Kosovo

Published / Updated: October 2016

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Kosovo has made significant progress in many areas since the end of the conflict in 1999. It continues to consolidate and harmonize its democratic institutions and has made significant progress strengthening its basic legal framework and institutional structures, with a view to reinforcing the necessary foundations for a functioning market economy. The pursuit of economic reforms received new momentum after the 2014 elections when a new Assembly was formed and a new government took office in December. On 27 October 2015, the EU signed a Stabilization and Association Agreement (SAA) with Kosovo. This is a milestone on Kosovo’s path towards a European future. Some progress has also been made in facilitating business creation, improving the legal system, and financial-sector stability. Kosovo has been one of only four countries in Europe that recorded positive growth rates in every year of the post-economic crisis period following 2008. The average growth of 3.5 percent contrasts favorably to the region but has remained slightly below the global average.

Despite progress, economic growth, the rights of women and minorities, democratic governance, environmental protection, and the rule of law are constrained by poorly defined, administered, and enforced property rights. Kosovo still ranks high among the poorest countries in Europe, with widespread and persistent poverty. According to the UNDP, nearly 30 percent of the population is poor. While there are few significant differences between urban and rural areas, there are regional differences in terms of the incidence of poverty. Lack of economic growth is also due to limited progress in privatizing and liquidating publicly owned enterprises and budget revenues from these activities remain low in comparison to projections. However, the Ministry of Trade and Industry has drafted the “Private Sector Development Strategy 2013 – 2017” document, which represents coordination of activities of the Ministry toward development of the private sector. The Strategy mainly focuses on the development of Small and Medium Enterprises, investment promotion, enhancing internal markets, free movement of goods, and improvement of trade policies through changes in the legal, institutional, and policy framework. Weak institutional capacity and unclear property rights have continued to create disincentives for formal private sector activities.

Extreme poverty is disproportionately high among children, the elderly, households with disabled members, female-headed households, and certain ethnic minority households, especially in the Kosovo Roma, Ashkali, and Egyptian communities (World Bank 2015a). Reliance on remittances and a widespread informal economy likely contribute to already low labor market participation and high unemployment, which as of late 2015 stands at 35.3 percent overall, rising to 61 percent among youth. Labor market conditions are especially difficult for women. Only one in five women of working age are active in the labor market and only one in eight are employed. Limited job opportunities, especially for young people, are also putting a strain on social cohesion and encouraging emigration, which has risen since 2015. While land legislation gives women and men equal rights to property before the law, Kosovar Albanian and Serb women almost universally waive their rights to inherit property, often in the face of severe social pressure.

The most tenuous property rights are found among displaced people: Kosovo Serbs and other ethnic minorities, and those living within Kosovo’s informal developments. Displaced persons face problems in Kosovo in registering residences in the relevant cadastral offices because they lack proper documentation. Many Kosovars who left during the 1999 conflict have returned. The Government has developed a National Policy addressing reintegration, which is designed to support effective integration and repatriation of displaced persons (Ministry of Internal Affairs 2013e). Overall, central processing of repatriated people is relatively efficient and emergency assistance is provided to those in need. However, as in many post-conflict areas, land records have been destroyed, are nonexistent, or unreliable. The cadastre system is being reconstructed and updated, and tribunals are resolving property claims, but the pace is slow. Decentralized municipalities administer their own cadastres, but property transactions are not systematically reviewed and registered in the national cadastre. Tens of thousands of people are still displaced within the country and hundreds currently residing in 36 Collective Centres (CCs) in Kosovo. Almost 85 percent of the individuals living in CCs are from the Kosovo Serb non-majority and almost 5 percent from the Kosovo Roma, Ashkali and Egyptian (RAE) communities.

Kosovo is still in the early stages of adapting and implementing environmental standards. Kosovo has developed and/or approved a Strategy for Environmental Protection and Sustainable Development 2013-2022, the National Environmental Action Plan 2013-2017, the Air Quality Strategy 2013-2021, the Biodiversity Strategy and Action Plan 2011-2020, the Waste Strategy and Action Plan, the Framework Climate Change Strategy, the Water Strategic Plan and the Management Plan for River Basins. These documents determine for each policy area the necessary measures for environmental protection and the measures to be taken for climate-change adaptation and mitigation. However, waste management, air, and water quality are among the most serious issues the country faces: surface and groundwater resources are polluted by sewage and industrial waste. Air pollution is also significant and together these have had serious public health impacts. Lack of data, integrated monitoring, legal frameworks, and organizational capacity are cited as underlying factors.

Kosovo has high-quality agricultural land, which comprises more than half of its land use. Agriculture has always been a key sector in Kosovo’s economy, but it declined significantly during and after the conflict. Recent studies from the Kosovo Agency of Statistics indicate that some 140,000–150,000 people are informally employed in agriculture. The sector is constrained by land fragmentation and the small size of the agricultural parcels. This has posed a problem for sustaining adequate agricultural outputs, leading to lower agricultural production and economic losses at the household, local, and national levels. Labor statistics in other sectors, including services and industry are less reliable due to a large informal economy. An estimated 60 percent of workers between the ages of 20 and 64 work within the services sector and less than 20 percent work in industry.

Beyond agricultural lands, Kosovo possesses an abundance of natural resources, including trees and minerals. Kosovo’s forests are tree-species rich and comprise more than 40 percent of land use. Forests provide timber, fuelwood, and various non-timber forest products used by the population. However, only a small fraction of the harvesting is carried out in accordance with existing forest legislation. Progress has been achieved in the areas of developing long-term management plans, yet a high degree of illegal cutting of forests remains a challenge and greater engagement and mobilization of the stakeholders involved in the implementation of the forest strategy is required. Finally, Kosovo is rich in mineral deposits and their potential has been left largely untapped. In addition to 10.9 billion tons of proven, exploitable lignite reserves, the country has abundant deposits of ferronickel, lead, zinc, magnetite, and other ores that—if developed—could make a major contribution to employment and exports.

In 1989, the Milosevic regime with the Socialist Federal Republic of Yugoslavia (SFRY) eliminated Kosovo‘s autonomous status and placed Kosovo under direct rule. The decade of discriminatory control over ethnic Albanians and armed conflict that followed displaced hundreds of thousands of Kosovo nationals and destroyed property throughout the country. At the conclusion of the armed conflict in June 1999 the United Nations Interim Administration Mission in Kosovo (UNMIK) established a transitional government and set the stage for development of Kosovo‘s independent government.

Kosovo declared its independence in February 2008. The government promised to embrace multi-ethnicity as a fundamental aspect of good governance. With support from the EU’s Rule of Law Mission (EULEX) police, judges, prosecutors, and customs officers were deployed throughout Kosovo. Kosovo adopted its Constitution in 2008 and has developed a substantial body of law and policy. The country joined the International Monetary Fund and World Bank in 2009. As of July 2015, 112 countries have recognized Kosovo’s independence. Serbia and Russia are among those that have not recognized the country’s independence. A landmark Serbia-Kosovo deal, brokered by the EU, concluded on April 19, 2013. It paves the way for both Serbia and Kosovo to make progress towards EU accession.

Kosovo is one of only four countries in Europe that recorded positive growth rates in every year of the post-1999 period (World Bank 2015a). With a relatively stable political, economic, and institutional framework in place, Kosovars have been returning to the country. However, tens of thousands of people are still displaced. And despite economic progress, Kosovo ranks among the poorest countries in Europe. Poverty is disproportionately high among children, the elderly, households with disabled members, female-headed households, and certain ethnic minority households. Reliance on remittances and widespread economic informality decreases incentives to search for employment and contributes to already low labor market participation and high unemployment, especially among youth (World Bank 2015a).

Weak institutional capacity and unclear property rights create disincentives for formal private-sector activities. As in many post-conflict areas, land records were destroyed, are nonexistent or unreliable. The cadastre system is being reconstructed and updated, and tribunals are resolving property claims, but the pace is slow. Legislation gives women and men equal rights to property before the law. However, Kosovo Albanian and Kosovo Serb women almost universally waive their rights to inherit property, as a matter of cultural practice and often in the face of severe social pressure.

Kosovo is still in the early stages of adapting and implementing environmental standards. Waste management, air, and water quality are among the most serious issues. Kosovo possesses an abundance of natural resources, including trees and minerals, which, if developed—could make a major contribution to employment and exports. Kosovo is also endowed with good quality agricultural land—and had been largely food self-sufficient in the past. Over the last decade, demand for high-value horticulture products has surged more than any other food category. However, unfavorable farm structures, land fragmentation, outdated farm technologies and farm management practices, weak rural infrastructure, a rudimentary rural advisory system, and limited access to credit and investment capital are all limiting factors. In addition, Kosovo’s farmers are placed at a competitive disadvantage as agricultural imports originate in neighboring and EU member states in which farmers receive production and export subsidies.

Kosovo has a total land area of 10, 908 km² and an estimated 1.8 million people (Kosovo Agency of Statistics 2014). Kosovo Albanians comprise 92.9 percent of the population, followed by Kosovo Bosniaks 1.6 percent, Kosovo Serbs 1.5 percent, Kosovo Turks 1.1 percent, Kosovo Ashkali 0.9 percent, Kosovo Egyptians 0.7 percent, Kosovo Gorani 0.6 percent, Kosovo Roma 0.5 percent, other/unspecified 0.2 percent.2 (Central Intelligence Agency 2015). Thirty-nine percent of Kosovo‘s population lives in urban areas. Pristina, the largest municipality and capital city, had a population of 207,477 in 2014 (GoK 2016). Almost two-thirds of Kosovo’s population is of working age (15-64 years). The working age population is expected to grow rapidly over the next decade as Kosovo has one of the youngest populations in Europe. Of those of working age, nearly 60 percent are not economically active (GoK 2014c). Of those who are economically active, 35.3 percent (176,743 persons) are unemployed. This implies that 64.7 percent of economically active people are employed, yielding an employment-to-population ratio (employment rate) of 26.9 percent (GoK 2014c). It is important to note, however, that informal employment is widespread. Kosovo’s 2014 GDP was 27.4 billion USD with agriculture comprising 14.3 percent of GDP, manufacturing 19.5 percent and services 66.5 percent (World Bank 2016). The agriculture sector remains a highly “informal” sector (World Bank 2015a).

Out of the total surface of 1.1 million hectares, approximately 577, 000 hectares (53 percent) is cultivable land and 413, 635 hectares is currently under cultivation. Pristina is the region with the largest arable land area at 27.7 percent (GoK 2015a). The majority of agricultural land is privately owned (80 percent), providing primarily subsistence farming for individual households (World Bank 2015a). Agriculture in Kosovo is dominated by subsistence farming due to small plot sizes, generally less than 3 hectares, and a lack of mechanization and technical expertise. Most rural households keep some livestock. The largest area of arable land is under grain cereal crops, planted on almost 75 percent of the area of arable land. The second most important group of crops on arable land are fodder crops. Other crops include peppers, tomatoes, onions, cabbage and watermelon (World Bank 2015a, GoK 2015a, GoK 2014b).

Although land use is dominated by agriculture, Kosovo (at 165 people per square kilometer of land) has a high population density compared to other countries where the agriculture sector is significant and linkages between rural and urban areas are strong. As with many post-conflict countries, because of poor economic and infrastructure conditions, many have moved to more developed settlements in search of better living conditions. The uninterrupted movement of population has burdened urban areas, which in turn are developing without the benefit of control of spatial planning, particularly at the municipal level, despite. Informal construction is widespread and especially acute along regional roadways (GoK Ministry of Environment and Spatial Planning 2010a). The consequences are manifest in unequal development between urban and rural areas, the creation of housing areas without the proper physical and social infrastructure, and increasing property and legal disputes. At the same time, the strong links between rural and urban areas means there is good potential for diversifying economic activities wherever the infrastructure is present and allows market access.

Forest area in Kosovo remains fairly stable at approximately 481,000 hectares (44.7 percent of total area) and provides timber, fuelwood, and various forest products used by the population. Annual harvest is above the recommended long-term harvest levels and more than 90 percent of the volume is not harvested according to regulations. Between 30-40 percent of public and private forestlands have been subject to uncontrolled or illegal harvesting activities (GoK Ministry of Agriculture, Forestry and Rural Development 2010b).

Kosovo is facing serious environmental problems, especially in relation to land management and discharge of different pollutants into agriculture land, releases of wastewater and raw sewerage into rivers and construction activities within natural floodplain areas and on agricultural land. Sites for deposition of mining waste are high-risk areas for pollution of land and groundwater with toxic and heavy metals (Ukaj et al. 2013).

LAND DISTRIBUTION

Kosovo is a small, landlocked country with a total area of 1.1 million hectares, 53 percent of Kosovo’s land is agricultural, 44 percent is forest land, 1 percent is water surface and 5 percent is other surfaces (e.g., roads, urban, and other land) (GoK Kosovo Agency of Statistics 2015). There are about 2 million land parcels and an estimated 350,000 property owners (World Bank 2015b). To some degree, land settlement patterns in Kosovo, like much of the Western Balkans, continue to reflect a history of ethnic conflicts (Sauer et al. 2010). The majority of Kosovo Serbs live in Kosovo Serb-dominated areas,p three of which are located on the Serbian border and one of which is located on the Macedonian border. A large proportion Kosovo Bosniaks live within Prizren and Dragaš holds many Gorani. The remainder of the population in this region is Kosovo Albanian (GoK Kosovo Agency of Statistics 2014d). Pristina is the region with the highest in-migration (GoK Kosovo Agency of Statistics 2014d).

Total area of land used for agricultural production in 2014 was 413,635 hectares, which is 41.8 percent of the total area of Kosovo. The average size of agricultural utilized area per agricultural holding is 3.2 hectares, often spread across an average of seven smaller plots, aggravating farmers’ ability to achieve economies of scale. Within the total of utilized agricultural land, the largest area is permanent grasslands (54.3 percent) following by arable land (43.6 percent), permanent crops (1.9 percent) and kitchen gardens (0.3 percent) (GoK Kosovo Agency of Statistics 2015a). The average age of the head of agricultural households and individual agricultural businesses is 52. Kosovo is a rural and patriarchal society and it is estimated that at the national level the distribution of female land ownership is around 15 percent (World Bank 2015b). The majority of farm holders are males, but women are often the predominate workers on those family farms (Sauer et al 2010). Land plots are typically held without clear legal title or registration and property records are not properly maintained. About 30-40 percent of landowners are estimated to be absent, having either migrated to urban areas or moved abroad. Efforts are being made to rationalize and consolidate physically separated parcels of land, which requires reallocation among landholders, but the process is slow and burdensome.

Socially Owned Property and Socially Owned Enterprises (SOE’S) have a complex and contentious history within Kosovo. Precise and current statistics on Socially Owned Property and Socially Owned Enterprises (SOEs), including unions, associations, and cooperatives are not available. However, an estimated 500 business enterprises in Kosovo have been identified as potentially being Socially Owned Enterprises (Azzopardi 2014). The Privatisation Agency of Kosovo (PAK) is focused on privatizing SOEs and their land (GoK Privatisation Agency of Kosovo 2009). Privatized agricultural SOEs have been distributed to a large extent to many small household farms (Azzopardi 2014).

The Kosovo War displaced hundreds of thousands of people. The rural-urban ethnic composition changed dramatically between 1991 and 2000. The population of ethnic Serbs declined in urban areas and grew in rural ones, while the Kosovo Albanian population exhibited the opposite trend. As residents evacuated rural and urban areas, their abandoned housing was often destroyed or illegally occupied. As of December 2012, there were an estimated 225,000 persons displaced from Kosovo within Serbia, including an estimated 15,000 displaced Kosovo Roma who have not been registered as displaced (IDMC 2013). Displaced persons are primarily Kosovo Serbs, but also include Kosovo Romas, Ashkalis, and Egyptians. Members of these minority communities are among those marginalized by displacement.

Thirteen years after their displacement, only around 4,500 of the estimated 245,000 displaced persons I have returned to their places of origin. According to UNHCR, 551 displaced persons returned to their places of origin in 2013 – the smallest number since the 1999 conflict (IDMC 2014). Most displaced Kosovo Serbs live in northern Kosovo, where they rely on a system of education, security gand health care services provided entirely by Serbia. To facilitate the continued return of approximately 17,000 internally displaced and 643 individuals living within Collective Centres, Kosovo adopted the Strategy for Communities and Returns for 2014 to 2018. The issue of return is paralleled by a recent spike (in 2014 and 2015) in the number of Kosovar (mostly Kosovar Albanians) seeking asylum in the EU (GoK Ministry for Communities and Return 2014e, Los Angeles Times 2016).

Resettlement and recovering property is particularly difficult for displaced Kosovo Roma, Ashkali, and Egyptians, many of whom may have traditionally lived in informal settlements called mahalas, without legal title to the property. The mahalas are characterized by a lack of infrastructure and irregular tenure status. In 1999, many mahalas were destroyed and their occupants forcibly evicted. In some areas members of these communities have constructed informal settlements on public and socially owned land (IDMC 2009; COHRE 2008).

Population displacement, an insufficient and inadequate supply of housing, and an absence of functioning law enforcement, have resulted in an increase in the numbers of illegal settlements and illegally constructed buildings throughout Kosovo. Agricultural, state, and displaced owners’ land have been the site of illegal settlements, particularly on the periphery of urban areas. According to the Ministry of Environment and Spatial Planning, permanent land loss has occurred due to settlements, commercial, and industrial activities. “Temporary” land loss has been due to superficial mining, sand and gravel exploitation, landfills, industrial and municipal waste dumping, erosion, and land degradation (Ministry of Environment and Spatial Planning 2010a).

LEGAL FRAMEWORK

The Constitution of Kosovo (2008) recognizes the right to own property and mandates that property must be used in accordance with the law and in the public interest (GoK Constitution 2008a). Kosovo‘s formal land laws include: 1. the Law on Property and Other Real Rights, Law No. 03/L-154 (2009), which governs the creation, transfer, protection, and termination of land rights; 2. the Law on Establishment of an Immovable Property Rights Register, Law No. 2002/5 (2002), which establishes the basic concepts and procedures for a modern immovable property rights register; 3. the Law On Cadastre, the Law No. 04/-L-013 (2011) regulates the cadastre of immovable property, national and cadastral surveys, geodesic and cadastral works as well as acquisition, registration, keeping, maintenance and use of cadastral data. 4. the Law on Basic Property Relations, SFRY No. 6/80 (1980) governs urban land to the extent not superseded by the 2009 Law on Property; 5. the Law on Agriculture Land 02/L-26, (2006) determines the use, protection, regulation and lease of agricultural land for the purpose of permanent preservation and protection of agricultural potential, based on principles of sustainable development and; 6. the Law on Obligation Relationships, No. 04/L-077 (2012) governs leases (Hasolli and Nushi 2010, GoK Law on Property 2009e, Stanfield et al. 2004; GoK 2012d, GoK 2011, GoK 2006, GoK Law on Basic Property 1980). The 2011 Law On Land Regulation No.04/L-040 establishes the legal basis and regulation of the agriculture land, forests and forest lands. Article 4 of this law enables voluntary land consolidation, creation of parcels of regular geometrical shape, improvement of infrastructure, including access to public infrastructure, reforestation of land of lower quality or polluted land, and creation of a new cadastre among others (GoK 2011).

Kosovo does not recognize the local customary law, or Kanun, as a normative and legal entity, although debates have neglected the Kanun’s role at micro-levels, as this law continues to be used and it influences Kosovo society. There is evidence that Kanun norms continue to operate in and regulate land and property relations within families. A clear example of the continued influence of the Kanun norms is that v rural residents still use it as a basis for identifying males as the sole heirs of real property despite formal secession laws that provide for women. In fact, women are regularly excluded from a share in the family’s immobile property. Although there is a legal infrastructure dealing with women’s property rights, Kosovo struggles with poor implementation of the Law on Inheritance and the influence of education, culture, tradition, economic conditions all of which affects women’s access to property (Vuniqi and Halimi 2011, Bardhoshi 2013).

TENURE TYPES

Real property in Kosovo falls into three categories: state, socially owned, and private. State land includes properties belonging to the government and used for public facilities, such as roads, schools, hospitals, and administrative buildings. The category of socially owned land was introduced by the former Socialist Federal Republic of Yugoslavia. It is land in which society as a whole had a vested right of ownership, and individuals and entities had use rights. Socially owned land includes various categories of land (e.g., public land, forestland) controlled and managed by Socially Owned Enterprises (SOEs), public sector agencies, publicly owned enterprises (e.g. public utilities), religious organizations, and other entities. Private land is land that is owned by individuals and legal entities. Formal law in Kosovo recognizes ownership and leasehold tenure. Landowners have the right to exclusive use of their land, the right to exclude others, and the right to alienate the land. Leasehold rights to non-agricultural land are governed by the terms of the lease and principles of contract law; the parties have the right to negotiate for the length of the lease and rent. Unless otherwise agreed to by the parties, lessees can sublease their land (Hosolli and Nushi 2010).

Under the Law on Agricultural Land, leases of agricultural land are categorized as short-term (less than three years), long-term (three years or longer), or grazing leases. Long-term leases must be in writing to be enforceable under the law. The Law on Agricultural Land specifies the requirements for written leases of agricultural land and provides for the enforcement of leases. It also prohibits the conversion of agricultural land to nonagricultural land unless the new use is identified by a land-use plan that the municipal government authority has approved. Conversion of irrigated land requires a specific showing of public importance (GoK Agricultural Land Law 2006).

SECURING LAND RIGHTS

People and entities obtain land in Kosovo by purchase, lease, inheritance, and gift. No national data comparing various methods of accessing land is available. Security of land rights are supported by land law, land administration, and access to information about land rights. Land law in Kosovo has been described as “modern, egalitarian” (Joireman 2015). However, gaps between law and practice exist, which compromises secure land rights. Improvements in land administration, particularly in land registration, have offset weakened land tenure security due to the effects of conflict on land records, many of which were destroyed or moved to Serbia. Registering land in Kosovo has been reduced to 6 steps, which takes approximately 10 days. The number of land transactions has increased by approximately 10 percent over the past few years (World Bank 2016a, Kelm 2015). Despite progress, the requirements for registering land, payment of taxes on registered land, prohibitions against certain transactions (e.g. between Serbs and Albanians), and a lack of public awareness of the importance of legal documentation have resulted in many informal land transactions and failure to register land transfers (Hasolli and Nushi 2010).

The most tenuous property rights are found among displaced persons, Kosovo Serbs and other ethnic non-majority, women, and those living within Kosovo’s informal developments. Displaced people s face problems in Kosovo in registering residences in the relevant cadastral offices because they lack proper documentation. The land restitution program, which has mainly addressed claims of the Kosovo Serb population, has gone some distance toward reducing property rights disputes and territorial claims as a driver of ethnic conflict. However, barriers within the legal system, including a large backlog of cases, remain (Lawry 2013, Heugten 2012). For women, secure land rights continue to be affected by poor implementation and enforcement of land laws, lack of awareness about existing laws, insufficient understanding about options for legal compensation and conflict resolution, prevalence of traditional attitudes and practices, and lack of co-ownership between spouses when registering property (Vaniqi and Halimi 2011). Informal developments or settlements, which have proliferated in recent years throughout Kosovo, are characterized by a lack of access to basic infrastructure, social services, and insecure tenure. Because they are not built in compliance with spatial plans, lack the necessary construction permits, and are not registered in the cadastral records, inhabitants are especially vulnerable to forced eviction, especially when homes are constructed on municipal or Socially Owned Property (OSCE 2011).

INTRA-HOUSEHOLD RIGHTS TO LAND AND GENDER DIFFERENCES

The Constitution recognizes gender equality as a fundamental value for the democratic development of society and mandates equal opportunity for men and women in political, economic, social, and cultural spheres. Kosovo‘s formal law provides that women and men have equal rights to own and inherit property. The laws governing women’s rights to land include: The Law on Property and Other Real Rights of 2009, which establishes the framework for all property ownership and transfer in Kosovo for all citizens. Three additional laws provide a framework for gender equality in Kosovo and for women’s access to property: The Law on Gender Equality of 2015, the Inheritance Law, and the Family Law, both of which passed in 2004. Kosovo’s Family Law governs property regimes between spouses and is based on the principle of equality between husband and wife. The law permits a mixed marital property regime in which property acquired during marriage is regarded as common property, and property acquired prior to marriage by inheritance, by gift or by other forms of legal acquisition is regarded as separate property. The common property of a married couple must be administered jointly, registered jointly, and may not be alienated without the consent of both spouses (GoK Constitution 2008a; UNMIK Kosovo Family Law 2004b; UNMIK Kosovo Inheritance Law 2004c). Spouses, even those who do not have registered marriages, may inherit under certain circumstances. If a couple is married under a common property regime and one spouse dies, the surviving spouse is first in the order of inheritance among heirs (GoK Law on Gender Equality 2015b, UNMIK Kosovo Inheritance Law 2004c).

A recent survey of attitudes related to women’s rights to inherit property in Kosovo found evidence that a large majority (87 percent) of women routinely renounce or withdraw property and inheritance rights (USAID, 2015). Further, among survey respondents, 78 percent stated that there were no female members of their household registered as property owners. The number of respondents who claimed that there was one or more registered female property owner in their household was only 6 percent. Low levels of ownership and concerns related to inheritance may reflect the fact that remnants of the patri-local extended family system indigenous to Kosovo reemerged during the 1999 conflict as a strategy for improving chances for survival and coping with economic scarcity. Under this system the husband’s family is expected to care for his wife, but she is regarded as a kin-outsider, and her children belong to the husband’s family (Tawil 2009). Informal or unregistered marriages, which are common in Kosovo, can become particularly problematic when a spouse dies. There is a notable gap between the Family Law’s understanding of “factual” marriages and the Inheritance Law, which has multiple restrictions on the ability of a recognized spouse to inherit if a marriage is not formalized (Joireman 2015).

LAND ADMINISTRATION AND INSTITUTIONS

The Law on Cadastre No. 04-L/013 regulates the country’s cadastre of immovable property, national and cadastral surveys, geodesic and cadastral works as well as acquisition, registration, keeping, maintenance and use of cadastral data (GoK Kosovo Cadastre Agency 2016b). This legislation has significantly influenced the reform of the land administration system to provide more accessible, secure, safe and accurate land data. Responsibility for implementation of land administration is housed within the Kosovo Cadastral Agency (KCA), whose mandate is to serve as a customer-oriented, advanced, modern institution for land management. The KCA was originally designed as part of the former Ministry of Public Services, now the Ministry of Public Administration, and the agency was incorporated into the Ministry of Environment and Spatial Planning in late 2009 (Ministry of Environment and Spatial Planning 2016a). The KCA has been active in mainstreaming gender in land administration activities.

Municipal Cadastral Offices (MCOs) are responsible for the day-to-day operation of the cadastre. MCOs perform cadastral surveys and cadastral activities in accordance with powers delegated from the central level, the provisions of the law, and administrative instructions issued by the KCA and the Ministry. The MCO officers who conduct cadastral surveys must be certified by the KCA. All activities of MCO are reflected in the central database of the KCA (Kosovo Cadastre Agency 2016a, Ministry of Environment and Spatial Planning 2010a) The work of the KCA and MCOs are integrated with regard to policy implementation, technology, and human resources, but the KCA does not directly manage the MCOs.

The mandate of the Ministry of Environment and Spatial Planning (MESP) is defined by United Nations Mission in Kosovo (UNMIK) regulation no. 2002/5 and 2005/15. These regulations create and provide for the implementation of general management legislation in the fields of environment, water, housing spatial planning and construction. MESP has 7 departments: Environmental Protection (DEP), Spatial Planning (DSP), Housing and Construction (DBN), Water (DU), Central Administration (DCA), Procurement (DP), and National Parks (DNP). Two institutes are also housed within MESP: The Hydrometeorology Institute and Institute for Spatial Planning Inspectorate (Ministry of Environment and Spatial Planning 2010a).

The Ministry of Justice (MoJ) has established Department for European Integration and Policy Coordination (DEICP), which coordinates the process of European integration, strategic planning and policy development, external assistance in preparation for EU accession.

With agriculture and rural land comprising a significant proportion of Kosovo’s land area, the mandates of the Ministry of Agriculture, Forestry and Rural Development (MAFRD) are broad and include (among others) implementing laws and developing polices for agriculture and rural development and irrigation, assisting the administration and management of forestry sector, and protection of the environment related to forestry, hunting, fishing, and water resources. The Ministry houses the Kosovo Forestry Agency and the Agency for Agricultural Development. The latter has several departments, including departments of Rural Development and Advisory Services, Policy Development, Plant Production, and Livestock Production (Ministry of Agriculture, Forest and Rural Development 2016c)

The Privatization Agency of Kosovo (PAK) is an independent public body that oversees the privatization of SOEs. PAK succeeded the Kosovo Trust Agency (established by UNMIK) in 2008 (Privatization Agency of Kosovo 2013).

LAND MARKETS AND INVESTMENTS

Data regarding Kosovo’s land market remains limited, and the market remains largely dysfunctional and inefficient, creating a fundamental impediment to sector development in Kosovo and beyond. Land registration difficulties, land co-ownership (both formal and informal), high levels of land abandonment, lack of job alternatives for farmers, as well as high transaction costs and low land mobility (i.e. few sellers and few buyers), can be found in many other countries in the region and continue to constrain the regional land market. While the land market is active in some areas, it is also plagued by lack of clarity over land rights, difficulty valuing land, and lack of credit (Sauer et al. 2010).

Overall, women own 15.2 percent of all property compared to approximately 75 percent for men (Tonchovska et al. 2014). Kosovo women also mortgage their property much less often than men. In other countries, even when the amount of land women own is low, the number of mortgages is proportionally higher. In Kosovo, men use their property as collateral more than ten times as often as women.

The agricultural sector remains constrained, in part, due to the land market and the fragmentation of agricultural land. Because larger farm size is correlated with higher levels of productivity, efforts have been made under the ARDP to rationalize and consolidate physically separated parcels of land, which requires reallocation between landholders. This process is slow and burdensome: developing adequate (speedy, easy, and inexpensive) systems for registration and the transfer of land ownership rights to facilitate land consolidation and long-term investments remains a challenge. For example, regarding privately owned agriculture land, there is no single database on the market as a single source of information about supply and demand, as well as the sale price of agricultural land. (European Fund for Southeast Europe 2014, National Council for European Integration 2013).

Private investor interest in Socially Owned Land, which would assist in stimulating the land market, is limited by several factors, including a lack of clarity over possession and/or ownership; the confused regulatory environment; continued debate about restitution; and ambiguity about how to treat land that has a public interest (European Fund for Southeast Europe 2014, Stanfield et al. 2004).

LAND EXPROPRIATION AND ACQUISITION

The Constitution (2008) protects against the arbitrary expropriation of property in Kosovo. The state can expropriate property if authorized by law or if necessary to achieve a public purpose or promote a public interest. The Constitution requires the immediate and adequate provision of compensation to the person or persons whose property has been expropriated (GoK Constitution 2008a). The Law of Expropriation (2009) protects a natural person’s right to seek compensation for property that has been expropriated. Under the Expropriation Law, the state can only expropriate property if the following conditions are fulfilled: 1. the expropriation is related to the accomplishment of a legitimate public purpose; 2. the public purpose cannot be achieved without the expropriation; 3. the public benefits of the expropriation outweigh the negative effects of the expropriation; 4. the property will not be expropriated for any discriminatory purpose or objective; and 5. the Expropriation Authority has followed the applicable provisions of the law. Expropriations of property may be appealed through the court system (GoK Expropriation Law 2009c; GoK Constitution 2008a). Municipalities can expropriate property under the following conditions: 1. in order to implement an urban or spatial plan that has been adopted in accordance with all applicable legal requirements; 2. for construction or enlargement of a building or facility to be used by a municipal authority to fulfill its public functions; 3. for construction or enlargement of infrastructure and facilities if they promote general economic and/or social welfare or provide a public benefit to the municipality, including (i) municipal roads; (ii) public facilities for education, health or social welfare; (iii) water and sewer pipes; (iv) landfill sites; (v) public cemeteries; or (vi) public parks and sports facilities and; 4. for acquisition of surface rights to implement a mining license pursuant to a mining law. Other provisions include Procedures / Compensation, Restrictions on Subsequent Transfers, Land for Land, Return of Expropriated Property, Right of First Refusal, and in keeping European Convention on Human Rights (Tonchovska et al 2014).

LAND DISPUTES AND CONFLICTS

Competing land claims have contributed significantly to violence between Kosovo Albanians and Kosovo Serbs, forced displacement, and the destruction of property. Following the end of the Kosovo War, Kosovo Albanians began to return. This led to displacement among some secondary occupiers of land and housing, which contributed to land disputes. Displaced Kosovo Serbs increasingly migrated out of the country or sought compensation for lost property. UNMIK initially established the Housing and Property Directorate (HPD) and the Housing and Property Claims Commission (HPCC) to resolve disputes over residential land. These agencies accepted claims through July 1, 2003. The initial claims that were deemed appropriate to address were those raised by people who lost possession of their property as a consequence of discriminatory laws and practices during the Milosevic regimes, those who were unable to register purchased property as a result of discriminatory laws, and those displaced at the beginning of the NATO action in 1999. Claims of Kosovo Serbs who were forced from their homes were subsequently added. Landless individuals and households – primarily members of the Kosovo Roma, Ashkali, and Egyptian communities who had been living in conditions of informal property tenure for decades did not, however, have standing to bring claims for lost housing. Remedies were initially limited to restitution, which was not always satisfactory, and some decisions proved difficult to enforce (Arraiza and Moratti 2009).

The Kosovo Property Agency (KPA) was established by UNMIK Regulation 2006/10 (2006) as an independent agency and designed to fill some of the gaps of HPCC. The mandate of the KPA is to facilitate the resolution of property claims, including those relating to agricultural and commercial property. Since its inception, the KPA has collected claims for over 42,000 properties and decided 98 percent of those claims (GoK Kosovo Property Agency 2014). Outstanding cases are found primarily in Mitrovica. While the process of issuing decisions is approaching its end, the enforcement of such decisions in a number of cases is becoming particularly problematic, especially those cases where a new building has been constructed on disputed properties (Moratti 2014). The prevalence and effectiveness of customary law in resolving land disputes is not reported.

Illegal logging represents one of the biggest challenges to Kosovo’s land sector and is a strong driver of insecurity and potential larger scale conflict and may have major implications for post-conflict development and peace-building efforts in Kosovo. A variety of actors are currently engaged in illegal woodcutting, ranging from individuals, families, small-scale sellers in markets, and larger organized criminal networks. Incidents of illegal logging have sparked violence between victims and offenders, who are often armed and ready to use their firearms to avoid detection or prevent the confiscation of their assets. According to international security forces in Kosovo, many of these are “inter-ethnic incidents” between Kosovo Albanians and Kosovo Serbs, and could act as a trigger for tensions between the communities. Uncontrolled woodcutting also leads to serious environmental degradation, thus increasing the vulnerability of poor and disadvantaged populations (Bensky et al. 2013).

KEY LAND ISSUES AND GOVERNMENT INTERVENTIONS

The Government of Kosovo has placed early and consistent focus on the need for reconstruction of the land cadastre and developing legal frameworks governing land, registration of land and apartments, efficient claim procedures to resolve the incomplete and unreliable nature of land and property records, and strengthening the institutions in the land sector. In the case of Kosovo, these efforts have had a positive impact on the institutional weaknesses of a post-conflict society. In addition, interventions in housing, property rights, and land administration have contributed to foundational efforts to solve prevailing social and economic problems. The availability of land dispute resolution mechanisms has helped with settling disputes over land and reducing conflict and these interventions supported the overall security situation (Todorovski et al. 2016). However, the gap between women’s legal rights to land and de facto realization of these rights remains. Both the Government of Kosovo and the donor community are seeking to improve women’s property rights and access to land by building capacity in land administration to mainstream gender into land administration processes, including data collection (Tonchovska et al. 2014).

Current government interventions, policies, and plans in the land sector include the Land Consolidation Strategy 2010-2020, Spatial Plan of Kosovo/ Strategy on Spatial Development of Kosovo 2020, review and update of the Kosovo Environmental Strategy and National Environmental Action Plan 2013-2022, and Biodiversity Strategy and Action Plan 2013-2022.

DONOR INTERVENTIONS

Donor support has been instrumental in assisting the GoK in improving land tenure security, strengthening property rights and creating more sustainable development through improved resource governance.

Working closely with the European Union (EU) and Ministry of Justice (MOJ), the Property Rights Program (PRP) 2014-2018, funded by the U.S. Agency for International Development (USAID), seeks to improve the property rights regime in Kosovo, strengthen the rule of law, and increase economic growth and investment. The Program is currently implementing better coordination and policy priorities by assisting the GoK to develop the National Strategy for Property Rights, improving court procedures related to property claims, enhancing women’s and minorities’ rights to use property in practice and improving communication, access to information, and understanding of property rights. PRP is the only donor-funded project in Kosovo working to improve court procedures related to property claims, with emphasis on improving court practices to remove constraints to women inheriting property. PRP is also improving women’s land access in the design of a strategic social and behavior change communications campaign. The campaign aims to shift attitudes and actions around women’s land rights and increase women’s ability to access and own property.

The Kosovo Real Estate Cadastre and Registration Project (RECAP) 2011-2015 is funded by the World Bank. The objective of RECAP is to help develop Kosovo’s land and property markets and to improve tenure security. The project addresses a range of issues by: (i) supporting improvements in the capacity of the municipal cadastral offices (MCOs) to deliver services by rehabilitating the MCOs and carrying out systematic registration in the Kosovo Cadastre Land Information System (KCLIS); (ii) financing the establishment and maintenance of a Continuous Operating Reference Network (CORN) to provide a single source of reference points to surveyors; (iii) supporting institutional reform by upgrading the legal and normative framework and promoting the greater financial self-sufficiency of the Kosovo Cadastre Agency (KCA); and (iv) training KCA and MCO managers and staff, the project coordination office, private surveyors, and other key stakeholders in management, planning, legal, technical, and administrative subjects (World Bank 2015). The project is currently funding the use of Unmanned Aerial Vehicles (UAVs) to reduce the cost and time for high quality cadastral mapping activities and it works to empower local communities, and women, to participate in this process (World Bank 2016b).

Kosovo is sensitive to climate threats because of the significant economic role of traditionally climate-sensitive sectors, such as agriculture and forestry. Kosovo has a very limited adaptive capacity to address climate changes in a systematic way. The Support for Low Emission Development in Kosovo Project 2013-2015 from UNDP works to assist the Government of Kosovo in mainstreaming climate change concerns into sectoral and overall development priorities, thus enabling Kosovo to deal with climate change-related issues, and consider it not only as a separate environmental issue but as an issue of sustainable development (UNDP 2015).

The Agricultural Growth and Rural Opportunities (AGRO) Program (2015-2018) is a USAID project that will emphasize cross-sector partnerships that facilitate sustainable economic growth in this underdeveloped sector, the empowerment of female and youth participation, food safety education, and certification programs that support exports into valuable regional and European markets. This program will help farmers be better prepared to respond to local and regional market requirements (USAID 2014).

RESOURCE QUANTITY, QUALITY, USE AND DISTRIBUTION

Kosovo has a mountainous terrain, with the Sharr Mountains in the south and southeast, the Kopaonik Mountains to the north, and a central north-south ridge. Major rivers, including the White Drini, Sitnica, South Morava, and Ibar, cross the country. Large lakes are well distributed, with the Gazivoda in the northwest, the Radoniqi in the southwest, and the Batlava and Badovac in the north and northeast. The country is divided into four water basins/catchment areas: The White Drini, Ibar, Morava e Bincës, and Lepenc water basins. Average rainfall is about 700 millimeters annually, but is highly erratic. Rainfall can be as high as 1750 millimeters annually in the mountains, causing flooding, while drought has become common in the lower-lying areas (Stritih et al. 2008).

Despite its lakes and rivers, Kosovo faces very substantial challenges in the water sector related to quantity, quality, and use. Present water quantity has been a function of relatively low water storage and comparatively low efficiency of water use (high rates of losses). The key independent factors that may influence the future availability and adequacy of water resources are climate and population. Related to the former, climate projections to 2050 indicate that the average annual temperature will increase by approximately two degrees centigrade and average annual precipitation will decrease by approximately 15 percent. These changes are expected to reduce the annual available water resources by approximately 20 percent (GoK 2014f). Population projections estimate an increase of 6 percent by mid-century. The implications of the changes in climate and population are significantly increased levels of water stress.

Only 64 percent of the population currently has access to clean water (UNICEF 2014). Data from the Institute of Public Health show that bacterial (rather than chemical) contamination affects the quality of drinking water. Much of this bacterial (fecal) contamination occurs in the water supply systems of small cities and rural areas, where a large proportion of wells and springs are thought to be contaminated (World Bank 2015a). Contributing factors include inadequate management of the water supply and sanitation systems, a lack of waste water treatment and monitoring schemes, and inadequate waste management systems, which potentially can affect the drinking water sources (EU Office in Kosovo 2015). Low revenue collections to provide funding to address these issues by both Regional Water Companies and Irrigation Companies are a function, in part, of low household incomes and incidence of bribery in the water sector in general (United Nations Kosovo Team 2015).

Distribution of water resources by sector is 52 percent for urban and rural water supply, 41 percent for irrigation, and 8 percent for industry. Broad disparities exist in access to services between urban and rural areas, between ethnic groups, and by gender. For example, 30 percent of people in rural areas live without tapped water or sanitation services, compared to access rates of 7 percent for non-majority communities, particularly Kosovo Roma, Ashkali and Egyptian communities, which is much lower than the Kosovo average (United Nations Kosovo Team 2010, Krampe 2015). Water issues disproportionately affect women from rural areas. Although women in both urban and rural areas are responsible for housework, childcare, dishwashing, cleaning and washing clothes, in rural areas women are water providers, meaning, they are responsible for collecting water as well. This makes their lives more difficult, especially when the water sources are far from home (European Commission 2014).

LEGAL ISSUES

The Constitution (2008) permits all people in the Republic to enjoy the natural resources of the country, provided that use does not impinge on the rights of others. The Constitution also states that water and other natural resources enjoy special protection under the law (GoK Constitution 2008a). The Republic of Kosovo is attempting to approximate EU environmental standards and considerable progress has been made in legislation development concerning environmental protection as a whole, including water protection. The consistency of Kosovo environmental legislation with EU law and regulations (the acquis communitaire) is ensured through Progress Monitoring on transposing and implementing the legislation. Some water laws have been revised and adopted in recent years by the Assembly of Kosovo and MESP and good progress has been made in preparing the relevant secondary legislation (administrative instructions, administrative orders and ministerial regulations) (European Commission. 2014b).

The legislative basis for regulating the water and wastewater management sector in Kosovo consists of the following primary and secondary legislation: Law No. 04/L-147, On Waters of Kosovo, which repealed the Law No. 2004/24, on Water. Article 1 of this law establishes that the water resources are assets of general interest and the property of the Republic of Kosovo. The purpose of this law is to provide sustainable development of water resources, establish procedures and guiding principles for the optimal distribution of the water resources, and establish the institutional structures for water resource governance and management. Secondary legislation includes, but is not limited to: Administrative Instructions No. 2/99 “on Testing and Enforcing Minimum Standards of Drinking Water Quality,” AI No. 24/05-MESP “on the Content, Form, Conditions and Method of Issuing and Retaining the Water Permit,” (2005); AI No.06/2006 “for water payment structure,” (2006); AI No. 06/07-MESP “on the Content of Water Infrastructure,” (2007); AI No. 13/07-MESP “on the Criteria’s for Defining the Water Protected Zones and their Protection Measures for Water Resources used for Drinking Water,” (2007); AI No. 13/08 “on Limit Values of Effluents Discharged in Water Bodies and in Public Sewage Network,” (2008); AI No. 16/2012 “on the Quality of Water Intended for Human Consumption”, dated 24.12.2012; and AI No. 12/2013 “Water Information System,” (2013). The current legislation on irrigation includes Law No.02/L-9 (2005), and Law No. 03/L-198, (2010), that updates and revises the law of 2005 to formally establish and define bodies offering services for irrigation, including the Ministry of Agriculture and Rural Development, municipalities, water companies, water users’ associations, and a federation of water users’ associations (Government of Kosovo and Assembly of Kosovo 2015b)

One of the requirements for Kosovo to acceded to the EU is that the country enact legislation that approximates EU legal requirements. The European Commission recently completed a “fitness check” of Kosovo water legislation. The outcome of this process indicated that no new legislation is needed, however some streamlining of existing legislation is required, as well as better implementation coordination with other planning processes (e.g. spatial) (Government of Kosovo and Assembly of Kosovo 2015b).

TENURE ISSUES

Under article 7 Law No. 04/L-147, On Waters, legal and natural persons may not own Kosovo waters, regardless of legal status of property on which waters are located. The law also provides the procedures and terms relating to extraction, use, accumulation, direction changes, construction, discharge, and other actions that may be carried out on waters. The Government may expropriate or limit the rights of land owners, possessor of land or shores, in accordance with Law on Expropriation of Immovable Property. Article 27 of the law defines allowable water use to include any activities of taking, extraction, and accumulation, change of direction of underground and surface flows for the purposes of human consumption, that is drinking water and food preparation, agriculture, industry, and technology; to produce electricity; for tourism and recreation; and activities related to delivering and releasing water.

The Registry of Water Protocol contains water permit data and the Register of Concessions contains details of the concessions, contracts and related decisions in the water sector. This cadastre contains the following registries: Cadastre of Surface Waters, Cadastre of Groundwater, Cadastre of Endangered Areas, Cadastre of Facilities and Water Infrastructure, Cadastre of Water-Flow Regulation and Protection from Harmful Water Actions, Cadastre of Water Pollutants, Cadastre of Technical Documentation, and the Cadastre of Water Protection Zones (Government of Kosovo and Assembly of Kosovo 2015b).

GOVERNMENT ADMINISTRATION AND INSTITUTIONS

Governance responsibilities in the water sector are distributed across a number of entities and as a whole are regulated at the national level. The Ministry of Environment and Spatial Planning is responsible for management and administration of Kosovar water resources, which includes drafting laws and regulations, development of policies and strategy, issuing and monitoring water rights, protecting of water resources, and inspecting facilities and waterways. The Ministry of Economic Development, through its Policy and Monitoring Unit and the Board of Directors of water companies, is responsible for administration of Regional Water Companies. The Water and Wastewater Regulatory Office is responsible for the economic regulation of the water sector. Regulation includes licensing of water companies, tariff setting, setting minimum service standards, and monitoring of customer protection. The Inter-ministerial Council for Waters is composed of seven members from four line ministries and is chaired by the Prime Minister of Kosovo. The Council provides opinions on, and recommendations for, laws and regulations relating to water management, drafting and approval of the National Water Strategy, and policy development in the field of water. The National Institute for Public Health (NIPH) is responsible for monitoring drinking water quality and has contractual arrangements with water companies for this monitoring (World Bank 2015c).

The Ministry of Agriculture, Forestry and Rural Development (MAFRD) creates and implements policies on irrigation and drainage, including sustaining and developing Water User Associations (WUAs). The rationale behind WUAs, as identified by the law, is to decentralize and assign the management of secondary and tertiary water networks to local actors. The number of active Water Use Associations is, however, very low compared to the nearly fifty that were initially created and some critiques indicate that not enough effort has been made in sustaining and developing these local governance institutions (Shuku 2012).

Water-sector related activities are managed by the Water Department (WD), which has three Divisions: 1. the General Water Policy Division, which carries out analysis and strategic planning on the use, exploitation, and protection of waters; 2. the Division for Water Resources Management, which carries out administrative/legal tasks for the direct application of provisions related to economic issues that may arise from the use and protection of water from negative impacts, water protection from pollution, protection and control of water quality, water regulation and water flows, protection from erosion and streams regulation; and, 3. the Division for River Basin Coordination, which collects data, establishes and organizes database on river basins, carries out environmental impact assessments during development of spatial and urban plans, supervises researches, protection of public interest, controls the temporary hydro-economic permission (Government of Kosovo and Assembly of Kosovo 2015b).

Water services in the form of water supply and wastewater collection are largely (but not entirely) under the responsibility of the seven Regional Water Companies (RWCs). These RWCs were established between 2002 and 2006. Prior to this, water and wastewater services were provided by municipal water supply companies. RWCs are considered the property of the state and under the control of the Government of Kosovo through the Ministry of Economic Development. Each RWC is registered as a publicly owned enterprise. There is provision for RWCs to have contractual relations with each municipality within their region. These agreements are signed as “service agreements,” which provide RWCs with the sole and exclusive role of water supplier within the respective municipality. Not all municipalities have signed such service agreements and some of those that have, have expressed concern about the terms and conditions.

Some responsibilities for the implementation of water policy are delegated to municipalities. These responsibilities are related to the issuing of licenses and permits, for construction of water facilities, protection of water quality, and a duty to raise concerns related to water risk to MESP. Public water services are also provided by municipal water utilities that are under supervision of respective municipality (GoK 2015f). In theory, tariffs and service quality monitoring are the responsibility of the respective municipalities. However, there is no publicly available information regarding the service quality provided by these utilities, except for water quality. The Government’s policy is to integrate these operators into the seven RWCs within a relatively short time-frame (World Bank 2015c, Government of Kosovo and Assembly of Kosovo 2015b).

GOVERNMENT REFORMS, INTERVENTIONS AND INVESTMENTS

The GoK has made significant improvements in water quality and distribution by focusing on structural issues, such as consolidating municipal utilities into regional companies and creating a supporting regulatory framework. Technical assistance for capacity building and institutional development has also been a priority. Despite significant donor investments in the water sector, nearly 25 percent of total funding has come from the Kosovo Consolidated Budget, demonstrating a commitment by the Government to improve water supply and wastewater services, particularly among municipalities (Shuku 2012). Out of the total water sector investments at the municipal level, 61 percent have been allocated for wastewater (Shuku 2012). For those systems operated by the Regional Water Companies, compliance with the drinking water quality requirements is generally high (over 95 percent) with 24- hour service (Water and Wastewater Regulatory Office 2013f).

The Water Sector Strategy 2015-2034 seeks to move beyond emergency provision of water post-conflict, to more development and long-term projects to address the whole range of sector needs including: legislation, guidance, inspection and enforcement, institutional development, research, monitoring, information management, and awareness raising. The National Water Strategy will be implemented through the Water Action and Investment Plan (WAIP), which identifies the priority projects and establishes their implementation in specified time horizons (short-term, medium-term and long-term) over the full duration of the National Water Strategy (Government of Kosovo and Assembly of Kosovo 2015b).

DONOR INTERVENTIONS AND INVESTMENTS

The European Union has been the largest donor in Kosovo’s water sector through its Community Action for Reconstruction, Development and Stabilization (CARDS) and Instrument for Pre-Accession Assistance (IPA) programs. It has implemented several major environmental projects, some of which continue projects initiated by the European Agency for Reconstruction (EAR) through the European Office in Kosovo (EUOK). EUOK has provided support for a wide range of activities, from infrastructure investments to technical assistance in the MESP. Environmental infrastructure includes investments in new drinking water treatment plants, storage reservoirs, pumping stations, water transmission lines and distribution networks in urban areas. EUOK (previously ECLO) has also supported investments to supply clean drinking water to villages. These programs have been complemented with technical assistance and institutional building at the RWC level. Under the IPA II (2014-2020), the Kosovo Municipal Social and Economic Infrastructure Program will assist municipalities in improving infrastructure, including water and wastewater. Projects must also take into consideration the environment and climate change, equal opportunities and gender mainstreaming, engagement with civil society (and, if relevant, other non-state stakeholders), minorities and vulnerable groups, as well as sustainability (European Commission 2014b).

The Swiss Agency for Development and Cooperation (SDC) has been providing assistance to Kosovo to improve the water sector for more than 15 years. The Rural Water and Sanitation Support Program, Phase IV and V, funded from 2011 to 2017, contributes in improving the health and well-being of communities through sustainable water and sanitation services in line with Kosovo national sector strategies and legislation. New water supply systems were constructed in villages of South-East Kosovo, Suhareka and Vushtrri municipalities. The project further supported Regional Water Companies in improving their financial sustainability and enhancing capacities for a sustainable operation and maintenance of rural water systems. At the national level, the capacities of policymaking institutions were strengthened to manage water resources and services. Phase V strives to increase access of Kosovo’s population to proper water supply and sanitation and to a sustainable countrywide water and sanitation services management (Swiss Cooperation Program in Kosovo 2014).

USAID’s Small Infrastructure for Water and Sanitation Projects (SIWSK) (2008-2014), worked with the municipalities of Peja, Gllogovc, Lipjan and Malisheva and the three RWCs to bring access to safe and reliable public water supply services to homes of those who never had these services. Kosovo Water Institutional Sector Reform (K-WISER) Program, (2009-2013), supported two RWCs to strengthen their institutional capacity and quality of service delivery through technical assistance and infrastructure improvements (United States Agency for International Development 2014a).

RESOURCE QUANTITY, QUALITY, USE AND DISTRIBUTION

There are no official statistics about the size and value of Kosovo’s forestry sector and there is a relative dearth of current data on forestry following the 1999 conflict. Best estimates suggest that forest area in Kosovo is fairly stable at approximately 481,000 hectares (44.7 percent of total area) and provides timber, fuelwood, and various forest products used by the population. There are considerable areas of barren forestlands, some of which have been eroded. The sector is estimated to employ approximately 20,500 people and is among the top sources of employment in Kosovo (Bensky et al. 2013). Kosovo forests are tree-species rich and are stocked with four or more species, key among which are oak and beech. Broadleaved forest, created through natural seeding, covers more than 90 percent of the forest area. Based on a non-timber/non-wood forest products (NWFP) inventory, 84 tree species of commercial importance have been identified and the Sharri Mountains and the Albanian Alps are the richest regions in Kosovo in terms of NWFPs (Rodina 2015). Almost the entire forest area (99 percent) shows some kind of human influence.

According to the GoK Policy and Strategy Paper On Forestry Sector Development 2010 – 2020, and the Forest Sector Annual Progress Report 2013, out of the total area of surveyed and un-surveyed forestlands, 278,880 hectares are classified as public forestlands and 185,920 hectares are private forestlands. This total area is slightly larger (6-8 percent) than previous estimates (Ministry of Agriculture, Forestry and Rural Development 2013d). The Sharri and Bjeshket e Nemuna national parks have been designated as protected areas by the government and it is estimated that up to 90 percent of growing stock in coniferous forest and mixed coniferous/broadleaved forest are located within the parks (Ministry of Agriculture, Forestry and Rural Development 2013d). The average size of private forest holdings in Kosovo is small: approximately 1.5 hectares. Such small holdings require forest owners to seek supplemental incomes. In many cases forest owners also own agriculture lands, and run operations as a combined agriculture and forest estate. Forty percent of public forestlands and 29 percent of private forestlands have been subject to uncontrolled or illegal harvesting activities. By all standards these figures are very high. The most recent inventory results also confirm that coppice forest, especially on public forestlands, is exposed to heavy harvesting and in urgent need of management interventions, such as pre-commercial thinning and commercial thinning (Ministry of Agriculture, Forestry and Rural Development 2013d, Rodina 2015).

Kosovo’s forests are neither a source nor a sink of the greenhouse gas carbon dioxide. This is because a quantity equivalent to the annual increment of woody biomass sequestering carbon is being removed every year, and most of it burnt as firewood. Fire is the most significant disturbance to forest stands and it estimated that 2.5 percent of total forest area or nearly 15 percent of growing stock has been seriously affected by fire (Ministry of Agriculture, Forestry and Rural Development 2014g).

Although rich in resources the sector remains constrained by insufficient enforcement of forest law, lack of studies on resource assessment capacity and management plans, low levels of public awareness and knowledge on the importance of sustainable wood and NWFP rural income generation, unclear forest ownership, selling products as raw materials at very low prices, and small number of processing industries and exporters (Ministry of Agriculture, Forestry and Rural Development 2013d, Rodina 2015).

LEGAL FRAMEWORK

The Constitution (2008) permits all people in the Republic to benefit from the country’s natural resources, provided that use does not impinge on the rights of others. Under the Constitution, natural resources enjoy special protection (GoK Constitution 2008a). The Law on Forests in Kosovo (No. 2003/3) defines forest as land managed for the production of wood or other products, or whose best use involves the growing of trees. The law recognizes the importance of forests as a national resource and establishes a foundation for improved forest management and more efficient use of forest land. The Law and its 2004 Amendment (Law No. 2004/29) regulate forests based on principles of sustainable development. The Forest Law recognizes a role for public participation in forestry but does not include a system of community-based forest management. In 2003 a new Law on Forests was adopted bringing in elements adapted to market principles and consistent with European forest legislation (GoK 2003b). The law is consistent with European standards, is considered as adequate, and is supported by a number of implementing administrative directions. As of 2008, Kosovo has been striving to reach EU legal thresholds of environmental protection. It has adopted a broad environmental legal framework, but the country is suffering from important problems of weak enforcement and compliance. The poor implementation is considered to be at the root of illegal practices that are openly carried out in most parts of Kosovo, including illegal logging and illegal hunting within Kosovo’s forests (Fajardo del Castillo 2015).

Decentralization is one of the main processes in Kosovo undertaken by the government to support development. It is a major aspect of the ‘Ahtisari’ agreement. Decentralization is also addressed in forestry: The Law on Local Self-Government delegates local forest protection and harvesting to municipalities (GoK 2008c).

Unfortunately, since the establishment of UNMIK in 1999, laws and regulations governing forestry in Kosovo have changed numerous times, creating uncertainty and leading to general inefficiencies in forest management and in part, to illegal logging. Because of the prevalence of illegal logging, both within and across border, Article 358 of the Criminal Code makes forest theft punishable by fine and/or imprisonment (GoK 2012b).

TENURE ISSUES

Use rights to Kosovo’s public forests are based on written agreements between the Kosovo Trust Agency and the Kosovo Forest Agency (KFA). The Ministry of Agriculture, Forestry and Rural Development (MAFRD) grants licenses to harvest timber and non-timber, non-wood products from public forests and grants permits to graze animals in public forests. The right to issue licenses for use of the forests and forest products can be delegated to local governments or other entities. Municipalities and other bodies with authority to convert public forests to other uses must obtain the consent of the MAFRD before ordering such conversion (UNMIK 2003b).

Private owners manage operations on private forestlands within the constraints of the legal/regulatory framework. In 2006 the first Forest Owners Association was established in the Western part of Kosovo. Their activities are still limited, but can be regarded as a first step in the process of organizing private forestry in Kosovo. Owners of private forests are restricted from harvesting trees unless the trees are marked by the Forest Agency as suitable for harvesting. Owners of private forests are also required to undertake forest protection or regeneration actions as directed by the Forest Agency. However, there is little institutional capacity to enforce this restriction and intensive deforestation for conversion to agricultural land persists. Owners must also allow the public free access to use the forests for bee-keeping, hunting, and non-commercial gathering of fruit, nuts, herbs and mushrooms, provided that such use does not interfere with valid commercial interests (UNMIK 2003b). These are notable limitations on property rights and may create disincentives for efficient management.

Illegal logging comes in many forms in Kosovo, including logging in public forests without permission, logging in protected areas, false declaration of volume of harvested wood, and illegal logging in private forests. Smuggling and illegal accounting practices extend the list further. Some of the geographic hotspots of illegal logging in Kosovo include the western region around Peja and northern Kosovo. A large amount of illegal logging also takes place in “gray zones,” that is, places with overlapping jurisdictions of Serb and Kosovo institutions, municipal boundary lines, or near borders/boundaries with neighboring countries (Bensky et al. 2013, EULEX 2011). While the KFA technically has jurisdiction over the area north of the Ibar River, the continued presence of parallel structures poses significant barriers for its effective operation. The Serbian Forestry Agency (Srbijašume) is the de facto agency managing woodcutting north of the Ibar (EULEX 2011).

GOVERNMENT ADMINISTRATION AND INSTITUTIONS

The Ministry of Agriculture, Forestry and Rural Development (MAFRD) is the lead authority in charge of forestry, and has two branches dealing with forest management: 1. The Department of Forestry develops policy and sets the regulatory framework for forest management and developed the most recent 10-year strategy for governing the forestry sector. 2. The Kosovo Forestry Agency (KFA) is the implementing body of the Ministry and the administrator and manager of forest land. The KFA carries out its functions through six regional offices – Pristina, Gjilan, Ferizaj, Prizren and Mitrovica. KFA offices are responsible for drafting annual management plans, including the planning of permits each year, marking trees that are to be harvested on both private and public land, designing, implementing programs for protecting forests from diseases, pests and forest fires, and organizing and monitoring afforestation of degraded forest land (GoK. Ministry of Agriculture Forestry and Rural Development. 2010b).

The Forestry Inspectorate, a department within the KFA, is responsible for controlling forest activities in both public and private forests. In addition to conducting inspections in response to reports from different regions about forestry-related illegal activities, the inspectors also conduct inspections in the forest and the wood markets, often in cooperation with Kosovo police and KFA (GoK. Ministry of Agriculture Forestry and Rural Development. 2010b).

The Ministry of Environment and Spatial Planning (MESP) has authority over the national parks Sharr and Bjeshket-e-Nemuna. Within MESP, the Kosovo Agency for Environmental Protection KEPA houses the Directorate of National Parks, which is responsible for managing all of the national park territory. The designation of rights for landowners within the parks has been contentious and loggers have spread rumors about the government trying to take over private land. Poaching and illegal logging is lucrative and continues, though it has been dramatically reduced through stricter monitoring (Wilson Center 2015). The Institute of Nature Protection, also within KEPA, provides cutting permits for private forest owners in the national park based on land ownership certificate and needs. It is also responsible for determining and mapping the boundaries of national parks (Kosovo Agency for Environmental Protection 2016d).

GOVERNMENT REFORMS, INTERVENTIONS AND INVESTMENTS

The Ministry of Agriculture, Forestry and Rural Development (MAFRD) adopted its Policy and Strategy Paper on Forestry Sector Development 2010–2020 in 2009. The Strategy Paper recognizes sectoral challenges including: 1. lack of human and financial capacity; 2. lack of information regarding the forests; 3. lack of transparency in government operations; 4. illegal harvesting of forest products; 5. sub-optimal revenues from sale of timber; 6. lack of environmental protection; and, 7. an undeveloped private sector. The Strategy Paper identifies the following broad areas for initiatives over the 10-year period: 1. forest management and silviculture; 2. forest planning; 3. harvesting and transport; 4. capacity-building; 5. environmental protection; 6. wood use, 7. private-sector development; and 8. development of non-wood products (Ministry of Agriculture, Forestry and Rural Development 2010b). As of 2016, the forestry sector is still constrained by mechanisms to encourage stakeholder participation in implementation and decision-making processes, lack of organization of private forest owners, insufficient funding and subsidies for forest and nature conservation, and poor harmonization between the forestry and wood sectors (Nishori et al 2016).

The 2009–2013 update to Kosovo‘s Agriculture and Rural Development Plan (ARDP) (2007–2013) included a framework for development of sustainable economic, environmental and social uses of forests. The Plan emphasized afforestation of abandoned agricultural land, enforcement actions to curb illegal logging, development of agroforestry, and improvement of forest infrastructure. The Program for Agriculture and Rural Development for 2015 hopes to advance the sector by promoting more sustainable livelihoods and trade and by emphasizing “diversification of farm and business development.” Priority is given to projects implemented in the areas proposed by female entrepreneurs and young farmers and high priority is also given to projects that create jobs and drive rural tourism. Collection, processing and marketing of non-timber/non-wood products are also addressed (Ministry of Agriculture, Forestry and Rural Development 2015d).

Kosovo’s NWFP Strategy 2014-2020 aims to increase the contribution of the NWFP sector to rural income generation, and support the national economy through sustainable use, focusing on the multi-functional role of forestry. The Strategy is based on three pillars: 1. Tailor-made projects to increase knowledge in underdeveloped competence areas through education and training; 2. Support to resource owners and potential users, for example implementing organic certifications and FairWild principles and; 3. Support to the government institutions that have the overall responsibility for implementing the strategies, for example for resource planning and private sector development (Gola and Conrad 2014, Rodina 2015).

DONOR INTERVENTIONS AND INVESTMENTS

The United Nations Food and Agriculture Organization (FAO) has provided technical assistance policy advice, capacity building, and support for family farms. The Organization’s assistance also has a regional dimension, promoting cooperation, joint activities and mutual understanding in the Western Balkans. Projects include “Streamlining of agriculture and rural development policies of SEE countries for EU accession” (TCP/RER/3403), which supports policy discussions in the agro-food sector involving relevant institutions and academics, establishing a platform for sharing information, data, experiences and recommendations on agriculture and rural development policies. The FAO is also providing technical assistance on the implementation of the Policy and Strategy Paper on Forestry Sector Development (PSP) for the period 2010 – 2020.

The “Support to Implementation of Forest Policy and Strategy in Kosovo” program, funded by the Ministry of Foreign Affairs of Finland and implemented by the FAO, aims to increase the contribution of the forestry sector to the national economy through sustainable use of forest resources, taking into account multi-purpose forestry and including economic, social and environmental benefits as well as forestry’s contribution to climate change mitigation. The first phase of the project took place 2011-2014 and in order to ensure the sustainability of the results and integration of the forest management of northern Kosovo under Kosovo administration, the project has been extended for years 2015-2016 (Kosovo Forests 2014, Ministry of Foreign Affairs Finland 2014).

RESOURCE QUANTITY, QUALITY, USE AND DISTRIBUTION

Prior to ex-Yugoslavia’s dissolution, the mining sector had been an important growth engine for Kosovo’s economy. However, capacity has suffered due to neglect during the 1990s, the damage caused by the war, and the political fragilities in the four Kosovo Serb-majority municipalities in northern Kosovo. Kosovo is rich in mineral deposits, although their potential has been left largely untapped. In addition to 10.9 billion tons of proven, exploitable lignite reserves, the country has abundant deposits of ferronickel, lead, zinc, magnetite, and other ores that—if developed—could make a major contribution to employment and exports. Kosovo also has a number of small-scale sources of iron, which contain different quantities of nickel, cobalt, chrome and copper. The iron-nickel sources in Kosovo stretch from Ivaja, close to Kaçanik, in the south to Vërbovc (Drenas) in the north. (Sinan 2014, Ministry of Economic Development 2012c).

Lignite is Kosovo’s most important energy resource and it supplies approximately 97 percent of overall electricity production. It is found in the Kosovo, Dukagjin and Drenica Basins, though extraction has been restricted to the Kosovo Basin. The most important lead and zinc deposits are located in the so called “Metallogenic Trepça Strip,” which lies in the northeastern part of Republic of Kosovo, ranging from Albanik (Leposavic) to Gllame (Gjilan). The strip length is over 80km and its average width is 30km (Ministry of Economic Development 2012c).

The major companies in the mining sector include: 1. Trepca, which is comprised of a number of mines, floatation, metallurgies and chemical industry companies. Four of Trepca mines (operating with limited capacities) are located in Stanterg, Cernac, Belloberde and Artana. 2. Kosovo Energy Corporation (KEK) is a publicly owned enterprise that operates lignite mining, electricity generation, distribution and supply assets (Ministry of Economic Development 2012c).

The sector is constrained by an insufficient legal and regulatory framework, obsolete technology, lack sufficient capital to invest to improve generation capacities, the need for more specialized staff on the legal and regulatory framework, negative environmental effects caused by mining activities, and lack of a permanent pollution monitoring system (Sinan 2014).

Kosovo is expected to remain a modest producer of mineral commodities, but it is likely to continue increasing its mineral output as development of the mining infrastructure advances and if foreign investment in the mineral industry increases. The Trepca Complex could make Kosovo a regionally significant producer of lead and zinc if significant investment is received and if legal ownership issues are resolved.

LEGAL FRAMEWORK

Under the Constitution mineral resources are of special interest to the Republic and subject to special protection. The people of Kosovo have the right to use its natural resources in accordance with the law (GoK Constitution 2008a). There are numerous laws, regulations and Government decisions influencing the mining sector. The Regulation on Mines and Minerals in Kosovo (UNMIK Regulation 2005/3) governs the mining sector and provides for a range of mineral licenses. It also guarantees security of tenure for mining-license holders (UNMIK Mining Law 2005). UNMIK Regulation 2005/2 created the Independent Commission for Mines and Minerals (ICMM) in Kosovo. UNMIK Regulation 2003/13 On the Transformation of the Right of Use to Socially Owned Immovable Property provides for 99-year leaseholds, which allow for mining activities, on land associated with SOEs (UNMIK SOE Regulation 2003a; ICCM 2005). The Law on Natural Gas (Law No. 03/L-133 (2009)) establishes a legal framework for the transmission, distribution, supply, usage and storage of natural gas. The Law also specifies the structure of the natural gas sector (GoK Natural Gas Law 2009d).

In 2011, Law No. 03/L–163 on Mines and Minerals was passed to create zones of special interest for key minerals and to encourage mineral exploration and extraction. This law on mining investment was supplemented in 2013 by the New Mining Law, which simplified the process for obtaining a mining license. In addition, the 2011 Public Private Partnership (PPP) Law No. 2011/04–L–045 further opened major Kosovar sectors to foreign investment by harmonizing bidding procedures and investment regulations with the laws and regulations of the European Union (GoK 2013b, GoK Assembly, 2013, U.S. Department of State, 2013).

TENURE ISSUES

Individuals and entities can obtain licenses for mining rights. License or permit types are: 1. exploration license; 2. retention license; 3. exploitation license; 4. special operations permit; and 5. artisanal license. Exploration licenses are granted for 2-year periods with the length and number of extensions depending upon whether exploration is conducted with regard to construction minerals or other minerals. Retention licenses are available for one year from the expiration of an exploration license for construction minerals and for five years from the period of all other exploration licenses. Exploitation licenses are granted for periods of 25 years with possible renewal periods of 25 years for construction materials. Exploitation licenses for all other minerals are for periods up to 40 years, with no extension (UNMIK Mining Law 2005). Artisanal mining licenses are granted for mining for construction minerals for periods of two years. Renewals are available for an additional 2-year period. Special operations permits are granted with reference to the scope of each operation, as determined by ICMM (UNMIK Mining Law 2005). If a licensee or permit holder fails to comply with material requirements of the Mining Law, then the license may be revoked after a 60-day suspension period (UNMIK Mining Law 2005).

Significant tenure and ownership issues relate to the contested Trepca complex, which straddles Kosovo Serb – Kosovo Albanian divide. At its peak time of its operation in 1980s, Trepca employed 22,500 workers and it had average annual earnings of 100 million USD. The complex has been held in trust by the Privatization Agency of Kosovo (KPA), which is attempting to prepare the socially owned enterprise for sale. However, the mine’s future is uncertain, due to a complex and unclear ownership structure, numerous creditor claims, and Serbian claims to 75 percent of Trepca’s operations (Reuters 2015). The complex has since been running at minimum capacity due to these conflicts.

GOVERNMENT ADMINISTRATION AND INSTITUTIONS

Two government agencies are broadly responsible for the mineral sector in Kosovo: 1. the Independent Commission for Mines and Minerals (ICMM) and 2. the Department of Energy and Mining, located within the Ministry of Economic Development. The ICMM is an independent agency that regulates the mineral industry. It is in charge of issuing, transferring, suspending, and revoking exploration permits. In terms of administration, it maintains the mining cadastre and a GIS database containing geographical data, geological data, other relevant economic data and all existing minerals titles and mining rights and the issuance of rules on the internal organization and operation of the ICMM. It also mandated to ensure exploration and exploitation of mineral resources in Kosovo and the optimal utilization of mineral resources at all mining operations in accordance with the Law on Mines and Minerals and the Mining Strategy (ICMM 2016). The Ministry of Economic Development is responsible for formulating policies, strategies, and the legislative framework for mine development and for promoting new mineral research and exploitation in the country while the Privatization Agency of Kosovo is in charge of privatizing state-owned enterprises by issuing calls for tenders, including for major metal and other mineral production plants.

GOVERNMENT REFORMS, INTERVENTIONS AND INVESTMENTS

Developing the mining industry is a Government priority due to economic opportunities within the sector based on: considerable mining reserves, readiness for some mines to be transferred from maintenance to generation phase, relatively low labor costs, and high public acceptance for the mining industry due to its long tradition (Ministry of Economic Development 2012c). The Government of Kosovo, understanding the potential contribution of mining and minerals to economic development, has been actively working to resolves issues surrounding the Trepca complex (Office of The Prime Minister Kosovo 2016e).

The Mining Strategy of Republic of Kosovo provides for realistic and rational utilization of mineral resources with the aim of achieving sustainable economic development. The strategy is comprised of four pillars: 1. Provision of favorable conditions for economic valorization and utilization of mining resources and attraction of investments; 2. Enhancement of human and institutional capacities in the mining sector; 3. Social considerations and community benefits; 4. Environmental considerations (Ministry of Economic Development 2012c).

In the coming years, the Government will be focusing on funding and rehabilitating existing mines, making mines more functional, and reorganizing SOEs. Other efforts will include attracting local and foreign investments in the mining sector, valorization and increase of the processing levels of certain minerals as products or byproducts, harmonizing university programs with mining sector needs, attracting young people towards this sector and further exploration and identification of new mineral resources in Kosovo (Ministry of Economic Development 2012c, 2012d).

DONOR INTERVENTIONS AND INVESTMENTS

Donor interventions in the mining sector are primarily in the areas of capacity building and environmental considerations. The objectives of the World Bank’s Energy Sector Cleanup and Land Reclamation Project for Kosovo (2006-2016) are to address environmental legacy issues related to open dumping, reclaim land for community development purposes, and build capacity in KEK for continued clean-up and environmentally good practice in mine operations (World Bank 2013).

The EU has supported the minerals and mining sector in the areas of mineral/mining policy and administration, mining management, and mineral prospection and exploration and rehabilitation of mines (OECD 2013). The Japan International Cooperation Agency 2014 (JICA) funded Environmental Managing Process in Mining Sector, 2012-2014 to build the capacity of the Kosovo government and Trepca Company for environmental managing processes in the mining sector (JICA 2014)