Ban on Serbian exports, a chance for Albanian exports to Kosovo

TIRANA, July 25 – The Kosovo government’s decision to temporarily ban Serbian products is being considered a good chance for Albanian businesses to increase trade exchanges with the neighboring Kosovo.
Albania’s business association represented by Konfindutria says the agricultural, food, construction materials and furniture and mechanical industry in Albania can benefit from the decision filling the void created by the ban of Serbian products.
Last week, the Kosovo government approved measures of reciprocity to block goods with Serbian custom stamps and impose a 10 per cent import tax on Bosnian goods.
The measures were implemented in response to the two countries refusal to abide by the terms of the Central Europe Free Trade Agreement, allowing free movement of goods in the region.
Hailing Kosovo’ government’s decision, Konfindustria described the decision as delayed under conditions when no Kosovo products is allowed to enter Serbia or transit causing big damage to the Kosovo’s economy.
“Serbia has unilaterally violated the CEFTA agreement. The issue is about around 350 million euro a year of Serb exports to Kosovo without including dozens of millions of euros of other products smuggled through northern Mitrovica” says Konfindustria.
However, Business Albania, another Tirana-based business Association is skeptical Albania could replace Serbia especially on grains which are the main products Kosovo imports from Serbia.
“Even if Kosovo’s ban to Serbian products continues, Albania has few chances of replacing the grain market because of high costs,” says Luan Bregasi, the president of Business Albania.
He says the decision currently provides positive results for Albanian businesses only thanks to a temporary and technical decision.
According to Business Albania, Albanian exporters can gain ground in Kosovo only through exchange of products and their competiveness.
The situation mostly favors Albanian construction materials which are already successfully exported to Kosovo.
Albanian authorities have recently agreed to remove reference prices for Kosovo products, a trade barrier which has prevented Kosovo agricultural exporters from entering the Albanian market during this year.
Data show Albanian imports from Kosovo remain at low levels, accounting for only 0.9 percent of total imports. Meanwhile, Albanian exports to Kosovo have grown considerably to reach 6.1 percent of total exports– making Kosovo the second most important destination for Albanian products after Italy. The construction of the Durres-Kukes highway linking Albania to Kosovo in the shortest possible way has also influenced the increasing trade exchanges between the two countries. Trade exchanges between Albania and Kosovo in 2010 reached 93.8 million Euros, accounting for 2.1 percent of Albania’s total trade exchanges, according to the Ministry of Economy.