WASHINGTON—The leaders of Serbia and Kosovo said Friday they were normalizing economic relations, a sign of progress as the two quarreling Balkan nations seek to resolve a decadeslong dispute that once prompted a U.S. military intervention in the region.
In a meeting in the Oval Office with Serbian President Aleksandar Vucic and Kosovo Prime Minister Avdullah Hoti, President Trump hailed the agreement and said, “Economies can bring people together.”
Mr. Vucic told The Wall Street Journal that the deal, which he described as a huge leap forward, would establish a single market with Kosovo, guaranteeing a free flow of people, services and capital. This view was echoed by Mr. Hoti.
It wasn’t immediately clear, however, when the agreement would be implemented, and no deadline was noted in the official documents. Officials from both countries said the implementation could depend on whether Mr. Trump gets reelected.
In a statement released by the White House later Friday, the president said Kosovo and Israel had agreed to normalize ties and establish diplomatic relations, and that Serbia had agreed to move its embassy to Jerusalem by July.
In what officials said was a major concession to the U.S., both countries pledged to remove 5G equipment provided by untrusted vendors from their mobile networks, and to prohibit such vendors from bidding in the future. Officials from both countries said this was a reference to Chinese companies such as Huawei Technologies Co.
Talks between the U.S., Serbia and Kosovo took place at the White House this week, hosted by U.S. national security adviser Robert O’Brien and the special envoy for Serbia and Kosovo negotiations, Richard Grenell. A meeting earlier in the summer was postponed when an international tribune said Kosovo’s president could be charged for war crimes.
Mr. Trump promised both leaders cheap loans guaranteed by the U.S. government for strategic infrastructure development amounting to several billion dollars, according to two people in the room.
The financing for the planned projects in Kosovo alone exceeds the $1 billion mark, said Arban Abrashi, Kosovo’s infrastructure minister, who attended the White House meeting.
In a briefing later Friday, Mr. Grenell said there had been a long road to Friday’s agreement. “We’ve been fighting and talking about the same thing for decades,” he said. “It’s been a nightmare.”
“What President Trump said to me was, ‘They’re fighting politically about everything. Why don’t we give it a try to do something different and creative. Why not try to do economics first and let the politics follow the economics?’” Mr. Grenell said. “That proved to actually be a formula that they were eager for.”
The deal includes a one-year freeze on Kosovo’s efforts to seek new membership in international organizations and on Serbia’s efforts to request other countries and international organizations to not recognize Kosovo as an independent state. Kosovo is recognized by more than 100 countries, including the U.S., but it is unable to join international organizations such as the United Nations because Serbia—backed by Russia and China—has rejected its independence bid.
The leaders of Serbia and Kosovo each signed documents outlining what they had agreed to do to work toward normalizing their economic relations. Mr. Trump signed a document “as a witness to say this is a great agreement,” Mr. Grenell said.
The White House has recently made progress on several foreign-policy fronts, including announcing last month an agreement between Israel and the United Arab Emirates to establish formal diplomatic ties after Israel agreed to suspend a plan to annex parts of the occupied West Bank.
Mr. Grenell said Friday the U.S. was in close contact with the European Union and predicted: “I think the Europeans are going to be very happy.”
Mr. Vucic and Mr. Hoti are set to meet again at the EU headquarters in Brussels on Monday, where they will continue to negotiate under the auspices of the bloc’s chief diplomat, Josep Borrell.
Kosovo, once a Serbian province, became a stage of clashes between the majority Albanian population and Serbian forces after the breakup of Yugoslavia. In 1999, the North Atlantic Treaty Organization launched a bombing campaign against Serbia to stop what Western countries called ethnic cleansing against Kosovo’s mostly Muslim Albanians.
Kosovo’s president, Hashim Thaci, is facing a 10-count indictment filed by the Kosovo Specialist Chambers, a body established in 2017 by Kosovo law. Mr. Thaci, once a leading figure in Kosovo’s guerrilla force, has denied the charges against him.
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Appeared in the September 5, 2020, print edition as ‘Serbia and Kosovo Will Normalize Economic Ties.’