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TRANSPARENCY IN THE PRIVATIZATION PROCESS

The privatization process in Kosovo has faced significant challenges, particularly due to the distinct nature of social and public enterprises and the management by different institutions. Initially starting in 1989, the process has been marred by interruptions, lack of transparency, and inadequate representation, particularly before and after Kosovo's independence. Despite some progress, ongoing legal issues and a lack of transparency have hindered effective privatization and economic development.

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6 views3 pages

TRANSPARENCY IN THE PRIVATIZATION PROCESS

The privatization process in Kosovo has faced significant challenges, particularly due to the distinct nature of social and public enterprises and the management by different institutions. Initially starting in 1989, the process has been marred by interruptions, lack of transparency, and inadequate representation, particularly before and after Kosovo's independence. Despite some progress, ongoing legal issues and a lack of transparency have hindered effective privatization and economic development.

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habtamu yilma
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TRANSPARENCY IN THE PRIVATIZATION PROCESS

A summary of problems that have characterized and continue to characterize the


process of privatization in Kosovo
n The privatization process in Kosovo must be treat- ed from two perspectives due to the specifi
nature of ownership of the two di erent groups of enterprises in Kosovo as well as since the
privatization process- es in the respective groups have been managed by di erent institutions.
The fi group represents social enterprises, which primarily operated in competitive markets.
Whereas, the second group represents pub- lic enterprises that mainly provide public services,
especially at national level where the privatization process is still ongoing.

Regarding social enterprises, the privatization pro- cess has started in 1989 under the Law on
Social Cap- ital of the former Yugoslav Federation. Nevertheless, the number of companies that
have gone through this process has been very small, mainly from the region of Gjakova. At that
time, the privatization process was interrupted quickly due to the onset of violent mea- sures
that followed the abolition of Kosovo’s autono- my. During this period, thousands of employees
were laid o ; companies were stripped of their assets and investments were lacking. The real
privatization pro- cess started after the war, in 2002, and was managed by the Kosovo Trust
Agency (KTA), continuing under the framework of the Privatization Agency of Kosovo (PAK) after
the country’s independence.12
The privatization process of these enterprises man- aged by of KTA and later PAK was
accompanied by contradictions and marked problems. Initially, the process of privatization has
been treated, by UNMIK and Kosovo institutions afterwards, as an end in itself and has not been
part of a long-term strategy for eco- nomic development. Decisions on the privatization process
before independence were made within a closed institutional environment which, one could
argue, did not show an appropriate representative character. Even after independence, this
process has continued in a similar way. Although the process went pretty well for several years,
it was stopped several times, either because of legal problems caused by Serbia, or as a result of
delays in the transfer of power to the PAK.

Regardless whether the process continued or was interrupted, the lack of real transparency
associated with this process has been chronic. Moreover, there was a lack of proper reporting
procedures and trans- parency towards investors, the general public and national institutions
(government and assembly) (RI- INVEST/Forum 2015, 2008). Although, the applied methods of
privatization of socially owned enterpris- es in Kosovo, theoretically, create less discretion

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