Kosovo - Smugglers' Heaven

AIM Pristina, May 18,2001

If one high UNMIK official publicly admitted that Kosovo has become a heaven for illegal trade, then things must be very serious. The reason for this is that apart from violence, which is probably resorted to for political and ethnic reasons, UNMIK officials always try to present the Kosovo situation as much better than it really is. However, long ago local experts have warned that the illegal trade would become a carcinogenic illness not only for Kosovo's economy, but also its society. Kosovo still doesn't have much prospects for economic development, but on the other hand, expects to encounter grave difficulties in securing the budget from domestic sources. Are the authorities undertaking measures which are adequate for the gravity of the situation?

Hardly anyone of Kosovo citizens would answer - Yes! Has illegal trade got wings by its better organisation, as well as increased volume of goods illegally entering Kosovo? Almost all Kosovars would say: Yes! Early this spring UNMIK has placed control points for goods coming from and leaving for Serbia. Despite its efforts, the flow and smuggling of goods have increased several times compared to the situation before the placement of these control points on this part of the border.

This was known from the very beginning and officials and protagonists of these deals have corroborated that lately. Requesting anonymity certain Albanian businessmen have started speaking openly about this. And while high police officials do not deny that such a phenomenon exists, they demand additional proof. Some lower police sources have privately uncovered things which confirm public speculations about cases of ser ious abuse of office and illegal trade that caused serious damages to Kosovo and its budget. Proceeding from such assessments, it can be concluded that Kosovo's financial capabilities for securing a certain and stable budget and giving greater contribution to economic revival, are much greater.

However, inter alia, it is necessary to ensure equal business conditions for all economic entities, i.e. equal treatment of commodity imports to Kosovo. Some are paying taxes in the amount of 15 percent of the value of goods, while others do not pay anything. Some pay 10 percent customs duties, others do not pay them at all. Both official, as well as some other routes, are used for illegal trade and smuggling of goods. However, when nothing is paid to the official Kosovo authorities, then it means that someone else is taking his fee for enabling the smuggling of goods into Kosovo.

After well-known malversations with goods coming from Macedonia, malversations at entry points with Serbia and, partly, with Montenegro have also become a problem as of late. The Albanian businessmen told us that Serbian officials charge a fee of 3 percent of the value of goods coming to Kosovo from Macedonia, by way of Serbia.

In Leposavici or Zubin Potok, to which goods arrive under escort of the Serbian police, the so-called "bridge keepers" (semi-legal Serbian police service which controls the Northern Kosovo) take charge. They turn over the goods to Albanian businessmen at specified points on the demarcation line on the territory under their control.

Serbia and Montenegro do not charge any taxes or custom duties on goods entering their territory. But, such levies are paid to "bridge keepers" and, depending on the kind of goods, they can be as much as DM 1 - 6,5 thousand per trailer or tank truck. The maximum amount is paid on oil and oil derivatives. The smuggling price for coffee and cigarettes, on which UNMIK charges the excise tax, is much higher. It is assumed that up to DM 40 to 55 thousand is charged for one trailer with cigarettes. If every day several dozens of tank trucks with oil enter Kosovo, then it is easy to calculate the value of damages the Kosovo economy suffers because of smuggling, but also the profit of illegal traders. It has been estimated that hundreds of millions of German Marks change hands each year. There is unconfirmed information that police charge DM 500 to 1,000 for escorting goods from the territory under the Serbian control to unloading points.

There have been numerous instances of smuggling by non-governmental organisations, as well as humanitarian organisations, which are exempt from various taxes on goods they bring to Kosovo.

Illegal trade from Macedonia is old news and quite a different story. Here smugglers are trying to take advantage of facilities envisaged under the Agreement Belgrade and Skoplje have signed several years ago according to which on goods coming from Macedonia only one percent of the value of goods is charged. UNMIK respects this Agreement, which means that there are no customs duties on goods originating from Macedonia, Serbia or Montenegro. On goods from all other countries customs authorities charge 10 percent. Illegal traders try to present to the Kosovo customs authorities goods coming from other countries as Macedonian produce. That is why there are special services in Macedonia which change the packing, forge papers, while some official Macedonian services even provide false documents.

Thus, Macedonia often seems like a major producer and exporter of oil, bananas and Mediterranean and tropical fruits. Ylber Rraci, Director of the Kosovo Customs Authorities, recently stated that in the first four months of this year his officials have detected some 200 false certificates (just for oil and oil derivatives) issued by the Macedonian customs authorities. False certificates are issued for other kinds of goods too. This year alone traders were fined DM 1,1 million for such forgeries. This relates only to uncovered cases. Nevertheless, while at the Macedonian border with Albania efforts are exerted at reducing or controlling the illegal trade, negative trends can be observed at points at which goods, coming from Serbia, enter Kosovo.

Due to the intensified control at the border between Macedonia and Albania and after the closing of Macedonia's border on 2-3 occasions and expansion of smuggling from Serbia, in recent months the illegal trade has been redirected towards entry points from Serbia. These trends have incidentally coincided with efforts to establish control points with Serbia for incoming and outgoing goods. Thus, Leposavici has lately become the main centre for smuggling goods into Kosovo.

When UNMIK put up control points at the border with Serbia, the Kosovo Serbs and those on the other side of the border blocked roads leading to Kosovo. The barricades were explained as a risk of separating Kosovo from Serbia, although UNMIK repeatedly explained that these were not customs control points, but points for charging the turnover tax and that it was not the intention of the international administration to undermine Serbia's integral customs system. Now, the international officials claim that control points with Serbia have already been shut down, since the road blockades have obstructed the flow of goods.

However, well-versed sources estimate that the flow of goods at these crossings has increased and that smuggled goods in the value of DM 2-3 million cross from Serbia to Kosovo without being charged any custom duties, taxes or excise taxes which should go to the Kosovo budget. As it was previously mentioned, the illegal trade is controlled by "bridge keepers" who closely cooperate with the Albanian businessmen and illegal traders (smugglers). Long lines of trailers and tank trucks which pass through Serbian barricades in the north of Kosovo can be spotted even from the outer space looking like a kind of the Great Wall of China. There are no arricades for the illegal trade (smuggling). However, someone is persistently turning a blind eye and a deaf ear to all this.

Fehim REXHEPI

(AIM)