EU pledges 500 million euros for Kosovo

A spokeswoman for the European Commission said the EU's 27 member states were also expected to make their own pledges on top of that.

EU pledges 500 million euros for Kosovo
The European Union pledged 500 million euros ($789 million) to help newly independent Kosovo ahead of an aid conference on Friday billed as the first step to rebuilding its shattered economy.

A spokeswoman for the European Commission said the EU's 27 member states were also expected to make their own pledges on top of that.

EU sources say donors will look to provide close to 1.5 billion euros ($2.4 billion) of funds for Kosovo.

The United States has pledged some $400 million, leaving the European Union to cover the bulk of the needs of the territory, which seceded from Serbia in February after nine years as a U.N. protectorate.

"Kosovo is a profoundly European matter. The EU is ready to use all instruments to help Kosovo realise its European perspective," EU Enlargement Commissioner Olli Rehn said in a statement ahead of the one-day conference in Brussels.

For decades the poorest part of Yugoslavia, Kosovo is still weighed down by the destruction of the 1998-99 war and a legacy of waste and corruption under international stewardship. The government has identified its main priorities and prepared a 145-page document outlining its plans for the donor conference hosted by the European Commission.

A large part of the total sum, meant to plug holes in the budget until 2011, will go to servicing Kosovo's share of the Yugoslav debt it inherited from Serbia on independence.

Analysts say that regardless of the amount raised, the government will have a tough job fulfilling the expectations of its 2 million people, the youngest population in Europe but one struggling with over 40 percent unemployment.

It applied for membership of the International Monetary Fund and World Bank on Thursday, Prime Minister Hashim Thaci said on Friday, adding that he expected a positive response soon.

Despite being recognised by 43 mostly Western states, a post-independence investment boom has not materialised.

Legal challenges by Serbia and its ally Russia also threaten to keep Kosovo out of some international bodies for the near future, robbing it of the legitimacy it needs to attract loans and investors put off by its limbo status.

Reuters
Last Mod: 11 Temmuz 2008, 15:04
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