Finance Minister Iron Murati has presented Kosovo’s 2027 draft budget to the Commission, which envisions expenditures worth 4 billion and 268.7m euros.
According to Murati, the budget has been drafted in light of expectations for economic growth, increased revenues and maintenance of public finance sustainability.
He announced that budget revenues are earmarked to reach about 4 billion and 2m euros, while the remainder of the expenditures will be covered through deficit financing.
A budget of 4 billion and 268.7m euros on the side of budget expenditures is in question, Murati said.
The budget deficit for 2027 is planned at the 2 per cent level of Bruto Product, estimated at 13.3 billion euros. The need for funding, according to the minister, totals 266m euros.
As far as divisions according to economic categories are concerned, 1 billion euros of 84.9m euros are planned for goods and services of 588m euros, while for subsidies and transfers of 1 billion and 446m euros.
For capital investments, 1 billion and 70m euros have been earmarked, while 55m euros have been earmarked for public debt interest and 11.9m euros for the flow reserve.
Murati stressed that by 2027 capital investments will no longer be financed through investment clauses but will be included within the deficit limit of 2 percent.
The entire amount of money capital investments is financed by the budget grant, but also by the deficit, and it all gets involved in the 2% deficit envisioned under the fiscal rule, he said.
Opposition criticises level of investment implementation
During the discussion, Democratic Party of Kosovo deputy Mergim Lushtaku raised concerns about realising capital investments, arguing that planning large sums has not been associated with spending them in practice.
He referred to the GAP Institute report for the period 2021-2024, under which more than one billion euros from planned investments have not been spent.
In some reports, such as the GAP report 2021-2024, over 1 billion euros have not been spent on planned investments, Lushtaku said.
According to him, failure to implement projects directly affects citizens, citing lack of roads, bridges, schools, and other public objects.
Lushtaku also questioned the real impact of nominal budget growth on the welfare of citizens, linking this to inflation and increased cost of living.
He also cited the gap of about 258m euros between revenues and planned spending.
Murati: Failure to implement projects is a problem over the years
In response to the criticism, Minister Murati said that the low execution of capital investments is a problem that, according to him, has been presented repeatedly over the years and is not linked solely to current governance.
As far as the execution of capital projects is concerned, it is a chronic situation, not only this year, or in some of the early years, he said.
Murati cited as factors affecting the implementation of projects, ministries, municipalities and the length of procedures.
However, he said the trend of realising capital investments has marked improvement.
The minister also talked about increasing the cost of living, saying inflation is not only Kosovo’s problem, but also related to international developments.
According to him, the impact on price hikes has initially had war in Ukraine and later the latest developments in the Persian Gulf.
As far as inflation is concerned, it is certainly a problem to increase the cost of living in Kosovo, as in all other countries of the world, Murati said.
He added that the war in Ukraine had affected global energy and food prices, while the new wave of price hikes, according to him, relates to the conflict in the Persian Gulf.
In conclusion, Murati demanded that the budgetary division bill be prosecuted further, naming it as planning with record-level revenues and spending.
Source Layer: RTKLive