Reconstruction Trends And Challenges In Kosovo
Riinvest, a CIPE Partner in the Balkans, Testifies on Capitol Hill

Post-war renewal efforts in Kosovo over the past year have brought about radical changes, according to Dr. Muhamet Mustafa, President of the Pristina-based Riinvest Institute for Development Research. Mustafa was in Washington, D.C. recently to present testimony on Kosovo's reconstruction before the International Relations Committee of the U.S. House of Representatives.

Reconstruction in Kosovo is a complex task, Mustafa stated, because it involves rebuilding society literally from the ground up. "It is not just the continuation of everyday life," he noted, "but the creation of a new living environment, including the recovery of a fragile economy, its transition to a market economy, and the building up of civil society."

According to Mustafa, there is an urgent need for reform in the following areas:

Housing - From provisional settlements to long-term solutions

Electric power - From day-to-day problems to reliable power generation and supply

Financial infrastructure - From initial steps to adopting modern banking practices and financial market institutions

Legislation - Filling significant gaps in the nation's laws

Jobs and income generation - Setting up structures to provide credit and technical assistance to small and medium-sized enterprises

Socially-owned enterprises - Privatizing these enterprises and creating ownership and management opportunities for Kosovars

Local Administration - Setting up structures, defining responsibilities, and enhancing municipal services

Public order and security - Building coalitions to improve security and enhance inter-ethnic tolerance and communications

Mustafa argued that shifting from a crisis mode to a sustainable reconstruction strategy should include building economic independence based on an open economy with regional and European integration. Kosovars have the human capital, the entrepreneurial spirit, and positive attitude to rebuild their own society, he stated, and it is important that technical and financial assistance focus on developing local capacity and supporting entrepreneurship rather than creating yet another "aid-economy."

For lasting stability and sustainability, he said, Kosovar participation in the reconstruction process should be encouraged in several key areas:

• Establishing more active programs to engage a broad cross-section of Kosovars in the international reconstruction effort;
• Creating, with Kosovar input, an economic framework that reflects Kosovar needs and aspirations, and discourages informal and illegal economic activity;
• Strengthening civil society and democratic institutions, as well as Kosovars' involvement in the renewal process; and
• Continuing the commitment of the United States and the international community to transform Kosovo from an "aid-based" economy to a self-sufficient economy.

Mustafa concluded his remarks by thanking Members of Congress for their continuing support and the opportunity to provide a first-hand account of Kosovo's reconstruction efforts. He also thanked CIPE, the National Endowment for Democracy, the U.S. Agency for International Development, and Freedom House for encouraging democracy and supporting Riinvest and Kosovars' capacity for economic and social development.