Where did the millions separated for capital investments go?

Most were executed in the second six months of the year.

This, according to Murati, was due to the reluctance of leading companies to engage at the beginning of the year, when the prices of raw materials and construction materials were more expensive.

The projects in which it was invested included: local roads, sewers, irrigation channels, nests, hospital objects, digitalisation of the education system and others.

Responding to Radio Europe's free questions on the subject, at a news conference on December 28th, Murati did not specify which municipalities have been invested, nor how much.

According to citizen informator for the 2023 budget, published by the Finance Ministry, the amount of resources for capital projects for the central level was 604m euros, while for the local level of 216m.

Economic Affairs expert Ismet Mulaj says the projects have had to be completed at the end of the year, rather than start.

The Institute for Advanced Studies, GAP, found that millions of euros went for old projects. While, according to some opposition representatives, large amounts of money, destined for capital investments, were divided as “

What are the GAP data?

The GAP, which monitors the work of Kosovo institutions, published a report this month, saying that with the 2023 budget, tens of millions of euros were earmarked for capital projects that had started several years earlier.

For example, more than 22m euros were earmarked for expansion and rehabilitation of the Pristina-Pristina-Mtrovica highway, which began in March 2010, while 20 million were earmarked for the rehabilitation of the Kosovo-Hann railway line of Elez this project, launched since 2016. The GAP analysed the first nine months of the year, until September, respectively, and said capital projects were spent only 263.7m euros, from both the central and local level.

The Zhui root, a researcher at the institute, tells Radio Free Europe that of this amount, 163.5m euros were spent by ministries and other state institutions, while 100.2m by municipalities.

On both levels, over 1,700 priority capital projects did not even start, according to GAP.

At the central level, the Ministry of Infrastructure leads with 167 projects that are not started, followed by the Ministry of Culture with 165 of them.

At the local level, meanwhile, leads the Vushtrri municipality with 138 uninitiated capital projects, followed by Istog with 92 and South Mitrovica with 41, always according to GAP.

Why weren't all the tools spent?

Murati, who heads the Ministry of Finance responsible for the separate means, did not respond to the REL.

Similarly, the three municipalities did not respond to mostly uninitiated projects.

But according to Saban Ibrahimi, leader of the Kosovo Communist Association, they have spent about 70 percent of the previous budget on capital projects. He says municipal projects have small financial values, compared to those at the central level.

Not specifying what projects and what municipalities, Ibrahim adds that they, this year, have had only 23 percent of the money funds for capital projects.

The “as far as planning and spending this year, as last year, the central level has been cut, because it couldn't afford to spend the tools. I think the central level has insufficient capacity in terms of capital investment expenditures”, Ibrahimi tells Radio Free Europe.

As reasons for not implementing many capital projects until September, Zuri, from the GAP Institute, numbers some: poor planning, lack of implementation capacities, delays in procurement procedures and problems in expropriation.

Almost similar problems, over the years, also identified the National Audition Office.

Juri says capital investments could spur greater economic growth and, therefore, new employment opportunities. But in recent years, she says, the focus of the Government of Kosovo has been more pronounced on subsidies and transfers, which, as it were, have short-term impact on the economy.

The Kosovo government, late on Tuesday, decided to separate from 100 euros for pensioners and children under 16 years of age for December. Its decision sparked criticisms of some who said the means destined for capital projects were divided as “aged”.

“There are new nests, there is no increase in wages in education, there is no reform in three years, no health insurance, no change in fiscal policies... Until at the expense of price hikes, citizens pay twice as much taxes, they get up and share contributions from 100 euros, because that's the easiest job, because that's the only thing they can do from the Democratic League of Kosovo, former Finance Minister Hykmete Bajrami wrote on Facebook.

In a post on the X platform, former Kosovo Foreign Minister Petrit Selimi of the Democratic Party of Kosovo wrote:

“The terrible challenge left by non-exploration in capital investments (schools, nests, waterways, roads) imposed on the Law on the Board of Business 2023 Now, what do you call charity? Increase investments! Then, raise pensions! Stop these populist budgetary actions”.

Finance Minister Murati announced this week that successive additions for children and pensioners have already been split.

During this year, the Government shared subsidies for other purposes, such as for women employed for the first time in the private sector, for electricity, for efficient heating equipment, for the employment platform “Superpulla” and so on.

misspelled “”

The approach of the Government should change, says economic affairs expert Ismet Mulaj, who in the past served as minister of trade and industry in Kosovo.

According to him, the government should have capital investments priority, from which economic development results, not aid.

“Wanting to share subsidies is wrong, because Kosovo's citizen must be able to survive with the revenues earned and not with state assistance”, Mulaj says.

“Any expenditure at the end of the year is a quick, unplanned and, in reality, executed in unfriendly conditions”, he adds. According to Minister Murati himself, in the first six months of the year, only 150m euros of the budget for capital investments were spent, though in a Facebook post on July 8th, he said the second quarter marked the record “dinic” of these investments.
After addressing and fixing many problems with projects, expropriating contracts this year have launched a new dynamic of capital investments by budget organisations. The second quarter of 2023 has marked the 110m-euro level of capital investment, which is at the same time the highest registered level of”, Murati said at the time.

Compared to the previous year, according to him, it was about more than “double the” dynamics.

According to Finance Ministry data, in the first six months of 2022, just over 79m euros were spent on capital projects. In the same period of 2021, about 129m euros were spent for the same purpose, and in 2020 about 92m euros were spent.

On December 14th, Kosovo's Assembly adopted the 2024 Budget Law, which totals 3.3 billion euros.

Of this amount, more than 850m euros are spent on capital spending.

However, the GAP Institute reports that 83 percent of the budget amount of capital investment in 2024 will be for the continuation of previous projects, and only 17 percent are planned for new projects.

According to a REL report last year, failure to complete capital projects in time often goes unpunished.