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Prishtina, 17.08.2012 – The Minister of Economic Development, Besim Beqaj, has emphasized that according to constitutional obligations, in line with a vision for a sustainable economic development of the Government, and the annual action plan, MED strives to ensure structural economic reforms, for a functioning market economy, strengthening of the private sector, introduction of high professional and institutional standards, with the aim of ensuring sustainable economic growth and creating new jobs.

Minister Beqaj made these comments in the press conference presenting the biannual activities and achievements of MED.

“Fulfilling these basic principles, the Ministry has implemented a series of planned activities in energy, mining, telecommunication, monitoring of publicly owned enterprises, the PTK and KEDS privatization process, Kosova e Re Power Plant Project and the legislative plan, completing its tasks successfully”, said Minister Beqaj.

Beqaj said that Mining Strategy 2012-2015 was drafted by the Ministry and approved by the Assembly of Kosovo.

“This strategy is based on four fundamental principles: Creation of favorable conditions for economic utilization and monetization of mining resources, and attracting investments; Enhancing human and institutional capacities in the mining sector; Enhancing relevant institutional scientific and educational capacities; Social issues and community benefits, and environment protection”.

The following pieces of legislation were drafted and adopted in the first six months of 2012 - Law No. 04/L-094 on Information Society Services, and – Law No. 04/L-111 amending the Law No. 03/l-087 on Publicly Owned Enterprises.

Other laws drafted and pending adoption are – Draft Law on Electronic Communication (pending adoption by the Assembly); Draft Law on Mines and Minerals, amendment (initiated by the Committee on Economic Development, Infrastructure, Trade and Industry, supported by MED professional staff.

A series of bylaws have also been adopted, such as administrative instructions, regulations and other bylaws under the scope of the Ministry.

“In addition, MED has made steps to enhance the functioning of its civil service, namely the creation of the new Development Policies Department, and the merging of energy and mining departments into one”. 

MED has also completing all of its obligations of the European Integration process, by way of generating reports, participating in stabilization association process meeting, and fulfilling its obligations under the feasibility study of the stabilization association process.

Other obligations and requirements of the Energy Treaty have been completed, and responses were submitted to all requests of the ECT Secretariat. The MED received high considerations in the annual meeting known as the “Kosovo Day”.

MED has fulfilled its activity plan of monitoring publicly owned enterprises, including:

Separation of PK from PTK was finalized on 31 July 2012, and as of 1 August there are two separate business entities, Post of Kosovo and PTK.

After the unbundling of Kosovo Railways with the aim of restructuring, enhancing competition, and opening the market for new investors, there are two new services companies operating in 2012 INFRAKOS j.s.c. and TRAINKOS j.s.c.

Minister Beqaj said on this occasion that around €300 million of direct investments have been secured this year only for energy, including the sale of KEDS, investments in small Hydro Power Plants in the Municipality of Deçan, and investments envisaged under the privatization of KEDS.

In 2012, 20 capital projects are financed by the Budget of the Republic of Kosovo, reaching a value of 7.745.190 Euros, for the energy sector, railways, potable water, and waste management.

The overall amount of infrastructure projects, under the scope of MED, financed by donors is €58,5 million, and the participation of the Government and Municipalities includes an amount of €22 million.

More specifically, these projects include

– Water treatment facility in Prishtina, with a value of €35 million, financed by KfW-20 million, EC-5 million, Municipality of Prishtina-5 million, and the Government of Kosovo-5 million (The project is still in the initial phase, pending selection of the consultancy company for project implementation).
– Wastewater plant in Prizren, estimated value of €22 million, financed by KfW 12 million, Kosovo Government 5 million and the Municipality of Prizren 5 million (The project is still in the initial phase, pending selection of the consultancy company for project implementation)
– Construction of the water supply system in rural areas in the Southeastern part of Kosovo, with an estimated value of €8.1 million, financed by SDC-6 million, Kosovo Government and Municipalities-2 million. (The project is under implementation).
– Projects on replacing the water supply network in Pejë, Prizren and Istog financed by USAID;
– Water supply plant in Mitrovicë, financed by the European Commission, with a value of €11 million. The project is under implementation;
– Replacement of the water supply system in Mitrovicë, financed by the Government of Luxemburg, with a value of €4.5 million;

An analysis of operational costs of Enterprises providing public services shows that there was a decrease of fuel costs by 16%, and an increase of representation costs by 8% compared to the same period of the previous year.
A decline in salary costs has also been noted in PTK of around 25% from the previous period, as envisaged in the business plan, after the suggestion of the shareholder.

“With the aim of providing more quality public services for the citizens of Kosovo in heating, energy, water supply services and waste collection in the north of Mitrovica, in 2012 the Government will subsidize POEs with around €19 million, 9,5 million of which was already transferred and social cases were subsidized with nearly €4.4 million for energy. In 2012 there is a reduction of subsidies for energy imports from 27.3 million to 13.5 million euro” said minister Beqaj.

Kosovo Energy Efficiency Agency and the Kosovo Geological Institute were established during this period, the National Museum of Crystals and Minerals of Kosovo was inaugurated, and the National Geology Institute was made operational.

The construction of new HPP capacities of 23 MW has started in River Lumbardhë, in the region of Deçan by the company KELKOS Energy (Austrian company). The investment value is 55.000.000.

For energy efficiency, €592 thousand have been allocated from the Kosovo budget, and €24.8 million have been committed by donors for concrete projects.

In addition to the approval of the legal infrastructure, MED and the Kosovo Government, in consultation with TRA, has undertaken concrete steps in telecommunication and approved the decision for further liberalization of mobile telecommunication services to enable the use of frequency resources available to the existing licensed mobile operators, application of new technologies, and provision of next generation mobile broadband services and networks – mobile broadband internet.

Speaking on the privatization process of 75% of TPK shares, Minister Beqaj has said that the selection of companies for prequalification for tender is underway. 8 companies have applied for prequalification.

The deadline for the publication of the PTK privatization tender is end of August or beginning of September, and the entire project will be completed by the final quarter of 2012.

KEDS privatization process is near completion.

Currently, work is ongoing in the finalization and signing of the transaction documentation, and this is expected to occur within 90 days after the announcement of the winner, but no later than 19 October 2012.

Initially, the Government of the Republic of Kosovo, on June 12, 2012, approved the decision to endorse the recommendation of the Government Privatization Committee to announce the Consortium Calik – Limak and their the offer of €26.3 million,  as preferred bidder in the KEDS privatization process.

Investments of around €200-300 million of investments were announces in the conference announcing Calik-Lima Consortium as winner.

Minister Beqaj said on the process of developing TPP Kosova e Re that the Project Steering Committee has analyzed requests of prequalified investors, completed a market sounding in terms of investments in the electricity generation sector, conditions of prequalified bidders for the submission of the bid, and proposed the Government that the Power Plant Kosovo B is removed from the current tender package, and develop it as a second phase after the project TPP Kosova e RE, with the aim of ensuring coherence between the two separate, but closely interrelated processes, and a better coordination with the transaction for the privatization of Distribution and Supply Company.

According to the Law on the Budge for 2012, MED has revenues of €42.6 million. In the six-month period, 49 percent of the budget was used.