The ruling party of Prime Minister Hashim Thaci has declared victory in Kosovo's parliamentary elections in which the Serbian minority is taking part for the first time since the territory broke away from neighbouring Serbia.

An exit poll conducted by the Gani Bobi social research institute put Thaci's Democratic Party of Kosovo (PDK) on 33 percent, just ahead of the opposition Democratic League of Kosovo (LDK) on 30 percent. 

Thaci is likely to form a coalition government with smaller parties and ethnic Serbs to secure a third four-year term at the helm of the young Balkan country.

The turnout of only 43 percent appeared to reflect widespread frustration among Kosovo's 1.8 million people at the lack of progress made since Thaci presided over the territory's secession from Serbia in 2008.

With average monthly wages of $476, landlocked Kosovo has one of the lowest living standards in Europe, with nearly half the population living in poverty and about 12 percent in extreme poverty.

Unemployment is stuck at 35 percent, rising to 55 percent among the young, according to the Kosovo Statistics Bureau.

"[Following the elections] I expect the economy to improve and our youth to have jobs and prospects and not to be on the street or seeking asylum in the West," 65-year old pensioner Daut Shalla told AFP after casting his ballot.

Nazmi Jashari, 67, was less optimistic. "The government that has ruled the country up until now has not been up to the task and we should replace them," he said.

Sunday's vote saw Serbian minority vote for the first time since Kosovo declared independence.

"Participation ... and support for Serb representatives at these election is the civic and patriotic duty of every Serb citizen in Kosovo," the Serbian government said in a statement on Thursday, even though the country still rejects Kosovo's independence.

Thaci was one of the leaders of the Kosovo Liberation Army that took up arms in the late 1990s to break free from the repressive rule of Serbia under strongman Slobodan Milosevic.

NATO intervened in 1999 with 78 days of air strikes against Serbia, trying to halt the massacre and mass expulsion of Kosovo Albanians by Serbian forces waging a counter-insurgency.

Source: Agencies