Kosovo Independence Raises Hopes for Economic Revival

Yet Obstacles Abound For Areas Damaged By Sanctions, Bombs

Poor and mostly Muslim but feverishly pro-Western, Kosovo declared independence from Serbia on Sunday, ending a long chapter in the bloody breakup of Yugoslavia. U.S. President George Bush hailed the newly independent Kosovo and officially recognized it as a state and a "close friend" on Monday.
Washington Post Foreign Service
Saturday, February 23, 2008; Page A10

GJAKOVA, Kosovo -- The last time Florie Myrtaj drew a paycheck was in 2002. Her husband has been out of work, too. The only way they survive is through the charity of a relative living in Germany.

But in this economically stricken city, Myrtaj, a 42-year-old mother of three, sees a window of opportunity opening. Among Kosovars, she is not alone.

"We're all hoping that independence will change our lives," she said.

Kosovo has faced angry resistance from its Serb minority since declaring independence Sunday. But while attempting to temper the fury of ethnic Serbs with promises of tolerance, the country's government must now also satisfy an ethnic Albanian majority that is mired in poverty but flush with expectations that independence will rapidly translate into prosperity.

"People in Kosovo lived in a ghetto and they tolerated it in the name of independence," said Berat Buzhala, editor of the Express newspaper in Pristina, the capital of Kosovo. "They think independence will solve everything, automatically and quickly. Unrealistic expectations could be a big problem."

Since NATO troops entered Kosovo in 1999 after expelling Serb forces, economic growth has been feeble. Unemployment hovers around 40 percent and soars to more than 60 percent in Gjakova and some other cities.

Once an industrial hub in Yugoslavia, Gjakova -- called Djakovica by Serbs -- was devastated by the war. Serb forces killed 1,000 people in this region and burned 10,000 homes and businesses. Most of the homes have been rebuilt, according to Haqif Shehi, a former mayor of Gjakova. But a recovery effort that was started following NATO's arrival has stalled; it never translated into job-creating growth.

"We're still waiting for the future," said Shehi. "We're very happy about independence, but the economic situation is very bad. And we need jobs for our young people."

With 2 million people, Kosovo has Europe's youngest and fastest-growing population. Barring an economic recovery, about 50 percent of Kosovars ages 20 to 35 intend to emigrate, according to a report by Forum 2015, a research group in Pristina.

The new government is expected to apply soon for membership in the International Monetary Fund and the World Bank. Economic development funds are also expected to flow from the United States and Western European countries, including Britain and Germany, which have recognized Kosovo's independence.

But even under the most optimistic growth scenarios, the former Serbian province will still face a steep road before reaching standards of living on par with those of Western Europe, according to Luan Shllaku, executive director of the Kosovo Foundation for Open Society.

The Gorenje electric motor company, where Myrtaj worked, sits on the edge of this city, an industrial graveyard of empty factories that once hummed with activity. At its peak, the Gorenje plant employed more than 1,000 people. It was among a host of enterprises in the region that generated $100 million in exports in the 1980s from metals, textiles and agriculture.

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