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40 Abit Hoxha, Donika Emini and BiH. According to UNHCR, approximately 10,000 of the Kosovo refugees have moved to BiH since January 1988 9 . 2. Economic Cooperation Kosovo and BiH are undergoing a long-lasting transition from the socialist to liberal open market economy. The trajectory of Kosovo and BiH economic development is shifting from the system in which the establishment of state ownership and control was the main objective of economic policy, to the liberalization of the economy, free market, self-management and decentralization 10 . The economies of Kosovo and BiH have shown a relatively low development since the 90s, and the challenging struggles for better, sustainable economy are continuing in the post-war years. Needless to say, despite its weak economy, Kosovo has showed enthusiasm for trade liberalization. Along with internal economic development, Kosovo has been struggling to establish commercial and trade relations with other countries in the region and worldwide. A small emerging economy such as the one of Kosovo does not have a balance of exports and imports – meaning that the quantity of imported good is larger than the goods exported in other partner countries. 2.1. CEFTA and Free Trade between Kosovo and BiH The CEFTA is a free trade agreement which progressively form an integrated area of regional trade and cooperation. The new CEFTA – also the so called – CEFTA 2006 was signed by its all parties in 2007, to only enter into force in the second part of 2008 11 . CEFTA represents a trade agreement between non-EU countries in Central and South-Eastern Europe. Comprised of fifteen member states, the signatory countries are: Poland, Hungary, Czech Republic, Slovakia, 9 Krieger, H. (2001). The Kosovo conflict and international law: an analytical documentation, 1974- 1999. Cambridge: Cambridge University Press, 66-68. 10 Simon, György, An Economic History of Socialist Yugoslavia (2014). Available at SSRN:http://ssrn. com/abstract=2094334 or http://dx.doi.org/10.2139/ssrn.2094334 11 Introduced by the European Union, CEFTA was firstly established in 1991, and it only became effective in 1993 having only Poland, Czech Republic and Hungary as member states. Rocznik Instytutu Europy Środkowo-Wschodniej • Rok 12 (2014) • Zeszyt 3
Bosnia and Herzegovina in Kosovar Perspective: An Agenda for International Cooperation 41 Slovenia, Rumania, Bulgaria, Croatia, Macedonia, Albania, Kosovo, BiH, Moldova, Montenegro, and Serbia.Basically, through this treaty the member states agree on mutual reduction of customs in their territory. Furthermore, it envisages the elimination of state monopolies by stimulating competition, and harmonizing the legal framework and regulations 12 . From 2000 until 2013, Kosovo products have been exported mainly on the regional countries, whereas the economic embargo set by the authorities in BiH and Serbia had a remarkable implication in this manner. Since the declaration of independence by Kosovo institutions, both Serbia and BiH have introduced the economic sanctions towards Kosovo. Not having recognized the independence of Kosovo and the new customs stamps, Serbia and BiH seized both import and transit of Kosovo products in and through their territories thus by hampering Kosovar economic development 13 . As a reaction towards the Serbian and BiH authorities, Kosovo introduced trade reciprocity, meaning that an embargo on imports of Serbian products and set a 10% tariff on goods produced in BiH 14 . Figure 1. Kosovo Foreign Trade with BiH (Source: Kosovo Agency of Statistics) 12 Handjiski, B. (2010). Enhancing regional trade integration in Southeast Europe. Washington, D.C.: World Bank, 56-57. 13 GAP Insitute (2011). Kosovo in CEFTA: In or Out GAP Institute. Retrieved August 13, 2014, from http://www.institutigap.org/documents/72590_CEFTAEng.pdf 14 Halili, P. (2011). Kosovo on the offensive: Trade reciprocity and rule of law. Washington Times Communities. Retrieved August 7, 2014, from http://communities.washingtontimes.com/neighbor/- hood/europeanization-monitor/2011/aug/2/kosovo-offensive-trade-reciprocity-and-rule-law/ Rocznik Instytutu Europy Środkowo-Wschodniej • Rok 12 (2014) • Zeszyt 3
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About the Authors Artur Adamczyk -
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