Components of the EU
Pillar include:
Central Banking Authority of Kosovo (CBAK) In September 2006, the Banking and Payments Authority of Kosovo (BPK) was transformed into the Central Banking Authority of Kosovo (CBAK). This new regulation was drafted with the aim of increasing the role of Kosovars and Kosovo’s institutions in CBAK activities. The CBAK regulation was prepared in cooperation with International financial institutions - namely the IMF - as well as with the Ministry of Economy and Finance and the various UNMIK components. It will strengthen both the independence and capacities of the newly established CBAK.
The role of the CBAK is to foster the development of financial and payment systems in Kosovo. It supervises and regulates Kosovo’s banking sector (six banks with approximately 240 branches), insurance industry (eight insurance companies), pension funds and other micro finance institutions, and performs a number of other tasks normally undertaken by a central bank. These include cash management, transfers, clearing, management of funds deposited by the Treasury or other public institutions, collection of financial data, and the management of a credit register. The CBAK, however, is not authorised to grant any loans, including liquidity, to banks. The main aim of its "monetary policy" is to foster financial stability. This implies the need to develop a strategic corporate plan outlining new priorities and mapping out the future development of the CBAK in its role as the banker and advisor to the PISG. The CBAK has established technical cooperation with Central Banks in the region. Capacity building and management training will continue to constitute an important part of the CBAK’sactivities. Back
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Fiscal
Affairs Office (FAO) The Fiscal Affairs
Office (FAO) is responsible for advising and supporting
the SRSG, through the DSRSG, on macroeconomic policy,
and tax policy and budget issues, in particular on the
formulation of the parameters of the Kosovo Consolidated
Budget (KCB).
In partnership with the PISG,
the FAO liases with the International Financial Institutions
(IFI) on macroeconomic and fiscal stability in line
with EU Standards. In particular, the FAO assisted in
negotiations to prepare and sign a Letter
of Intent and Memorandum of Economic and Financial
Policies, approved by the IMF. The Fiscal Affairs Office
has taken the lead in preparing the 2006-2008 Macroeconomic
Framework and has worked closely with the Ministry of
Economy and Finance (MFE) to prepare the Kosovo Medium-Term
Expenditure Framework, a key framework document for
medium-term budget planning and donor appeals. The Head
of FAO continues to have responsibility related to the
Economic and Fiscal Council (EFC) under a co-Secretary
arrangement with the Government and FAO continues to
serve as secretariat. The FAO carries out the following
key functions, in line with the EU Pillar mandate:
| • |
monitoring
and supporting the budget development process and
advising the SRSG on budget development issues; |
| • |
providing support
and advice to the SRSG on Treasury matters and managing
the SRSG’ s contingency fund; |
| • |
advising the
MFE in the preparation of revenue forecasts for
the budget and advising the SRSG on promulgation
of tax related regulations; and |
| • |
advising on
the fiscal aspects of decentralisation and related
budgetary impacts. |
The Fiscal Affairs Office's membership in Governing
Boards and other committees:
| • |
The Head of
FAO is a member of: the BPK Governing Board; the
BPK internal audit committee; the Steering Committee
on the Public Expenditure Management Project; the
Steering Committee of the Public Investment Program
(PIP); the high level working group on the Kosovo
Development Plan and the working group on local
government finance. |
| • |
The Deputy
Head of the FAO serves as an ex officio member to
the Kosovo Pensions Saving Trust (KPST) Governing
Board, representing UNMIK. |
The FAO monitors and supports:
| • |
the Ministry
of Finance and Economy including the Tax Administration;
|
| • |
the Auditor
General's Office; and |
| • |
the Kosovo
Pensions Savings Trust. |
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Kosovo
Trust Agency (KTA)
The Kosovo Trust Agency works towards enhancing the
value, viability, and corporate governance of socially
owned and public enterprises in Kosovo. The powers of
the KTA are vested with the Board of Directors, comprised
of four international Directors and four residents of
Kosovo. A team of professional local and international
staff manages the day-to-day operations of the KTA.
Kosovo must actively compete with other places in the
Balkans to attract investment - a scarce resource in
a global marketplace. The KTA was established by UNMIK
Regulation No. 2002/12 (‘On the Establishment of
the Kosovo Trust Agency’ - the KTA Regulation),
and is an independent public body entrusted with the
authority to administer Publicly and Socially Owned
Enterprises (POEs and SOEs). Enterprises included for
privatisation among the former Socially Owned Enterprises
under the system set up during communist-era Yugoslavia
range from mining facilities to glass production factories,
warehouses to wineries and hotels to construction companies.
The Kosovo Trust Agency is responsible for privatising
these enterprises and putting them on a solid legal
footing. Some of these enterprises are inefficient and
dilapidated after years of neglect – hence the
need for investment.
Indeed, KTA’s greatest recent accomplishment has
been the increased pace of privatisation. A major target
for 2006 is to privatise 90% of the SOEs by value and
over 50% of the SOEs by number. The KTA Privatisation
and Regional Teams are working aggressively to prepare
Waves 13, 14, 15, 16 and beyond. KTA has also overseen
the incorporation into new joint stock companies of
the Publicly Owned Enterprises including Post and Telecommunications
of Kosovo, the Kosovo Electrical Company (KEK), Pristina
International Airport, Kosovo Railways, District Heating
companies in Gjakova/Djakovica and Pristina and the
Kosovo Landfill company. Their assets have been valued,
cadastre reviewed and modern balance sheets adhered
to. For more information, see the Invest
in Kosovo section of this website. Back
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Customs Service (UNMIK Customs)  The
UNMIK Customs Service (UNMIK Customs) is a reserved
power of the SRSG, with the Provisional Institutions
of Self-Government (PISG) bearing significant responsibility
in its administration and operational delivery. The
Director General of UNMIK Customs is required to consult
with the Government of Kosovo before implementing operational
policy through Administrative Instructions.
The main priorities of the UNMIK Customs are to:
| • |
collect and
protect revenue for the Kosovo Consolidated Budget
(KCB); |
| • |
facilitate
legitimate trade through re-establishing suspended
Customs procedures and adopting modern Customs practices
and techniques; and |
| • |
protect society
and legitimate trade by cracking down on smuggling
and fraud. |
During 2004, UNMIK Customs collected 436 million euro
net, representing 72% of total revenues collected for
the KCB. During 2005, UNMIK Customs collected 436 million
euro net, representing 69% of total revenues collected
for the KCB.
The mandate of the international directors of UNMIK
Customs is to:
| • |
continue to
develop UNMIK Customs to international standards
and in conformity with the EU blueprint for customs
administrations; and |
| • |
carry out capacity
building of personnel and systems; and |
| • |
position UNMIK
Customs to take advantage of EU concepts of Integrated
Border Management. |
Going forward, UNMIK Customs has a strategic plan
to move top management responsibility from international
to local staff. UNMIK Customs is primarily funded from
the Kosovo Consolidated Budget (KCB). It receives some
technical assistance from the EU-funded Customs and
Fiscal Assistance Mission (CAFAO – UNMIK).
For more detailed information on these areas,
visit the Documentation section of this site.
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