Kosovo Government open to privatization of KEK

Prishtinë, 17 January 2008 – The Kosovo Government is not turning down the option of privatising Kosovo Energy Company (Korporata Energjetike e Kosovës – KEK). Deputy Minister of Energy and Mining, Blerim Rexha, stated the Government is collecting facts to find a better model of privatisation than the one proposed by the KEK management. In addition to this he stated that KEK is like a damaged car and the Government has two exit roads: “to sell it as a scrap metal or to repair it and sell it in a better state”.

Rexha stated that the new Government does not agree selling the best parts of KEK. According to him the sale of the corporate can be done altogether, he continues also saying that MEM is collecting facts to sell the debts or privatise the distribution, but there isn’t anything final in this direction.

The situation of KEK indicates that this company is far away from a favourable situation for privatisation. According to the Athens’s treaty, within the restructuring of the energy sector in Europe, respectively in South-East Europe, was supposed to complete the first incorporation and head towards privatisation of its departments. By incorporation and despite the division of the financial accounts, the different KEK Departments such as digging, generation and distribution, could also do the full division of assets. KEK departments after the incorporation would have been able to contract each other for the services. They would not only operate by separate budget, but each department would be able to determine its costs.

The idea is that the incorporation would discharge the government’s budget by the request to invest in KEK and would open the path for private capital. Rexha added that KEK was supposed to be incorporated in June 2007, but the KEK management hasn’t done any step in this direction.