Press Release No. 18/55

Statement by IMF Deputy Managing Director Tao Zhang at the Conclusion of his Visit to Kosovo

February 15, 2018

• Country needs strong and sustained growth to catch up with Europe.
• Reducing unemployment, especially among the youth, is an urgent task for authorities.
• Discussions focused on policies to support private sector development and foster investment, and ensure fiscal and financial stability.

Mr. Tao Zhang, Deputy Managing Director of the International Monetary Fund (IMF), issued the following statement in Pristina today at the conclusion of his visit to Kosovo.

“It has been a great pleasure to visit Kosovo for the first time. I had the privilege to meet with Prime Minister Ramush Haradinaj, Assembly Speaker Kadri Veseli, Finance Minister Bedri Hamza, and Acting Central Bank Governor Fehmi Mehmeti for very fruitful discussions on Kosovo’s economic reforms and policy priorities. I also had the opportunity to visit the city of Prizren to experience some of Kosovo’s impressive cultural heritage, and met with students at the University of Pristina to hear about their own challenges and aspirations for the future.

“Kosovo has been a successful example of a post-conflict country able to develop its economy by implementing important reforms. In my meetings, I encouraged the authorities to continue on this path, as Kosovo will need strong, sustained, and inclusive growth to reduce the large income gap with the rest of Europe. This includes reducing unemployment, especially among the young, and the dependence on remittances. In this regard, I underscored the need to accelerate such reforms— especially in the areas of education, governance, health, infrastructure, and access to finance, to improve competitiveness, attract foreign direct investment, and foster private sector development.

“Prudent fiscal policies and macroeconomic stability are the basic conditions for stronger growth, and I commended the Kosovar government for the fiscal discipline and financial stability of recent years. In this regard, reforming and containing increases in untargeted social benefit spending as well as in public wages should help create the fiscal space needed for priority spending on education, health and infrastructure within the limits of the fiscal rule, which remains appropriate. Strengthening the tax administration will help to fight informality and ensure a friendly environment for investment.

“I would like to reiterate the IMF’s strong support for Kosovo and look forward to our continued partnership with the government in its important reform program through policy advice and technical assistance. Finally, I would like to thank the government and the people of Kosovo for their very warm welcome and hospitality."