PRISTINA (Kosovo), November 1 (SeeNews) – Kosovo’s economic growth is expected to be around 4.0% in 2018, but fiscal risks have increased and should be managed carefully, the International Monetary Fund (IMF) said.
“Reforms to improve competitiveness and strengthen governance to achieve stronger and more inclusive growth, reduce unemployment and the large income gap with the rest of the Europe should continue to be on the forefront of the policy agenda,” the IMF said in a statement on Tuesday, following the conclusion of a visit to Kosovo by an IMF mission led by Stephanie Eble.
In 2019, growth is projected at 4.2%, supported largely by a temporary acceleration in public investment, the statement added.
According to the IMF, inflation remains subdued but has started to pick up because of higher food and energy prices and is expected to average 0.9% in 2018 and 1.4% next year.
“Maintaining macroeconomic stability, managing fiscal risks, and advancing structural reforms are critical to ensure stronger and more inclusive growth,” the IMF noted.
The fund's mission advised the Kosovo government to accelerate tax administration reforms to reduce informality, tax gaps, and tax debts; move ahead with measures to contain spending pressures; improve spending efficiency and outcomes; and adopt contingency measures.