EU Growth Plan/Kosovo cannot receive the first millions of funds without the Assembly being constituted

Kosovo has not ratified the loan agreement with the EU in Parliament and until it does so, it cannot receive payments. Meanwhile, the EU is maintaining the punitive measures imposed on Kosovo in June 2023.

Kosovo and the European Commission are finalizing the procedural steps through which the execution of 7% of the total amount foreseen for Kosovo from the Growth Plan for the six Western Balkan countries will take place, according to Kosovo's request.

If Kosovo manages to ratify this in Parliament, the first regular payments would be made between the second and third quarters of 2025, a European Commission spokesperson said.

“Kosovo has requested the release of an advance payment of up to 7% of the total amount foreseen under this arrangement [of the initial indicative amount of funding available to each beneficiary]. The Commission and Kosovo are now finalising the procedural steps, which should allow the release of the advance payment to be made as soon as possible in 2025, pending the ratification process by Kosovo. The first regular payments are expected to be made between the second and third quarters of 2025, following the fulfilment of the reform-related conditions.”

The EC has indicated that the Growth Plan for the Western Balkans provides a roadmap to bring the economies of the Western Balkans closer to the European Union.

The growth plan is 6 billion euros in investments and the principle is both investments and reforms.

“In terms of the process – to date, we have five ambitious reform agendas in place – including Kosovo, and in return, these reforms are supported by investments. Regarding Kosovo, it submitted its Reform Agenda to the Commission in July, covering both fundamental and socio-economic reforms. The Commission has assessed the Reform Agenda and concluded that it is in line with the objectives and requirements of the Facility (Reform and Growth). The Reform Agenda was adopted on 23 October 2024 through a Commission Implementing Decision, following a positive opinion from the Member States.”

The main innovation of the Reform and Growth Facility (RGF) is that EU financial support will be conditional on the successful implementation of reforms.

In the Reform Agenda, reforms are divided into quantitative and qualitative steps, which will serve as payment conditions, and each step has an implementation timeline.

The relevant funds under the arrangement will be released twice a year, on the basis of a request submitted by the beneficiaries and verifiers, by the Commission, of the three sets of conditions set: ex-ante conditionality, general conditionality and payment conditionality. (for pre-financing: only ex-ante conditionality and payment conditionality are required).

The preconditions include the standard conditionality that must be met at all times, namely that beneficiaries continue to support and respect effective democratic mechanisms, including a multi-party parliamentary system, free and fair elections, pluralistic media, an independent judiciary and the rule of law, and guarantee respect for all human rights obligations, including the rights of persons belonging to minorities.

There is also a specific precondition for Serbia and Kosovo, namely to engage constructively in the normalization of their relations, with measurable progress and tangible results, with a view to fully implementing all their respective obligations stemming from the 2023 Roadmap to Normalization and its Implementation Annex, as well as all past dialogue negotiations on normalization agreements, and to engaging in the Comprehensive Normalization Agreement.

These agreements have the character of international agreements and therefore must be ratified by the Assembly of Kosovo with a two-thirds majority vote.

The EU has decided that all countries for which reform and growth agendas have been approved will be paid a “frontloading payment”, an amount of 7 percent of the funds dedicated to that respective country. All countries in the region, with the exception of Bosnia and Herzegovina, have fulfilled the condition of approving the reform agendas.

The total package is worth 6 billion euros for all countries in the region for the period from 2024 to 2027. Of this amount, 2 billion are non-repayable EU grants, while the rest are in the form of soft loans. According to an unofficial estimate, Kosovo could benefit from over 880 million euros from this growth plan.

Over 250 million will be allocated to Kosovo as non-refundable money, while the rest will be in the form of soft loans.

According to this, Kosovo would be paid 7 percent initially as “pre-financing,” which amounts to about 61 million euros. Per capita, Kosovo would benefit the most from this package of all countries in the region.

Albania will benefit from a total of 922 million euros, North Macedonia will have a total of 750 million euros available, Serbia 1.58 billion euros, Bosnia and Herzegovina 1 billion and 85 million euros, while Montenegro 383 million euros./Monitor