Kosovo pushes the dinar as the internationals demanded: What happened in a month?

The CEC today has spoken of a transition period related to the rule of cash, more precisely the highly controversial issue of the Serbian dinar. This issue, which sent Kosovo to the UN Security Council, has a history of development below, we sum it up on three topics.

As the international community, the Republic of Kosovo, has requested, more precisely, the BQC, today offered a transition phase of up to three months for the use of the dinar. Below, a more important news review of this subject.

February 12th, 2024

The Kosovo Central Bank (BQK) has announced on Monday that the phase of transition to implementing its regulation, which prohibits the use of the Serbian dinar, cannot last more than three months.

Equipment of the CEC, which determines that the euro is the only currency available for cash payments across the country, went into effect on February 1st, with all Major international pressure to delay its implementation.

In a media report Monday, the CEC announced it has drafted a new plan for facilitated implementation of regulation effects for cash operations in specific communities.

Earlier in the day, Kosovo Prime Minister Albin Kurti said that, until Kosovo will not give up the dinar ban on cash payments, He is respecting the international community's demands on the issue.

The CEC announced it has taken a series of relief measures for Kosovo Serbs in the four northern municipalities, including opening a free phone line (0800-222-55), an e-mail for complaints, as well as a number dedicated to the eviberı.

Among the extenuating measures it has taken are facilitating the conditions for opening bank accounts, the temporary suspension of the BQK's minimum compensation for opening branches/states, “to encourage non-bank financial institutions (with exchange emphasis) licensed for opening offices in the majority Serbian Kosovo municipalities, especially in four northern municipalities”.

February 9, 2024 Why was the UN Security Council discussed?

At Serbia's request, the UN Security Council debated the situation in Kosovo, following several Kosovo Government decisions

Kosovo and Serbia exchanged accusations of the decision to ban the Serbian dinar for payment in Kosovo.

Serbia named it “assault on Serbs”, meanwhile, Kosovo said Kosovo Central Bank regulation aims to protect citizens from illegal activities

In the UN Security Council, Kosovo was criticised for implementing the Kosovo Central Bank regulation and for ignoring its influence on the Serb minority in Kosovo.

However, it was praised for the transition period it has promised to implement this regulation.

Security Council members demanded that Kosovo and Serbia be committed to dialogue and implement agreements, as well as refrain from unilateral actions that could increase tensions.

Serbia was also asked to hold responsible those involved in the armed attack on Zvecan Banjska.

At the UN meeting, called by Serbia, Kosovo Prime Minister Albin Kurti defended the CEC's decision, which envisions only the euro being the currency for payment by preventing the use of the dinar. Meanwhile, Serbia's president, Aleksandar Vuciq, described this decision as “attack” on the Serb population in Kosovo.

Kurti said the BQC's regulation for cash operations, which went into effect on February 1st, does not prohibit the Serbian dinar, but makes the euro the only currency for payment.

February 6, 2024: We haven't been informed in advance of the BQC regulations.

US Ambassador to Pristina Jeff Hovenier said that despite the decision to regulate Kosovo's Central Bank for using only euro currency for payment in Kosovo was taken on December 27th 2023, but was announced in January this year, Washington has not been informed in advance of it.

In an interview for RTV 21, Houvenier said that if they were aware of the adoption of this regulation, which prohibits the use of the Serbian dinar for payment, Washington would be willing to discuss with the Government of Kosovo the challenges of such a decision.

If Government was concerned about armoured vehicles that brought in large sums of cash and wanted to find alternative ways to do so that it would be less vulnerable, we would probably have talked about those issues. I don't think there's been any such talks”, said Havener.

January 28, 2024

The ambassadors of the QUINT states have demanded that Kosovo suspend implementation of the Kosovo Central Bank regulation, which envisions that the only currency in Kosovo for payment is euros.

Through a joint statement, the QUINT ambassadors said the suspension of the decision would have to be made to “enable a sufficient transition period and for clear and effective public communication”.

The “issue should be further discussed under the dialogue facilitated by the European Union”, the statement said.

QUINT ambassadors said the BQK's regulation for cash operations, expected to go into effect on February 1st, aims to reduce counterfeit money and preserve financial stability, but also “gre concerns about the impact in particular on Serb majority communities”.

“We are concerned about the impact of regulation in particular on schools and hospitals, for which no alternative process seems applicable at the moment. The regulation will also have a direct impact on the daily life of the overwhelming majority of Kosovo Serbs who receive payment and financial assistance from Serbia”, the QUINT ambassadors' statement said.

January 18, 2024

The Kosovo Central Bank has adopted a regulation for cash operations, which says the only currency allowed to conduct cash transactions in Kosovo is the euro.

This regulation will take effect on February 1st.

The only “Valta allowed to be used for conducting cash and payment transactions in the Republic of Kosovo is euros, both currency and Article 11 of the Constitution of the Republic of Kosovo and articles 16, 17 and 18 of Law No. 03L-209 for the Central Bank of the Republic of Kosovo”, Article 35 of this says Rules.