Prime Minister Albin Kurti said his left-wing Self-Determination Movement, or Vetevendosje, wanted to lift the tariffs in phases, starting Sunday with raw materials imported from Serbia, as a goodwill gesture.
The party's main governing partner, the Democratic League of Kosovo, or LDK, wants the import taxes dropped completely. Kurti wants abolishment of the tariffs made conditional on Serbia stopping an international campaign against Kosovo's recognition as a country.
The coalition partners have not found a compromise, Kurti said. “In the absence of a government decision … everything remains as it is, the 100% tax remains,” he said. The United States and European Union also want Kosovo to do away with the tariffs and to resume talks with Serbia on normalizing ties.
The Millenium Challenge Corporation, a U.S. independent government agency, said on Friday it would pause implementation of a $49-million funding program for Kosovo until the tariffs issue is settled.
Kosovo imposed the punitive tariffs in November 2018 over Serbian efforts to block Kosovo from joining international organizations. The dispute led to the suspension of the EU-mediated talks, which started in 2011.
Serbia’s President Aleksandar Vucic has described Kurti’s proposed phase-out as a trick. Kosovo was formerly a part of Serbia and won independence after a 1999 NATO bombing campaign that ended a bloody Serb crackdown on an armed uprising by members of Kosovo's ethnic Albanian majority. Serbia refuses to accept Kosovo's 2008 declaration of independence.