{
  "title": "IMF Survey: Kosovo Receives €48 Million Installment Under IMF Loan",
  "publication": "IMF News, July 17, 2012",
  "sourceUrl": "https://www.imf.org/en/news/articles/2015/09/28/04/53/socar071712b",
  "canonical": "https://www.imf.org/en/news/articles/2015/09/28/04/53/socar071712b",
  "overlayPath": "/en/news/articles/2015/09/28/04/53/socar071712b/index.md",
  "summary": "The IMF’s Executive Board approved today the second tranche for Kosovo under the country’s €106.6 million Stand-By Arrangement.",
  "authors": [
    "Arrangement. The"
  ],
  "publishDate": "2012-07-17",
  "sections": [
    {
      "heading": "Program disbursement and background",
      "content": "- The IMF’s Executive Board approved the second tranche for Kosovo under the country’s €106.6 million Stand-By Arrangement.\n- The €48 million tranche follows a first disbursement of €5 million received when the 20-month program was approved in April 2012.\n- Kosovo became a member of the IMF in 2009. Before membership the IMF provided extensive technical assistance while Kosovo was under administration of the United Nations (1999–2008).\n- The new Stand-By Arrangement was approved by the IMF’s Executive Board in April 2012."
    },
    {
      "heading": "Economic outlook and recent performance",
      "content": "- The IMF projects the economy to grow by 3.8 percent in 2012, modestly down from 5 percent in 2011.\n- Kosovo has remained largely shielded from the euro crisis for several reasons:\n  - Kosovo’s exports are small.\n  - Financial linkages are limited: largest banks are foreign-owned but funded with domestic retail deposits and do not depend on financing from their parents.\n  - Kosovo’s debt is not traded in cross-border financial markets.\n  - Economic growth depends importantly on remittances and foreign direct investment from the Kosovar diaspora that lives primarily in Germany and Switzerland.\n- Solid remittance inflows and robust lending activity by a well-capitalized and liquid banking system have supported growth."
    },
    {
      "heading": "Program objectives and policy measures",
      "content": "- First objective: restore a sustainable fiscal position that would keep public debt below 30 percent of GDP in the long-term.\n  - During the 2011 Article IV consultations, the IMF assessed that relative to this yardstick, Kosovo’s fiscal stance was too expansionary by about 3 percent of GDP.\n  - Significant adjustment has already been achieved in the context of the SMP and the 2012 budget.\n  - A fully sustainable position is targeted for 2014.\n- Second objective: restore an adequate level of cash buffers.\n  - In a unilaterally euroized economy like Kosovo’s, cash buffers insure against possible fiscal and financial risks and have a similar function as international reserves in a country with an own currency.\n- Third objective: provide orientation for fiscal policy in the long-run.\n  - With no independent monetary policy, fiscal policy is the main tool to stabilize and anchor the economy.\n  - A technical assistance mission from the IMF’s Fiscal Affairs Department discussed options for a fiscal rule that could be introduced next year.\n- Fourth objective: reinforce the resilience of the financial system.\n  - As Kosovo is euroized, the central bank cannot generate liquidity on its own.\n  - After the installment tied to this review becomes available, the authorities intend to fund a central bank facility designated for emergency liquidity assistance.\n  - In April Kosovo’s assembly passed a revised banking and microfinance law that strengthens the central bank’s capacity to resolve troubled institutions."
    },
    {
      "heading": "IMF engagement history and program implementation",
      "content": "- Earlier engagement:\n  - In July 2010, the Executive Board approved a first Stand-By Arrangement (SBA), which went off-track partly due to outsized public sector wage increases in the context of the 2011 budget.\n  - Kosovo requested a staff-monitored program (SMP) through end-2011; implementation of the SMP was broadly satisfactory with significant overperformance especially relative to fiscal targets, paving the way for the new SBA.\n- IMF mission chief for Kosovo: Johannes Wiegand."
    },
    {
      "heading": "Medium-term challenges and policy priorities",
      "content": "- A key medium-term challenge: build a competitive economy and develop a tradable sector to reduce dependence on transfers and create conditions for durable, robust growth.\n- Critical actions to address this challenge:\n  - Strengthen the institutional framework and business climate.\n  - Invest in infrastructure and education.\n  - Carefully prioritize, cost, and sequence spending initiatives to avoid risking macroeconomic stability.\n  - Secure broad political support for reforms.\n- Kosovo is a young country with large capital and social spending needs; policymakers face significant pressure to address these needs rapidly.\n\nIMF Survey online, July 17, 2012 — IMF\n\n---\n\n\n References\n\n- https://www.imf.org/en/News/country-focus\n- PRESS CENTER\n- IMF Country Focus\n- Press release\n- Read the report\n- Kosovo and the IMF\n- The IMF and Europe\n- Blog: Banks in Eastern Europe\n- Europe needs action on growth\n- Factsheet: Stand-By Arrangement\n- approved\n- technical assistance\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2015/09/28/04/53/socar071712b"
    }
  ],
  "bullets": [
    "[Markdown version](/en/news/articles/2015/09/28/04/53/socar071712b/index.md)",
    "[Structured JSON version](/en/news/articles/2015/09/28/04/53/socar071712b/index.json)",
    "[Bundle manifest](/en/news/articles/2015/09/28/04/53/socar071712b/bundle-manifest.json)",
    "Authors: Arrangement. The",
    "Published: July 17, 2012",
    "The IMF’s Executive Board approved the second tranche for Kosovo under the country’s €106.6 million Stand-By Arrangement.",
    "The €48 million tranche follows a first disbursement of €5 million received when the 20-month program was approved in April 2012.",
    "Kosovo became a member of the IMF in 2009. Before membership the IMF provided extensive technical assistance while Kosovo was under administration of the United Nations (1999–2008).",
    "The new Stand-By Arrangement was approved by the IMF’s Executive Board in April 2012.",
    "The IMF projects the economy to grow by 3.8 percent in 2012, modestly down from 5 percent in 2011.",
    "Kosovo has remained largely shielded from the euro crisis for several reasons:",
    "Solid remittance inflows and robust lending activity by a well-capitalized and liquid banking system have supported growth.",
    "First objective: restore a sustainable fiscal position that would keep public debt below 30 percent of GDP in the long-term.",
    "Second objective: restore an adequate level of cash buffers.",
    "Third objective: provide orientation for fiscal policy in the long-run.",
    "Fourth objective: reinforce the resilience of the financial system.",
    "Earlier engagement:",
    "IMF mission chief for Kosovo: Johannes Wiegand.",
    "A key medium-term challenge: build a competitive economy and develop a tradable sector to reduce dependence on transfers and create conditions for durable, robust growth.",
    "Critical actions to address this challenge:",
    "Kosovo is a young country with large capital and social spending needs; policymakers face significant pressure to address these needs rapidly.",
    "[https://www.imf.org/en/News/country-focus](https://www.imf.org/en/News/country-focus)",
    "[PRESS CENTER](http://presscenter.imf.org/)",
    "[IMF Country Focus](https://www.imf.org/en/news/country-focus)",
    "[Press release](http://www.imf.org/external/np/sec/pr/2012/pr12261.htm)",
    "[Read the report](http://www.imf.org/external/pubs/cat/longres.aspx?sk=26073.0)",
    "[Kosovo and the IMF](https://www.imf.org/external/country/uvk/index.htm)",
    "[The IMF and Europe](https://www.imf.org/external/region/eur/index.htm)",
    "[Blog: Banks in Eastern Europe](http://blog-imfdirect.imf.org/2012/06/13/lost-found-in-eastern-europe-replacing-funding-by-western-europes-banks/)",
    "[Europe needs action on growth](https://www.imf.org/external/pubs/ft/survey/so/2012/POL061812A.htm)",
    "[Factsheet: Stand-By Arrangement](https://www.imf.org/external/np/exr/facts/sba.htm)",
    "[approved](https://www.imf.org/external/np/sec/pr/2012/pr12154.htm)",
    "[technical assistance](https://www.imf.org/external/np/exr/facts/tech.htm)",
    "[https://www.imf.org/en/home](https://www.imf.org/en/home)"
  ],
  "alternates": {
    "markdown": "/en/news/articles/2015/09/28/04/53/socar071712b/index.md",
    "json": "/en/news/articles/2015/09/28/04/53/socar071712b/index.json",
    "bundleManifest": "/en/news/articles/2015/09/28/04/53/socar071712b/bundle-manifest.json"
  },
  "generatedAtUtc": "2026-09-27T07:18:56.539Z"
}