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Serbs in northern Kosovo rally against ban on Serbian dinar

Kosovo government will ban the Serbian dinar in minority regions

BELGRADE (Reuters) - Thousands of Kosovo Serbs in the ethnically divided town of Mitrovica rallied peacefully on Monday to protest against the decision of Kosovo's government to outlaw the Serbian dinar as legal tender.

Serbia, which does not recognise the independence of Kosovo, its former southern province, uses the dinar in predominantly Serb areas to pay pensions, social assistance and wages for some parallel Serbian institutions such as hospitals and schools.

But last month Kosovo's Central Bank said that all future payments in the country must be conducted in euros, suggesting that the Serbian dinar would be outlawed from Feb. 1, a move that many powers in Europe worried would stoke longstanding political tensions.

Kosovo said it would allow a month-long transition period after calls by the U.S., Italy, France, Germany and Britain to suspend the decision. But that concession has appeased few in the northern, predominantly Serb part of Mitrovica.

Protesters waved Serbian flags and carried banners reading "Europe open you eyes", and "I've been working for my pension all my life, I will not give it to (Kosovo's prime minister Albin) Kurti".

"The decision to ban the dinar, to make it impossible for us to get our ... pensions, means that our ... our lives are being abolished," Dusanka Djorovic, a pensioner, told the crowd from an improvised stage.

Kosovo, which wants to join the European Union, unilaterally adopted the euro as its currency in 2002, but its 5% Serb minority community also uses the dinar as part of their refusal to recognise Kosovo's statehood.

Kurti on Sunday said the new measure was aimed at curbing illegal cash flows.

"The only change ... is that the cash cannot cross the border in bags ... but through bank accounts and (be) withdrawn in euros," Kurti said in a TV broadcast.

The northern region of Kosovo, where half of the 100,000 Serb minority lives, has seen frequent outbreaks of ethnic violence, the latest flare-up coming in September 2023 when Serb gunmen battled Kosovo police in the northern village of Banjska.

NATO troops reinforced their presence with another 1,000 troops after last year's violence.

(Reporting by Aleksandar Vasovic; Editing by Edward McAllister and Alex Richardson)