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Eggert Peja Rreze and Verena

Peja report

March 2002

The first question for ESI in Kosovo was simple: what was really going on in the local economy? To provide some answers in the absence of any reliable official figures, ESI undertook a detailed study of Peja (Pec), the largest town in Western Kosovo.

The report found that:

"Today, after five decades of socialist development and more than ten years of post-socialist decay, Peja's economy is back where it started early last century. Amid the ruins of an industrial sector which has entirely collapsed, one can find economic structures strikingly similar to those of the pre-socialist 1930s: shops, tradesmen, hotels, and a handful of functioning industries: a saw mill, a bakery, a brewery and a brick factory."

The report alerted UNMIK to the extent of deindustrialisation that had taken place in Kosovo:

"When economists talk of "de-industrialisation", they normally mean the shift from industry to services which is characteristic of the most advanced economies … where high productivity growth in industry and agriculture leads to a shift of employment towards the service sector, accompanied by a general rise in living standards … In Kosovo, de-industrialisation refers to a very different phenomenon. It means the collapse of industry and a return to the pre-industrial past."
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