One of the world's newest countries still struggles with international recognition. But its bigger problem could be its stagnant economy.
PRISTINA -- Aleksandar Josifovic was studying computer programming in northern Mitrovica five years ago when Kosovo declared independence from Serbia.
Josifovic hoped his studies would lead to a job in information technology or as a teacher. But five years later, the 25-year-old Serb from the town of Gracanica can only find work behind the cash register of his father's small grocery store.
With Kosovo's widespread poverty and an official unemployment rate of 45 percent, Josifovic sees himself as a victim in a game of politics and corruption where the rules are stacked against all but a handful of elite families.
Many young ethnic Albanians also share his view, saying they await the day when their generation has a chance to run things and more people can be prosperous.
Half of Kosovo's 1.8 million people are 25 or younger. Half of those under 30 are unemployed, and the situation is getting worse. Every year, more than 30,000 young people enter the job market. Fewer than 8,000 find work.
Economists estimate Kosovo's economy must grow by 8 percent each year
to absorb the young people entering the job market and hold unemployment
steady. But Kosovo is in recession, struggling to maintain growth of
about 3 percent.
Put simply, Kosovo has not yet fully recovered from its 1998-99 war and has failed since declaring independence to build a production-based economy that can employ most of its people.
Kosovar Deputy Prime Minister Mimoza Kusari-Lila says the government's political agenda has distracted it from dealing properly with economic woes.
"Focusing always on political issues or having politicians engaging in the political agenda -- be that the declaration of independence and dialogue -- has left a little bit aside the economic development," Kusari-Lila says.
"I believe that we'll be working and focusing more on the economic agenda [in the future] because the economic agenda will actually assist and help the political agenda as well."
To be fair, Kosovo's infrastructure in 1999 was less developed than in other parts of former Yugoslavia. About $1 billion has been spent since then to build a four-lane highway linking Pristina with Tirana and Albania's Adriatic port at Durres.
It is meant to eventually connect with the pan-European transport corridor at Nis, Serbia -- which runs between Salzburg, Austria, and Thessaloniki, Greece. Construction is also meant to start this year on a 55-kilometer highway between Pristina and Skopje.
Planners say both projects will improve Kosovo's trade links with its neighbors. But municipal officials complain that the projects have drained money away from their budgets, making it difficult for them to fund their own infrastructure improvements that would improve the business climate.
Kosovo's economy also still hasn't recovered from lost production at the Trepca mine complex in the divided city of Mitrovica.
Trepca once employed 23,000 and accounted for 70 percent of Kosovo's gross domestic product (GDP). But since the war ended in 1999, the de facto partition of Mitrovica between Serbs and ethnic Albanians has kept most of Trepca's facilities closed.
Kusari-Lila still hopes Trepca will contribute to GDP in the future. But she admits Trepca is unlikely to have the economic impact it had in the past.
Oliver Ivanovic, a Serbian political leader in northern Mitrovica and former Trepca manager, doubts the complex can be reopened without at least $650 million in foreign investment to repair and update smelters and refineries.
He says it will be impossible to get that investment without a political resolution on northern Kosovo, where Serbs insist they will never recognize Pristina's declaration of independence. "Under these circumstances, with permanent political tensions, you simply cannot even have thoughts about economic development," he says. "We have to make some solution that somehow can be acceptable for both sides."
A Lack Of Production
Meanwhile, half of Kosovo's citizens struggle to survive on social benefits of less than $2 per day.