Tensions between Kosovo and Serbia increase amid tax hikeAdriatic Journal 29 November 2018
A day after Kosovo’s failed attempt to join Interpol, its government passed a proposal to increase tax on Serbian and Bosnian goods from 10% (introduced earlier this month) to 100%. Kosovo’s deputy prime minister Enver Hoxhaj said the move is in retaliation for Serbia’s “aggressive campaign” to block Kosovo from becoming a member of international organisations. Serbia’s deputy prime minister and minister for trade Rasim Ljajić said the tariffs will have grave consequences. “This means a complete cessation of every kind of trade between central Serbia and Kosovo.” Both Serbia and Kosovo are part of Cefta, a free trade agreement amongst Balkan countries. Last year, exports to Kosovo from Serbia amounted to EUR 440m, while Serbia’s imports from Kosovo were worth EUR 21m. Trade was expected to grow by 9% this year, according to Ljajić.
International community criticies Priština's decision
Kosovo’s decision has been heavily criticised by the international community, with EU foreign policy chief Federica Mogherini saying it “is a clear violation of the Central European Free Trade Agreement (CEFTA) and of the spirit of the Stabilisation and Association Agreement between the European Union and Kosovo.” United States of America have also demanded the authorities in Kosovo remove import tariffs and work with Serbia to avoid escalating the tensions. “Normalisation of relations between Kosovo and Serbia is the only way to give way to the integration of both countries within the community of western countries. United States of America are ready to assist the sides to achieve an applicable agreement which would increase stability”, the statement from the US State Department says.
So far, Serbia and Bosnia and Herzegovina have not introduced any counter measures and both countries have announced they will refrain from doing so. In Kosovo, however, situation between the two ethnicities is worsening with daily protests by Serb majorities in north Kosovo which were followed by resignations of mayors from four Serb municipalities that effectively stopped all communications with Priština authorities. The mayor of northern Kosovska Mitrovica, Goran Rakić, said: “I submit my resignation because of anti-civilised, unlawful and inhumane taxes on Serbian goods, which endanger the right to life, treatment, public information, and survival of Serbs in their heartland.
Haradinaj insists Kosovo will not back down
Despite the international pressure and growing internal tensions, the country’s prime minister Ramush Haradinaj remains adamant that Kosovo will reverse the decision on tariffs only “when Serbia ceases its agression” and “when Serbia recognises Kosovo”, according to Priština based daily Gazeta Express. In his op-ed in the Washington Post, Haradinaj reiterated that Kosovo will not back down.
“Enough is enough — in the name of fair trade, national security and our vital national interests, my government has imposed a 100 percent tariff on all Serbian goods. These measures will remain in place until Serbia stops its efforts to undermine our sovereignty and begins honouring its commitments.”
The current intensification of relations is likely to have a negative impact on the negotiations to normalise relations between the two countries. The next meeting between Serbia’s president Aleksandar Vučić and Kosovo’s president Hashim Thaci is due to be held in December, but that meeting is now questionable.