Kosovo heading for grand coalition after election

PRISTINA, Serbia, Nov 18 (Reuters) Kosovo was heading for a likely grand coalition today to lead the province into a final showdown with Serbia on the ethnic Albanian majority's demand for independence.

A senior official in Hashim Thaci's Democratic Party (PDK), which claimed victory in yesterday's parliamentary election, told Reuters a coalition with the second-placed Democratic League of Kosovo (LDK) was ''the most likely, since there's no other option''.

The PDK and LDK have been bitter rivals since Thaci's guerrilla fighters eclipsed the LDK's policy of passive resistance to Serb rule in the 1990s, under the guidance of the late independence leader, Ibrahim Rugova.

The official, who asked not to be named, said the party's ''red lines'' ruled out a pact with the third-placed New Kosovo Alliance of millionaire construction tycoon Behgjet Pacolli.

A second PDK source also said a PDK-LDK coalition was most likely, with the support of some smaller parties to secure a stable majority in the 120-seat parliament.

Thaci's PDK won around 34 percent of the vote, according to preliminary results released by analysts, in a ballot marred by record low turnout and a Serb boycott to protest against Albanian independence plans.

''With our victory today begins the new century,'' Thaci told cheering supporters, six hours after polls closed. ''We showed that Kosovo is ready to move forward towards freedom and independence.'' Thaci ''crushes LDK'', read the front-page headline of the Kosovo daily Express.

ECONOMIC CRISIS All parties back a quick declaration of independence from Serbia for the breakaway province, which has been under UN rule and NATO protection since 1999.

But in a sign that many voters see little difference in their ability to improve daily life beyond a declaration of statehood, little over 40 percent of 1.5 million turned out to vote, the lowest showing since the 1998-99 war.

''This is not about independence. Turnout was low because people are depressed. This is about the economic situation -- no water, no electricity, no jobs,'' said analyst Berat Buzhala of the daily Express.

The 120,000-strong Serb minority boycotted the vote, under orders from Belgrade not to legitimise a parliament threatening to declare independence within weeks.

''These elections are not about Kosovo's status,'' said Thaci, who is now clear favourite to become Kosovo's new prime minister. ''We will declare independence immediately after Dec.

10.'' That is the date for a report by Russian, United States and European Union mediators on efforts to find a compromise between Serbia and Kosovo's 90 per cent ethnic Albanian majority.

There is still no glimmer of a deal. Two negotiating sessions are set for Brussels and Vienna in the coming week.

Kosovo guerrillas took up arms in 1998 to end a decade of repression under late Serb leader Slobodan Milosevic, whose brutal response put almost 1 million civilians to flight and triggered NATO intervention in 1999 and an era of UN control.

The election for Kosovo's parliament is the third since then. The campaign was dominated by party pledges to tackle 60 percent unemployment, minimal foreign investment and rampant corruption. The bid for statehood was never in question.

REUTERS SZ RN1624