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# Report on a Recovery Strategy for Kosovo under Preparation
# Update on European Commission activities in Kosovo
# TAFKO first Monthly Summary July-August 1999
# European Commission Task Force for Kosovo (TAFKO)

 
Report on a Recovery Strategy for Kosovo under Preparation
September 27, 1999

A World Bank team joined European Commission counterparts in Kosovo during the
first three weeks of September to prepare a recovery plan for the Province. The team
left Pristina Sept 22. The mission reviewed field assessments of damage and urgent
needs, met with UNMIK, Kosovo's temporary governmental administration run by the
UN, European Commission staff working in Kosovo, and with NGO's and other
organizations. The European Commission and World Bank, in close consultation with
the institutions mentioned above, are now preparing their report, including sector by
sector assessments and recovery strategies. This report will be completed within the
month in order to provide a basis for donors to plan their assistance. It will be
provided to donors in advance of the second donors conference for Kosovo, and will
be posted on this website as soon as it becomes available. Information on the next
donors conference, as well as the date, will also continue to be made available on this
website.

 
Update on European Commission activities in Kosovo
Pristina, September 27, 1999

The European Commission's monthly update on their activities in Kosovo indicates
that the budgetary allocation for assistance to Kosovo in 1999 is EUR 138 mn. An
additional EUR 10 mn worth of projects were initiated in 1998, suspended, and are
now being restarted after handing over their management from Brussels to their field
operation called TAFKO. In the three tranches of assistance, the first projects under
implementation are listed in the update; the second tranche is designed to provide
urgent support for road winterisation, for municipal twinning and, possibly, for the
rebuilding of destroyed broadcasting transmitters. The third tranche will likely focus on
public utilities, public buildings, economic reconstruction and institution-building.
Discussions on microcredit for SMEs, transport and media are currently taking place.

TAFKO first Monthly Summary July-August 1999 (pdf)
[ http://www.seerecon.org/Kosovo/KosovoReconstruction/TAFKOSummaryJuly-August99.pdf ]
see below !

See TAFKO page
[ http://www.seerecon.org/Kosovo/KosovoReconstruction/tafko.htm ]
see below !

EUROPEAN COMMISSION
Task Force Kosovo

Pristina, 29 September 1999
D(99)

INFORMATION NOTE

Subject: Monthly summary of Task Force activities: July-August 1999

This report is the first of a regular series of summaries which the Task Force will prepare monthly. This first summary, however, covers the two months in which the Task Force began its operations. The report will focus on the operational activities of the Task Force (TAFKO), although some brief notes on the political context have also been provided, together with a brief description of the work of the contracts and finance unit and the administration and political and public affairs section.

1. Political

1.1 Security

Visitors invariably remark upon the amazing speed at which Pristina seems to have returned to normality. Shops are full, bars and restaurants busy, concerts take place and in the evening people throng the central pedestrian area. But behind this apparent normality security remains a major concern in Pristina and across Kosovo. After a rise in violence during the first half of August, the rate of killings, looting and arson has resumed the downward trend which characterised the first weeks after the entry of KFOR and UNMIK. Insecurity (and, mostly, a sense of insecurity engendered by threats rather than actual violence) has led, first, to a consolidation of the Serb population in particular areas (mainly in the north and east of Kosovo), and second, to some migration of Serbs to Serbia. It must be underlined, however, that the vast majority of Serbs left Kosovo either during the air campaign (50.000) or during the withdrawal of the federal army (130.000). With regard to violence against the remaining Serbs (about 40.000), a consensus is emerging within the international community that the KLA leadership is not directly responsible. Some incidents are simple revenge attacks by individuals: others seem to be organised, possibly by semi-detached groups of KLA members. And ordinary criminality adds to the toll.

The implementation of the KFOR–KLA agreement on demilitarisation is going well, with 60% of weapons handed in. The question of what role the KLA could play in a demilitarised Kosovo remains unresolved, and is of considerable sensitivity. The principal concerns of the ethnic Albanian population are continued violence against the remaining Albanians in Serbia (mainly to the east of Kosovo); fears about the presence of Russian troops whom they distrust deeply, and anxiety about the fate of some 5.000 ethnic Albanian prisoners held on Serb jails. Organised crime, especially “imported” from Albania, is also a source of concern.

European Commission,
The Museum, Pristina, Kosovo
Office: 4.17,
Satellite phone: +873.762.06.60.17, +873.762.06.60.77; fax: +873.762.06.60.19
 

1.2 Political developments

There are hopeful signs within the political process, however. After a prolonged exile in Italy, Rugova returned at the beginning of August and ended a boycott by his party (the LDK) of the Kosovo Transitional Council which includes prominent members of the Albanian parties, independents and representatives of the Serb, Turk and Bosniac communities and which is the forum for exchange between UNMIK and Kosovars. The KTC has now met just three times, although it seems that there is now the prospect of more regular meetings.

TAFKO is establishing contacts with the major Kosovar players, mainly informally or at the level of simple exchange of information. Relations with all of these have begun well.

1.3 KFOR

KFOR has divided Kosovo into five multinational brigade zones (north, south, east, west and central). It is primarily responsible for security, although it has also taken on responsibility for civil policing, in the run-up to the establishment of a international civil police force, and in the longer term a Kosovar police force, as well as engaging in a number of urgent reconstruction activities. Relations between KFOR and TAFKO are excellent, and there has been outstanding co-operation on a number of areas, particularly public utilities and housing reconstruction.

1.4 UNMIK

The United Nations Interim Administration in Kosovo (UNMIK) is headed by Dr Kouchner with a principal deputy (J. Covey – US) and four deputies each in charge of a “pillar” (see organisation chart in annex).

Of the pillars, the UNHCR (I) and OSCE (III) were active here before the conflict and have significant resources for their activities, as well as on-the-ground experience which is serving them well. The Task Force enjoys good relations with both (as does ECHO with UNHCR). Under OSCE auspices, the “state” radio station (RTP) has started broadcasting again, the police academy has been set up and recommendations for municipal administration have been made to the pillar for civil administration.

The Civil Administration pillar (II) faces considerable challenges. It has to take on responsibility for practically all public services and departments of government at provincial, regional and municipal level. It is woefully under-resourced so to do. However, with Commission help, it has been able to get a grip of the customs service and the public utilities, and the EU has offered help in the vital area of municipal administration.

Our Commission colleagues in pillar (IV) are responsible for providing an economic and financial framework in which reconstruction and development can take place. Co-ordination between this pillar and TAFKO is intensive and good.
 

2. Operations

2.1 Programming and project design

The total budgetary allocation for TAFKO activities in Kosovo during 1999 is EUR 138 million. To this must be added almost EUR 10 million’s worth of projects which were initiated in 1998 but were suspended. These are being restarted after handing over of their management from Brussels to TAFKO.

From the 1999 budget, EUR 46 million is currently being managed. Before the Task Force began work, EUR 9,5 million had already been committed for an assessment of damage to Kosovo and for technical assistance in programme design, implementation and monitoring. After TAFKO operations had begun, a first tranche of EUR 35,5 million was approved at the end of July and was reinforced with an extra EUR 1 million for an urgent project at Mitrovica Hospital on 26 August.

First payments of EUR 5 million have already been made thanks to the decentralised procedures put in place.

In the framework of future new budgetary allocation of EUR 92 million which must be decided by the Budgetary Authority in September, a second tranche of 5MEUR for emergency repairs of roads and bridges, telecommunication infrastructure and development of municipalities by mean of twinnings with EU municipalities is under preparation. The last tranche of 85MEUR will be submitted to the Commission for approval after a programming mission planned for mid-September.

A Memorandum of Understanding between the Commission and UNMIK, governing the implementation of the first tranche of funding is due for signature after approval by legal advisers.

Details of the 1998 and first tranche projects are below. The second tranche is designed to provide urgent support for road winterisation, for municipal twinning (i.e. between Kosovar municipalities and small teams of experts from EU local authorities) and, possibly, for the rebuilding of broadcasting transmitters destroyed during NATO action. The third tranche is likely to focus on public utilities, public buildings, economic reconstruction and institution-building. We are having detailed discussions on micro-credits for SMEs, the transport sector, and the media sector.

Within the second tranche, one project is already well-developed. This is for the extremely urgent task of municipal administration. A request for experts from member states’ local authorities has been sent out, with a view to putting in place teams of experts who can provide assistance to municipal administrations once UNMIK has put these in place. A central team of experts, advising UNMIK directly, is also envisaged. In preparation for this, a handbook for municipal administrators is being prepared. We envisage complementing this programme with investment in municipal infrastructure from the third tranche.

2.2 Implementation

2.2.1 Animal feed and timber imports (EUR 5,4 million – 1998)

Having been suspended, unblocking these contracts took considerable work. The delivery schedule for the Montenegrin supplier of timber needed renegotiating and there were complex negotiations with the NGO responsible for implementing the animal feed deliveries over administrative costs. Both problems have now been resolved and deliveries of both will resume before mid-September.

2.2.2 University of Pristina (EUR 4,4 million – 1998)

The 1998 proposal involved the renovation and building of dormitory accommodation for Serb and Albanian students. However, war damage and looting has meant that priorities need to be re-ordered before building work can begin. The contractor has begun this reassessment of needs and it is hoped to start work before the winter.

2.2.3 Damage assessment (EUR 3,5 million – 1999)

The first phase of the damage assessment, focusing on housing and local infrastructure such as water, electricity, schools and clinics, was presented to the EC/WB Donors’ Conference on 28 July and was used as an authoritative basis for first pledges. It found 120.000 damaged houses in the nearly 1.400 villages surveyed, with 78.000 of these falling into the two highest damage categories. The assessment is continuing over the summer, now broadened in scope to take in industrial and transport infrastructure. An interim report will provide input for the second Donors Conference in October. The final report covering the whole of Kosovo’s physical, economic, social and cultural infrastructure will be available before the end of the year.

2.2.4 Housing rehabilitation (EUR 14 million – 1999 1°)

Although reconstruction of the housing stock is a long-term task, the damage assessment’s identification of less badly damaged houses which could be made good before the winter has enabled us to design a programme of procurement of basic materials (tiles, timber, doors, windows etc.) to enable people to rebuild on a permanent basis. This will complement the emergency shelter kits which are being provided by the humanitarian community.

The approach is two-fold. The majority of funds will be available to a procurement agent, chosen after a tender procedure launched on 20 August, which will have the task of identifying suppliers, especially from within the region, and of delivering materials to distribution centres in Kosovo for further distribution by NGOs.

The second element is a pilot programme, involving KFOR, UNHCR and UNMIK, for the identification of and procurement from local suppliers, for delivery within Kosovo by NGOs. This pilot programme will start in the week beginning 6 September. The idea behind both approaches is to support the admirable spirit of self-help which the Kosovars have shown and to inject cash into the local economy rather than to rely wholly on imported materials.

2.2.5 Village Employment and Rehabilitation Programme (EUR 4,5 – 1999 1°)

This programme aims to provide employment in communities most badly affected by the conflict, and at the same time improve the environment in villages. A contract to implement the programme was signed with UNDP on 5 August and the first payment has been made. The programme was launched at Kosovo’s most badly-damaged village, Çabra near Mitrovica, on 8 August. It is remarkable that, less than 6 months after the inhabitants of the village were expelled, their property looted and homes completely destroyed, the international community has been able to ensure their safe return and that EU funds have already helped them to take the very first steps in the long task of rebuilding their community. The programme will extend to more than 50 other villages and is likely to provide temporary employment for up to 10.000 people.

2.2.6 Customs (EUR 3 million – 1999 1°)

UNMIK, with the help of TAFKO expertise, has re-established a customs service to monitor cross-border traffic, and, once a decision is taken by the UN on the sensitive question of the applicable customs regime, to collect customs duties. The Commission’s financial contribution is providing 10 EU customs experts to provide training and other technical support to the local customs officers. The operation is being implemented under the customs framework contract.

2.2.7 Public utilities (EUR 9 million – 1999 1°)

The provision of electricity is an extremely high priority, especially as winter approaches. KFOR moved in quickly to restore a basic service from Kosovo A power station, but wishes to hand over this task to the civilian sector as quickly as possible. After excellent co-operation with KFOR and other donors, the Commission has put together a package of measures including the funding (with the UK government) of the international management team put in place by UNMIK, ensuring the provision of coal from local mines to power the station, the provision of consumables (diesel and chemicals), the replacement of necessary equipment and the training of the local workforce. The management contract will be signed on 1 September and an arrangement with KFOR for the supply of consumables was signed on 31 August. Other donors, including the Danish and Swedish governments, are working on the electricity distribution network. Work on the water system is also foreseen and we are awaiting concrete proposals in this area.

2.2.8 De-mining (EUR 4 million – 1999 1°)

The United Nations Mine Action Service (UNMAS) has the lead responsibility on demining. We therefore concluded a financing agreement with them on 31 August for a EUR 3 million allocation for demining. An additional EUR 1 million is due to be focused on urgent priorities related to other elements of our programme (such as villages in which we wish to have VERP projects, demining of border posts, demining around electricity pylons).

2.2.9 Small-scale operations programme (EUR 1 million – 1999 1°)

This was launched on 20 August. It provides the Task Force with an instrument to respond rapidly to local initiatives - especially for promoting civil society, media, culture and sports, and local public services - with grants of between EUR 15.000 and EUR 50.000. The basic objectives of the programme include support for ethnic reconciliation, promotion of lasting peace, assistance to returned refugees and the promotion of democratic values and structures. Applications will be considered on a monthly basis, with the first grants being awarded in the first full week of September and monthly thereafter.

2.2.10 Mitrovica Hospital (EUR 1 million – 1999 1° supplementary)

Mitrovica is the principal northern city. The river Ibar runs through it dividing the Serb community in the north from the Albanian community in the south. Tension in Mitrovica was extremely high at the beginning of August and was widely reported in the media. An uneasy truce between the two communities seems to be reigning and UNMIK’s regional administrator continues to negotiate towards secure and free movement within the city.

Against this background, support for the major bi-ethnic institution in the city – the hospital – is of great symbolic and political, as well as practical importance. The hospital is situated in the north of Mitrovica, and problems have been encountered throughout July and August with keeping staff of both ethnic groups working together and with ensuring free access to the hospital by Albanian patients. UNMIK took over the hospital last week and appointed an administrator which has enabled us to establish a programme of rehabilitation of the hospital. Conditional upon maintenance of ethnic Serb and ethnic Albanian staff and upon guaranteed secure access to the hospital by patients of both communities, TAFKO will work with an NGO to provide heating, water and material reconstruction to the hospital, as part of a co-operative package of measures agreed by a number of donors. The contract with the NGO will be concluded by 6 September.
 

3. Contracts and payments

As indicated above, contracts and financing arrangements have already been prepared and signed for most of our projects. The remainder will be dealt with in the very near future. Payments have already been made on the VERP (EUR 2,4 million) and are due in the next few days for consumables for the power station, management of the power station, demining and timber and animal feed imports. By mid-September we aim to have paid around EUR 3,3 million. Contract, implementation and payment status for each project is summarised in the table in annex.

In addition, a number of horizontal tasks has been undertaken by the contracts and payments unit. A comprehensive set of procedures has been agreed, based on the OBNOVA model, but adapted to the particular circumstances of Kosovo. Authority for the signature of contracts and payment orders has been delegated to the Head of the Task Force, and the Task Force will shortly be connected directly to SINCOM 2 (the Commission’s computerised accounting system), enabling more rapid, transparent and effective management of procedures. Members of the unit have received training from our colleagues in Sarajevo in managing a programme sur place. An analytical accounting system, which will track the administrative costs of managing each project,, has been put in place. A comprehensive tableau de bord of TAFKO assistance, EU assistance and all donors’ assistance is being prepared.
 

4. Administration

Three members of the Task Force arrived in Pristina on 5 July. At the time of writing, the Task Force numbers more than 30, and has implemented, I believe, an impressive programme of activities. For most of the period, we have been housed in temporary offices in UNMIK headquarters, which were cramped, extraordinarily hot and badly-equipped. Negotiations on more permanent premises have foundered at least four times, but earlier this week TAFKO moved to new premises in the museum in Pristina. The long-awaited arrival of telecoms and informatics equipment is now on the horizon.

At the same time, the administration section has found housing, local staff, transport (despite formidable problems of registration and insurance of vehicles) and has set up all the services required for a rather large delegation.
 

5. Co-ordination, information and public affairs

Co-ordination with member states sur place and other donors and international organisations has been excellent and regular meetings with member states to discuss reconstruction have been begun. We have received a large number of visitors from member states and other countries. The interest of the commercial sector in our activities has been extremely impressive, and we have a database of well over 200 companies who have contacted us directly, in addition to those which have contacted Brussels. All of these have received a written reply giving basic information about the programme and directing them to further information about future contract opportunities.

An information strategy for the rest of the year has been developed, principally targeting local communities, but also providing resources for the media, the business community and others outside Kosovo interested in the Task Force’s activities. Local designers and printers are being used. Once we have internet connections, we shall make full use of the Europa server and the joint Commission/World Bank site to disseminate information more widely.

Media interest in our activities has been reasonably high, especially at the time of the Donors’ Conference at the end of July about which coverage was particularly good. Press conferences, press releases and direct contact with journalists (about 30 interviews with journalists from a wide range of member states as well as local journalists) have ensured that the EU’s visibility has been kept as high as the limited resources which we have for this type of activity allow.
 

Marc FRANCO
Head of the Task Force

Cc
Attachments
Annex 1: Organisation chart
Annex 2: TAFKO Organigramme

European Commission Task Force for Kosovo (TAFKO)

The European Commission's Task Force for the Reconstruction of Kosovo (TAFKO) is a team of Commission officials and experts, set up in Pristina on July 1, 1999. The Task Force is responsible for the programming and implementation of the first phase of the European Union's reconstruction program in 1999.

TAFKO's work will soon be taken over by the European Agency for Reconstruction, which will be set up to lead the EU's efforts towards the reconstruction of Kosovo, and eventually, for the region.

While TAFKO and later the European Agency are mainly focusing on reconstruction and structural assistance, a humanitarian assistance program is already in place, managed by the European Community Humanitarian Office (ECHO: Sat. phone 00871-762.106.086).

TAFKO is headed by Marc Franco. The head of operations is Thérèse Sobieski and the head of finance and contracts is Adriano Martins. Press relations are covered by the spokesman, Roy Dickinson, relations with the member-states and other donors by Andreas Zobel.

A budget of around EUR 140 million for 1999 is envisaged. This will be disbursed in two phases, the first of EUR 45 million, the second of EUR 92 million.

The priorities identified by TAFKO in agreement with UNMIK for the first phase are:

Damage assessment

De-mining

Procuring of wood, tiles and glass for the basic rehabilitation of houses

Support for public services (electricity and water)

Village employment program (cleaning and local repairs)

Assistance in re-establishing the customs service

In addition some urgent interventions are being considered such as the rehabilitation of Mitrovica Hospital which is of particular importance for improving the relations between the two main communities.

Priorities for the second phase will be established in close consultation with UNMIK after a detailed damage assessment has been completed.

A short guide for companies (pdf)
http://www.seerecon.org/Kosovo/KosovoReconstruction/TafkoGuideForCompanies.pdf

An organigram of TAFKO (pdf)
http://www.seerecon.org/Kosovo/KosovoReconstruction/TafkoDiagramm.pdf

The European Commission's Integrated Rehabilitation Program in Kosovo
http://www.seerecon.org/Kosovo/KosovoReconstruction/ECIRPK.htm

TAFKO Monthly Summary, July-August 1999 (pdf)
http://www.seerecon.org/Kosovo/KosovoReconstruction/TAFKOSummaryJuly-August99.pdf
 

Relevant Press Releases

BRUSSELS, August 27, 1999 EC
European Commission decides on assistance for hospital at troubled town of Mitrovica, Kosovo
http://europa.eu.int/rapid/start/cgi/guesten.ksh?p_action.gettxt=gt&doc=IP/99/641|0|RAPID&lg=EN

PRISTINA, August 20, 1999 EC
European Commission announces small grants programme for Kosovo organisations
http://www.seerecon.org/PressReleases/press017-20-8-99.htm

PRISTINA, August 16, 1999 EC
European Commission sets up custom assistance mission in Kosovo
http://www.seerecon.org/PressReleases/press016-16-8-99.htm

PRISTINA, August 8, 1999 EC/UNDP
European Commission Launches First Programme for Reconstruction at Shattered Village of Çabra
http://www.seerecon.org/PressReleases/press013-8-8-99.htm

BRUSSELS, July 27, 1999 EC
The first Donors Conference for Kosovo-Meeting urgent needs and preparing a joint strategy for reconstruction
http://europa.eu.int/rapid/start/cgi/guesten.ksh?p_action.gettxt=gt&doc=IP/99/571|0|RAPID&lg=EN

BRUSSELS, July 23, 1999 EC
EU Launches reconstruction programme for Kosovo
http://europa.eu.int/rapid/start/cgi/guesten.ksh?p_action.gettxt=gt&doc=IP/99/517|0|RAPID&lg=EN

PRISTINA, July 22, 1999 EC
Top EU official visits Kosovo to announce Agency for Reconstruction and prepare 28 July Donor Conference in Brussels
http://www.seerecon.org/PressReleases/press015-22-7-99.htm

PRISTINA, July 14, 1999 EC
European Commission establishes Task Force for Reconstruction of Kosovo
http://www.seerecon.org/PressReleases/press014-14-7-99.htm

BRUSSELS, June 23, 1999 EC
Press release announcing the European Agency for Reconstruction set up for Kosovo
http://europa.eu.int/rapid/start/cgi/guesten.ksh?p_action.gettxt=gt&doc=IP/99/411|0|RAPID&lg=EN
 

Relevant EU Council Conclusions

BRUSSELS, July 19, 1999
General Affairs Council
Revision of Obnova Regulation - Establishment of European Reconstruction Agency
http://www.seerecon.org/Calendar/Cal-19-7-99-Council.htm
 

Relevant Documents

Reconstructing Kosovo
Commissions' Proposal for a COUNCIL REGULATION (EC) Amending Regulation (EC) No 1628/96 relating to aid for Bosnia and Herzegovina, Croatia, the Federal Republic of Yugoslavia and the former Yugoslav Republic of Macedonia and setting up a European Agency for Reconstruction, June 23, 1999
http://europa.eu.int/comm/dg1a/see/reg_obn_agency/prop_reg_en.htm

Council Regulation
amending the Obnova Regulation on aid to the countries of former Yugoslavia and setting up a European Agency for Reconstruction (EAfR) Explanatory Memorandum June 23, 1999
http://europa.eu.int/comm/dg1a/see/reg_obn_agency/motives_en.htm

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