i vendimeve të Qeverisë së Kosovës

The Government of Kosovo approved the Economic Reform Program 2017

24-02-2017 07:25:00

 The Government of Kosovo in its meeting held on January 27, 2017, with the decision 06/129 approved the Economic Development Program (EDP) for 2017. This program contains mid-term macroeconomic projections, budget plans for the next three years and the structural reforms agenda.

On May 25, 2016, the European Commission has published the Conclusions on EDP 2016 for candidate and potential candidate countries for European Union membership. Under this program, Kosovo needs to strengthen economic planning and take steps to form an independent mechanism for reviewing fiscal policies, to guarantee the continuation of public investment, and to address the causes of high interest rates on bank loans. Kosovo authorities are committed to implementing the action plan for the reduction of informal economy and to enhancing energy security by encouraging families to increase energy efficiency and by preparing a plan to gradually increase energy tariffs that reflect current costs. Kosovo has also pledged to establish an action plan for addressing youth unemployment, improving teacher training, increasing women participation in the labor market, and strengthening the role of the employment agency.

The objectives of EDP 2017 approved by the government are: maintaining fiscal deficit and budget composition with favorable growth, creating space for important infrastructure projects, further enhancing the banking regulatory and supervisory framework, reducing the remaining bank loans for the manufacturing sector and improving the business environment of Kosovo by improving the public procurement system.

In the third chapter of the PRE, the Fiscal Framework, a new fiscal package has been designed to improve the business environment, strengthen domestic production and job creation on the path to sustainable economic growth.

The fiscal package for 2017 contains:

- Expanding the list of products considered as raw material to be exempted from customs duties;

- Reduced excise rate for crude oil;

- Amendments to the list of products subject to VAT with 0% or reduced (8%);

- Administrative Instruction for Tax Breaks;

- Bread packets in flour packages for the special conditions for the registration, control and marking of flour that is circulating freely in the market of the Republic of Kosovo;

- Evaporation, weight loss under certain conditions that are recognized (known), losses from breakdown, evaporation or loss in weight of oil and its products.

Meanwhile, in chapter four are presented the measures of priority reforms for the period 2017 - 2019:

- Improving public procurement through the electronic procurement application,

- Reduction of energy consumption through energy efficiency measures and further development of energy production capacities,

- Extending the relevant infrastructure of ICT networks for socio-economic development,- Investments in agricultural infrastructure and agro-processing and expansion of farms through consolidation and regulation of agricultural lands,

- Supporting the development of industrial clusters,

- Development of tourist product in Kosovo tourism regions,

- Adoption of policy-based data,- Provision of property rights by addressing informality in the immovable property sector,

- Increase of judicial efficiency in case resolution,

- Improving access to finance for SMEs through the Kosovo Credit Guarantee Fund,

- Union of customs and tax administration, creating a single revenue collection agency,

- Improving the policy and strategy framework and capacity building for research and innovation,

- Increase the cost efficiency of international trading transactions,- Improvement of quality infrastructure,

- Harmonization of supply and demand through drafting of occupational standards and curriculum review,

- Implementing and improving the career system for teachers,

- Improving employment services through the establishment of the Employment Agency and active labor market measures,

- Improving social and health services.

These reforms will be funded from Kosovo budget as well as external financing through financial institutions, grants and technical assistance from development partners. The overall budgetary impact stemming from the implementation of the 20 structural reforms envisaged amounts to 273 million Euro for the period 2017-2019. 

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