Investors flee from Kosovo: Investments rang from 400m to 100m euros

Foreign direct investment has marked declines from 400m to 100m euros, especially in the past five years. Investment balance in 2014 was 123.9m euros, which represents a significant decline compared to the value of 250.2m euros in 2013.

While the 2015 IHD balance was 287.3m euros, which represents a high increase compared to the value of 123.8m euros in the preceding year. In 2016, Kosovo's accepted Foreign Direct Investment amounted to 215.9m euros, which represents the lowest level.

Foreign investments in 2017 amounted to 287.8m euros, which represents a 30.8 percent increase compared to 2016.

While the bad year for investment was named 2018, worth 121.9m euros, and marked annual decline of 43.0 per cent.

Kosovo's chairman of the Kosovo Economic Chamber (OEK) says there is a decline in foreign direct investment and is an extremely negative indicator, while in countries of the region there are much more positive developments in terms of foreign direct investments.

Mayor Rukiqi has also said that even foreign investment quality is not quality.

The problem is also in the quality of foreign direct investment, when we say quality doesn't have a quality meter here, but it can be seen at the value added to the economy. We have very few investments that have created increased value in the economy... The best investment promotion is when conditions here in Kosovo improve, when there is enough electricity, when we eliminate bureaucracy, when we have no problem with construction permits, with different licenses, when we reduce corruption, when we increase the performance of the judiciary, when we deal with property issues”, Rukiqi points out.

The chairman of Kosovo's Oda Afarisation Board (OAK), Skender Krasniqi, says investments have been halved due to lack of literal bidding and lack of an efficient law to invest in Kosovo.

Even those few investments, according to Krasniqi, most are from fellow countrymen who have investments in real estate rather than in the company; factories or production.

Krasniqi has taken an example of Macedonia, which he says has two, three, four and five investors each month because it has an appropriate law, while in Kosovo it does not.

The main causes are lack of supply. Kosovo has still failed to make a serious offer for both local and foreign investors. Two years ago, it was approved by the government and the Committee for Strategic Investment, and unfortunately we have only 11 offers for this year and none finished. So Kosovo has failed to bring no investors through the Strategic Investment Law. And this has contributed to investments in Kosovo falling from about 400m euros that have been in 2010, while in the first six months of this year there are less than 100m euros in investment”, Krasniqi says.

He has added that so much Kosovo needs foreign investment, for employment that the prospect of living in Kosovo every day is losing as the lack of greater seriousness of the Government of Kosovo to prioritize Kosovo's economy and the development of the country.

While, Minister of Trade and Industry Andrew Shala says attracting foreign investment will be one of the important priorities during 2019.

Minister Shala says he has made some interference in the law's underground acts for strategic investments and expects the first strategic investors to announce early next year.

“There are interested, I have authorised them for certain changes after the demands of potential investors on the issue of the application procedure for strategic investors. So far, there are interested people who are following all procedures, which the Law defines for Investment and other regulations in force. I believe that very soon we as the Minister of Trade and Industry will also come up with results in relation to this”, Shala says.

Energy sector, mining, transport and telecommunications, processing industry, agriculture and tourism are just some of the most potential sectors in which international investors could invest.