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IMF offers membership to Kosovo

Published 05/08/2009, 07:49 PM
Updated 05/08/2009, 07:56 PM
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WASHINGTON, May 8 (Reuters) - The International Monetary Fund has offered membership to Kosovo, the fund announced on Friday, giving the small country that broke away from Serbia last year access to millions of dollars in IMF-backed loans.

Landlocked Kosovo is one of Europe's poorest nations. But its finance minister said recently that while it was close to joining the IMF, it had no plans to ask the IMF for money right away.

"The executive board of the International Monetary Fund (IMF) today certified a vote by the IMF's Board of Governors to offer IMF membership to the Republic of Kosovo," the fund announced in a statement.

It said Kosovo would become a member when its representatives sign the relevant papers in Washington, where the 185-member fund is headquartered.

Kosovo's proposed initial quota in the IMF is 59 million Special Drawing Rights (SDRs), which the IMF said was the equivalent of about $88.64 million.

Each member of the IMF is assigned a quota, based broadly on its relative size in the world economy and determining its maximum financial commitment to the IMF and its voting power, as well as providing a basis for its access to IMF financing.

The total of all members' quotas amount to 217.4 billion SDRs, which the IMF said was about $326.6. billion.

Kosovo broke away from Serbia in February 2008 and soon applied for IMF membership even though it is not a U.N. member. The IMF recognized Kosovo's secession last year and said it would consider its membership application "in due course" as a sovereign Balkan state.

Fifty-eight countries have recognized Kosovo's secession, including the United States and most European Union countries, which have the majority voting power at the IMF. Kosovo also has applied for World Bank membership.

For decades the poorest region of Yugoslavia, Kosovo is still recovering from the 1998-99 war when NATO launched air strikes and drove out Serb forces. Its unemployment rate is estimated at 45 percent.

Many of Kosovo's former Yugoslav neighbors are either considering or have received IMF loans as the world economic crisis spread recession across the Balkans.

(Writing and reporting by Susan Cornwell; Editing by Bill Trott)

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