Reuters: Kosovo’s biggest security threat? Its ‘sick economy’

By: Nina Brenjo
Negotiations over the final status of Kosovo have started and the media has been abuzz with talk of possible interethnic violence if the talks reach a dead-end as expected. But it’s Kosovo’s disastrous economy that may prove to be a greater security threat and a bigger challenge than its political status, according to the Wall Street Journal.

This is not just what the pundits are saying; people in the province have similar worries. In fact, nearly half of the ethnic Albanian population think problems such as unemployment, poverty and poor electricity supply are greater security threats than interethnic violence, according to a 2006 U.N.-sponsored review cited by the paper. Only 5 percent named interethnic violence as a threat to security in the region.

“When you’ve got an economy as sick as this, that’s a security threat,” the paper quotes Michael Page of the U.N. Development Programme as saying.

Unemployment in Kosovo has reached a staggering 40 percent. But not even 3 percent growth in 2006 and the prospect of similar growth this year is enough to cut unemployment, as 25,000 to 30,000 young people are added to the job market each year, says The Financial Times. The territory has the highest birth rates in Europe, so the numbers are unlikely to change in favour of economy any time soon.

Some people survive on foreign aid, which amounts to 20 percent of the region’s gross domestic product. Some live on money sent by the relatives working abroad, with remittances making up around 15 percent of GDP. And in the capital Pristina, some get by selling phone cards, cigarettes and fake CDs on the streets.

Infrastructure is poor and a quarter of the population lack piped water. Power outages are still a regular occurrence, so gas generators are a common sight. Agriculture, which many people depend on, is running at half capacity. It is not surprising, then, that in 2006 the province imported twice as much as it exported.

Smuggling and organised crime – both activities that don’t bring any revenues to the government – are widespread. Alcohol, cigarettes, vehicles, weapons, drugs, people and even cows from Serbia regularly cross Kosovo’s leaky borders.

Organised crime in Kosovo has been a consequence of a dysfunctional political system, according to Veton Surroi, politician and former newspaper editor, who is quoted by the Journal. “Once you have duality of governments,” he says, referring to the region’s supervising U.N. Mission and its own provisional government, “you don’t actually have a government.”

Because Kosovo is riddled with corruption and has an uncertain future, many big companies are bypassing the province. Lack of new businesses means no new employment opportunities for the jobless. “We’re not going to solve unemployment in the next five, 10 or 15 years,” Surroi says. “This is a generational change.”

Even credit from the likes of the International Monetary Fund or the World Bank has been hard to come by because of Kosovo’s unsettled status. International donors should be providing up to 1 billion euros ($1.4 billion), but only after Kosovo’s final status has been finally decided.
 

Source:  Reuters Foundation

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