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Trepca: Making Sense of the Labyrinth
Trepca: Making Sense of the Labyrinth
Table of Contents
  1. Executive Summary
The Kosovo-Serbia Agreement: Why Less Is More
The Kosovo-Serbia Agreement: Why Less Is More
Report 82 / Europe & Central Asia

Trepca: Making Sense of the Labyrinth

The enterprise known as Trepca is a sprawling conglomerate of some 40 mines and factories, located mostly in Kosovo but also in other locations in Serbia and Montenegro.

Executive Summary

The enterprise known as Trepca[fn]Written ‘Trepçë’ by Albanians and ‘Trepča’ by Serbs.  This report omits either accent, in order not to have to use both.  Similarly ‘Zvecan’ is used to represent the Serbian ‘Zvečan’ and Albanian ‘Zveçan’. And the term ‘Kosovo’ is used in deference to normal international usage, to avoid excessive use of ‘Kosovo/a’ or of the ugly neologism ‘Kosov@’.Hide Footnote  is a sprawling conglomerate of some 40 mines and factories, located mostly in Kosovo but also in other locations in Serbia and Montenegro.   Its activities include chemical processing and production of goods as varied as batteries and paint.  But the heart of its operations, and the source of most of its raw material, is the vast mining complex to the east of Mitrovicë/a in the north of Kosovo, famous since Roman times.  This report examines the current position of the mines, together with the associated smelting complex at nearby Zvecan.

The future of Trepca cuts to the heart of the Kosovars' identity.  Its great mineral wealth is the basis of the economy of Kosovo, but the complex is badly run-down as a result of under-investment and over-exploitation by governments in Belgrade.  Trepca figured largely among the issues over which Albanians took to the streets in 1988/9, and the issue of control over the mines has assumed tremendous symbolic importance. Trepca, as one circumspect Kosovar observed, is Kosovo's Berlin Wall.  It has long stood for Kosovar Albanians as the symbol of Serbian oppression and of their own resistance.

After 1974, when Tito's new constitution accorded the province near-republic status, with its own parliament and courts, Kosovars enjoyed a period of greatly increased control over their own resources.  Finally able to manage the Trepca facilities themselves, Kosovars used their enhanced authority to build factories in Kosovo that capitalised on their mineral production, created thousands of jobs, and brought some real income into the province.

After Tito's death, Kosovars pressed again for more rights and greater political and economic autonomy, but with little success.  Belgrade reasserted control of the mines, and in 1981-82, a sort of "Trepca-gate" scandal – in which Kosovar Albanian workers were accused of having stolen vast quantities of gold and silver – was the pretext for firing many engineers and technicians. 

From 1981-89, Belgrade monopolised the export of Trepca's minerals to Russia and elsewhere, reaping the profits in hard currency and oil, while compensating the Kosovars only with electricity and other non-fungible forms of payment.  This discriminatory compensation scheme was aggravated by the high inflation of the 1980s.  Trepca's Kosovar management attempted to sell its products on the European market and to modernise the facilities' modes of production, only to be foiled time and again by the Serbian government, which was in the process of "integrating" Serbia's economy – that is, of tethering all economic sectors even more closely to Belgrade.  By the late 1980s, with the final integration into the Serbian system of the power generating system, Kosovars had lost virtually all control over their economy, as they would over their politics and civic freedoms.[fn]ICG interview Prishtinë/Priština, Mitrovicë/a November 1999.Hide Footnote

In 1988-89 the Albanian management and workers were summarily expelled from Trepca.  The mineworkers' union organised a winter march to Prishtinë/Priština in November 1988, followed by other marches of support within Kosovo.  In February 1989 there was a hunger strike, many miners and directors were arrested and imprisoned for up to 14 months.  These events are remembered and romanticised by young and old as Kosovo's own Solidarity movement - the earliest, sustained resistance to Serbian oppression under Slobodan Milošević.[fn]Noel Malcolm, ‘Kosovo A Short History’, pg.343 and ICG interviews Prishtine/Pristina November 1999.Hide Footnote

During the first half of the 1990s Belgrade managed to keep up only a small percentage of Trepca's production, due to lack of ongoing investment in machinery, poor maintenance and the dismissal in 1989 of experienced Albanian staff.[fn]Vesna Peric-Zimonjic “Kosovo’s Economy Myths and Poverty” Interpress Service 28 May 1998 and ICG interviews Prishtinë/Priština and Mitrovicë/a November 1999.Hide Footnote The management attempted to replace this expertise with guest miners from Serbia and Poland.[fn]The Polish firm Kopeks was contracted by Trepca to mine 20,000 tonnes of lead and zinc ore monthly.  www.hri.org/news/balkans/kosova/96-10-25.ksv.html and ICG interviews Prishtinë/ Priština November 1999.Hide Footnote  All the production plants closed.  After nearly three years of economic sanctions instituted as punishment for its role in the Bosnian war, Belgrade was looking for ways to acquire large injections of cash.  Exploiting Trepca seemed a likely option.  In February 1995, new management was installed, and a 'program of revitalization' was undertaken.  The new team claimed that by the end of 1996 all the production plants were back into operation, ore excavation had increased, modern mining equipment had been purchased from Sweden, and all the lead and zinc mines in Serbia and Montenegro had been brought under the management of the Trepca company.  Again according to Serbian official sources, in 1996 Trepca had exported $100 million of products, making it the largest exporting company in the Federal Republic of Yugoslavia.[fn]Serbia Today 6 January 1997.  All of these production claims are disputed by knowledgeable Kosovars who had been watching closely activity at the Trepca facilities.  This is backed up by the visible deterioration of the sites themselves.Hide Footnote  Belgrade even planned to bring mineral concentrates from the Bosnian Serb controlled mine in Srebrenica, site of the notorious massacre by Serb forces in July 1995.[fn]Tanjug from BBC Monitoring Service 19 December 1996.  Srebrenica has long been known for the high quantity of silver in its ore concentrate.Hide Footnote

The problems of Trepca are many and complex. They include its alleged liabilities, the question who really owns it and who has been profiting from it, the deteriorating condition of its antiquated machinery, its anachronistically oversized workforce, the scant field of prospective investors, the disastrous environmental impact of the Zvecan smelter, and internal Kosovo politics.

Even so, it is critical that at least some aspects of the Trepca issue be addressed immediately and not await the resolution of the entire nexus of problems.  Most urgently, because of its importance to Belgrade, Trepca figures centrally in the unresolved security situation in Mitrovicë/a and in its current status as a divided city.  At least some of the talk of a partition of Kosovo arises from the knowledge that control of Trepca makes a vast difference to the territory’s economic prospects.  Reports of Serbian police in and around Zvecan, of Serb looting, rumours even of Albanian prisoners being held there – all point to a need for immediate international action.[fn]ICG interviews Prishtinë/Priština and Mitrovicë/a November 1999, and Dejan Anastasijević, “Mostar on the Ibar”, Vreme, Belgrade, FR Yugoslavia, 28 August 1999, and KFOR Cimic Sit-Reps of 22-23 October 1999.Hide Footnote

It is also urgent that the people of Kosovo begin to see signs of progress towards some sort of economic normality.  The return to work of even a few hundred Kosovar miners would represent, for all Kosovars, the reclaiming of their patrimony.  A timely, if temporary, step forward on the issue of Trepca by UNMIK and KFOR would demonstrate to the Kosovars that the international community appreciates Trepca's symbolic importance and Kosovars' need and wish to get back to work and to regain some control over their lives.

Washington/ Priština, 26 November 1999

The Kosovo-Serbia Agreement: Why Less Is More

The 19 April agreement between Kosovo and Serbia is an earthquake in Balkan politics: the ground lurched, familiar landmarks toppled, the aftershocks are still rumbling and the new contours are only slowly emerging.

The two prime ministers initialed a “First Agreement of Principles Governing the Normalisation of Relations” in Brussels. The brief, fifteen-point text is the first bilateral agreement between Serbia and its former province; as the title suggests, it’s unlikely to be the last. Curiously neither government has published it, though a reportedly authentic version leaked quickly in the Pristina press.

The spinning has been furious among advocates (the EU and both governments), opponents and commentators on both sides of the Atlantic. It is too soon to try to say what it all means. For now clarity comes from focusing on the few patches of firm ground.

There are only two sure things about the agreement, both are very important, and neither is spelled out anywhere in its text. The first is that the Serbian government has given up on keeping northern Kosovo in its system and has ceded its authority to Pristina. The second is that Belgrade has implicitly recognised that Kosovo is a state. These are tectonic shifts, whose effects will be felt no matter what happens with the early attempts to implement the deal.

The New Normalising 

The agreement’s title itself is misleading: ostensibly about “normalisation of relations”, the first twelve of the agreement’s fifteen points cover instead the governance of Kosovo’s Serb-controlled northern region. Only one point is explicitly about bilateral relations, and all it says is that neither party will block the other’s progress toward the EU.

The agreement specifies creation of an “Association/Community of Serb majority municipalities”.[fn]See Crisis Group Report Serbia and Kosovo: The Path to Normalistion.Hide Footnote The dual name is another sign of trouble ahead: for Serbia, it is a Zajednica (union or community) of municipalities, a governing entity newly established by the agreement, while for Kosovo, it is merely an inter-municipal association like one that already exists to help local governments coordinate and share expertise.

What Belgrade and Pristina have initialed is not so much an agreement as a set of principles that must be elaborated before they can be implemented, and the elaboration can be as hard-fought as the agreement itself. Consider the second point:

The Community/Association will be created by statute. Its dissolution shall only take place by a decision of the participating municipalities. Legal guarantees will be provided by applicable law and constitutional law (including the 2/3 majority rule).

The first sentence is silent as to who shall legislate the statute: the Kosovo Assembly (as Pristina prefers), the municipalities in question (which operate under Serbian law) or newly elected municipal bodies (under Kosovo law). The second implies the entity cannot be dissolved by a court decision, which suggests it is to have some kind of constitutional status. The third mentions a “constitutional law”, something that does not exist in the Kosovo system (but does in the Serbian one), and a “2/3 majority rule” of which Kosovo has at least two. It also mentions “legal guarantees”, but not what they are to protect. Most of the other points are as diaphanous as this one, amenable to different readings and needing a lot of follow-up work to give them life.

The Brussels House Style - And Its Limits

Followers of the history of EU mediation between Belgrade and Pristina will recognise this ambiguity as the Brussels house style: get the parties to commit publicly to an agreement whose content is to be filled in later, often by EU officials, out of the spotlight. The advantage of this approach lies in making possible agreements that would be politically deadly if spelled out in black and white. The cost, however, is steep. Both sides can feel cheated, and Belgrade especially tends to squeal when implementation begins on terms that were only implied in the text itself.

Much of the agreement depends on the cooperation of the northern Kosovo Serbs and their leaders, all of whom reject the deal and promise to resist.  This community has a bad reputation these days; they are portrayed as extremists, criminals, or at best simply too few in number to matter. That portrait is unfair: as those who spend time in the North know, its people are little different from their neighbors across the Balkans. Rejection of the Belgrade-Pristina deal comes from a bedrock patriotism that is common to most populations who see state borders shift against their will. Given the near-total absence of law enforcement, the area is surprisingly peaceful; since Kosovo declared independence in 2008 there have been only four fatalities in the North linked to the dispute. During tense times, improvised bombs explode and pot shots ring out, but are meant to warn or intimidate and seldom injure anyone. The only serious confrontations have pitted locals against NATO’s peacekeepers when the latter tried to remove barricades in 2011 and 2012.

While the two governments can, and should, implement a few measures right away, it’s impossible to guess the shape that northern Kosovo government will finally take. The two governments should coordinate the transfer of all security sector staff in Kosovo from Belgrade payroll and jurisdiction to Pristina, which entails: taking existing Kosovo Police (KP) off the Serbian payroll (many have been drawing two salaries, one from each state) and otherwise leaving them alone, and transferring the several hundred (reputed) undercover Serbian officers over to Kosovo payroll. This is less provocative than it sounds, because the “Kosovo Police” brand is widely accepted in northern Kosovo and seen as essentially local, regardless of who pays. It is important the two capitals work together to ensure no interruption in payment and no interregnum during which displaced cops can be recruited by organised crime.

Too much focus on the agreement’s specifics is likely to mislead; many of its provisions will be modified in practice and some may be simply forgotten over time.

Implementing the agreement will require both countries to amend the relevant legislation. One or both may have to amend their constitutions. The issues will have to be aired in public, members of parliament will have to take stands. Early signs are not encouraging. Kosovo’s Assembly approved the deal after a raucous late-night session featuring angry denunciations by the opposition Vetëvendosje (Self-Determination) party, whose supporters rallied outside the legislature. The Serbian parliament refused to vote on the agreement itself, claiming that to do so would constitute recognition of Kosovo; instead, it approved the government’s report on the negotiations. Earlier technical agreements between the two are held up on appeal to Serbia’s constitutional court on grounds that the government impermissibly changed by decree issues that must be regulated by law.

Northern leaders are still stunned by Belgrade’s move, which took them by complete surprise. They have yet to digest its implications, and early reactions bear a distinct resemblance to the five stages of grief: denial, anger, bargaining, and a few signs of depression and acceptance. They seem to hope the deal will die without their cooperation, but have no real plan. Some day soon, should Belgrade start to squeeze them in earnest, the residents of northern Kosovo will face stark choices. Their preference – the status quo, ignoring Pristina and largely integrated into the Serbian system – is no longer possible. There are many things Belgrade can do, starting with money (reducing or eliminating bonuses, cutting positions), and going on to dissolving municipal governments on a pretext and replacing them with more pliant staff, arresting key local leaders on real or trumped-up charges, closing various offices, and even the “nuclear option” of closing the two main employers, the university and medical centre. The limiting factors are legal (as in many ex-communist states, workers have many rights and are hard to fire) and political (they do not want to provoke a televised exodus, even a small one). One ironic component of this story is that Serbia will probably be tacitly encouraged to violate its own laws by the EU to make all this work, as doing it properly – amending all the relevant legislation and regulation – would take much longer than Brussels prefers.

A Self-Governing North, and the De Facto Recognition of Kosovo

The big irony here is that Belgrade’s preferences on implementing the deal are more threatening to the northern Kosovo Serbs than are those advocated by Pristina or the EU, because it is much easier to resist the latter. Serbia wants to form the Community quickly, out of the existing municipal governments; name a senior Serb police officer to take charge of integrating the illegal Serbian security presence into Kosovo institutions; and transfer the existing Serbian court to Kosovo jurisdiction. These steps would bundle the local population and their leaders into a loose Kosovo jacket that could be tightened over time as tempers cool. Kosovo wants to defer forming the Association until the OSCE organises local elections; supervise the transfer of security officials; and dissolve the Serbian court and staff a new Kosovo court. Northerners can easily boycott or sabotage all of those measures and probably remain confident that Pristina would stick to its positions.

The North has fourteen years of experience resisting pressure from Kosovo,[fn]See Crisis Group report North Kosovo: Dual Sovereignty in Practice.Hide Footnote with a large arsenal ranging from community pressure and civil disobedience to organised boycotts, intimidation and occasional pitched battles. But they do not know how to fight Belgrade. In the near term, the stronger Serbia’s influence over northern Kosovo is, the more that territory will integrate with Pristina; and the more Serbia pulls back, the more the North will maintain its independence from Kosovo. The clearest example of this paradox is Serbia’s plan to pass a constitutional law transferring its governing authority over Serbian municipalities to what it calls the “provisional institutions” in its “autonomous province” of Kosovo. Pristina would surely reject such a law and see it as an insult; yet it would leave the North no legal avenue to keep rejecting integration into the Kosovo system.

With or without a Serbian constitutional amendment, there is no way for northern Kosovo to keep saying it rejects the Belgrade-Pristina agreement but is otherwise a normal part of the Serbian legal and administrative system, because Belgrade is transferring it to Pristina’s authority. The North is thinking of three options. It can submit to integration into the Kosovo system, and work to expand the space of autonomy it offers them. It can declare independence, with an aim of negotiating a better deal with one or both of the states that claim it. Or it can strike out on its own without any formal declarations, subverting and obstructing the agreement where it can and hoping for a re-negotiation.

Curiously, all three courses lead toward the same place: a largely self-governing region, with some ties to a Kosovo whose independence it rejects, and with other ties to Serbia. The differences are in emphasis and symbolism, emotionally powerful but with modest practical implications. Pristina and Belgrade should refrain from sudden or provocative moves. So far there has been no surge in violence against Kosovo institutions in the North but that is a risk in the near future, with the North Mitrovica Administrative Office and its staff being the most obvious targets. These should be protected.

There is no point holding elections without significant local support. If the North is firmly opposed, there is a risk of violence against the organisers, and polls that require hefty KFOR protection would be of little use. Belgrade and Pristina need to explain, in detail, what the agreement means for northern Kosovo. They should take the time necessary to prepare the ground.

All previous accords were packaged as deals between Serbia and some external player – the UN or the EU – acting as Kosovo’s proxy. This is the first high level agreement between the two states, and shows that Serbia can deal with Kosovo as an equal. It is a kind of de facto recognition of Kosovo and that may be its greatest long-term significance. Whatever else happens, it is easier today to imagine that Serbia may one day formally recognise the independence of its former province. Yet the thaw in Belgrade-Pristina relations is still fragile and easy to reverse. Both capitals should make improving their bilateral ties the priority, and should not allow lingering disagreements over northern Kosovo to impede them. Better state-to-state relations are much more important than administrative details governing the North.