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War-torn Kosovar village faces new threat as World Bank considers coal power plant

Development Policy

War-torn Kosovar village faces new threat as World Bank considers coal power plant

Kosovo A, a coal-fired power plant, provides much of the country’s electricity.

[Michael Hudson]

HADE, Kosovo – In 1999, Serbian commandos wearing hoods over their heads and greasepaint on their faces entered this mountain village and executed five Muslim men ages 25 to 80. The soldiers forced the surviving inhabitants onto buses headed for Albania and Macedonia. Then they set nearly every home in Hade ablaze.

After an American-led bombing campaign ran Serb forces out of Kosovo, the people of Hade returned from refugee camps and from havens higher in the mountains. Over the next few years they rebuilt their village and resumed tending their cows and gardens and mining coal for KEK, Kosovo’s state-owned power company.

But the homecoming hasn’t turned out the way they hoped.

Refugees of Development

Hade is again being threatened with destruction. This time, villagers and their advocates say, the threat to their homes is coming from their own country’s government and the World Bank, the global lender that has committed itself to promoting “shared prosperity.”

Kosovo’s government, bolstered by money and technical assistance from the World Bank, plans to clear and destroy the village.

A rich vein of lignite coal lies underneath Hade’s rolling hillsides, making it a target as KEK has expanded its mining operations and Kosovo officials and World Bank experts have planned for a proposed coal-burning power plant nearby.

Kosovo’s government hopes that with the World Bank’s help it can build a state-of-the-art coal plant – known as “New Kosovo”.

The World Bank and the US Treasury Department say that a lack of electricity-generating capacity is holding back economic growth in Kosovo, which is one of the poorest countries in Europe.

The government’s push to clear the village has already forced about 1,000 Hade residents from their homes. Thousands more from Hade and neighboring villages have been waiting for a decade to know when their time to move will come.

“This has been going on for 10 years. We don’t even know when this is going to end,” says Skender Grajcevci, a coal miner who lives in one of the sections of Hade that has yet to be cleared. “This is worse than the war. In the war, we were part of something. Now, we feel weak. Wherever we go, nobody supports us.”

Obilic apartments [Visar Kryeziu/ICIJ]Obilic apartments [Visar Kryeziu/ICIJ]

Grajcevci and other villagers claim they have been misled and abused during Hade’s saga of development and displacement – and that the World Bank has hidden behind technicalities to avoid taking responsibility for its role in their ordeal.

The World Bank Group’s rules require that its clients – governments and private companies alike – protect people in the footprint of development projects from the trauma of losing their homes or livelihoods. Under these rules, governments and companies that get money from the bank must restore people who are displaced by development projects to living conditions that are equal to or better than they were before.

In complaint filed June 12 with the World Bank’s internal watchdog, the villagers’ representatives claim the bank has violated its rules governing “involuntary resettlement.” They say the bank allowed the fledgling government of Kosovo – which operated on a provisional basis until it declared independence from Serbia in 2008 – to take their homes and farmland without fair compensation and without an adequate plan for resettling them.

The World Bank says that it’s not to blame for what’s happening to Hade, because the bank hasn’t decided yet whether it will help put together a large-scale financing package for the construction of the proposed 600-megawatt power plant. A bank spokesman told the ICIJ that the bank won’t decide whether to give full support to the coal-burning plant until it consults the public and completes environmental, social and technical analyses.

In a statement, the bank says it was “not involved” in the first wave of evictions from Hade a decade ago. It says a more recent wave of evictions “were not caused by any Bank projects” but that it agreed to help Kosovo’s government plan and monitor these relocations “in order to ensure good practice” and help the government “build capacity” for handling resettlements.

Kosovo’s government says that the people who have been forced from Hade were fully informed and fully consulted, and that they were compensated at “most favorable” rates for their economic losses.

A soccer match in front of the apartment buildings where many villagers evicted from Hade now live. [Visar Kryeziu/ICIJ]A soccer match in front of the apartment buildings where many villagers evicted from Hade now live. [Visar Kryeziu/ICIJ]

Hade’s villagers are Muslims of Albanian heritage. They live together in mahalas, neighborhoods named after extended clans. Often three or four generations of a family live within a single walled compound with flower gardens and multiple houses built with cinder block or concrete. Before mining began swallowing land and homes, residents say, they were mostly poor but self-sufficient. They grew vegetables, baked bread, sold smoked meat and dug coal by hand to help make ends meet.

The story of Hade is an example of how the World Bank exercises influence in developing countries even before it approves large financial deals – and how it often fails to use this influence to ensure that its clients live up to its standards.

The bank’s ability to offer expertise and label a country as a good place or bad place to do business gives it an outsized influence on what’s happening on the ground in many places. The bank advises governments on organizing their economies and on writing laws relating to land rights and evictions. And years before it approves a big project, the bank sends in experts to help line up other funders and help borrowers clear legal and social roadblocks.

Human rights and environmental groups say the bank’s effort to distance itself from the evictions in Hade doesn’t square with its history there and in other villages within central Kosovo’s coalfields.

The World Bank began advising Kosovo’s government on resettlement issues in the area in 2004. It approved a multimillion-dollar grant in 2006 to help the government plan relocations and consider the construction of a new coal-fired power plant.

Getting to the source

The protests haven’t done much to move the government to change course, villagers say. After years of frustration with the government’s handling of the resettlement process, the people of Hade tried a new approach. They sought help from an outside power that promotes itself as a defender of beleaguered peoples: the World Bank.

In 2012, residents of Hade and nearby villages filed a complaint with the World Bank’s Inspection Panel charging that the bank had failed to properly assess the coal project’s economic and environmental impact. “Many of our neighbors have been displaced, and we do not know how many more will be moved,” it said.

World Bank officials countered that because the bank has yet to give final approval to a proposed $58 million “partial risk guarantee” considered crucial to making the new power plant a reality, the villagers have no right to complain to the Inspection Panel. Their problems, the bank said, are “historical conditions” caused by the operations of the older power plants and have nothing to do with the bank’s activities.

The Inspection Panel expressed concern about what was happening in Hade but said its hands were tied – it couldn’t investigate because the project was still at an “early stage” and there were “no key Bank activities or decisions” at this point that the panel could review.

It added that the “affected people will have recourse to the panel at a later stage in the project cycle if they so wish.”

The villagers and their advocates say bank officials are using loopholes to dodge accountability. Chad Dobson, executive director of the nonprofit Bank Information Center, says the bank’s argument that it’s not responsible for issues that come up before a financing package gets final approval is a “lawyer’s answer” aimed at “minimizing the bank’s exposure.”


As the World Bank’s Inspection Panel was considering and disposing of the residents’ 2012 complaint, Kosovo’s government was pursuing a new round of evictions, targeting Hade’s Shala neighborhood.

The World Bank took a more active role in this new round of evictions. It provided money and advice to help Kosovo officials create a resettlement plan that is supposed to live up the bank’s standards for handling forced relocations.

In all, 63 households totalling 320 residents have been evicted from the Shala neighborhood, according to the World Bank. But New Hade remains almost empty. About 10 families have built houses on the New Hade site and moved in. The rest have either moved elsewhere or are still in temporary housing.

A spokesperson for Kosovo’s Ministry of Environment and Spatial Planning said that the ministry “has arranged all infrastructure in New Hade” and satisfied the needs of former residents of old Hade. The World Bank said in a statement that KEK and the government “have made a very serious effort to manage resettlement from the Shala neighborhood of Hade professionally and with a view to protecting affected households’ interests. Overall, the New Hade village is of good quality and will improve the residents’ living standards.”

Dajana Berisha, executive director of the Forum for Civic Initiatives, a local group that has worked on behalf of Hade’s evictees, says authorities recently put in a paved road at the new site, but other promised improvements that would make the relocation site a real community – including a school, a mosque, a medical clinic and stores – haven’t been built.

“They showed people lots of pictures of how nice New Hade would look,” Berisha says. “But almost none of what they promised is there in the field.”

Last week, a new complaint was filed to the World Bank’s Inspection Panel that makes it clear people there don’t believe the resettlement process has protected their interests.

The bank has failed to follow its own rules, creating “a false certainly in the Government that they are in compliance with international standards” and subjecting families to impoverishment, homelessness and landlessness, the complaint says. The economic and social burden of the government’s push to exploit the country’s coal resources, the current and former Hade residents charge, has been “put on our backs.”

A bank spokesperson did not respond to questions about the new complaint.

Slow Death

When Armend Grajcevci was a little boy, he had trouble sleeping many nights. He worried his family’s home might slide off the hilltop and into the open-pit coal mine in the valley below.

“When I was 7 years old, I was very scared,” Armend says. Now he’s 15. “And I’m still scared.”

KEK’s mining operations remain a daily presence in his life. Earth-moving machines rumble in the distance. Coal trucks speed by on the road that runs past the village school.

Serb forces destroyed Hade a year before Armend was born. Now his village is dying a slower death. Many of his friends had to move away during the earlier waves of evictions. Attendance at the local school has shrunk so much that some grades are combined into one classroom.

Armend’s father, Ragip, sends him and his sisters and brothers to tutors so they can learn English and someday go somewhere else to live and work.

“To have a life of their own,” his father says.

For now, the father and son fight for a village that may soon be gone. Getting tear-gassed at his first protest didn’t discourage Armend from showing up at the villagers’ demonstrations. Whenever there’s a community meeting or a demonstration, he’s by his father’s side.

“I will never stop, because I don’t like seeing injustice,” Armend says.

This story is part of ICIJ’s continuing series of stories about the World Bank Group’s impacts on communities around the globe.

Michael Hudson is a senior editor with the International Consortium of Investigative Journalists. Visar Prebreza is a journalist at Koha Ditore, a leading daily newspaper in Kosovo. Karin Steinberger is a journalist at Süddeutsche Zeitung, a daily newspaper in Germany. Artrit Bytyci provided research assistance for this story.