Kosovo has the lowest rate of foreign investment in the region as high levels of corruption, chronic shortages of electricity and poor road infrastructure make it less attractive to foreign investors, study finds.
By Tirana Times Staff
PRISHTINA, Nov. 17 – Now that it is a newly independent state with increasing political stability, Kosovo has to deal with high levels of corruption, chronic shortages of electricity and poor road infrastructure — all elements that drive potential foreign investors away, according to a study by Kosovo’s Foreign Policy Club.
The study deals with a variety of factors of why Kosovo has the lowest rate of foreign investment in the region.
Economy experts say investments are needed most in the manufacturing sector, because production could spur economic development and can do a lot to ease Kosovo’s high unemployment.
Foreign investments have fallen in the last two years and show movement against the positive trend in the region, according to Ylli Hoxha of the Foreign Policy Club.
“The fundamental thesis of this report concludes that corruption is hurting the process of attracting investors to Kosovo. Through this report, we try to argue that this phenomenon is hurting Kosovo’s development,” Mr. Hoxha told German public broadcaster DW.
Statistics show that foreign investments in Kosovo are very low. The few investments that are made are concentrated in the telecommunications and banking systems.
Experts also believe proper rule of law is very important for foreign investors and that is automatically connected with the functioning of the courts.
Kosovo has been severely criticized in European Commission progress report, which gave its justice system a low grade.
Flamur Keqa of the Kosovo Chamber of Commerce says proper court functioning is the most important element of giving a sense of security to foreign investors.
“Unfortunately this element leaves Kosovo at a great disadvantage, because its courts have declared that they have many pending cases, while, on the other hand have a very small number of bailiffs to implement the decisions,” Mr. Keqa told DW. “The importance of proper functioning of the courts has to do with the fact that if there is any dispute of any investor, whether with the state or any other business here in Kosovo, the issue should be resolved very quickly. This is not guaranteed right now in Kosovo’s judiciary.”
But Kosovo’s parliament has long adopted a law that guarantees foreign investments in Kosovo. Next step is preparing the right economic climate.
