The government approved on Friday (March 11th) the 2011 draft budget worth 1.43 billion euros.

It includes a 50% hike in public sector salaries, a move opposed by the IMF, which says the government should not raise salaries to the level promised during the 2010 election campaign.

The IMF supports a maximum increase of 20% due to deficit concerns. The differences are being discussed with the IMF during two-week long talks in Pristina.

The government may lose grants worth 200m euros from international financial institutions if it ignores IMF recommendations.