As of: January 31, 2024, 3:58 p.m
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The flag of Kosovo: The next conflict is looming between the breakaway republic and Serbia.
© Visar Kryeziu/dpa
Serious tensions are looming again in the Balkans: After Kosovo banned the Serbian currency dinar, Belgrade representatives reacted angrily - and the West worried.
Pristina - Serbia and Kosovo have just settled their long-standing bitter dispute over license plates, and the next crisis is already looming.
From Thursday, only the official currency, the euro, will be accepted in the former Serbian province.
The Serbian dinar, which was previously tolerated in the regions inhabited by the majority of the Serb minority, will thus be banned.
According to a new regulation from the Central Bank of Kosovo, from February 1, “only the euro may be used in the Republic of Kosovo.”
Kosovo unilaterally adopted the euro as its currency in 2002, despite not being a member of the eurozone or the European Union.
The approximately 120,000 Kosovo Serbs held on to the Serbian dinar even after the end of the Kosovo war in 1999.
Many of them work for Serbian institutions, where their salaries, pensions and other financial transactions depend on the dinar rather than Kosovo's official currency.
“I've had enough!” - the population reacts dividedly
Belgrade did not recognize Kosovo's declaration of independence in 2008 and continues to consider it its province.
Ahead of the entry into force of the new regulation, several banks in Serbian communities in northern Kosovo began closing their operations.
Confusion is spreading among the population.
“I have the impression that everyone is playing with us.
Nobody tells us anything,” complains Zoran Ilic, who lives in the divided northern city of Mitrovica.
“I’m fed up with politics,” complains the 45-year-old Serb.
Aleksandra Jovanovic complains that the closure of her bank will likely lead to long trips to another branch in southern Serbia.
“This is not normal, nothing is normal,” adds the 37-year-old, who also lives in Mitrovica.
The government in Belgrade supports the Serbs in Kosovo through, among other things, generous financial and employment packages.
The Serbian budget earmarks the equivalent of around 120 million euros annually for spending in Kosovo, although analysts believe the actual value could be at least twice as high thanks to informal transactions.
Now Serbs who use dinars are likely to be de facto excluded from Kosovo's financial system.
Experts fear diplomatic tremors
“The Kosovo Serbs will take the biggest hit,” says Belgrade-based political analyst Bosko Jaksic.
The “diplomatic and political consequences” would be “far more serious than the monetary ones,” he emphasizes.
In the West, Pristina's actions are viewed with concern.
Some governments warned that the new arrangement could further deteriorate already tense relations between Serbs and the government in Pristina.
“We are concerned about the impact of the regulation, especially on schools and hospitals, for which there currently appear to be no viable alternatives,” said the ambassadors of the so-called Quint states France, Germany, Italy, Great Britain and the USA on Saturday.
Kosovo appears undeterred
“The regulation will also have a direct impact on the daily lives of the overwhelming majority of Kosovo Serbs who receive payments and financial assistance from Serbia,” the joint statement continued.
The ambassadors called for “the suspension of enforcement of the regulation to allow for a sufficiently long transition period.”
However, the government in Pristina was undeterred.
“The official currency is only the euro,” emphasized the governor of the central bank, Ahmet Ismaili.
The Kosovo authorities see the regulation as a means of combating corruption, money laundering and the use of counterfeit currencies.
Deputy Prime Minister Besnik Bislimi emphasized that this would stop the flow of unregulated cash from Serbia.
Belgrade, however, spoke of a provocation by Pristina.
Serbian Prime Minister Ana Brnabic predicted the new arrangement would likely derail EU-backed talks to normalize relations between Belgrade and Kosovo “once and for all.”
(afp, lf)