraw his forces from Kosovo, though NATO could not appeal to any particular motion of the Security Council of the United Nations to help legitimise its intervention. Combined with continued skirmishes between Albanian guerrillas and Yugoslav forces the conflict resulted in a further massive displacement of population in Kosovo.
During the conflict, roughly a million ethnic Albanians fled or were forcefully driven from Kosovo. In 1999 more than 11,000 deaths were reported to Carla Del Ponte by her prosecutors. Some 3,000 people are still missing, of which 2,500 are Albanian, 400 Serbs and 100 Roma. Ultimately by June, Milošević had agreed to a foreign military presence within Kosovo and withdrawal of his troops.
Since May 1999, the International Criminal Tribunal for the former Yugoslavia has prosecuted crimes committed during the Kosovo War. Nine Serbian and Yugoslavian commanders have been indicted so far for crimes against humanity and violations of the laws or customs of war in Kosovo in 1999: Yugoslavian President Slobodan Milošević, Serbian President Milan Milutinović, Yugoslavian Deputy Prime Minister Nikola Šainović, Yugoslavian Chief of the General Staff Gen. Dragoljub Ojdanić, Serbian Interior Minister Vlajko Stojiljković, Gen. Nebojša Pavković, Gen. Vladimir Lazarević, Deputy Interior Minister of Serbia Vlastimir Đorđević and Chief of the Interior for Kosovo Sreten Lukić. Stojiljković killed himself while at large in 2002 and Milošević died in custody during the trial in 2006. In 2009 Milutinovic was acquitted by the Trial Chamber; five defendants were found guilty (three sentenced to 15 years imprisonment, and two to 22 years; and in 2011 the remaining defendant, who had been in hiding when the main trial started, was found guilty and sentenced to 27 years. The verdicts are under appeal. The indictment against the nine alleged that they directed, encouraged or supported a campaign of terror and violence directed at Kosovo Albanian civilians and aimed at the expulsion of a substantial portion of them from Kosovo. It has been alleged that about 800,000 Albanians were expelled as a result. In particular, in the indictment of June 2006, the accused were charged with the murder of 919 identified Kosovo Albanian civilians aged from one to 93, both male and female.
In addition, the Office of the Serbian War Crimes Prosecutor has secured final judgements involving the conviction of 7 persons, sentenced to a total of 136 years imprisonment for war crimes in Kosovo involving 89 Albanian victims. As of June 2012, a trial of 12 defendants for an alleged massacre of 44 Albanian victims in Čuška (Alb: Qyshk) is ongoing.
Six KLA commanders were indicted by ICTY in two cases: Fatmir Limaj, Isak Musliu and Haradin Bala, as well as Ramush Haradinaj, Idriz Balaj and Lahi Brahimaj. They were charged with crimes against humanity and violations of the laws and customs of war in Kosovo in 1998, consisting in persecutions, cruel treatment, torture, murders and rape of several dozens of the local Serbs, Albanians and other civilians perceived un-loyal to the KLA. In particular, Limaj, Musliu and Bala were accused of murder of 22 identified detainees at or near the Lapušnik Prison Camp. In 2005 Limaj and Musliu were found not guilty on all charges, Bala was found guilty of persecutions, cruel treatment, murders and rape and sentenced to 13 years. The appeal chamber affirmed the judgements in 2007. In 2008 Ramush Haradinaj and Idriz Balaj were acquitted, whereas Lahi Brahimaj was found guilty of cruel treatment and torture and sentenced to six years. The Office of the Prosecutor appealed their acquittals, resulting in the ICTY ordering a partial retrial; however on 29 November 2012 all three were acquitted of all charges.
UN administration period
On 10 June 1999, the UN Security Council passed UN Security Council Resolution 1244, which placed Kosovo under transitional UN administration (UNMIK) and authorised Kosovo Force (KFOR), a NATO-led peacekeeping force. Resolution 1244 provided that Kosovo would have autonomy within the Federal Republic of Yugoslavia, and affirmed the territorial integrity of Yugoslavia, which has been legally succeeded by the Republic of Serbia.
Estimates of the number of Serbs who left when Serbian forces left Kosovo vary from 65,000  to 250,000 (194,000 Serbs were recorded as living in Kosovo in the census of 1991. But many Roma also left and may be included in the higher estimates). The majority of Serbs who left were from urban areas, but Serbs who stayed (whether in urban or rural areas) suffered violence which largely (but not entirely) ceased between early 2001 and the riots of March 2004, and ongoing fears of harassment may be a factor deterring their return. International negotiations began in 2006 to determine the final status of Kosovo, as envisaged under UN Security Council Resolution 1244. The UN-backed talks, led by UN Special Envoy Martti Ahtisaari, began in February 2006. Whilst progress was made on technical matters, both parties remained diametrically opposed on the question of status itself.
In February 2007, Ahtisaari delivered a draft status settlement proposal to leaders in Belgrade and Pristina, the basis for a draft UN Security Council Resolution which proposed 'supervised independence' for the province. A draft resolution, backed by the United States, the United Kingdom and other European members of the Security Council, was presented and rewritten four times to try to accommodate Russian concerns that such a resolution would undermine the principle of state sovereignty.
Russia, which holds a veto in the Security Council as one of five permanent members, had stated that it would not support any resolution which was not acceptable to both Belgrade and Kosovo Albanians. Whilst most observers had, at the beginning of the talks, anticipated independence as the most likely outcome, others have suggested that a rapid resolution might not be preferable.
After many weeks of discussions at the UN, the United States, United Kingdom and other European members of the Security Council formally 'discarded' a draft resolution backing Ahtisaari's proposal on 20 July 2007, having failed to secure Russian backing. Beginning in August, a "Troika" consisting of negotiators from the European Union (Wolfgang Ischinger), the United States (Frank G. Wisner) and Russia (Alexander Botsan-Kharchenko) launched a new effort to reach a status outcome acceptable to both Belgrade and Pristina. Despite Russian disapproval, the U.S., the United Kingdom, and France appeared likely to recognise Kosovar independence. A declaration of independence by Kosovar Albanian leaders was postponed until the end of the Serbian presidential elections (4 February 2008). Most EU members and the US had feared that a premature declaration could boost support in Serbia for the ultra-nationalist candidate, Tomislav Nikolić.
Under the Constitutional Framework, Kosovo had a 120-member Kosovo Assembly. The Assembly includes twenty reserved seats: ten for Kosovo Serbs and ten for non-Serb and non-Albanian nations (e.g. Bosniaks, Roma, etc.). The Kosovo Assembly was responsible for electing the President, Prime Minister, and Government of Kosovo, and for passing legislation which was vetted and promulgated by UNMIK.
Provisional institutions of self-government
In November 2001, the Organization for Security and Co-operation in Europe supervised the first elections for the Kosovo Assembly. After that election, Kosovo's political parties formed an all-party unity coalition and elected Ibrahim Rugova as President and Bajram Rexhepi (PDK) as Prime Minister. After Kosovo-wide elections in October 2004, the LDK and AAK formed a new governing coalition that did not include PDK and Ora. This coalition agreement resulted in Ramush Haradinaj (AAK) becoming Prime Minister, while Ibrahim Rugova retained the position of President. PDK and Ora were critical of the coalition agreement and have since frequently accused that government of corruption.
Parliamentary elections were held on 17 November 2007. After early results, Hashim Thaçi who was on course to gain 35 per cent of the vote, claimed victory for PDK, the Democratic Party of Kosovo, and stated his intention to declare independence. Thaçi formed a coalition with current President Fatmir Sejdiu's Democratic League which was in second place with 22 percent of the vote. The turnout at the election was particularly low. Most members of the Serb minority refused to vote.
Declaration of independence
Kosovo declared independence on 17 February 2008 and over the following days, a number of states (the United States, Turkey, Albania, Austria, Croatia, Germany, Italy, France, the United Kingdom, the Republic of China (Taiwan), Australia, Poland and others) announced their recognition, despite protests by Russia and others in the UN. As of 20 May 2015, 108 UN states recognise the independence of Kosovo and it has become a member country of the IMF and World Bank as the Republic of Kosovo. The ICJ concluded unanimously in 2010 that Kosovo's declaration of independence of 17 February 2008 did not violate general international law.
The UN Security Council remains divided on the question (as of 4 July 2008[update]). Of the five members with veto power, USA, UK, and France recognised the declaration of independence, and the People's Republic of China has expressed concern, while Russia considers it illegal. As of May 2010[update], no member-country of Commonwealth of Independent States, Collective Security Treaty Organisation or Shanghai Cooperation Organisation has recognised Kosovo as independent. Kosovo has not made a formal application for UN membership yet in view of a possible veto from Russia and China.
The European Union has no official position towards Kosovo's status, but has decided to deploy the European Union Rule of Law Mission in Kosovo to ensure a continuation of international civil presence in Kosovo. As of December 2013[update], most of the member-countries of NATO, EU, and OECD have recognised Kosovo as independent.
All of Kosovo's immediate neighbour states except Serbia have recognised the declaration of independence. Montenegro and Macedonia announced their recognition of Kosovo on 9 October 2008. Albania, Slovenia, Croatia, Bulgaria and Hungary have also recognised the independence of Kosovo.
The Serb minority of Kosovo, which largely opposes the declaration of independence, has formed the Community Assembly of Kosovo and Metohija in response. The creation of the assembly was condemned by Kosovo's president Fatmir Sejdiu, while UNMIK has said the assembly is not a serious issue because it will not have an operative role. On 8 October 2008, the UN General Assembly resolved, on a proposal by Serbia, to ask the International Court of Justice to render an advisory opinion on the legality of Kosovo's declaration of independence. The advisory opinion, which is not binding over decisions by states to recognise or not recognise Kosovo, was rendered on 22 July 2010, holding that Kosovo's declaration of independence was not in violation either of general principles of international law, which do not prohibit unilateral declarations of independence, nor of specific international law – in particular UNSCR 1244 – which did not define the final status process nor reserve the outcome to a decision of the Security Council.
Some rapprochement between the two governments took place on 19 April 2013 as both parties reached an EU brokered agreement that would allow the Serb minority in Kosovo to have its own police force and court of appeals. However, the agreement is yet to be ratified by parliaments in both countries.
Government and politics
The government of the Republic of Kosovo is defined under the 2008 Constitution of Kosovo as a multi-party parliamentary representative democratic republic. Legislative power is vested in both the Assembly of Kosovo and the ministers within their competencies. The President of Kosovo is the head of state and represents the "unity of the people". The Government of Kosovo exercises the executive power and is composed of the Prime Minister of Kosovo as the head of government, the deputy prime ministers, and the ministers of the various ministries. The Judiciary of Kosovo is composed of the Supreme Court and subordinate courts, a Constitutional Court, and independent prosecutorial institutions. There also exist multiple independent institutions defined by the Constitution and law, as well as local governments. The Law of Kosovo is based upon a civil law system
International civil and security presences are operating under auspices of the United Nations Security Council Resolution 1244. Previously this included only the United Nations Interim Administration Mission in Kosovo (UNMIK), but has since expanded to include the European Union Rule of Law Mission in Kosovo (EULEX). In December 2008, EULEX was deployed throughout the territory of Kosovo, assuming responsibilities in the areas of police, customs and the judiciary.
A Kosovo Police Force was established in 1999.
Continued international supervision
The Ahtisaari Plan envisaged two forms of international supervision of Kosovo after independence: the International Civilian Office (ICO), which would monitor the implementation of the Plan and would have a wide range of veto powers over legislative and executive actions, and the European Union Rule of Law Mission to Kosovo (EULEX) which would have the narrower mission of deploying police and civilian resources (including prosecutors) with the aim of developing the Kosovo police and judicial systems but also with its own powers of arrest and prosecution. The Kosovo Declaration of Independence and subsequent Constitution granted these bodies the powers assigned to them by the Ahtisaari Plan. Since the Plan was not voted on by the UN Security Council, the ICO's legal status within Kosovo was dependent on the de facto situation and Kosovo legislation; it was supervised by an International Steering Group (ISG) composed of the main states which recognised Kosovo. It was never recognised by Serbia or other non-recognising states. EULEX was also initially opposed by Serbia, but its mandate and powers were accepted in late 2008 by Serbia and the UN Security Council as operating under the umbrella of the continuing UNMIK mandate, in a status-neutral way, but with its own operational independence. The ICO's existence terminated on 10 September 2012, after the ISG had determined that Kosovo had substantially fulfilled its obligations under the Ahtisaari Plan. EULEX continues its existence under both Kosovo and international law; in 2012 the Kosovo president formally requested a continuation of its mandate until 2014.
The Republic of Kosovo is governed by legislative, executive and judicial institutions which derive from the Constitution of Kosovo, adopted in June 2008, although until the Brussels Agreement, North Kosovo was in practice largely controlled by institutions of the Republic of Serbia or parallel institutions funded by Serbia. The Constitution provides for a temporary international supervisory function exercised by the International Civilian Office (ICO), and, in the field of the rule of law, by EULEX. The International Steering Group has announced that the ICO's mandate has been successfully concluded and that the ICO ceased to exist on 10 September 2012 
The Constitution provides for a primarily parliamentary democracy, although the President has the power to return draft legislation to the Assembly for reconsideration, and has a role in foreign affairs and certain official appointments. It specifies that "the Republic of Kosovo is a secular state and is neutral in matters of religious beliefs". Like the Constitutional Framework before it, it guarantees a minimum of ten seats in the 120-member Assembly for Serbs, and ten for other minorities, and also guarantees Serbs and other minorities places in the Government.
A wide range of legislation affecting minority communities requires not only a majority in the Assembly for passage or amendment, but also the agreement of a majority of those Assembly members who are Serbs or from other minorities. Although Kosovo is not currently a member of the Council of Europe (and thus her citizens cannot appeal to the European Court of Human Rights) the Constitution enshrines the European Convention on Human Rights in Kosovo law, and gives it primacy over any domestic Kosovo laws. Kosovo's independent Constitutional Court has indeed overturned executive actions on the grounds that they infringe upon the Convention.
The Constitution provides extensive powers to the municipalities; boundaries of municipalities cannot be changed without their agreement. Three Serb-majority municipalities (North Mitrovica, Gračanica, and Štrpce) are directly given powers which other Kosovo municipalities do not have in the fields of university education and secondary health care; the constitutional right of Serb municipalities to associate and co-operate with each other means that, indirectly, they too have potential powers in these fields
The largest political parties in Kosovo are the centre-right Democratic League of Kosovo (LDK), which has its origins in the 1990s non-violent resistance movement led by Ibrahim Rugova until his death in 2006, and two parties having their roots in the Kosovo Liberation Army (KLA): the centre-left Democratic Party of Kosovo (PDK) led by former KLA leader Hashim Thaçi and the centre-right Alliance for the Future of Kosovo (AAK) led by former KLA commander Ramush Haradinaj. In 2006 Swiss-Kosovar businessman Behgjet Pacolli, reputed to be the richest living Albanian, founded the New Kosovo Alliance (AKR), which came third in the 2007 elections and fourth in those of 2010.
In 2010, the Constitutional Court ruled that the first President of the Republic, Fatmir Sejdiu, was violating the Constitution by remaining leader of the LDK as well as being President. He chose to resign the Presidency rather than resign as leader of the party, but lost his leadership of the LDK anyway to Isa Mustafa, who campaigned for the leadership on a platform of leaving the Government coalition with the PDK. In the early elections which resulted from this political crisis, the PDK emerged as victors over the LDK, and formed a coalition with Behgjet Pacolli, the Serb Samostralna Liberalna Stranka, and other minority community parties.
The Assembly narrowly elected Behgjet Pacolli as President, but his election was subsequently declared invalid by the Constitutional Court on the grounds that it was unconstitutional for a Presidential election to have only one candidate. He was succeeded by Atifete Jahjaga.
Politics in Serb areas south of the River Ibar are dominated by the Independent Liberal Party (Samostalna Liberalna Stranka), led by Slobodan Petrović; Serbs north of the river almost totally boycotted the Assembly elections of 2010. In February 2007 the Union of Serbian Districts and District Units of Kosovo and Metohija transformed into the Serbian Assembly of Kosovo and Metohija. On 18 February 2008, day after Kosovo's declaration of independence, the assembly declared it "null and void". Following the Brussels Agreement, Serbs from North Kosovo reluctantly followed the call from the Serbian government to participate in the 2014 parliamentary elections, and Belgrade-backed List "Srpska" took 9 out of 10 seats appointed to Serb minority.
A 2,500-strong Kosovo Security Force (KSF) was trained by NATO instructors and became operational in September 2009. The KSF did not replace the Kosovo Protection Corps (KPC) which was disbanded several months later. Agim Çeku is the current Minister of Security Forces of the Republic of Kosovo. On 5 March 2014, Prime Minister Hashim Thaqi declared that the Kosovan government had decided to establish a Defence Ministry and by 2019, officially transform the Kosovo Security Forces into the Kosovan Armed Forces, an Army which meets all the standards of NATO states with aim in joining the alliance in the future.
In the past, Kosovo's capabilities to develop a modern health care system were limited. Low GDP during 1990 worsened the situation even more. However, the establishment of Faculty of Medicine in the University of Pristina marked a significant development in health care. This was also followed by launching different health clinics which enabled better conditions for professional development.
Nowadays the situation has changed and health care system in Kosovo is organised in three sectors including, primary, secondary and tertiary health care. Primary health care in Pristina is organised in thirteen family medicine centers and fifteen ambulantory care units. Secondary health care is decentralised in seven regional hospitals. Pristina does not have any regional hospital and instead uses University Clinical Center of Kosovo for health care services. University Clinical Center of Kosovo provides its health care services in twelve clinics, where 642 doctors are employed. At a lower level, home services are provided for several vulnerable groups which are not able to reach health care premises. Kosovo health care services are now focused on patient safety, quality control and assisted health.
Kosovo has an area of 10,887 square km. It lies between latitudes 42° and 43° N, and longitudes 20° and 22° E. The border of Kosovo is approximately Script error: No such module "convert". long. It borders Albania to the southwest (112 km), Macedonia to the southeast (159 km), Montenegro to the west (79 km), and Central Serbia to the north and east (352 km).
Most of Kosovo's terrain is mountainous; the highest peak is Đeravica (Script error: No such module "convert".). There are two main plain regions, the Metohija basin in the west, and the Plain of Kosovo in the east. The main rivers of the region are the White Drin, running towards the Adriatic Sea, the South Morava in the Goljak area, and Ibar in the north. Sitnica, a tributary of Ibar, is the longest river lying completely within Kosovo. The biggest lakes are Gazivoda, Radonjić, Batlava and Badovac. The largest cities are Pristina, the capital, with an estimated 198,000 inhabitants, Prizren on the southwest, with a population of 178,000, Peć/Peja in the west has 95,000 inhabitants, and Ferizaj (Uroševac) in the south at around 108,000.
39.1% of Kosovo is forested, about 52% is classified as agricultural land, 31% of which is covered by pastures and 69% is arable. Phytogeographically, Kosovo belongs to the Illyrian province of the Circumboreal Region within the Boreal Kingdom. According to the WWF and Digital Map of European Ecological Regions by the European Environment Agency, the territory of Kosovo belongs to the ecoregion of Balkan mixed forests. The 39,000 ha Šar Mountains National Park, established in 1986 along the border with the Republic of Macedonia, is the only national park in Kosovo, although the Balkan Peace Park in the Prokletije along the border with Montenegro has been proposed as another one. The Nerodimka river, near Ferizaj, is the only example in Europe of a river dividing with its waters flowing into two different seas.
|Climate chart (explanation)|
Kosovo has a humid continental climate with Mediterranean and oceanic influences, featuring warm summers and cold and snowy winters. Precipitation ranges from Script error: No such module "convert". per year, and is well distributed year-round. To the northeast, Kosovo field and Ibar river valley are drier (with total precipitation of about 600 mm per year) and more influenced by continental air masses, with colder winters and very hot summers. In the southwest, climatic area of Metohija receives more Mediterannean influences with warmer summers, somewhat higher precipitation (Script error: No such module "convert".) and heavy snowfalls in the winter. Mountainous areas of Prokletije in the west, Sharr on the south and Kopaonik in the north have a more alpine climate, with high precipitation (Script error: No such module "convert". per year), short and fresh summers, and cold winters.
The average annual temperature of Kosovo is Script error: No such module "convert".. The warmest month is July with average temperature of Script error: No such module "convert"., and the coldest is January with Script error: No such module "convert".. Except Prizren and Istok, all other meteorological stations in January recorded average temperatures under Script error: No such module "convert"..
Kosovo was the poorest part of the former Socialist Federal Republic of Yugoslavia (SFRY), and in the 1990s its economy suffered from the combined results of political upheaval, the Yugoslav wars, Serbian dismissal of Kosovo employees, and international sanctions on Serbia, of which it was then part. After 1999, it had an economic boom as a result of post-war reconstruction and foreign assistance. In the period from 2003 to 2011, despite declining foreign assistance, growth of GDP averaged over 5% a year. This was despite the global financial crisis of 2009 and the subsequent Eurozone crisis. Inflation was low. Most economic development since 1999 has taken place in the trade, retail and construction sectors. The private sector which has emerged since 1999 is mainly small-scale. The industrial sector remains weak. The economy, and its sources of growth, are therefore geared far more to demand than production, as shown by the current account, which was in 2011 in deficit by about 20% of GDP. Consequently Kosovo is highly dependent on remittances from the diaspora (the majority of these from Germany and Switzerland), FDI (of which a high proportion also comes from the diaspora), and other capital inflows.
In 2009 the Industry sector accounted for 22.60 of GDP and a general workforce of 800,000 employees. It's on the 150th place, compared to the rest of the world. There are numerous reasons for this kind of stagnation, ranging from consecutive occupations, political turmoil and the recent War in Kosovo (1999). The electricity sector of Kosovo relies on coal-fired power plants (97%) and is considered one of the sectors with the greatest potential of development. The inherited issues after the war in Kosovo and the transition period have had an immense effect on the progress of this sector. Regulation of activities in energy sector in Kosovo is a responsibility of the Energy Regulatory Office (ZRrE). An additional factor in the energy sector in Kosovo is Ministry of Economic Development (MZHE), which has the responsibility of dealing with issues that have to do with energy. MZHE prepares legislation and drafts strategies and projects. Kosovo has large reserves of lead, zinc, silver, nickel, cobalt, copper, iron and bauxite. There is also believed to be around 14,000 billion tonnes of lignite. In 2005 the Directorate for Mines and Minerals and the World Bank estimated that Kosovo had €13.5 billion worth of minerals.
Kosovo has a strongly negative balance of trade; in 2004, the deficit of the balance of goods and services was close to 70 percent of GDP, and was 39% of GDP in 2011. Remittances from the Kosovo diaspora accounted for an estimated 14 percent of GDP, little changed over the previous decade. The United Nations Interim Administration Mission in Kosovo (UNMIK) introduced an external trade office and customs administration on 3 September 1999, when it established border controls in Kosovo. All goods imported to Kosovo face a flat 10% duty. These taxes are collected at all Customs Points at Kosovo's borders, including that between Kosovo and Serbia. UNMIK and Kosovo institutions have signed free-trade agreements with Croatia, Bosnia and Herzegovina, Albania and the Republic of Macedonia. Kosovo enjoys a free trade within Central European Free Trade Agreement (CEFTA), agreed with UNMIK, enabling its producers to access the regional market with its 28 million consumers, free of any customs duties. According to the Business Registry data for 2007, there are 2,012 companies of foreign and mixed ownership that have already used the opportunity to invest in Kosovo. The Multilateral Investment Guarantee Agency (MIGA, a member of the World Bank Group) guarantees investments in Kosovo in the value of 20 million Euro. The US Overseas Private Investment Corporation (OPIC) also provides political risk insurance for foreign investors in Kosovo. A major deterrent to foreign manufacturing investment in Kosovo was removed in 2011 when the European Council accepted a Convention allowing Kosovo to be accepted as part of its rules for diagonal cumulative origination, allowing the label of Kosovo origination to goods which have been processed there but originated in a country elsewhere in the Convention. Since 2002 the European Commission has compiled a yearly progress report on Kosovo, evaluating its political and economic situation. Kosovo became a member of the World Bank and the International Monetary Fund on 29 June 2009.
Government revenue is also dependent on demand rather than production; only 14% of revenue comes from direct taxes and the rest mainly from customs duties and taxes on consumption. In part this reflects low levels of production as shown in the current account; but in part it reflects very low direct taxation rates. In 2009 corporation tax was halved from 20% to 10%; the highest rate of income tax is also 10%. However, Kosovo has very low levels of general government debt (only 5.8% of GDP), although this would rise if Serbia recognised Kosovo and an agreement was reached on Kosovo's share of SFRY debt (which Serbia estimated in 2009 at $1.264 billion  and which it is currently servicing, though Kosovo is putting money into a separate account to take account, on a conservative basis, of potential liabilities). The Government also has liquid assets resulting from past fiscal surpluses (deposited in the Central Bank and invested abroad). Under applicable Kosovo law, there are also substantial assets from privatisation of socially owned enterprises (SOEs), also invested abroad by the Central Bank, which should mostly accrue to the Government when liquidation processes have been completed.
The net foreign assets of the financial corporations and the Pension Fund amount to well over 50% of GDP. Moreover, the banking system in Kosovo seems very sound. For the banking system as a whole, the Tier One Capital Ratio as of January 2012 was 17.5%, double the ratio required in the EU; the proportion of non-performing loans was 5.9%, well below the regional average; and the credit to deposit ratio was only just above 80%. The assets of the banking system have increased from 5% of GDP in 2000 to 60% of GDP as of January 2012. Since the housing stock in Kosovo is generally good by South-East European standards, this suggests that (if the legal system's ability to enforce claims on collateral and resolve property issues is trusted), credit to Kosovars could be safely expanded.
The euro is the official currency of Kosovo. Kosovo adopted the German mark in 1999 to replace the Serbian dinar, and later replaced it with the euro, although the Serbian dinar is still used in some Serb-majority areas (mostly in the north). This means that Kosovo has no levers of monetary policy over its economy, and must rely on a conservative fiscal policy to provide the means to respond to external shocks. Officially registered unemployment stood at 40% of the labour force in January 2012, although some estimates have put it as high as 60%. The IMF have pointed out, however, that informal employment is widespread, and the ratio of wages to per capita GDP is the second highest in South-East Europe; the true rate may therefore be lower. Unemployment among the Roma minority may be as high as 90%. The mean wage in 2009 was $2.98 per hour.
The dispute over Kosovo's international status, and the interpretation which some non-recognising states place on symbols which may or may not imply sovereignty, continues to impose economic costs on Kosovo. Examples include flight diversions because of a Serbian ban on flights to Kosovo over its territory; loss of revenues because of a lack of a regional dialling code (end-user fees on fixed lines accrue to Serbian Telecoms, while Kosovo has to pay Monaco and Slovenia for use of their regional codes for mobile phone connections; no IBAN code for bank transfers until 2015; and no regional Kosovo code for the Internet. Nevertheless, Information and communications technology in Kosovo has developed very rapidly and one survey has suggested that broadband internet penetration is comparable to the EU average.
According to the Kosovo in Figures 2005 Survey of the Statistical Office of Kosovo, Kosovo's total population is estimated between 1.9 and 2.2 million with the following ethnic composition: Albanians 92%, Serbs 4%, Bosniaks and Gorans 2%, Turks 1%, Roma 1%. CIA World Factbook estimates the following ratio: 88% Albanians, 8% Kosovo Serbs and 4% other ethnic groups. According to latest CIA The World Factbook estimated data, as of July 2009, Kosovo's population stands at 1,804,838 persons. It stated that ethnic composition is "Albanians 88%, Serbs 7%, other 5% (Bosniak, Gorani, Roma, Turk, Ashkali, Egyptian, Janjevci – Croats)".
Albanians, steadily increasing in number, have constituted a majority in Kosovo since the 19th century, the earlier ethnic composition being disputed. Kosovo's political boundaries do not quite coincide with the ethnic boundary by which Albanians compose an absolute majority in every municipality; for example, Serbs form a local majority in North Kosovo and two other municipalities, while there are large areas with an Albanian majority outside of Kosovo, namely in the neighbouring regions of former Yugoslavia: the north-west of Macedonia, and in the Preševo Valley in Southern Serbia.
At 1.3% per year (2008 data), ethnic Albanians in Kosovo have the fastest rate of growth in population in Europe. Over an 82-year period (1921–2003) the population of Kosovo grew to 460% of its original size. Whereas Albanians constituted 60% of Kosovo's 500,000 person population in 1931, by 1991 they reached 81% of Kosovo's 2 million person population. In the second half of the 20th century, Kosovo Albanians had three times higher birth rates than Serbs. In addition, most of Kosovo's pre-1999 Serb population relocated to Serbia proper following the ethnic cleansing campaign in 1999.
Until 2007, Kosovo was divided into 30 municipalities. It is currently divided into 38, according to Kosovo law and the Brussels Agreement of 2014, which stipulated the formation of new municipalities with Serb majority populations. These municipalities, 10 altogether, are in the process of forming a community encompassing approximately 90% of the Serb population in Kosovo; they are marked with an asterisk in the table below. (The first name is Albanian, and the second one is Serbian).
- Deçan / Dečani
- Dragash / Dragaš
- Drenas / Glogovac
- Ferizaj / Uroševac
- Fushë Kosovë / Kosovo Polje*
- Gjakova / Đakovica
- Gjilan / Gnjilane
- Gracanicë / Gračanica
- Hani i Elezit / Elez Han
- Istog / Istok
- Junik / Junik
- Kaçanik / Kačanik
- Kamenicë / Kosovska Kamenica
- Klinë / Klina
- Kllokot / Klokot-Vrbovac*
- Leposaviq / Leposavić
- Lipjan / Lipljan
- Malishevë / Mališevo
- Mamush / Mamuša
- Mitrovicë Veriore / Severna Mitrovica*
- Mitrovicë / Kosovska Mitrovica
- Novobërdë / Novo Brdo*
- Obiliç / Obilić
- Rahovec / Orahovac
- Partesh / Parteš*
- Pejë / Peć
- Podujevë / Podujevo
- Prishtinë / Priština
- Prizren / Prizren
- Ranillug / Ranilug*
- Skënderaj / Srbica
- Shtërpcë / Štrpce*
- Shtime / Štimlje
- Suharekë / Suva Reka
- Viti / Vitina
- Vushtrri / Vučitrn
- Zubin Potok / Zubin Potok*
- Zveçan / Zvečan*
Relations between Albanian and Serb communities
The relations between Kosovo's ethnic Albanian and Serb populations have been hostile since the rise of nationalism in the Balkans during the 19th century, rivalry which became strong after Serbia gained Kosovo from the Ottoman Empire in 1913 and after Albania became independent in the same year. During the Tito-era of communist rule in Yugoslavia, the ethnic Albanian and Serb populations of Kosovo were strongly irreconcilable with sociological studies during the Tito-era indicating that ethnic Albanian and Serb peoples in Kosovo rarely accepted each other as neighbours or friends and few held interethnic marriages. Ethnic prejudices, stereotypes and mutual distrust between ethnic Albanians and Serbs have remained common for decades. The level of intolerance and separation between the ethnic Albanian and Serb communities during the Tito-period was reported by sociologists to be worse than that of Croat and Serb communities in Yugoslavia which also had tensions but held some closer relations between each other.
Roma and other minorities
Despite their planned integration into the Kosovar society and their recognition in the Kosovar constitution, Romani and other minorities (i.e. Ashkali and Egyptian communities) continue to face many difficulties, such as segregation and discrimination, in housing, education, health, employment and social welfare. Many camps around Kosovo continue to house thousands of Internally Displaced People, all of whom are from minority groups and communities. Because many of the Roma are believed to have sided with the Serbs during the conflict, taking part in the widespread looting and destruction of Albanian property, Minority Rights Group International report that Romani people encounter hostility by Albanians outside their local areas. The report adds:
In Kosovo, the critical issue for most minorities has been that of day-to-day security. Organised violence, harassment and attacks on property began at the start of the international administration and have continued ever since. Minorities do not feel adequately protected by the authorities in Kosovo. As described above, organised systematic ethnic cleansing took place in 1999 and 2004, but at all times ongoing insecurity has been chronic. What is critical is not only the actual insecurity but also the perception of minorities as to whether they can be adequately protected.—Clive Baldwin, Minority Rights in Kosovo under International Rule, 2006, p. 16.
Culture and media
Although the music in Kosovo is diverse, authentic Albanian and Serbian music still exist. Albanian music is characterised by the use of the çiftelia (an authentic Albanian instrument), mandolin, mandola and percussion. Classical music is well known in Kosovo and has been taught at several music schools and universities (at the University of Prishtina Faculty of Arts in Pristina and the University of Priština Faculty of Arts at Mitrovica). In 2014 Kosovo submitted their first film for the Academy Award for Best Foreign Language Film, with Three Windows and a Hanging directed by Isa Qosja.
Several sports federations have been formed in Kosovo within the framework of Law No. 2003/24 "Law on Sport" passed by the Assembly of Kosovo in 2003. The law formally established a national Olympic Committee, regulated the establishment of sports federations and established guidelines for sports clubs. At present only some of the sports federations established have gained international recognition. The Olympic Committee of Kosovo was recognised as a provisional member of the International Olympic Committee on 22 October 2014 before becoming a full member of the International Olympic Committee on 9 December 2014. Kosovo is expected to participate in the 2016 Summer Olympics in Rio de Janeiro and the 2015 European Games in Baku.
Rule of law
Following the Kosovo War, due to the many weapons in the hands of civilians, law enforcement inefficiencies, and widespread devastation, both revenge killings and ethnic violence surged tremendously. The number of reported murders rose 80% from 136 in 2000 to 245 in 2001. The number of reported arsons rose 140% from 218 to 523 over the same period. UNMIK pointed out that the rise in reported incidents might simply correspond to an increased confidence in the police force (i.e., more reports) rather than more actual crime. According to the UNODC, by 2008, murder rates in Kosovo had dropped by 75% in five years.
Although the number of noted serious crimes increased between 1999 and 2000, since then it has been "starting to resemble the same patterns of other European cities". According to Amnesty International, the aftermath of the war resulted in an increase in the trafficking of women for sexual exploitation. According to the IOM data, in 2000–2004, Kosovo was consistently ranked fourth or fifth among the countries of Southeastern Europe by number of human trafficking victims, after Albania, Moldova, Romania and sometimes Bulgaria.
Kosovo is extremely vulnerable to organised crime and thus to money laundering (see Albanian Mafia). In 2000, international agencies estimated that Kosovo was supplying up to 40% of the heroin sold in Europe and North America. Due to the 1997 unrest in Albania and the Kosovo War in 1998–1999 ethnic Albanian traffickers enjoyed a competitive advantage, which has been eroding as the region stabilises. However, according to a 2008 report by the United Nations Office on Drugs and Crime, overall, ethnic Albanians, not only from Kosovo, supply 10 to 20% of the heroin in Western Europe, and the traffic has been declining.
In 2010, a report by Swiss MP Dick Marty claimed to have evidence that a criminal network tied to the Kosovo Liberation Army and the Prime Minister, Hashim Thaci, executed prisoners and harvested their kidneys for organ transplantation. The Kosovo government rejected the allegation. On 25 January 2011, the Council of Europe endorsed the report and called for a full and serious investigation into its contents.
Wine has historically been produced in Kosovo; both red and white. Currently the wine industry is successful and growing after the war in the 1990s. The main heartland of Kosovo's wine industry is in Orahovac where millions of litres of wine are produced. The main wines produced in Kosovo include Pinot noir, Merlot and Chardonnay. Kosovo exports wines to Germany and the United States.
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