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Kosovo-Serbian customs war: who is short of the north?

Regardless of how the latest remergence of tensions plays out, Kosovo-Serbia customs embargos will have an adverse effect on efforts to improve relations between Serbia and Kosovo, especially as both states entered negotiations with strong disapproval from their respective domestic opposition parties
Milan Marinkovic
14 September 2011

On 20th July, the Government of Kosovo decided to impose an embargo on imports from Serbia. Five days later, Hashim Thaci, the Kosovo prime minister, ordered a special police unit to take over two customs posts on the border with Serbia so that the embargo could be implemented in full. The foregoing customs posts were theretofore under joint control of the EU mission in Kosovo (EULEX) and Serb officials, which reportedly had failed to comply with the government’s import ban. The action by Kosovo special police forces caused a protest by local Serbs, whereupon violence broke out between the two sides resulting in death of one policeman and several injured on both parts. After NATO-led peacekeeping troops (KFOR) intervened and eventually took control of the area, the situation is relatively calm, though tensions remain high. In the meantime, on 2 August, NATO announced it was about to dispatch a battalion of some 700 troops to Kosovo as reinforcements. 

Timing of the embargo 

It is indicative that these events are taking place in the course of the ongoing negotiations between Serbia and Kosovo under the aegis of the EU. The Kosovo government brought about the decision of embargo shortly after the next round of scheduled talks were postponed until September. The central topic of the postponed round was the issue of Kosovo customs stamps, which Serbia has been refusing to recognize as valid. 

In fact, Kosovo imposed the import ban in response to an identical step taken by Serbia in 2008. Although it may seem surprising that Kosovo waited three years to apply the countermeasure, the move was well-timed. Simply put, Kosovo was not in a position to reciprocate earlier, due to the poor state of its economy, which is still notably underdeveloped and depends heavily on foreign aid and credits. The Serbian government has been blocking exports from Kosovo to Serbia since 2008 with the aim of obstructing Kosovo’s economic recovery and thus weakening its ability to achieve full independence. If Kosovo had responded in the same way, it would have been faced with comparatively higher prices of the goods imported from more distant locations due to proportionally increased transport costs, which would have only put an additional burden on Kosovo’s already weak economy.  

However, Serbia’s hot pursuit of candidate status for EU membership has now tipped the balance in favor of Kosovo. Serbia's ruling coalition – especially president Boris Tadic and his Democratic party (DS) – appears to be desperate to earn candidacy status by the end of the year in order to improve the prospect of staying in power after the next year’s elections. The Serbian government hoped that the recent arrests of the two last war crimes indictees - Gen. Ratko Mladic and Goran Hadzic - would be enough to convince the EU that Serbia deserved to be rewarded the candidacy. Contrary to such expectations, Serbia was soon warned by leading European states that without more tangible results in the talks with Kosovo (apart from the few deals recently struck), further process of Serbia’s integration into the EU would be seriously brought into question. The Kosovo government therefore chose to impose the retaliatory embargo at this particular time on the assumption that Serbia was now more willing than ever before to make substantial concessions to its former southern province. 

Regardless of how these latest events are going to play out, they will certainly have an adverse effect on efforts toward improving relations between Serbia and Kosovo, especially as both states entered the negotiations with strong disapproval from their respective domestic opposition parties. While nationalist opposition in Serbia tends to portray any negotiations with Kosovo as an implicit recognition of its independence, their Kosovo counterparts are accusing the government of compromising the country’s sovereignty. In such an atmosphere, both governments perceive the negotiations as a zero-sum game, whereby even the slightest progress can hardly be made without pressure from either Brussels or Washington. 

In fact, the current dispute over customs is directly related to the more complex issue of the still unresolved status of the northern part of Kosovo, where the two disputed customs checkpoints are located. In this particular area, as opposed to the rest of the territory, ethnic Serbs constitute the majority of the population, which makes it extremely difficult for the Kosovo government to impose its legal authority there. The import ban by the government of Kosovo and the subsequent police action should therefore be examined principally in that context. 

The Serbian government, on the other hand, is striving to prolong the existing conditions in the north because they suit Serbia’s interests regarding Kosovo. By funding parallel local institutions loyal to the Serbian government, Serbia is encouraging the ethnic Serbs in this northern area to persist with their disobedience to the official authorities of Kosovo, in an attempt to convince both the U.S. and the EU that the partition of Kosovo - in which the Serb-dominated north would be annexed to Serbia - is virtually the only viable way to secure lasting peace and stability. Indeed, Serbian political leadership hopes to assuage anger on the part of domestic nationalists over the loss of the former southern province by taking the north back. Even though both the West and Kosovo resolutely reject any idea of the partition, Serbia remains reluctant to change its tactic.  

Furthermore, with tensions now being revived, it will certainly require far greater effort from Brussels and Washington to encourage both Serbia and Kosovo to reach new agreements when the talks continue in September. Otherwise, any further deepening of the crisis would only benefit hard-line nationalists, especially those in Serbia who strongly oppose the country’s aspiration toward EU membership.

Security concerns 

At the same time, the lack of law enforcement in the north of Kosovo has created a vacuum of power which makes the area a safe haven for organised crime groups involved in smuggling and other illegal activities, including drug trafficking. Two details pertinent to the recent incidents have particularly highlighted security threats posed by these local gangs. First, the policeman killed during the clashes was shot in the head from a sniper riffle – certainly a type of firearm unavailable to an ordinary person. Second, a relatively small but well-organised bunch of young thugs who set one of the customs checkpoints on fire was reportedly paid by a local smuggler to carry out the attack. 

Moreover, these organised crime groups in northern Kosovo are widely believed to be operating under the protection of certain elements within Serbian intelligence and security services. According to relevant sources, the faction in question consists of both current and former officials which established strong ties with a number of Serbian crime bosses as far back as 1990s when various sorts of smuggling were a state-sponsored business, aimed at mitigation of the consequences of economic sanctions the U.N. imposed on Serbia at that time. The sources also claim that the faction is maintaining close relations with pro-Russian nationalist circles in Serbia and far-right extremist groups. 

Whether some of these fractious elements have played an active role in the latest incidents in Kosovo or not, the fact that despite pro-democracy revolution in Serbia in 2000 they have managed to retain a considerable level of influence within Serbian police and intelligence raises serious concerns over the capacity of Serbian state institutions to deal with ever complex domestic security challenges.

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