Kosovo is Europe’s youngest country interms of history and demographics. Both characteristics aredefining the country’s overarching development challenges.The country’s geographical position along major trade routesmade its territory a pawn in the hands of powerfulneighbors, from the Romans and the Ottoman Empire toYugoslavia. The considerable amount of self-governancegranted to Kosovo under the Yugoslav Constitution of 1974,as a province of Serbia, but not as a constituent republicof the federation, proved politically unsustainable, astemporary gains in self-rule were reversed by Belgradeduring the Milosevic era. The period after 1989 wascharacterized by increased repression and violence,culminating in war and population expulsion in 1998–99.During the immediate post conflict period, United Nations(UN) Security Council Resolution 1244 placed Kosovo under UNinterim administration. In 2008, Kosovo declaredindependence. The transition period of supervisedindependence ended four and a half years later.International recognition has remained partial and hasprecluded Kosovo from joining the UN as a full member.4 Inthe wake of these developments, public institutions had tobe established from scratch and earn the population’sacceptance and credibility as their own. The remainder ofthis document is organized as follows. Section two presentsthe country context, including political and economicconditions, and discusses factors behind recent trends ingrowth, shared prosperity, and poverty. It concludes with aproposed conceptual framework. Sections three–six describekey drivers and the principal constraints to growth, sharedprosperity, and poverty reduction. Section seven examinesthe priority areas for action.
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