Kosovo Country Report
Following the June 2017 general election, a broad coalition was formed, including parties with seemingly contradictory interests. This has increased the risk of policy paralysis and early elections. EU-mediated normalisation talks with Serbia are currently at risk due to an incipient trade war. The risk of protests because of a deteriorating socio-economic situation will remain high throughout 2018.
Kosovo's business environment is constrained by widespread corruption and outdated infrastructure. However, local infrastructure has started to improve as a result of domestic and international investments. To date, the international community has invested EUR4 billion into improving Kosovo's road and rail networks. One major concern is the unstable water supply and the lack of an efficient energy infrastructure. Impending investments, such as the planned construction of a 400 kV interconnection line with Albania, will serve to diversify Kosovo's energy sources and increase energy security.
Dissatisfaction among Kosovo Serbs over the attempts by the central government to bring Northern Kosovo under the authority of Pristina increases the risk of attacks against Kosovo police. There is a growing number of radicalised youth adhering to extremist interpretations of Islam, a number of whom have travelled to Syria and Iraq to fight for Islamist military organisations. However, the risk of attacks remains low in the foreseeable future.
The main war risk in Kosovo stems from the ongoing dispute with Serbia over Kosovo's statehood. On 26 March 2018 Kosovo police arrested Serbian official Marko Djurić who had entered the country despite an entry ban. Serbian Prime Minister Aleksandar Vučić called the incident a "brutal provocation", promising to "hold to account" everyone involved. Incidents like this are often used to galvanise the nationalist support base in both countries, but run the risk of unintended escalation. Nevertheless, overall war risks are low due to the presence of international peacekeeping troops.