Having declared independence last year, Kosovo has shown significant progress in making the transition to a market based economy. However, the country continues to be highly dependent on the international community and the diaspora for financial assistance. Remittances from the diaspora, located mostly in Germany and Switzerland, provide almost 30 per cent of GDP.
The economy rebounded spectacularly in 2000, demonstrating growth of over 21 per cent. However, growth has slowed in line with declining donor resources to 5.4 per cent in 2008. In February 2009, Prime Minister Hashim Thaci presented the strategic priorities for economic development this year. These include keeping the promises the government made when it took office, including implementing "dozens of capital projects by creating thousands of jobs, and by increasing the rate of economic growth to 6.1 per cent.” The economy is expected to continue to grow at around five per cent for the second year in a row in 2009.
Investment Climate
Kosovo faces huge transitional challenges in the near future. Privatisation has been advancing but new investment has been limited by unrest. Reform of large public enterprises is in its first stage and needs to be progressed further. Progress has been made in reforming publicly owned enterprises. The airport, the railways, the post and telecommunications and the energy utility were incorporated in 2006, however, power sector reform is urgently needed.
New sources of economic growth must be generated to ensure social and environmental improvements. The mining and energy sectors are key areas for potential, future growth. Kosovo has an abundance of resources, including lead, zinc, ferro nickel and crushed stone along with relatively low transportation costs to Western European markets. The authorities need to ensure macroeconomic stability, making sure not to back track on economic achievements, including the liberal trade regime. These advantages should be seen as a foundation to be built upon to improve the investment climate.
UK Trading Relationship
Kosovo conducts the bulk of its trade with EU countries. In 2008, the UK exported goods worth £2.7 million to Kosovo, representing an increase of more than £1 million on figures for 2007. Imports from Kosovo are small, however, they have increased to more than £300,000.
Main Industries
Mineral mining, construction materials, base metals, leather, machinery, appliances.
Main Exports
Mining and processed metal products, scrap metals, leather products, machinery.
Main Imports
Foodstuffs, wood, petroleum, chemicals, machinery and electrical equipment.
CONTACTS
UK Trade & Investment
Kingsgate House
66-74 Victoria Street
London SW1E 6SW
Tel: 020 7215 4950
Email: liz.herisz@ukti.gsi.gov.uk
Web: www.uktradeinvest.gov.uk
There is no official UKTI service
British Embassy
Ismail Qemajli
Aberi Dragodan
Pristina Kosovo
Tel: 00 381 38 254 700
Email: britishoffice.pristina@fco.gov.uk
Embassy of the Republic of Kosovo
15 Stratton Street
Mayfair London W1J 8LQ
Email: embassy.uk@ks-gov.net
