The country's economic stability receives another blow as anticipated revenues fail to materialize.
By Muhamet Brajshori for Southeast European Times in Pristina -- 21/10/11
Amid corruption charges, the state-owned Kosovo PTK’s privatisation is halted. [PTK]
After the withdrawal of T-Croatian Telecom from the privatization competition for Kosovo's state-owned Post-Telecom (PTK), Kosovo Minister of Economic Development Besim Beqaj canceled the bid process.
"The government's commission for the PTK privatisation decided to cancel the process and start a new one," Beqaj told the press in Pristina.
T-Croatian Telekom and Telekom Austria AG were chosen in June as finalists for 75% of PTK holdings. The following month, however, the Zagreb-based firm – which is majority-owned by Deutsche Telekom AG (DTE) – said it might back out, due to a corruption investigation involving senior PTK management.
PTK executive director Shyqru Haxha, and the chairman of the board of directors, Rexhe Gjonbalaj, have been accused of signing "harmful contracts" and misuse of official positions.
While struggling with the budget deficit, the government was hoping to cover part of the expenditures with a portion of the telecom sale. Now the cancelation has undermined financial stability.
The government was expected to add 300m euros to the 2011 budget via PTK's privatisation, however, analysts warned that this was a miscalculation from the start.
Economist Liridona Konushefci told SETimes that the government mismanaged both the budget and the overall privatisation process "by selling everything that brings a cent into the budget, the budget being planned without an idea how to get the money and spend it, and the worst, most of the money goes into [building] a highway with Albania", a huge infrastructure project linking Pristina and Durres.
"My expectations are that in early 2012 we will have a financial crisis as we are using the budgetary reserves, and with the cancelation of the privatisation, those reserves will be used more, so the government might be in a position not to pay the salaries," she added.
Journalist Blerim Rugova told SETimes that the current outcome from the privatisation became clear a couple months ago, but the government refused to look into it.
"In July, journalists reported that T-Croatia Telecom would withdraw from the privatisation bid, because no one will invest in a company that is under a corruption investigation, but the government ignored the fact and now we have to deal with the situation," Rugova said.
"Kosovo will have a greater than 500m euro deficit by the end of this year, due to budget misuse, wrong planning and now the PTK failure. Early this year the IMF put Kosovo in a position to lose millions," Ilire Berisha, a researcher at the Pristina Centre for Economic Research, told SETimes.
Musa Limani, an economics professor, told Zeri that the country is in a deep deficit. He doubts that the construction of the highway with Albania will continue.
"Officials say they have no problem even after the failure of the PTK privatisation, but to my knowledge the highway spending was supposed to be covered by the PTK sale," Limani tells Zeri.
The political movement Vetevendosje (Self Determination), meanwhile, has welcomed the latest developments. It says the state-owned company has operated successfully under public management and does not need to be privatized.
There is no rationale for selling off a profitable public enterprise, the movement said in a statement.