Albanian 
Prishtinë, August 2, 2018 – Maintaining the macro economic stability through a diligent approach of spending the public money is of prior importance in long-term economic development of Kosovo. In this regard, the American Chamber of Commerce considers that local institutions are obliged to ensure that this stability is not endangered in any circumstances. Regarding the recent declarations on spending the public money unrestrainadly, AmCham voices its concerns also on the Draft Law on Salaries estimating that it risks budgetary stability as well as increases even more the payment gap between the public and the private sector.
Approving the Draft Law in its current form would result in extensive implications and budget deficit growth in the country. Increasing the inclusion of salaries in the budget would result in decrease of capital investments which are of crucial importance in empowering the private sector and economic development growth. Moreover, the deficit growth would increase the tax barriers for businesses in the country considering the need to collect more revenues.
Regarding the budgetary impact, the Draft Law on Salaries would also negatively affect the labor market in the country. The private sector cannot follow the institutions’ pace on increasing salaries since salaries in this sector are set based on market strengths and the labor force productivity. Increasing the payment gap would urge the labor force to favor the public sector as its employer, thus aggravating the situation of skills gap in the private sector’s labor force, this having been already reported amongst the most current issues in doing business. All these elements would harm prospects in private sector development and in attracting foreign direct investments.
Considering the aforementioned comments, the American Chamber of Commerce in Kosovo urges the Government of Kosovo to be careful in the salary levels proposal in the Draft Law on Salaries, always considering the recommendations by the International Monetary Fund. Since reforming the public administration is a very important and inevitable process, this reform should be led by the necessity of increasing employees’ productivity in the sector and offering better public services.
In conclusion, the American Chamber of Commerce once again reiterates its call to the Government for a more active dialogue with organisations representing the private sector and cicil society’s interests, while itself remains committed on giving its contribution in all aspects of empowering the private sector in the country.