Identifier
Created
Classification
Origin
08PRISTINA243
2008-05-14 14:16:00
CONFIDENTIAL
Embassy Pristina
Cable title:  

KOSOVO: AVOIDING CUSTOMS ADMINISTRATIVE GAPS IF

Tags:  PREL ETRD ECON EAID EAIR ETTC PTER KTFN UNMIK 
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VZCZCXRO4186
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DE RUEHPS #0243/01 1351416
ZNY CCCCC ZZH
O 141416Z MAY 08
FM AMEMBASSY PRISTINA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 8194
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE PRIORITY
RUCNDT/USMISSION USUN NEW YORK PRIORITY 1478
RHMFISS/CDR USEUCOM VAIHINGEN GE PRIORITY
RUFOADA/JAC MOLESWORTH RAF MOLESWORTH UK PRIORITY
RHFMISS/AFSOUTH NAPLES IT PRIORITY
RHMFISS/CDR TF FALCON PRIORITY
RHEFDIA/DIA WASHDC PRIORITY
RUEKJCS/SECDEF WASHINGTON DC PRIORITY
RUEPGEA/CDR650THMIGP SHAPE BE PRIORITY
RHEHNSC/NSC WASHDC PRIORITY
RUEAWJA/DEPT OF JUSTICE WASHDC PRIORITY
RUZEJAA/USNIC PRISTINA SR PRIORITY
C O N F I D E N T I A L SECTION 01 OF 02 PRISTINA 000243 

SIPDIS

DEPT FOR EUR, EUR/SCE, DRL, INL AND S/WCI, NSC FOR BRAUN,
USUN FOR DREW SCHUFLETOWSKI, USOSCE FOR STEVE STEGER, OPDAT
FOR ACKER

E.O. 12958: DECL: 05/12/2018
TAGS: PREL ETRD ECON EAID EAIR ETTC PTER KTFN UNMIK
KV, YI
SUBJECT: KOSOVO: AVOIDING CUSTOMS ADMINISTRATIVE GAPS IF
UNMIK RECONFIGURES

REF: PRISTINA 85

Classified By: CHARGE D'AFFAIRES TINA KAIDANOW FOR REASONS 1.4 (B) AND
(D)

C O N F I D E N T I A L SECTION 01 OF 02 PRISTINA 000243

SIPDIS

DEPT FOR EUR, EUR/SCE, DRL, INL AND S/WCI, NSC FOR BRAUN,
USUN FOR DREW SCHUFLETOWSKI, USOSCE FOR STEVE STEGER, OPDAT
FOR ACKER

E.O. 12958: DECL: 05/12/2018
TAGS: PREL ETRD ECON EAID EAIR ETTC PTER KTFN UNMIK
KV, YI
SUBJECT: KOSOVO: AVOIDING CUSTOMS ADMINISTRATIVE GAPS IF
UNMIK RECONFIGURES

REF: PRISTINA 85

Classified By: CHARGE D'AFFAIRES TINA KAIDANOW FOR REASONS 1.4 (B) AND
(D)


1. (C) SUMMARY. On June 15, Kosovo's constitution will enter
into force. In principle, authorities currently exercised by
UNMIK should be transferred to relevant Kosovo Government
institutions, though the discussion of UNMIK
"reconfiguration" continues and the nature of the actual
transition remains murky. Given the uncertainties of the
transition process, and given the fact that opposition to
Kosovo's independence from Belgrade, from Kosovo's Serb
community, and from some EU member states could cause
operational difficulties in the administrative handover,
Kosovo will likely not be in a position to fully accept or
fulfill every UNMIK role and responsibility. In a recent
meeting with Charge, UNMIK Pillar IV head Paul Acda
underscored this as particularly evident in the area of
customs services, where UNMIK, not the Kosovo government, is
still regarded by many as the principal acting authority. He
noted that there is a possibility that non-recognizing
countries could cease trade with Kosovo once "UNMIK customs"
becomes "Kosovo Customs," potentially causing a negative
impact on Kosovo's budget revenues and economic development.
In this, and several other functional and administrative
areas, we believe a handful of UN personnel could play a
critical residual role after the larger UN mission departs.
Such a downsizing plan has been offered by UNMIK to DPKO
(provided to EUR/SCE),a plan that would dramatically reduce
the functions that UNMIK performs in Kosovo but still retain
a few vital, mainly external, operations. END SUMMARY.



2. (C) With the Kosovo constitution coming into force on June
15, a number of institutional competencies will, at least in
theory, pass to the Kosovo government from UNMIK, although
this formal UNMIK "reconfiguration" has yet to be agreed by
the UN hierarchy in New York. While GOK officials have
already assumed many key responsibilities from UNMIK in the
last few years, some significant functional duties and roles
have not yet been transferred, including some that have a
direct impact on Kosovo's economic development and
international credibility. UNMIK has been the international
representative and liaison for Kosovo with several
multilateral institutions and agreements, such as the Central
European Free Trade Agreement (CEFTA),the Energy Community
Common Market, and the European Common Aviation Area (ECAA),
among others. Since Kosovo,s participation in these
organizations has been through UNMIK, inclusion without the
UN umbrella would have to be re-negotiated with each member,
not all of whom recognize Kosovo as a sovereign state.
Exclusion from these and other organizations would have
negative consequences for Kosovo's ability to continue
privileged trading relationships, aviation arrangements, and
to ensure energy security.

UNMIK Customs becomes Kosovo Customs


3. (C) The Charge met with UNMIK Pillar IV head Paul Acda on
May 6 to discuss preparations for the transition of UNMIK
authorities to GOK institutions. (Note: UNMIK Pillar IV,
its economic oversight arm, is funded by the EU and will
under any circumstances cease to function after the end of
June; the EU has so notified the UN and is engaged in
preparations for its shutdown.) Acda reviewed those areas
where UNMIK has been engaged in Kosovo's economic sector,
noting the external function of representation described in
the above paragraph and also discussing the question of
customs. Once UNMIK Customs officially becomes the Kosovo
Customs Service, he said, it is unclear whether cooperation
with neighboring and regional customs services will continue,
as some of these countries do not recognize Kosovo's
independence. Trade and cooperation have continued since
independence because many of these countries -- including
Serbia -- have agreed to work with UNMIK, and Kosovo is

PRISTINA 00000243 002 OF 002


permitted duty-free exports to all EU countries per an
agreement negotiated through UNMIK. Acda added that it is
entirely possible that non-recognizing countries will reject
certificates of origin and stamps issued by the Kosovo
Customs Service and refuse entry for Kosovo-produced goods.
Continued information sharing between regional customs
services could also be at risk, jeopardizing accountability
and smuggling control measures.

4. (C) Acda also noted that Serbia could declare Kosovo an
illegal customs regime after UNMIK's departure and attempt to
officially annex Kosovo as part of Serbian customs territory.
(This is a threat we have discussed before; the possible
effects of this scenario have been described reftel.) Thus
far, and notwithstanding the absence of effective customs
operations at the two northern gates, Serbia has continued
limited cooperation on customs issues at other gates and in
an administrative sense via intermediation through UNMIK
Customs. Serbian counterparts have told UNMIK they do not
want to cease communication with customs in Kosovo, but
without UN intermediation there would be no mechanism in
place that would allow them to continue the dialogue. While
the EULEX Customs component of monitors and mentors
theoretically could be deployed by the end of June, their
current mandate does not include any of the administrative or
representational roles now performed by UNMIK, and EU
Planning Team head Roy Reeve told the Charge that a reopening
of the mandate discussion in Brussels could lead to months of
wrangling among member states over issues already considered
closed, a prospect he said the EU would not relish.

Case for a Residual UNMIK Presence


5. (C) Acda suggested the possibility of creating an
"External Economic Policy Office" under a small residual UN
presence post-transition to fill in the administrative gaps
left by UNMIK's departure. A plan for such a small residual
presence (no more than thirty individuals total and even less
by the end of 2008, should circumstances permit) has already
been submitted by UNMIK to DPKO in New York (provided to
EUR/SCE) and could help ease the effects of transition and
ensure functional continuity. (Acda argued for possible
retention by the UN of staff currently working under Pillar
IV contracts given the basis of expertise involved, but we
doubt that the UN would agree to this arrangement.) At any
rate, the external economic policy unit could continue to
fulfill certain administrative customs functions, such as
issuing certificates of origin and negotiating trans-shipment
of goods with individual countries if they are
non-recognizing. The UN could also perform a liaison role
with international economic and trade organizations,
particularly where Kosovo is already represented by UNMIK but
cannot become a full partner due to non-recognition by other
member states.


6. (C) COMMENT: A number of issues and potential gaps may
emerge from a sudden or gradual UN downsizing in Kosovo, some
of which will need to be dealt with ad hoc, while others --
like the customs question -- could benefit from a considered
UN reconfiguration that includes elements of external
representation and intermediary functions post-transition.
These questions should be considered carefully and, to the
extent possible, discussed with DPKO as the UN makes
practical decisions about the shape and size of its residual
presence in Kosovo under UNSC 1244.
KAIDANOW