WESTERN COUNTRIES URGE KOSOVO TO POSTPONE DECISION TO REPLACE SERBIAN DINAR WITH EURO

Mon 29 January 2024:

Five Western nations urged Kosovo on Sunday to suspend its decision to replace the local currency, the Serbian dinar, with the euro as of Feb. 1, fearing tensions between Pristina and Belgrade.

The embassies of the Quint countries (the US, France, Italy, Germany and the UK) published a joint statement regarding a new regulation on cash payment transactions.

The statement pointed out that the regulation raises concerns about its impact, especially on Serb-majority communities.

According to the statement, the decision can have an impact on the regulation of schools and hospitals, which would mean a direct effect on the daily lives of the overwhelming majority of Kosovo Serbs who receive payments and financial assistance from Serbia.

It came after the ambassadors of the Quint countries met with Kosovo Prime Minister Albin Kurti on Jan. 26.

The Kosovo government said Kurti emphasizes the importance of everyone in the country respecting the constitution and law as well as respecting independent authorities, in this case, the central bank.

The US also asked the Kosovo government to reconsider its decision to replace the Serbian dinar with the euro, fearing tensions between Pristina and Belgrade over the issue.

“We urge the government of Kosovo to revisit this decision, consult with the affected communities, respond to the concerns expressed by the international community, and provide ample time for decisions to be implemented in order to mitigate the impact those decisions will have on its citizens,” said a statement issued by the US Embassy in Kosovo, as reported by Radio Free Europe (RFE).

On Jan. 17, the country’s central bank announced in a decree that Kosovo will adopt the euro for cash and payment transactions beginning Feb. 1.

The next day, Serbian President Aleksandar Vucic called the announcement “worrying,” saying it “throws into question all processes, both of normalization and dialogue.”

The move could spark controversy and even unrest as ethnic Serbian communities in Kosovo are currently using the dinar, the official currency of neighboring Serbia, at both state institutions and in commercial transactions. Many local Serbs have an attachment or even allegiance to Serbia.

Employees of Serbian institutions have been receiving dinars for salaries, pensions, child allowances and social assistance. Prices in stores in northern Kosovo, which borders Serbia and has a large ethnic Serbian population, are displayed in dinars only.

According to the central bank’s decree, currencies other than the euro can only be used in the country for physical safekeeping or bank accounts.

Dinars arrive in Kosovo from the National Bank of Serbia, which has a vault in the town of Leposavic, also in northern Kosovo, near the Serbian border.

Kosovo’s population is predominantly Albanian, with a small number of ethnic Serbs concentrated along the northern border with Serbia.

Kosovo declared its independence from Serbia in 2008, with most UN member states including the US, UK, France, Germany and Türkiye recognizing it as an autonomous country.

Serbia, however, still considers Kosovo its territory.

-Source: AA

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