By NICHOLAS WOOD
PRISTINA, Kosovo, Sept. 29 - For more than six years, this small Balkan province has been the subject of one of the most ambitious nation-building projects in recent history.
A United Nations mission, exercising near absolute authority and backed up by a NATO-led peacekeeping force, has been trying to forge a modern democratic system in this region, torn by decades of bitter ethnic tension between an ever more assertive Albanian majority and an isolated Serbian minority.
At a cost of about $1.3 billion a year, international civil servants and police officers - some 11,000 at the peak - helped to build ministries, a parliament, local councils, a bureaucracy, courts, customs services, police forces and news media outlets.
Now, as the United Nations appears to be ready to broker a deal between Serbs and ethnic Albanians and to end its mission in Kosovo, judging the result of that long, expensive effort is not easy.
At first glance, the province appears relatively thriving - particularly when compared with the war devastation of 1999. New houses can be seen everywhere, a result of a postwar construction boom. In the regional capital, Pristina, the streets are lined with cafes, restaurants and stores. Only the ubiquitous white four-wheel-drive vehicles of the United Nations mission and the infrequent military checkpoints hint at another reality.
In truth, the region remains in limbo - the poorest part of the Balkans, and the most unstable. Enmity between the Serbs and Albanians still runs deep. The hostilities boiled over in March 2004, when up to 50,000 ethnic Albanians took part in a three-day wave of attacks on Serbs and other minorities, as well as on United Nations buildings and other property. Nineteen people were killed and 4,000 were forced from their homes.
Today, most Kosovo Serbs remain in enclaves and in small rural communities, often fearful of venturing out. Albanians steer clear of the Serb-dominated northern part of the province, for fear of attack.
Estimates of unemployment range from 30 percent to 70 percent. The regional government is close to bankrupt, and the United Nations expects the economy to shrink by 2 percent this year.
For many, including United Nations experts and Kosovars, talks expected to begin soon on the province's political status - and whether it will remain part of Serbia - stand a chance of solving problems that the United Nations mission could not. Once the issue of Kosovo's sovereignty is resolved, they say, progress can be made on political and economic issues.
But others say there is a deeper lesson to be learned: the model of nation-building adopted here - a government staffed and directed by foreign officials - was too narrow and too authoritarian.
"The focus of the international mission from the start was on security and politics," said Gerald Knaus, director of the European Stability Initiative, a nongovernmental political research group with offices in Kosovo. International bureaucrats, he said, ignored economic needs - the World Bank estimates that 37 percent of the population lives on less than $1.75 a day. He said they built institutions "almost as an end in itself."
Mr. Knaus said the European Union set worthy examples of nation-building in Bulgaria and Romania. There, the union spent at a per-capita rate equal to that of European governments and the United Nations in Kosovo, but on economic development, not on building institutions.
The very presence of the United Nations mission, past a certain point, delayed the maturing of Kosovo's own governing bodies, some of those involved say.
Larry Rossin, a retired American diplomat who is the deputy leader of the United Nations Interim Administrative Mission in Kosovo, said, "I think the development of their institutions is somewhat retarded by our continuing role." From June 1999, when the United Nations arrived in the wake of NATO bombs that helped drive Serbian forces from Kosovo, until 2001 or so, the mission's efforts were held up as an example for building democracy elsewhere.
But then the process stalled, at least in the eyes of international officials and observers, and of Kosovo's Albanians. Those critics said the international administration here became unproductive.
Kosovo's Albanian politicians came to accuse the mission of a deliberately slow transfer of power to local authorities.
Veton Surroi, an ethnic Albanian publisher in the regional parliament, said, "The focus has been on buying time, and that's the only focus there has been."
In the next few days - possibly Monday or Tuesday - a Norwegian diplomat, Kai Eide, is expected to give the United Nations Security Council the results of a study commissioned by Secretary General Kofi Annan on whether to move forward with the talks on Kosovo's future, even though the enmities remain. Javier Solana, the European Union's foreign policy chief, has said he believes Mr. Eide will come out in favor of the talks, and pave the way for the United Nations' withdrawal.
The ethnic Albanians, who make up an estimated 90 percent of Kosovo's two million people, hope the talks will be the final step toward seceding from Serbia. But Serbs, in Kosovo and in Serbia, see in such a secession the loss of their homeland and some of Serbia's most treasured Serbian Orthodox churches and monasteries to an Albanian-controlled state.
The negotiations among the Albanians, the Kosovo Serbs and the Serbian government will require international oversight, and almost certainly will result in some kind of international presence remaining in the province.
A decision on Kosovo's status would help solve one part of its economic problem, Mr. Rossin said: with its current ambiguous status, the province cannot borrow money internationally.
"We are in a situation where we are living off, almost entirely, customs revenues and donations from donors," Mr. Rossin said. "The budget is extremely tight; school construction is nearly nil in the year 2005 because there is just no money in the capital budget to do it in a place that has crying needs in a whole range of social areas."
What money has been invested in economic development appears to have had a marginal impact. The province's two power stations suffer daily power cuts, despite more than $700 million in capital spending.
Kosovo's banking and payments authority report for 2004 states that the economy has been disinvesting since 2000, despite substantial international aid. United Nations officials here note that Kosovo was the poorest part of the old Yugoslavia, even before tensions exploded in the late 1980's and Slobodan Milosevic rode nationalist tensions to seize and consolidate power and to bring Kosovo under direct rule from Belgrade.
Eventually, an underground ethnic Albanian guerrilla movement - the Kosovo Liberation Army - started attacking Mr. Milosevic's forces in 1998. Retaliation was so fierce that NATO decided in 1999 to bomb Mr. Milosevic's forces out of Kosovo. Hundreds of thousands of Albanians who had fled returned, while about a third of the Serbian population abandoned Kosovo.
That history prompted the United Nations to focus on promoting democracy and improving interethnic relations, as well as developing institutions of autonomous government. For two years the goal has been "standards before status," a policy drive aimed at bringing the region up to Western democratic standards - which regional politicians, both Albanian and Serb, derided.
Meanwhile, violence that can dissipate for months on end has resurfaced. On Aug. 27, two Serbs were shot and killed in their car. Late Wednesday, gunmen wounded Kosovo's top Serbian police officer, Dejan Jankovic, near Gnjilane just two weeks after he was appointed regional commander.