ECONOMY

Serb figures show Kosovo has a foreign debt of $1.18 billion

BELGRADE (Reuters) – An independent Kosovo can count on a foreign debt of roughly $1.18 billion, according to figures released by Serbia’s central bank, although the final figure is a matter for negotiation, officials said. United Nations special envoy for Kosovo Martti Ahtisaari last week handed Serbia a plan that sets Kosovo firmly on a path to independence, allowing it to access international bodies, including access to international lending. It also says Kosovo, an autonomous province of Serbia in the old Yugoslav federation, must assume a share of Serbia’s foreign debt. Central bank figures showed Serbia’s total debt of $19.6 billion in November and put Kosovo’s share at 6 percent. Kosovo’s debt stood at $1.5 billion in 2000, the year after NATO bombed Serbia and drove its forces out of the majority Albanian province to end a counter-insurgency war. «Kosovo’s biggest debt is to the World Bank for projects or parts of projects implemented on its territory,» Gordana Lazarevic, deputy minister for foreign economic relations, told Reuters. «But their share is really a matter of talks.» Ahtisaari’s plan says Kosovo’s share will be determined in talks taking into account «principles used for the allocation of the external debt in the case of the succession» to Yugoslavia. After a decade of tough talks, Slovenia, Croatia, Bosnia, the Former Yugoslav Republic of Macedonia (FYROM) and Serbia together with Montenegro agreed in 2001 to divide Yugoslav state-held and private property, embassies, financial assets and debts, archives and pensions. They also agreed that dates when each of the four – Slovenia, Croatia, Bosnia and FYROM – declared independence would be treated as cutoff dates. Belgrade’s share in allocated financial assets and debts was 38 percent and 36.52 percent for non-allocated debts. The only thing they failed to agree on was the division of private hard currency savings, frozen at the time of the violent breakup of the former Yugoslavia in 1991. In practice, all republics stick to so-called territorial principle, servicing debts to people living in their countries. Serbia has been repaying a 4-billion-dollar debt to citizens, including Kosovo Albanians, since 2002, through a 14-year bond.