UNMIK/PR719
Wednesday, 24 April 2002

Address to the Security Council By Michael Steiner
Special Representative of the Secretary-General

Mr. President, Members of the Council,

I am pleased to tell you that the UN operation in Kosovo under Resolution 1244 has entered a new phase, allowing us to make new proposals for the way ahead.

In the period from June 1999 UNMIK concentrated on the humanitarian crisis, essential services and on stopping open hostilities, with KFOR's support. Indeed, the Kosovo where my predecessors arrived looked very different from Kosovo today.

I. WHAT HAS BEEN ACHIEVED?

You have seen the comprehensive report of the Secretary-General. His support has been invaluable in our work.

Government: The Kosovo-wide elections in November were universally recognised as free and fair. The Assembly, the President and the multi-ethnic Government of Kosovo are now in place and working. We are building an inclusive public service. We have set aside more than 20 % of posts to non-majority communities, 18% to Kosovo Serbs.

Police and justice: We have a functioning police and justice system. The crime rate has gone down steadily. There were 500 murders during the second half of 1999, 250 in 2000, and 136 last year. Since January 2002 there have been 16 and, if this trend continues, we can expect less than 100 murders this year.

The economy: It is slowly beginning to function. The 2002 Kosovo Consolidated Budget of 374 million Euros is now over 95 per cent funded from local taxes and revenues. Starting this month, people are paying income taxes. More than 50,000 businesses have been registered. There has been a four-fold increase in the rate of electricity production since 1999.

Public services: The social infrastructure has been rebuilt from scratch. We have more than 1,100 schools with a total of 450,000 pupils. Five regional hospitals have been refurbished and equipped. There are 360 functioning health care facilities throughout Kosovo. 130,000 pensioners will start receiving pensions as of July 2002.
II. PRIORITIES

Now we have the Provisional Institutions of Self-Government (PISG). What has changed? Until now the mission had a general view of where it was headed, but we didn't see how it would get there. Now we can see more clearly how to structure the path. The road is not endless. We have a vision on how to finish our job.

We need to look both inside and outside. We need to transfer authority within Kosovo to the Provisional Government. We also need to convince the Kosovans to look beyond Kosovo to Belgrade and to the region.

What are our priorities?

Firstly Reliable institutions: We now have Kosovan partners that we can work with: President Rugova, Prime Minister Rexhepi and Assembly President Daci. We need to consolidate the Provisional Institutions, to ensure that they are effective, representative and transparent. We will make a particular effort to ensure their multi-ethnic character at all levels. The Kosovo Serbs have agreed to my proposals for their participation in the Government. They will nominate a Minister for Agriculture, as well as an Inter-Ministerial Coordinator on Returns. This is significant progress. On the local level, the OSCE-run municipal elections this autumn will be key. There are good reasons why especially the Kosovo Serbs want these elections now.

Secondly Boosting the economy: 50% unemployment rate is an untenable situation. At the same time, UNMIK is downsizing. There has already been a substantial drop in donor money. And Kosovo is unable to borrow on the international markets. Getting the economic fundamentals right is therefore even more important. A key element is privatisation. Privatisation will not solve the problem in the short term, but it is the only basis for secure jobs in the long-term. The legislation to create the Kosovo Trust Agency, which will be the vehicle for privatisation, is now with the Provisional Government for comments.

Thirdly Rule of law: Effective police and judiciary are essential. We will gradually transfer policing responsibilities to the multi-ethnic Kosovo Police Force under UNMIK supervision. Let me pay tribute here to the brave UNMIK policemen and women. The Polish Special Police demonstrated their dedication recently in an exemplary manner. We are also enhancing capabilities to effectively combat organised crime, terrorism and corruption. However, I must emphasise that as we begin to make significant arrests against the criminal gangs, we should anticipate a criminal backlash. Commander KFOR General Marcel Valentin and I stand shoulder to shoulder on maintaining order. We must count on your support - particularly when the going gets tough.

Finally Returns: Now that the Kosovo Serbs will be part of the government, we can focus more efficiently on an integrated effort to facilitate return. The years 2002 and 2003 will be decisive. We are committed to create the preconditions for a substantial returns process. Damage assessments in over 80 minority villages and urban areas have been completed. Serb returns to 14 villages and non-Serb minority returns to 7 locations should commence within the next three months. The Kosovo Serbs will have their official representatives working on returns within the Government and in my office. It is time to work on a real breakthrough in returns. For this I must ask for your help. When the returns start, on the basis of our integrated approach, we need to be sure that there will be money to follow the returnees. Only this way can we achieve sustainable returns.

Here I would like to make a more general point that relates to the previous one. We need to follow a dual track approach. Multi-ethnicity and integration are the two mutually reinforcing elements here. On the one hand, the Kosovo Albanians as the majority community have to practice what their leaders preach. Multi-ethnicity means doing everything they can to encourage the smaller communities to stay in Kosovo and to make returns possible. On the other hand, the smaller communities have to participate in the institutions that we have set up under Resolution 1244. They must integrate and abandon parallel structures. The rule of law must apply everywhere in Kosovo. This is also true for Mitrovica.

There will be no multi-ethnicity without integration. But there will also be no integration without multi-ethnicity.

Integration within Kosovo needs to be complemented by strengthening relations with Belgrade as well as the cooperation within the region. Just as Kosovo is a factor influencing stability within the region, relations with regional neighbours influence stability in Kosovo. I have already made my first trips to Belgrade, Skopje, Tirana and Sarajevo. We will continue to foster regional dialogue both on the bilateral and the multilateral level. Belgrade will be the crucial partner in this process.

III. BENCHMARKS

I have described the priorities of my Mission. The work of implementing Resolution 1244 is now a joint effort with the Provisional Institutions.

We are transferring our responsibilities to these institutions in the process of building substantial autonomy. This will bring us closer to a stage when it is time to begin the political process designed to determine Kosovo's future status. This will be one of my main responsibilities, as foreseen in paragraph 11(e) of Resolution 1244.

But the time for this has not yet come. Kosovo society and institutions will have to show that they are ready for this process - without prejudging its outcome. We must make clear what is expected from them. Therefore, I am embarking on a benchmarks process. These benchmarks should be achieved before launching a discussion on status, in accordance with Resolution 1244.

The benchmarks are:

- existence of effective, representative and functioning institutions;
- enforcement of the rule of law;
- freedom of movement;
- respect for the right of all Kosovans to remain and return;
- development of a sound basis for a market economy;
- clarity of property title;
- normalised dialogue with Belgrade; and
- reduction and transformation of the Kosovo Protection Corps in line with its mandate.

You should have in front of you an illustration of our thinking on benchmarks. These benchmarks articulate our expectations of Kosovo's leaders and the wider public. They mirror the Principles and Priorities in the Coalition Agreement signed on 28 February by political parties forming the Government. Through stimulating public debate, we can also gain broad support for needed reforms.

Attaining these benchmarks is an objective in itself. Kosovo can only advance towards a fair and just society when these minimum preconditions are met. And when the changes in institutions are sustainable even without an international presence.

I offer this to you as an "exit strategy" which is, in reality, an "entry strategy" into the European integration process. The benchmarks complement the preconditions that Kosovo needs to meet to qualify for the Stabilisation and Association process.

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I rely on the support of the Security Council for this strategy. But in addition to political support, I will still need your sustained technical and financial support. This is essential in achieving our priorities. Yes, we will have to reduce our engagement. But not in the moment when we should be capitalising on our past work. I am concerned about the anticipated premature reduction in the Kosovo peacekeeping budget. After the marathon that we have run in Kosovo since '99, it would be tragic to falter as we are nearing the finish line.
The next stages of authority transfer will succeed only with your help. And only with your backing will Kosovo be able to develop normalised dialogue and meaningful relations with Belgrade and its neighbours.
The more we invest now, the more stable, sustainable and fair a society we will leave behind. Can we afford not to afford returns? Remember: a stable Kosovo is a key to a stable region. The more support you give us now, the faster we will be able to reduce spending and international personnel.
You have visited Kosovo twice. You have seen it develop. Where there was rubble there are now roads and schools and hospitals. Where there was anarchy, there are now democratically mandated institutions. This has been accomplished through our international presence and the funds that we have committed. I would like to invite you to come again and see what you have achieved.
Mr. President, we have to finish the job we started together. It still takes time. But this is now the decisive phase.

Thank you.