Serbia and Kosovo have only just settled their long, 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. However, the previously tolerated Serbian dinar is banned.
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.
Banks in Serbian communities are closing
Belgrade did not recognize Kosovo’s declaration of independence in 2008 and still considers the country its province. Prior to the entry into force of the new regulation, several banks in Serb communities in northern Kosovo began to close their operations.
In the West, the actions of the government in Pristina are being viewed with concern. Some governments warned that the new arrangement could further worsen already tense relations between Serbs and the government in Pristina. “We are concerned about the impact of the regulations, especially on schools and hospitals, for which there currently appear to be no viable alternatives,” said the ambassadors of the so-called Quint states of France, Germany, Italy, Great Britain and the US. on Saturday.
“The regulation will also have a direct impact on the daily lives of the vast 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.”
The change also serves to combat money laundering
However, the government in Pristina was not deterred. “The official currency is only the euro,” central bank governor Ahmet Ismaili stressed. Kosovo authorities see the regulations as a means to combat corruption, money laundering and the use of counterfeit currency. Deputy Prime Minister Besnik Bislimi emphasized that this would stop the flow of unregulated cash from Serbia.
Source: Krone
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