A coalition headed by the Democratic Party of Kosovo (PDK) has agreed to a deal with the junior New Alliance for Kosovo party to form a government, ending three months of political gridlock sparked by inconclusive elections.
The agreement, signed on September 4, gives the coalition, which includes the Alliance for the Future of Kosovo (AAK) along with ethnic minorities, 63 of parliament's 120 seats.
President Hashim Thaci has said that he would give Ramush Haradinaj, leader of the AAK, a formal mandate to try to form a government once he could show he had a deal showing a majority coalition was in place.
"Finally Kosovo has started to move...we had some big delays and our institutions now will be formed," Haradinaj said.
Officials from the European Union and other Western institutions have expressed concerns that the inconclusive June election results could plunge the country into the same constitutional crisis it faced after a 2014 vote failed to produce a clear winner, delaying the formation of a government for nine months.
The failure to move forward on creating a government prompted Britain, France, Germany, Italy, and the United States to issue a statement on August 13 that said it was "the responsibility of Kosovo's leaders" to end the deadlock.
"With this coalition we will push the processes forward. I am convinced that we will be in harmony with Prime Minister Haradinaj," Behgjet Pacolli, leader of the New Kosovo Alliance (AKR), said after signing the agreement.
The Kosovo Democratic Party (PDK), which Thaci used to lead before resigning to become head of state, joined forces with Haradinaj's AAK and Fatmir Limaj's Initiative for Kosovo (NISM). Each has its foundation in the Kosovo Liberation Army (UCK) that fought a separatist war against Serbia in 1998-99.
Haradinaj, who has twice stood trial before the United Nations war crimes tribunal for former Yugoslavia and was acquitted, briefly held the post of prime minister in 2005.
Pacolli, who also holds a Swiss passport, is widely considered the richest Kosovar. He made his money rebuilding state buildings in Moscow in the 1990s. He has since moved his company to Kazakhstan from Russia.
Jobs, health care, and education remain pressing issues for one of Europe's poorest countries, and a country where about one-third of its 1.8 million citizens are under the age of 15.
The early elections also derailed the process of ratifying the demarcation of Kosovo's border with Montenegro, which became a member of NATO earlier this month, a condition for Kosovo obtaining visa-free travel in the European Union.
With borders often the front lines of conflicts across the Balkans, the two countries had struggled to agree on a deal to finally define the frontier.
An accord was reached in 2015, but the result was unacceptable to the opposition, which felt Kosovo would lose about 82 square kilometers of valuable farmland even though an independent commission of experts ruled the area in question was legitimately part of Montenegro.
The issue sparked a no-confidence vote in parliament in May, which the government lost, triggering the early elections in June.
Kosovo, a country of 1.8 million people, 90 percent of whom are ethnic Albanian, declared independence from Serbia in 2008 and is recognized by 115 countries but not by Belgrade.
Currently there are around 120,000 Serbs in Kosovo and most of them, mainly in the north, oppose the Pristina authorities.
Kosovar Albanians, who are the ethnic majority in the small Balkan state, oppose greater autonomy for Serb-dominated municipalities, saying that this would give Belgrade more influence.