Invest in Kosovo: Brief economic overview

Kosovo is one of the youngest countries in Europe with a lot of potential. With an annual GDP growth rate of around 4%, a skilled workforce and a business-friendly climate, Kosovo is interesting for companies and investors. The economy is primarily driven by services. They account for more than half of GDP, followed by industry and agriculture. The Ecovis experts report on the opportunities the country offers foreign investors and companies.

Why invest in Kosovo?

1. Young and educated workforce: Over 50% of Kosovo’s population is under 30. The youthful workforce is highly educated, with strong expertise in fields such as information technology, engineering, finance, and business services. It is also relatively cost-effective.
2. Tax incentives: With a corporate tax rate of just 10%, Kosovo offers one of the lowest rates among its neighbouring countries. This strategic advantage allows businesses to dramatically reduce tax burdens while benefiting from direct access to a dynamic, growing market. For companies aiming to maximise profitability and operational efficiency, Kosovo’s tax regime presents an unmatched opportunity in the region.
3. Strategic location: Strategically located in the heart of the Balkans, Kosovo serves as a gateway to both regional and broader European markets. The country boasts excellent road connections to neighbouring countries, facilitating seamless trade and movement across borders. As a member of the Central European Free Trade Agreement (CEFTA), Kosovo enjoys preferential access to regional markets, creating a favourable environment for businesses looking to expand. Additionally, Kosovo is progressing steadily on its path towards European Union integration, further enhancing its potential as a future EU-linked market hub. This combination of connectivity and trade advantages makes Kosovo an ideal base for businesses aiming to scale within Europe.
4. Ease of doing business: Kosovo has positioned itself as a regional leader in the ease of doing business. Through comprehensive reforms in key areas such as business registration, property rights, and tax administration, Kosovo has streamlined processes that are crucial for attracting foreign investors. These improvements have significantly reduced bureaucratic hurdles, making market entry smoother, faster, and more cost-effective for international businesses. With these advancements, Kosovo stands out as an increasingly attractive destination for investment in Southeast Europe.
5. Low labour costs: Kosovo offers exceptionally competitive wages, making it one of the most cost-effective options in the region. This advantage is particularly valuable for businesses in labour-intensive sectors, allowing them to access a skilled and highly motivated workforce.

We specialise in auditing, accounting, tax and financial consulting and support companies and investors in establishing themselves in the dynamic market.

Nehale Hajredini, Audit Assistant, ECOVIS UA Kosova SH.P.K., Auditing, Accounting, Tax Services and Financial Consulting, Pristina, Kosovo

High growth industries in Kosovo

1. IT and technology: Kosovo’s tech industry is expanding rapidly, fuelled by a young, tech-savvy population. With a growing number of IT startups and software development firms, Kosovo is becoming a hotspot for outsourcing and technology-related investments. The country is already home to a thriving startup ecosystem and has the potential to be a regional leader in tech innovation.
2. Business services (audit, accounting, and financial consulting): As businesses grow, so does the demand for professional services such as audit, accounting, tax advice, and financial consulting.
3. Renewable energy: Kosovo has immense potential in the renewable energy sector, particularly in wind and solar power. The government is keen to reduce its dependence on coal and is increasing investment in cleaner energy sources. This makes it an exciting sector for investors interested in green technologies.
4. Agriculture: Agriculture continues to play an important role in Kosovo’s economy, with opportunities in organic farming, food processing, and exports. As demand for organic and sustainable products grows globally, Kosovo’s fertile land and low-cost production provide great potential for agriculture-related investments.
5. Construction and real estate: Kosovo’s real estate sector is experiencing growth, especially in urban areas such as Pristina. With increasing demand for both residential and commercial spaces, this sector offers solid returns for investors.

Conclusion

Given its strong economic fundamentals, favourable business environment, and strategic location, Kosovo stands out as a destination with high investment potential.

For further information please contact:

Nehale Hajredini, Audit Assistant, ECOVIS UA Kosova SH.P.K., Auditing, Accounting, Tax Services and Financial Consulting, Pristina, Kosovo
Email: nehale.hajredini@ecovis-uakosova.com