Winners and losers of capital investments: a local government perspective of the 2021 Draft-Law on State Budget


GAP Institute today published the report “Winners and losers of capital investments: a local government perspective of the 2021 Draft-Law on State Budget.”

This report analyzes the distribution of capital investments of ministries in municipalities, to check for favoritism or discrimination against municipalities on a partisan basis. Capital investments are an important source for the development of municipalities. The Draft Budget provides no explanation on the applicable criteria when deciding on central level investments in municipalities

According to the Draft Budget 2021, ministries allocated for capital investments over 93 million Euro will be invested in 33 municipalities. The three ministries with the highest capital investments budget in municipalities, in 2021, will be the Ministry of Infrastructure, Ministry of Economy and Environment, and the Ministry of Culture, Youth and Sports. Investments of the Ministry of Health in municipalities are expected to decline by 92%, compared to 2020. Municipalities that will benefit the most from ministries’ capital investments budget in 2021 are Gjakova, Prishtina, Deçan and Mitrovica.

As most capital investments are continued projects from previous years, the current government has had less room for introducing projects. Of the approximately 9m euros in new projects, more than half (55%) will be allocated by the Ministry of Economy and Environment.

Municipalities benefiting the most from the new capital investments in 2021 are Gjakova, Mitrovica, Klina and Deçan. Municipalities governed by AAK will benefit 60% of new investments, municipalities governed by LDK with 19%, municipalities governed by VV with 12% and others.

In terms of investments to population ratio, municipalities governed by LDK have been discriminated, and those governed by AAK have been favored. No major positive or negative discrimination was observed in municipalities governed by other political entities.

Click here te read the full report.

Click here for infographs.