From 1 February, Kosovo residents will use the euro for cash and payment transactions, the country’s central bank announced in a decree on Wednesday.
The move could cause controversy and even unrest because until now ethnic Serb communities in Kosovo have used the dinar, Serbia’s official currency, in both public institutions and commercial establishments.
Salaries, pensions, child allowances and social assistance to employees of Serbian institutions were paid in dinars. In shops in the north of Kosovo, all prices for products are in dinars.
According to a Central Bank regulation, currencies other than the euro may be used in Kosovo only for physical storage or bank accounts.
The dinars come into Kosovo from the National Bank of Serbia, whose vault is in the town of Leposavic, also in northern Kosovo near the border with Serbia.
Serbian President Aleksandar Vučić called the announcement to abandon the dinar “alarming,” saying it “calls into question all processes of both normalization and dialogue.”
In September 2021, Kosovo’s announcement to ban Serbian licence plates sparked controversy and protests. Kosovo is predominantly Albanian, with a small percentage of ethnic Serbs, most of whom are concentrated along the northern border with Serbia.
Kosovo declared its independence from Serbia in 2008, and most UN member states, including the United States, Britain, France, Germany and Turkey, have recognised it as an autonomous country.
