Kosovo and Serbia agree on arbitration for commercial disputes

06/01/2014

The two countries' chambers of commerce are seeking to create a positive climate for businesses to communicate and interact.

By Linda Karadaku and Igor Jovanovic for Southeast European Times in Pristina and Belgrade -- 06 /01/14

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Serbia and Kosovo chambers of commerce reached two agreements in Brussels to improve business relations. [Association of European Chambers of Commerce and Industry]

Serbia and Kosovo are improving commercial relations in an effort that officials consider mutually beneficial for economic growth and normalisation of relations.

The countries' chambers of commerce signed two agreements to promote arbitration to settle commercial disputes and build institutions to boost commerce.

The chambers signed the agreements under the auspices of Eurochambres – the European Assocation of Chambers of Commerce and Industry -- based on the Brussels agreement process established to normalise Belgrade-Pristina relations.

Trust and confidence are preconditions to develop proper business, said Arnaldo Abruzzini, secretary general of Eurochambres.

"[A]rbitration, mediation and alternative dispute resolution mechanisms can contribute to trust and stability in business relations. Being procedures that are developed outside the courts, they normally are much faster and business-oriented," Abruzzini told SETimes.

Abruzzini said achieving quality economic relations is the basis for normalising relations in the region.

"With this aim, further development will be secured in the coming year, boosting economic sectors like transportation and customs," he said.

The agreements aim to improve business relations, consolidate the institutional relations between the two chambers of commerce and develop tools of co-operation.

An example of a co-operative tool is a provision in the arbitration agreement that stipulates chamber representatives will serve in the other country. It entered into force this month.

"The agreements have short-term and long-term orientation," Safet Gerxhaliu, chairman of the Kosovo Chamber of Commerce, told SETimes.

Gerxhaliu said that in the long-term the agreements would open new prospects to eliminate barriers and enable businesses to access regional and European markets, which is crucial for Kosovo's economic development.

The Kosovo Statistics Agency reported last November that Serbia leads the list of the countries importing to Kosovo, followed by Germany, Italy, Turkey, China and Macedonia.

The Kosovo market is vital to Serbia because its annual value is estimated at 300 million euros, said Zeljko Sertic, president of the Serbian Chamber of Commerce.

"It is in our interest to open up that market to our producers to co-operate and for marketing of our goods to be bigger than it has been so far," Sertic told SETimes.

Sertic said various problems such as those concerning obstacles to the transport of goods, customs, or disagreements within CEFTA can now be resolved directly by Belgrade and Pristina.

"In general, it looks like the agreement intends to sensitise public opinion, especially businesses, for a positive, improved climate between Kosovo and Serbia," Fisnik Bajrami, researcher at the Kosovo Riinvest Institute in Pristina, told SETimes.

Regarding potential customs' problems, the agreements stipulate taxes and customs fees will be paid at the administrative border crossings.

Kosovo officials said they expect to collect an estimated 18 million euros per year from customs fees solely at the Jarinje and Brnjak crossings.

The agreements will improve the economic situation though not to the extent of the agreements that prime ministers Ivica Dacic and Hashim Thaci reached.

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"This is due to the fact that they [Dacic and Thaci] touch on fundamental economic issues such as customs, but also functioning of the energy system, telecommunications, water issues and the Trepca mine," Ibrahim Rexhepi, director of the Centre for Strategic and Social Research in Pristina, told SETimes.

The EU praised the chambers' efforts to boost commercial relations and contribute to improving Belgrade-Pristina relations.

"The signing of the agreements shows the business communities fully support the normalisation process," Maja Kocijancic, spokesperson for the High Representative of the Union for Foreign Affairs and Security Policy Catherine Ashton, told SETimes.

What else should Kosovo and Serbia do to enhance co-operation between the business communities? Share your opinion in the comments space.

This content was commissioned for SETimes.com.
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