Due to Kosovo's breach of agreements - IMF support stopped

PRISTINA, Kosovo — As to Kosovar and international media the International Monetary Fund (IMF) today decided to terminate its Kosovo programme. For the Republic’s budget this means a loss of almost 140m Euro of donations and low-interest-rate loans from IMF, World Bank and European Commission (EC) in 2011: If Kosovo "does not manage to cut spending by the same amount by the end of the year, Kosovo should declare a complete economic crisis in 2012" the Serbian news provider B92 quotes a source. 

Prior to this decision, the IMF repeatedly and strongly expressed its concern about an "irresponsible" increase of budget expenses caused – beyond others – by a costly highway project, a huge increase of wages in public institutions – following an election campaign promise of Kosovo PM Thaci – as well as by additional misled spending. Meanwhile an IMF team is said to be monitoring the ongoing budget activities throughout 2011 on request of the Kosovo government: Reportedly a decision about IMF support for Kosovo in 2012 will depend on the final evaluation of 2011 results. KON / NK

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