US President Donald Trump said on Friday that Kosovo and Israel have agreed to normalize their relations and establish diplomatic relations, announcing that Kosovo and Serbia will open their embassies in Israel in Jerusalem.

For his part, Israeli Prime Minister Benjamin Netanyahu confirmed today that Kosovo has agreed to open its embassy in Israel in Jerusalem, becoming the first country with a Muslim majority to do so.

The embassy announcement came shortly after Netanyahu said that Israel and Kosovo have agreed to establish diplomatic relations, and it also follows a similar announcement by US President Donald Trump in Washington.

In a speech in the Oval Office before meeting with the leaders of Serbia and Kosovo, Trump also announced that the two countries had agreed to normalize economic relations between them.

The US president added, "Both Serbia and Kosovo pledged economic normalization, with a focus on job creation and economic growth. The two countries can reach a major breakthrough."

Serbian President Aleksandar Vucic told reporters there that there are still many differences between Serbia and the breakaway region, but he said that today's agreement represents a huge step forward.

For his part, Kosovo Prime Minister Abdullah Hoti said that the agreement should lead to mutual recognition between the two countries.

Trump described the agreement as a major breakthrough (Reuters)

Great progress

Robert O'Brien, the US President’s national security advisor, wrote in a tweet Thursday afternoon, "They've made great progress, and discussions will continue" Friday.

O'Brien and the US envoy to the Serbian-Kosovar negotiations, Richard Grenell, is mediating between the two parties, and O'Brien said that "economic normalization means jobs for young people."

This summit - which is held in Washington and is unusual in a process traditionally led by Europeans - officially aims only at "strengthening economic relations" between the two countries in the Balkans, in the midst of one of the most complicated conflicts on the European continent.

Belgrade refuses to recognize the independence Kosovo declared unilaterally in 2008 after the 1990s war in which 13,000 people were killed.

Serbia is receiving support from its allies Russia and China, while the United States was one of the first countries to recognize the new country.