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Pristina hit Serbian goods with steep tariffs after blaming Belgrade's "aggressive stance" for its failed bid to join the Interpol. Kosovo declared independence from Serbia in 2008, but the countries remain at odds.
Kosovo raised tariffs on Serbian goods from 10 to 100 percent on Wednesday in retaliation for what it said was Serbia's efforts to block its accession to Interpol.
Prime Minister Ramush Haradinaj said the Interpol bid failed due to Serbia's "very aggressive stance" and also accused Serbia and Bosnia of not upholding regional trading rules. His deputy prime minister, Enver Hoxhaj, said the government was planning to announce additional actions "soon."
The small Balkan country, whose bid to join the international police organization failed on Tuesday, also raised tariffs by the same amount on Bosnia and issued an outright ban on any goods that failed to address Kosovo as "The Republic of Kosovo." Serbia and Bosnia do not recognize the formal title for Kosovo chosen chosen by the government in Pristina.
'Blow' to regional free trade
In response, Serbian strongman Aleksandar Vucic convened a meeting of his National Security Council and harshly criticized the Kosovo government.
Raising the tariffs would have "disastrous and destructive consequences" to relations across the entire region, he told reporters in Belgrade. President Vucic also expressed hope that a European power would "have the strength and the will to calm down" the Pristina authorities and pressure them into canceling the measure.
"We will not halt their trucks or automobiles, and we will not halt the flow of goods towards Kosovo and Metohija because we want to show the difference between responsible behavior from one side, and the irresponsible behavior form the other," he said, referring to Kosovo by the official Serbian designation for its one-time province.
Read more: From Yugoslav wars to an ever tense peace
Serbian Prime Minister Ana Brnabic also said the raising of tariffs was "senseless and unreasonable," but said she hoped there would be no countermeasures from Belgrade.
Belgrade goes to foreign partners
Bosnia's Foreign Trade and Economic Relations Minister Mirko Sarovic denounced the move as "the biggest blow" to the Central European Free Trade Agreement (CEFTA). All three countries are members of the EU-backed tariff-free arrangement.
Kosovo's decision came two weeks after it introduced a 10 percent tariff on goods from both countries. The flow of good from Serbia, Kosovo's biggest regional trading partner, has since fallen by half, according to figures from Kosovo Customs.
According to Vucic, Belgrade is set to consult with UN Security Council members and EU member states tomorrow and inform them about Pristina's "violations of the Stabilization and Association Agreement (with the EU) and the CEFTA accord."
Kosovo has struggled to achieve international recognition since its mostly ethnic Albanian population unilaterally declared independence from Serbia in 2008.
Serbia, which along with Bosnia does not recognize Kosovo's independence, has repeatedly blocked its attempts to join the United Nations.
The EU has tried to reconcile differences between Serbia and Kosovo to pave the way for both countries to join the bloc. Talks have however made little progress since they began in 2013.
amp,dj/aw (AP, Reuters, AFP)