Bad sign of the economy in Kosovo, in March the trade deficit deepened by 5.3 percent

The data from Kosovo's Foreign Trade goods points to a 5.3% higher trade deficit in March 2023, in proportion to the same period in 2022, worth 426.8m euros, compared to the deficit of 405.3m euros in 2022. Export covers import by 16.1%.

According to the AKS, the export of goods in March 2023 was worth 81.7m euros, while import 508.5m Euro, which is a drop of (7.7%) for export, as well as a 3.0% increase for import, compared to the same period in 2022.

Periscopi explains that the trade deficit is an expression used to show the difference between exports and one country's imports. If a country imports more than it exports, then it has a trade deficit.

In general, a trade deficit could be caused by causes such as increasing imports, reducing exports, increasing exchange rates, foreign competition and changes in demand and global bids.

The commercial challenge may be good for a country's economy in some cases, but in other cases it may have negative consequences. Some of the negative causes of commercial surplus may be:

1. Local production reduction: If a country imports far more than it exports, local producers could face greater competition from imported products. This could reduce local production and bring growing unemployment to the country.

2. External debt growth: A trade deficit could increase a country's external debt, making it more dependent on foreign lenders. This could jeopardise the country's financial stability and make further economic development difficult.

3. Cost-business growth: If a country imports a lot of goods, then the cost of business could be raised due to import tariffs and transport expenditures. This could lower the country's competitiveness and limit the development of local industries.

4. Decreasing certain sectors: In certain cases, a trade deficit could lead to the penetration of specific sectors in the local economy. This could happen if imports of certain goods have a huge competition with local products, and this makes them unhurt.

Despite this, according to AKS data, the main export groups: 23.6% make up basic metals and articles; 15.8% make up different products produced; 14.4% make up plastics, tires and items from them; 8.9% make up prepared foods, drinks and tobacco; 7.1% make up minerals; 3.8% make up textiles and text articles, etc.

While, according to key group data for import: 14.3% make up mineral products; 12.3% make up prepared food, drink and tobacco; 10.7% make up basic metals and articles from them; 10.7% make up machinery, mechanical and electrical equipment; 93% make up transportation; 8.7% make up chemical industry products; 6.3% make up plastics, tires and items from them, etc.

Kosovo exports to EU countries (27) reached 28.0m euros, or about 34.3% of total exports, with an increase of 11.0%. The main partners for export of goods to the EU were: Germany (9.2%), Italy (4.3%), the Netherlands (3.1%), etc. Kosovo imports from EU countries (27) stood at around 228.1m euros, or 44.9% of total imports, with an increase of 11.1%. The high-rate imports were from: Germany (12.3%), Greece (6.3%), Italy (6.1%), etc.

In March 2023, Kosovo's exports with CEFTA countries reached 32.0m Euros,

or 39.2% of total exports, with a drop of (six.3%). Key export partners from CEFTA countries were: Northern Macedonia (14.6%), Albania (11.0%), Serbia (6.3%), and Montenegro (5.8%).

While imports from CEFTA countries reached 92.5m euros, or 18.2% of total imports, in March 2023. The countries with the highest share in import was: Serbia (5.8%), Albania (5.5%), and northern Macedonia (5.0%).

Kosovo exports with other countries of the world reached 21.6m euros, or 26.5%. As more important partners from these export countries, it's worth mentioning: US (12.2%), Switzerland (7.7%).

While, Kosovo's imports with other countries of the world reached 187.8m euros, or 36.9%. The countries with the highest share in import in this group were: Turkey (14.3%) and China (8.4%). /Periscopi/