World News

Kosovo central bank governor held in graft probe

PRISTINA (Reuters) - Kosovo’s central bank governor Hashim Rexhepi was arrested on Friday after police searched his home and office in a corruption investigation, the European Union Police and Justice mission said.

Central bank spokesman Besnik Kada said Rexhepi was arrested in his office. Kosovo’s main currency is the euro and Rexhepi’s role was to monitor the work of banks in the country, which proclaimed independence from Serbia in 2008.

“The related searches are in connection with an ongoing corruption and financial investigation into suspicion of abusing official position or authority, accepting bribes, tax evasion, trading in influence and money laundering,” the statement said.

Kosovo is heavily reliant on foreign aid. Investors regularly cite organized crime and corruption as a major obstacle.

With unemployment at nearly 50 percent, analysts say Kosovo needs double-digit growth and strong foreign investment to revive its economy, but the 4 billion euros of aid it has received so far, mostly from EU countries, was not sufficient.

Kosovo seceded from Serbia in 2008 when its 90-percent ethnic Albanian majority passed a declaration of independence. The International Court of Justice on Thursday backed Kosovo’s independence, which Serbia contests.

Some 10,000 NATO troops oversee the fragile peace while the European Union’s EULEX monitors the work of police and the judiciary.

Reporting by Fatos Bytyci; Writing by Ivana Sekularac; Editing by Zoran Radosavljevic and Janet Lawrence