Kosovo pauses plans to drop dinar amid fears of Serbian backlash
Kosovo averted a crisis with its restive ethnic Serbian minority on Wednesday by pulling back on a demand that they stop using Serb dinars as currency and switch to the euro.
The Kosovo government had earlier indicated that from Thursday it would insist that the country’s ethnic Serbs no longer use dinars from neighbouring Serbia, but fall into line with the rest of Kosovo and adopt the euro.
Ethnic Serbs were deeply unhappy about the change because they receive their salaries and pensions in dinars, as well as social welfare and child allowance payments.
There were concerns that an enforcement of the new rule could lead to renewed unrest in the north of the country where ethnic Serbs are dominant.
Faced with criticism from its Western backers, the government announced just hours before the ban was to come into force that it would hold off for now.
Kosovo’s only ‘official currency’
Besnik Bislimi, the deputy prime minister, said: “We will not implement punitive measures immediately, however we will invest time in informing Serb citizens.”
He said the government was “committed to eventual transitional periods so that citizens can adapt as quickly as possible, as easily as possible and with minimum damage done”.
He insisted that the euro remains Kosovo’s only official currency.
Kosovo unilaterally adopted the euro in 2002, despite not being a member of the eurozone or the EU.
The currency dispute had risked plunging the Balkan nation back into unrest, just months after a shootout between Kosovo police and masked Serb gunmen at a monastery close to the Serbian border left four people dead.
There are parallels between a bitter two-year battle over car licence plates, in which thousands of ethnic Serbs continued to drive with Serbian-issued registration plates rather than those issued by Kosovo. Ethnic Serbs had resisted the change, sometimes resorting to violence.
Western diplomats had warned that the government’s insistence that ethnic Serbs adopt the euro could lead to a renewal of unrest.
Serbia refuses to acknowledge Kosovo’s declaration of independence in 2008 and tensions between the two neighbours constitute one of the most serious flashpoints in the Balkans.
‘Direct impact on everyday lives’
The US embassy in Pristina said in a joint statement issued by the US, Britain, Germany, Italy and France: “We are concerned about the impact of the regulation in particular on schools and hospitals, for which no alternative process seems viable at the moment.
“The regulation will also have a direct impact on the everyday lives of the overwhelming majority of Kosovo Serbs who receive payments/financial assistance from Serbia.”
The five Nato countries had called for the ban on the dinar to be suspended to allow a longer period of transition.
The request for a more gradual approach was met with anger on social media, with many Kosovars saying there should be no question that the country should use just one currency – the euro.
One Kosovar man asked on Twitter: “Dear ambassador, would you allow Russian rubles to be used in Alaska?”
Another commented: “No country in the world has licence plates from two countries. No country in the world pays with two different monetary units.”
Ana Brnabic, the prime minister of Serbia, warned that the enforcement of the regulation could damage the peace process with Kosovo beyond repair, derailing EU-sponsored talks between Belgrade and Pristina “once and for all”.
Kosovo fought a bloody war of independence against Serbia in the late 1990s. The war was brought to an end after a 78-day Nato bombing campaign forced Serbian forces to withdraw from Kosovo.
Amid continuing tensions, Serbia has raised the combat readiness of its military forces along the border several times in the last year.
