Key findings of the 2019 European Commission Report on Kosovo

Photo: AP Photo/Visar Kryeziu via Tanjug

BRUSSELS – The European Commission published today the country reports for the six Western Balkans states and Turkey. Here we present the key findings in the country report on Kosovo.

As concerns the political criteria, Kosovo made progress in the implementation of certain key EU-related reforms, in particular as regards the improvement of the legal framework in the areas of rule of law and public administration. However, a number of measures and ad hoc decisions were not in line with the government’s stated reform objectives. The excessive size of the government, including further increases in the number of deputy ministers, has continued to affect its credibility and effectiveness.

The Assembly was able to build majorities on some key strategic issues for Kosovo, as demonstrated by the ratification of the border/boundary demarcation agreement with Montenegro and the adoption of important EU-related legislative reforms. However, the Assembly continued to operate in a highly polarised political context, and weaknesses in its overall functioning remained, as demonstrated notably by the frequent lack of quorum, resulting in delays in the legislative activity.

There has been limited progress in addressing the EU election observation mission findings and recommendations regarding parliamentary and municipal elections held in 2017.

The situation in the north of Kosovo remains particularly challenging.

There is some level of preparation in the area of public administration reform. During the reporting period, some progress was made overall, however serious efforts are needed to tackle the political influence on recruitment of senior civil servants. There was good progress with the adoption of the package of laws on the functioning and organisation of public administration, on public officials and on salaries. Other achievements include the adoption of guidelines + on strategic planning and the start of the implementation of the action plan on the rationalisation of agencies. The revised legal framework is an important step towards creating a modern and professional civil service and improving accountability. While the Law on Salaries introduces a more transparent and equal salary system for public officials, its medium-term budgetary impact raises concerns.

Kosovo’s judicial system is at an early stage. Some progress has been achieved as the Law on the Disciplinary Liability of Judges and Prosecutors and the Law on Mediation were adopted, and the roll out of an electronic case management system has advanced. The number of judicial staff in both prosecution offices and courts increased in 2018, including in the Special Prosecution Office. While the integration into the judicial system of Kosovo Serb judges, prosecutors and their support staff was formally concluded in 2017, more work is needed to ensure full functionality, in particular regarding the Court of Appeals. The judiciary is still vulnerable to undue political influence. The administration of justice remains slow and inefficient and rule of law institutions need sustained efforts to build up their capacities.

Kosovo is at an early stage/has some level of preparation in the fight against corruption. Kosovo has made some progress through significant legislative reforms in the rule of law area and in investigating and prosecuting of high-level cases. Progress was also made on preliminary confiscation of assets although final confiscations remain low. Corruption is widespread and remains an issue of concern.

Kosovo is at an early stage in the fight against organised crime. Some progress was made notably through significant legislative reforms in the rule of law area, in investigating and prosecuting high-level cases and on the preliminary freezing of assets. However, little progress was made on final confiscation of assets and there are still few financial investigations and final convictions. Measures are needed to strictly ensure there is no political interference with operational activities of law enforcement bodies and the prosecution. The situation in the north of Kosovo with regards to organised crime continues to pose challenges for law enforcement agencies.

Progress was made in the fight against terrorism, especially with regard to creating better conditions for rehabilitation and reintegration of foreign terrorist fighters and their families. The Kosovo authorities need to be more effective in their efforts to fight money laundering and the relevant law should be brought in line with EU acquis and international standards.

The legal framework broadly guarantees the protection of human and fundamental rights in line with European standards. However, the implementation of human rights legislation and strategies is often undermined by inadequate financial and other resources, particularly at local level, limited political prioritisation and lack of coordination. The existing mechanisms for coordination and implementation of human rights are ineffective. The large dependence on foreign donors remains. More needs to be done to effectively guarantee the rights of persons belonging to minorities, including Roma and Ashkali and displaced persons, to ensure gender equality in practice, to set up an integrated child protection system and to advance the protection of cultural heritage.

Kosovo has some level of preparation regarding freedom of expression, which is enshrined in the Constitution. Kosovo benefits from a pluralistic and lively media environment. Rule of  law institutions increasingly follow up on threats and attacks against journalists and there is a decrease in the number of incidents. A sustainable solution for the funding of the public broadcaster remains to be adopted. The broadcaster remains vulnerable to political pressure and influence.

As regards the economic criteria, Kosovo is at an early stage and has made some progress in developing a functioning market economy. Economic growth was robust but the very challenging labour market situation remains a concern. The government adhered to the fiscal rules, but spending pressures relating to social benefits for specific groups of the population and public employees’ wages pose risks to public finances and hinder privat sector development. The business environment improved somewhat, but persistent challenges remain, including the widespread informal economy, a slow and inefficient judiciary, high prevalence of corruption and overall weak rule of law institutions. Despite strong growth of services exports, economic diversification has advanced slowly.

Kosovo is at an early stage and has made some progress regarding its capacity to cope with competitive pressure and market forces in the EU. Kosovo made some progress in improving roads, but there are large gaps in the railway and energy infrastructure. Little progress was made in securing a stable energy supply and losses in the electricity sector remain very high. Kosovo made some progress as regards the digitalisation of the economy. Little progress was made on improving the quality of education and addressing skills gaps in the labour market. Structural changes are emerging only slowly and the economy remains highly reliant on the domestic trade sector. Export growth is driven mainly by service exports to the diaspora, while the lack of product diversification hinders the growth of goods exports.

As regards good neighbourly relations and regional cooperation, Kosovo continued to participate in most regional fora. However, Kosovo’s decision to impose a 100% tariff on imports from Serbia and Bosnia and Herzegovina has undermined regional cooperation efforts.

Regarding the normalisation of relations with Serbia, Kosovo has remained engaged in the dialogue. However, the Kosovo government needs to revoke the tariffs on imports from Serbia and Bosnia and Herzegovina. Kosovo needs to make further substantial efforts to establish a conducive environment to the conclusion of a legally binding agreement with Serbia. Such an agreement is urgent and crucial so that Kosovo and Serbia can advance on their respective European paths.

As regards alignment with European standards, Kosovo has some level of preparation. Legislative alignment has continued in some areas but implementation is weak. Some progress was made in the area of free movement of goods, services and capital, as well as on financial services, public procurement and competition. Good progress was made in the  areas of statistics and financial control. In the area of taxation and customs, some progress was made in collecting tax revenues, reducing the grey economy, or enforcing customs measures for the protection of intellectual property rights, however Kosovo should step up the fight against the informal economy and tax evasion. Some progress has been achieved to address environmental issues, but implementation is lagging behind. The energy sector continues to face serious challenges, despite some progress especially on energy efficiency. Overall, Kosovo needs to improve its administrative capacity and coordination, across all sectors, to ensure effective implementation of the acquis.

Authorities have made progress in managing regular and irregular migration. These efforts should be continued and built on. In this context, Kosovo needs to put in place a return mechanism for irregular migrants in line with EU standards and practices.