Citizens turn to remittances, banks loans to close the gap

17/09/2012

Statistics in Kosovo show disproportion between the average salaries and the yearly average expenses per family, raising questions on where the rest of the money comes from.

By Linda Karadaku for Southeast European Times in Pristina -- 17/09/12

Many families use overdrafts and bank loans to make ends meet. [Kosovo Central Bank]

Since the economic crisis gripped the world in 2008, many citizens have had to rely on alternative means of income to make ends meet. For many, family members and banks have stepped up to help.

Zena Rafuna, a public servant in the documentation department of the Kosovo Interior Ministry, takes home 360 euros per month, or 4,320 euros per year. Her husband, Veli, who works at an insurance company, brings home 150 euros per month, adding about 1,800 euros annually.

"It is obvious that it is difficult for us to make it to the end of the month, the expenses are high and the incomes are low," Rafuna told SETimes.

"What we do when we need and can't make it [to the end of the month] is to take overdraft from the banking system and compensate this money in the coming months when we spend less," Rafuna told SETimes.

The Kosovo Statistics Office says that the average amount consumed by a Kosovo family of 5.88 members in 2011 was 7,010 euros per year. "Salaries from the public administration are the most important source of income, and the main source of living for 1/4 of Kosovo families," the office said.

The average salary in Kosovo is 270 euros per month. About 75 percent of that is spent on food and housing, Seb Bytyci, the executive director of the Balkan Policy Institute, told SETimes.

Prices for goods in Kosovo increased by 2.2 percent in July compared to a year ago for tobacco, power, gas, meat, vegetables and transportation costs. Milk, cheese and eggs prices increased by 1.8 percent, and fruit prices were up by 2.7 percent.

"Prices of food have grown constantly, and they have had a direct impact on the family budgets. The families have other sources of income, such as remittances and debts," Bytyci tells SETimes.

Almost 25 percent of Kosovo families live on remittances, according to a UNDP study released in July, up from 11 percent two years ago.

Zeke Rasaj, 48, from Gjakova, receives 300 to 400 euros per month from his brothers living and working in Germany. He makes the rest of the money needed for the family by working the land. "That money sent every month makes us feel safer, it's family solidarity," Rasaj told SETimes.

Most of remittances in Kosovo come from Germany, Switzerland and the Nordic countries.

Artana Begu works in a private sector insurance company, and brings home about 1,000 euros per month, but her husband Argtim is jobless, and the couple has two little children.

"We make it for a more or less normal life, but it depends what you call normal," she told SETimes, adding that saving money for vacations or emergency situations is not an option.

But despite the plethora of uncertainty, many still can see a bright side.

"I have been working in this department for 10 years and I am happy because I have the chance to work in this time of crisis and unemployment. I can't complain," Rafuna said.

This content was commissioned for SETimes.com.