Statement by Minister Plenipotentiary Enrico Nardi, Head of the Italian Delegation

Mr Chairmen, Ladies and Gentlemen,

First of all I would like to thank the European Commission and the World Bank for their commitment in organizing this meeting.

I would like to commend also SRSG Steiner, UNMIK, Prime Minister Rexhepi, Minister for Finance and Economy Sadriu, the Provisional Institutions, and other relevant organizations who contributed to make it so stimulating.

My comments cover both this morning and this afternoon sessions.

The reports we just heard, clearly show that a great job has been done, but that even greater goals have still to be reached.

The international community has a moral obligation in continuing its efforts, in sustaining the region economically and socially, focusing not only on the economic assistance but also on institution building and social integration.

The establishment of a multiethnic, multicultural, stable and economically sustainable Kosovo is of vital importance not only for the stability in the region, and for those who live there, but also for the whole international community.

A lot of work has still to be done in confidence building measures. Recent elections represent an important step. However, the level of participation showed that the commitment of the Kosovars to their institutions need to be significantly strengthened.

Provisional Institutions, Italy hopes, will continue and strengthen their commitment in promoting increasing returns of refugees and displaced people and in implementing practical requirements to make it possible, by ensuring more security measures and more confidence. Confidence is the first requirement to allow the start up of a new society able to share common values, as Prime Minister Rexhepi mentioned this morning.

Economic reforms and development policies need both a politically sound environment. In fact they are strictly interrelated.

Since a long time, Italy is one of the major donors in the Southeast Europe and in Kosovo.

Since '99, our Government has provided, in the framework of the international aid, substancial contributions to overcome the emergency in the field of institution building and humanitarian aid. In these terms, the presence of thousands of Italian security forces in KFOR has provided very valid contributions in addiction to our economic support.

In terms of economic aid, our commitments since '99 reached 22 million Euro, and about 60% of them have been already disbursed for projects directly implemented by Italian cooperation or through NGOs.

The fields we tried to cover refer mainly to vocational training, capacity building, employment, health, environment, agriculture and cultural heritage.

For 2003 we have to wait for our budget low which at the moment is under discussion in the parliament.

However also new needs will be taken into consideration along with the traditional ones. They will be related to the strengthening of the economy, especially on privatisation of public-owned enterprises.

Loans are of crucial importance and we hope that international financial institutions will find technical solutions to overcome problems related to final status. Another field which we intend to support is return, housing and property.

As far as we are concerned, our commitment to the area recently found a new tool in addiction to the others we already have.

I refer to the funds approved last year, under law 84 which is now under implementation. It provides an annual amount (renewable for 2 years) of 44 million euros for all the countries of Southeast Europe, 22 of which will be run by the Ministry of Industry and Foreign Trade, and 22 by our Foreign Ministry, with a focus on bilateral and regional projects aimed also at the strengthening of security.

Under the provisions of this law, other annual 7 million Euro will be available through our regions to implement project they will submit to our central Government.

Kosovo is a region eligible to the funds of law 84, and till now some projects are under evaluation.

Of course, the effective implementation of the projects requires the commitment of local authorities to carry out their share of responsibility. We are confident that they will continue to act in this direction, as done till now within the frame and the provisions of UN Security Council Resolution 1244.

From our side, in spite of budgetary restrictions, we will try our best to maintain the current level of contribution.