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Customs in Morinë, Kosovo-Albania border

By Fatos Çoçoli

On the eve of Kosovo marking 15 years of existence as the newest European state,, since its establishment on February 17, 2007, 90 cooperation agreements have been signed between the governments of Albania and Kosovo (at the Prime Minister, ministers, customs directors, other central and municipality mayors’ levels, etc.).

90 deals, but hindered trade

Economic cooperation between Kosovo and Albania still suffers from many misunderstandings, lack of information and real will between the two states’ agencies, beyond patriotic statements. Of the 90 agreements so far, signed with the government of Kosovo, a good part are agreements in the field of economic exchanges between the two countries.

However, the history of bureaucratic procedures in customs and political obstacles with Kosovo is sad and still stands stubbornly on the way to liberalizing trade and boosting private investments between the two countries.

Even for a truck loaded with fruits and vegetables worth 1,000 euros, the trader or entrepreneur of Albania or Kosovo must pay 250 euros in taxes and other mandatory payments. The current practice of the customs regimes of both our countries, forces the owners of the trucks to become smugglers, if they want to trade!

“We export to many countries of the European Union, but there are more obstacles when we export to Albania than to the EU“, says Bedri Kosumi, an export entrepreneur from Kosovo.

According to a study from the Center for Exports of Albania, customs tariffs and bureaucratic obstacles at the border are the reasons for the lack of significant growth in the expected level of trade between the two countries. The center found that to export goods from Albania to Kosovo and vice versa, the practice costs a minimum of 250 euros. This includes customs declarations, product certificates, goods analysis, the cost of the scanner for Albania, the cost of customs parking in Kosovo, but also in Albania, as well as the Nation’s Highway toll fee..

A solution to formal trade barriers

The Center for Exports of Albania, an NGO, proposes a solution to the main deadlock — a software that must be implemented by both customs administrations, which costs only 50,000 euro.

It records the moment when a business in Albania, for example a small fruit and vegetable business, loads its own truck or pickup truck to export to Kosovo. It automatically waits for the invoice where it marks the NIPT (business identity number) of the Kosovo enterprise that receives the goods.

The software realizes the online transmission of the invoice registered in Kosovo and sends the information directly to the Tax Directorate of Kosovo. Customs needs a reader only for businesses, to read the bar code of the invoice on behalf of the host company of goods in Kosovo, and vice versa in Albania.

Thus, businesses on both sides of the border are no longer obliged to pay 35 euro for the customs declaration, 10 euro for the customs parking in Albania, 40 euros for the customs parking in Kosovo, as well as many other taxes and costs!

And most of all, the businesses will not waste time, hours waiting to get the required documents. This is really the “together without borders” approach. It’s so simple. And it has not been implemented for 15 years!

These bureaucratic obstacles and big customs clearance costs have left the potential for the rapid growth of economic relations between our two countries as simply potential and illusive. Despite initiatives by both governments in recent years, such as the joint counter at the Morina customs point, or the Kosovo customs office in the Durres seaport, etc., as well as the numerous agreements signed, customs costs and bureaucracies remain like the Sword of Damocles on the future of our trade and economic relations, fading any initiative and movement at the political and governmental level.

90 agreements, but blocked investments!

Representatives of producers in Kosovo have claimed that the authorities in Albania are preventing businesses from Kosovo from being more present in the Albanian market. According to them, producers from Kosovo are presented with tariff and non-tariff barriers, such as the case of beer excise tax, then customs clearance procedures in Albania, scanner payment, notarization of analyzes, non-receipt of invoice price by Albanian Customs and many other obstacles, which, according to Kosovo producers, are undermining the competitiveness of Kosovo products in Albania.

In October 2021, the Open Society Foundation for Albania (OSFA) and the Kosovo Open Society Foundation (KFOS) measured in a questionnaire the attitudes of the citizens of Kosovo and Albania, regarding the relations between the two governments. More than 60 percent of respondents stated that the agreements signed between the two governments have had no impact on daily life of citizens from both States.

Even on the part of investors from Albania in Kosovo, despite the increased influx in recent years, their efforts are facing sharp problems.

“Mështenka” case

The company “Stella Consulting”, among the leading investors in tourist resorts in Albania, with a capacity of 1,350 beds of 4 and 5 stars, responded to the call of the Kosovo government for foreign investment in Kosovo and its interest to implement a range of tourism projects, with a project in the mountain resort of Mështenka.Three years have passed now and a significant investment from Albania, worth 22 million euro, is blocked in the tourist point of Brezovica in Kosovo.

After making the initial investment of 4.5 million euros and the realization of the first 150 beds, the company is blocked from investing for the other 350 beds and is faced with State blockage, as well as media attacks in Kosovo. At the end of 2018, a general inspection of the Ministry of Environment of Kosovo blocked the works that were carrying out the rest of the investment in the Mështenka resort.

The general inspection, after verifying the condition of all constructions in Brezovica, in a very selective way and without any legal argument, segregated company’s from Albania investment, blocking it, despite the submission of all construction permits by the latter.

It is here where the ordeal of political abuse with the foreign investor “Stella Consulting” begins. From the date of the political obstruction (you cannot call it otherwise, as no legal or administrative document was presented to justify the action taken by Kosovo’s State authorities, despite the fact that the investment company insisted on its legal reasons), the investment, blocked for more than three years now, is being heavily damaged every day in terms of moral, technical and financial values. Construction structures left unfinished are being irreparably damaged. The technical and financial damage caused by the political blockade of the investment is extraordinary, as the banks, threatened by political blackmail, have demanded the repayment of the loans.

The political reason for the persecution and blocking of investment by Albania lies in the fact that the partner of the company “Stella Consulting” is a personality of Kosovo’s political and public life, Mr. Veton Surroi. He has been a serious opposition to several political parties in Kosovo, by systematically denouncing corruption and lack of legitimacy in the behavior of various Kosovo governments.

One of “Mështenka” villas in Brezovicë, Kosovo

Allegations of violating the permit obtained from the municipality of Srtrpce (which was actually obtained by a subcontractor, a Kosovar company) and of building in a restricted area are absurd. In reality, the investment is not located in prohibited areas for construction, but within the lower area below 1000 m above sea level, where villas have been developed since the historical formation of the residential tourist area in Brezovica, in the time of Yugoslavia of Josif Broz Tito, in 1980s.

Blocking the company’s operations costs the Kosovo economy more than 800,000 euro in missing taxes per year and hundreds of jobs. On the other hand, the biggest damage, the blocking of the investor from Albania is against the interests of Kosovo, because it seriously damages the image of Kosovo, as an economy where one can invest and trust and where foreign investments are protected.

Investment attacks and blockades produce demotivation of foreign investors to risk their capital in Kosovo, and moreover, in an area of strategic importance, such as Kosovo tourism. If investors are hindered, blocked and prejudiced, being verbally violated, then the economic interests of the citizens of Kosovo are also hurt, prejudiced and violated.

The Government of Kosovo has all the time and opportunities to repair the damaged image and establish justice, unblocking the investment and allowing the investor from Albania to continue its investment in Kosovo. The Albanian investor, although unjustly attacked and in severe financial damage from the blockade, is determined to complete the investment.

Table 1. Cost of trade Kosovo-Albania

Cost of a 10 ton truck to Kosovo

– Commercial costs (fuel, driver, depreciation) 220 euro (61%)

– Cost of documents (Vet certificate Kosovo; Vet certificate

Albania; Customs tariff Kosovo; Customs tariff Albania; highway, Scanner) 140 euro (39%)

TOTAL: 360 EURO

Trade obstacles with Kosovo