Small economic growth expected in Kosovo this year

In the third quarter of 2019, compared with the quarter of 2018, Bruto has seen real growth of 4.38 percent. So said the report “Internal Production, third quarter 2019”, introduced by the Kosovo Statistics Agency (ASK).

According to financial institutions reports, Kosovo's economic growth for 2020 is expected to be 4.2 per cent.

The AKS in the report says greater growth marked financial activity, while agricultural activities marked decline.

<x0) Financial and security targets increased by 11.78 per cent, the extraction industry, electricity, water supply at 7.90 percent, professional and administrative activities at 7.03 percent, trade, transport, accommodation, and food service at 5.13 percent, construction at 3.46 percent, public administration, education and health at 1.02 percent. While economic activities that marked the decline in this quarter are recreation and recreation, other service activities of 18.72 percent, agriculture, forests and fishing at 2.87 percent”, the BQ report says.

As for the approach of expenditures, there has been an increase in government's final consumption spending.

The government's final consumption expenses increased by 10.54 percent, export of goods and services by 9.33 percent, import of goods and services by 6.67 percent, gross capital formation by 3.52 percent, total household consumption spending by 2.40 percent”, the report follows.

The Kosovo Central Bank in the report “Framework Development assessment, third quarter 2019”, says investments marked the main contribution to economic growth by 2.3 percentage points, followed by consumption at 1.2 percentage points and net exports by 0.7 percentage points.

During the first half of 2019, the new consumer loans have scored 9.8 percent, thus affecting the slowdown in consumer growth. Besides falling consumer loans, other sources of consumer financing, such as remittances, compensation of workers, and wages in the public sector were characterised by slow growth. In the same period, IHDs, which marked growth of 19.3 percent, affected investment growth. On the other hand, slowing down domestic demand has contributed to slow import growth while export has marked accelerated growth. This has caused net exports to mark the lowest trade deficit of about 1 per cent compared to the same period in 2018<18x1>, the report says.

Central Bank Governor Fehmi Mehmeti had confirmed that Kosovo's economic standing by the end of 2019 was 4.2 percent, while inflation has reached 2.8 percent.

The economic growth in the country is estimated to be 4.2 percent, supported mainly by net investments and exports. According to estimates for next year, growth will be the same. From the inflation data that we have by the end of November, it marks 2.8 percent that is evidently higher than it was a year ago, it actually scored 0.9 percent growth. This increase in inflation is due to increased food prices”, Mehmeti had said.

As for economic growth projections, the World Bank has warned that Kosovo's economic growth for this year is expected to be 4.2 per cent.

“In the Western Balkans there was a slowdown in public investments in Kosovo, production in Serbia, and export growth in Albania and Serbia that contributed to a growing age of approximately 3.2 percent in 2019. In Kosovo, growth for this year is expected to be 4.2 per cent”, the report says, sent by Telegrafi.

Despite this year's slight improvement, the World Bank says 2020 remains vulnerable to uncertainty about trade and geopolitical tensions.