Joint Press Release: UNMIK and PISG
#1438
PRISTINA – Prime Minister Bajram Kosumi today chaired the 27th meeting of the Economic and Fiscal Council. PDSRSG Larry Rossin and senior Kosovo Government, Assembly and UNMIK officials were present at the meeting. Points of discussion were the 2006 budget development process, the ‘Letter of Intent’ on Kosovo’s economic and financial policies and the proposal on taxation of PTK extra profit.
The Minister of Finance and Economy, Haki Shatri, provided an update on the 2006 budget development process and presented the main budget parameters for the 2006 fiscal year. The overall level of expenditure in the draft 2006 budget is maintained at 700 million euros, which is in line with the IMF recommendations. The Council agreed that the 2006 budget process is well on track and that it should be discussed in greater detail at an extraordinary EFC Meeting now tentatively scheduled for 10 November 2005.
Prime Minister Kosumi and PDSRSG Rossin praised the excellent cooperation between the Ministry of Finance and Economy, Pillar IV, the Office of the Prime Minister and the IMF in finalizing the ‘Kosovo Memorandum of Economic and Financial Policies’ (commonly referred to as the ‘Letter of Intent’). This extremely important and carefully-crafted document, which had been approved by the Government the day before this EFC meeting, describes key policies to be pursued jointly by the Government and UNMIK in furtherance of a realistic medium term macroeconomic framework, based on fiscal prudence. It will raise the confidence of the international partners in the Kosovo economic development and underpin continued donor support, including a donor conference planned for December 2005. The document was signed at the end of the meeting by Prime Minister Kosumi and the PDSRSG on behalf of the SRSG (who is currently outside Kosovo).
The Council discussed a legislative proposal that would tax PTK excess profit. The Council supported in principle a special tax of 30% on current net profits of PTK, and agreed that the draft legislation would be finalized after review by the UNMIK Office of the Legal Adviser, with a view to its promulgation by the SRSG.