Opinion: Despite Shared Yugoslav Past, a Study in Contrasts April 26 - May 9, 2013 Issue No. 110 www.prishtinainsight.com Price € 1 NEWS Bad Loans Soar as Kosovo Economy Stumbles > page 2 NEWS Kosovo and Serbia Reach Historic Deal in Brussels > page 5 NEWS Ruling Portrays MP as Ringleader in Killings > page 7 NEIGHBOURHOOD Albania Faces The Cayman Islands offer visitors stunning views - and for companies across the world, a tax haven with little financial transparency. (Photo/Louish Pixel) Questions Over Bullets for Libya Caymans Key to PTK Sale > page 9 CULTURE ACP Axos Capital’s buyout of the state telecoms company is financed through a Caribbean tax haven but the purchasers Airbrushing the deny claims that they’ve got something to hide. Ottomans By Nate Tabak and Parim Olluri cent stake in PTK, is putting Self-Determination party have Practices Act. There was and there together at least $250 million in voiced suspicions about the deal is no corruption in this transac- financing through an entity it con- and suggested that ACP Axos tion,” Budden added. “The people n offshore shell company in trols in the Cayman Islands. could be a front for dubious local of Kosovo should be very proud to a tax haven is playing a cen- Jan Budden, the managing interests. finally have an investor like us.” > page 14 - 15 Atral role in financing the director of ACP Axos Capital Budden rejected those claims. But ACP Axos Capital’s financ- 277 million euro purchase of a con- Partners, revealed the financing “The negative reactions in the ing arrangement via the Cayman trolling interest in Kosovo’s state telecoms company, PTK, raising arrangement in an interview with press and among some politicians Islands seems bound to further questions about who exactly is Prishtina Insight last week. make foreign investors less willing fuel suspicion. buying the country’s most prof- On April 16, Kosovo’s govern- to enter Kosovo,” Budden said. Thousands of companies Kosovo’s only English-language itable publicly-owned company. ment declared ACP Axos Capital “False accusations and rumours around the world operate entities newspaper is available: The Hamburg-based ACP Axos Partners consortium the winner of are not helpful to Kosovo.” in the Cayman Islands. Capital Partners, the leader of the the majority stake in PTK. Since “We strictly follow and are com- Delivered to consortium purchasing a 75 per then, media and the opposition mitted to the Foreign Corruption continues page 2 Your Door Captive Brown Bears Gain Clearing the Cultural ‘Mines’ From Newsstands Fresh Start of the Balkan Wars across Kosovo Kasandra has had a tough life. The Kosovo playwright Jeton Neziraj Sent To brown bear spent her first 10 years living believes he belongs to the company of the Your Inbox in a small cage at the Gjeraqina restaurant few artists in his home country that the near Suhareka. state does not control and who are thus free When the Four Paws organisation found to deliver a wider humanistic message and From Kasandra in March, she was underfed. use art to awaken in people the “view of our partners These days, she is... the other”. For him ... feature page 10-11 culture page 19 see page 16 for more info is supported by: 2 April 26 - May 9, 2013 news Caymans Key to PTK Sale from page 1 2007, is housed at a firm called ultimate owners of the Cayman Campbells Corporate Services vehicle are: untransparency is one The British territory, located in Limited, a firm that specialises in of the purposes of using tax the Caribbean, has no corporate giving foreign companies a pres- havens,” Capussela said. income tax and does not make pub- ence in the Caymans. Budden, however, said ACP lic even basic information such as While Budden declared that Axos was fully transparent with the names of company directors. ACP Axos “is not a front for any Kosovo officials about its offshore The Caymans have allowed com- Balkan investor”, he was never- financing arrangement. panies to operate entities largely theless vague about the source of “Financing agreements from on paper and avoid billions of its funding. Axos Cayman for the PTK transac- euros in taxes by funneling profits “The final structure is under tion in excess of 250 million USD through subsidiaries. The practice evaluation with our investment have been checked and approved is commonplace, with major cor- partners, banks and tax advisors. by in the qualification process,” porations including Microsoft and The money comes from US and Budden said. Exxon Mobil utilising offshore European investors,” Budden said. The Minister of Economic arrangements. ACP Axos, based out of a house Development, Besim Beqaj, whose But the Caymans and other off- in Hamburg, bid for PTK in a con- ministry led the privatisation, shore finance centres have also sortium with Najafi Companies, declined to discuss ACP Axos’s been used for nefarious purposes. an American private investment financing. The American energy company, firm. Kosovo first attempted to sell Enron, used the Caymans to help Najafi, whose representatives PTK in 2011. The process was conceal its fraud. declined to speak with Prishtina dogged by accusations of corrup- Budden said that ACP Axos Insight, is a small company that tion, and the government can- Capital controls an entity called primarily uses internally-generat- celled the sale after only one bid- ACP Axos Capital Partners is buying a 75 per cent stake in PTK. (Photo/Petrit Rrahmani) Axos Cayman, which he said has ed money and says that it “seeks to der was left in the running. served as a vehicle for investments make strategic investments in profit in 2012, has been plagued by Telecom Italia and Britain's BT since 2007. He said AXOS undervalued assets”. In the second and final attempt, corruption scandals, mismanage- Group. The company said it will Cayman’s founding investors In February, Najafi acquired the five bidders were qualified to bid, ment and a bloated payroll, and is create 1,000 jobs, in part through included DCM, a venture capital European operators of Cinram, including former US Secretary of in need of millions of euro in call centres that will serve compa- firm, and Columbia Capital, which manufactures Blu-Ray State Madeleine Albright’s invest- investment. nies outside Kosovo. which previously was in a consor- discs, CDs and DVDs. ment fund. While the proceeds of the priva- The suspicions about ACP Axos’ tium with ACP Axos in the PTK “We have known Najafi for a Eventually, only two bidders tization fell short of the earlier business practices aren’t surpris- Bid. very long time - a very good remained, ACP Axos and M1, a expectations, the sale is neverthe- ing, said Ken Lefkowitz, managing The Cayman Islands’ business investor from the US,” Budden company owned by the former less welcome news for the govern- partner at New Europe Corporate register does not list such a com- said. Prime Minister of Lebanon, Najib ment. The International Monetary Advisory in Sofia, who served as pany. It does however list an Axos But the identity of other PTK Mikati. Fund had warned that construc- an adviser to one of the prospec- Limited. investors remains unclear. The M1 bid just 150 million euro, tion of a highway to Macedonia tive bidders for PTK. Reflecting the Caymans’ lack of financing arrangement will make compared to ACP Axos’s 277 mil- wouldn’t be possible unless PTK “Axos are damned if they do, transparency, the registry only it difficult to determine true own- lion euro, leading some observers was sold. damned if they don't - in my expe- offers basic information: the com- ership, said Andrea Capussela, for- to suggest that the Lebanese offer Kosovo retains 25 per cent of rience, public opinion in Kosovo is pany name, the type of company, mer head of economic affairs of was only intended to make the shares in PTK, while the country’s biased towards suspicion of busi- the date of registration and forma- the International Civilian Office, process seem more competitive. postal service will be spun off into ness, to the extent that practices tion, a file number and address. ICO, which supervised Kosovo In 2010, the government said it a new publicly-owned company. viewed as quite usual and ordi- The registry charges about 28 euro after independence. hoped to get 300-600 million euro Budden, of ACP Axos, said the nary elsewhere are considered for the information. “It will almost certainly be for PTK. But the telecoms compa- new PTK will be run from suspicious in Kosovo,” Lefkowitz Axos Limited, established in impossible to ascertain who the ny, which posted a 56 million euro Prishtina, with the help of said. Bad Loans Soar as Kosovo Economy Stumbles A 30-per-cent spike in non-performing loans points to a decline in the country’s overall economic health. compared to 9.2 million euro from “Raiffeisen Bank has continued Europe. “Smaller banks are really push- the same period in 2012. The to take a careful approach in On top of that, even official gov- ing down the interest rates,” Thaqi increase amounts to 85 per cent. increasing loans by being focused ernment data, known for painting said. By Jeton Musliu and The sample is small but is never- more on the quality of loans than rosy pictures, put the unemploy- Banks should start publishing Nate Tabak theless a symptom of a troubling their volume,” Tahiraj said. ment rate at 39 to 41 per cent. Other their interest rates, which they gen- trend in Kosovo’s economy. The bank gave 402 million euro estimates put it as high as 45 per erally don’t do, to make it easier for According to the Central Bank, in loans in 2012, down slightly cent.