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Slovensko-Kosovsko Poslovno Združenje Shoqata Afariste Slloveno-Kosovare Slovene-Kosovo Business Association Slovenačko-Kosovsko poslavno udruženje

Newsletter No.4 Dear reader,

As we promised in previous publication of Newsletters, we are very pleased to present to you our “Newsletter No.4”. Considering SKBA Work Program for 2011, in past two months we have held two business events, first was Business evening on topic “Business Protocol”, furthermore, in this evening were discussed many topics, such as: business etiquette, tips & advices when sending e-mails, business meetings, business cocktails, business dinners, international business and many examples from practice related to main topic. Second business event was “ISO 9001-2008 Quality Management System”, moreover, this presentation was very useful for companies who have clearly drawn in their vision to be certified by ISO standards, and those who wants to know all necessary steps during process of standardization. However, in this business evening were discussed topics such as: ISO 9001-2008, principles of ISO 9001-2008, documentation requirements, control of documents, quality policy, review of inputs and outputs, planning of product realization etc. SKBA wish you all the best in your business activities! General Secretary Enver Ferati

INTERVIEW Visar Dobroshi Recura Financials Business Managing Director 1. What kind of investment policy is being used from successful enterprises in Kosovo? - Having in mind that majority of enterprises in Kosovo are private companies with a single owner, including the successful ones, it is hard to say that there are investment policies behind their success. Being owned by a single person or as a family business, the investment practices are very traditional and intuitive. I believe that the main determining factor to some successes is the vision of an entrepreneur and his/their determination to achieve the goal they have set. Having said that, there are many who have also failed in their attempts due to not having clear policies and proper planning and management. 2. What service activities are currently the greatest prospects in Kosovo? - There are several service sectors that offer some prospects in Kosovo market and nearby. Looking at some of the successful companies, we might say that there are opportunities and prospects in investing in Information Technology and Communications, Health, Education but also in consultancy services in different sectors. 3. What are the common mistakes in financial decisions of companies in Kosovo? - Most of mistakes come from the lack of knowledge about the financial practices and the law. Part of the blame should be addressed to the educational system that our society has inherited from the past. Finances have for a very long time been ignored or seen as just a tool to get to an objective, but not as a function in themselves and thus consequently financial planning and financial management were and continue to not be conducted properly in many businesses. This has also caused a very slow development process of more sophisticated the financial transactions, financial instruments and a slow movement of the financial capital in Kosovo, slowing down the growth of the private sector and the economy in general.

Slovensko-Kosovsko Poslovno ZdruĹženje Shoqata Afariste Slloveno-Kosovare Slovene-Kosovo Business Association SlovenaÄ?ko-Kosovsko poslavno udruĹženje

4. What are the most important criteria for foreign investors and what do you advise them? - It is well known that Kosovo has still a lot to work on improving the business environment and conditions, starting from business registration procedures, reducing and eliminating corruption, both real and perceptive, at different levels and going further to a more efficient rule of law and judicial system that is effective and quick in resolving cases as well as a system that understands contemporary business practices; all this leading to a perception of higher risk. Further, there are many issues that link to the structure of ownership in Kosovan companies, who are often very reluctant to absorb equity financing and open up the ownership composition to external parties. The lack of proper management practices, in particular as far as financial reporting is concerned, also creates obstacles in the eyes of foreign investors. Further, the lack of a stock market also hinders the entry of many potential investors. - It is for the stated reasons that Kosovo is also very attractive as it presents many opportunities for foreign investors. Interested investors are looking for good business opportunities, which in our opinion there are plenty of in Kosovo. The end goal is return on investments and Kosovo in our opinion can offer a lot in that direction. Kosovo is currently perceived as high risk, thus offering higher returns, however in reality the risk in Kosovo is at similar levels to the other Balkan countries, thus we tell our investor clients that this is an opportunity to gain higher returns, benefiting from the skewed perception of higher risk than actually. 5 From your experiences what are the conditions of Kosovo to get small investments in small enterprises, especially in advanced technology and knowledge? - I believe that there are conditions for small investments in small enterprises, depending on the innovations offered by entrepreneurs. Kosovo is a young nation and has a young population, and historically is known for entrepreneurship. Advanced technology is nowadays easy to access thanks to the advanced communication technology and this is a great opportunity for those who have ideas to materialize them. In addition to this, Kosovars are very eager to learn new things and there is a large diaspora in developed countries not only as a working force but also in education. - Further, Kosovo is attractive due to its low labor costs, which makes it an interesting destination for investors. Having said that, due to the lack of an financial institutional structure, investors face high pre-entry costs in performing due diligence for their investments, thus the chances for small investments are low, but not impossible. There are several success stories of foreign investments or joint ventures in advanced technologies in Kosovo, and in that sense if the idea is good and there is a visible capacity to implement these ideas, then there are opportunities even for angel or venture investments in Kosovo. 6. What Government of Kosovo must afford in order to proclaim Kosovo as a safe investment state/country ? - As I pointed out, Kosovo is a young country and there is still a lot to do in defining fair policies and laws for business development in the country and improving the rule of law system, with a focus on the judicial system and enforcement of court decisions. 7. What are the unused resources in ordinary works in Kosovo (networking, socially owned companies, joint ventures, different funds for encouraging innovation, tax policy etc) - More or less, everything you mentioned. Fortunately a lot of changes have been made in recent years and Kosovars has started to learn very quickly the business models of successful western companies. A lot of entrepreneurs in Kosovo are familiar with most of resources for making their business successful and they are using available opportunities in their work, although there is a lack of some institutional conditions for doing this at a desired level, such as a legal framework, institutional support etc. 8. What is the difference between Kosovo and Albania market, and what are the unused opportunities? - It is difficult to elaborate in several words but there are differences in several aspects. Majority of differences are

Slovensko-Kosovsko Poslovno Združenje Shoqata Afariste Slloveno-Kosovare Slovene-Kosovo Business Association Slovenačko-Kosovsko poslavno udruženje

at the different level of development of the legal environment and development level of the country, including autonomy of authorities and institutions, and other differences, all this due to the social and political conditions and working habits inherited from the recent history. I belong to those who believe that those differences can offer a lot of unused opportunities and establish a common market, from which everyone will benefit. 9. Currently, which activities in Kosovo have the biggest ROI (Return on Investment) - There are both production and service activities that if carefully planned, can offer very attractive ROI. Agriculture, metals processing, food processing on one side, and real estate, construction, ICT, banking, retail of consumables, consultancy services on the other side. All of these sectors are hardly touched in Kosovo and can offer a large potential for growth and development and can be quite profitable businesses in Kosovo. 10. Your life slogan is? - Whatever doesn’t kill you makes you stronger.

A learning corner Etiquette, manners, and cross cultural, or intercultural communication have become critical elements required for all International and Global Business executives, managers, and employees. As international, multinational, transnational, multi domestic, and global business continues to expand and bring people closer, the most important element of successful business outcomes may be the appreciation and respect for regional, country, and cultural differences - known as cultural diversity. Some tips & advices to good business etiquette which are very welcomed to anyone in business world and which would be respected as well: Writing Emails - Always specify and fill correctly “ subject “ field. - Respect other peoples time, keep your messages short, and do not forward messages with three pages before the message content of the information you want to send. - When you respond to questions that have been sent to you via e-mail, copy only the questions, then give your answers. - Be careful with automatic reply or reply to all: it may happen that your answer goes to the long list of groups instead of a person whom you wanted to send e-mail - Address and sign your e-mail. - DO NOT WRITE IN CAPITAL LETTERS, IT IS STRESSFUL and you will give the impression that you are lazy to write properly. - Minimize shortcuts to practice in e-mails ( itn,flm, KLM, etc. btw.) - Attention to grammar and spelling! - Minimize chain messages, jokes and other personal e-mails (that people more often comment on).

When using telephone - Make calls during regular working hours. - Prepare before you call. - Prepare to leave the appropriate message (including name, telephone number) to reception/wife or secretary camera automatically. - Respond to messages within 24 hours. - When answering calls, answer after the third or fourth ring and present yourself immediately. - Minimize side sounds.. - Smile! Complete the sentence positively and praise the caller. - Use the “Hold” in just a few seconds. - Do not use the “Voicemail” as a device to identify the caller. - Avoid personal calls during working hours

Slovensko-Kosovsko Poslovno ZdruĹženje Shoqata Afariste Slloveno-Kosovare Slovene-Kosovo Business Association SlovenaÄ?ko-Kosovsko poslavno udruĹženje

When using Mobile Phones - Limit important calls when you are with others. - Have consideration for others in public places (example presentations);turn mobile phones off or in this cases do not take it with you. - If you are expecting important calls, place the phone in vibration and leave space to respond. - Do not ask to use mobile phone of other people, - Consider the privacy of calls when you are in public. Business meetings / Coctails - Make research for the company before participating. - Read the newspapers before the meeting, to be updated with news worldwide. - Prepare an informal short presentation of yourself (about 30 seconds), - Take business cards. - Leave your mobile at home or keep it turned off. - Plan to arrive at a right place a few minutes earlier, give yourself time to visit the bathroom first and if it is necessary fix any detail in your appearance, - Come close to people who stand alone or join other groups, avoid groups where are only two people because two persons are usually more personal or have discussion purposes.

Presentations - When presenting in front of businessmen, use selfprepared presentation. - Use eye contact, smile and extend your right hand. - Try to adjust the hand-shaking of the person you salute. - Exercise confidence and attitude of the body. - When you present yourself to others, use the first name of the person who is most important. - If you have forgotten the name of someone, be honest and ask to repeat. - Be positive. - Avoid petty issues and sensitive (eg politics, religion, issues controversial, family affairs, unless the other person begins to speak his family or her.) remain in good themes: time, global positive news, food, hobbies, etc.. - Create enough space around you during the conversation with others. Food and beverages - Keep the drink in your left hand, right hand should be able to Welcoming people you meet. - Eat before you go. Never exaggerate with food in cocktails: - Avoid alcohol or limit it only one drink. You should be in top form! - Eat only light meals, without liquid and that is served in bites.

Slovensko-Kosovsko Poslovno Združenje Shoqata Afariste Slloveno-Kosovare Slovene-Kosovo Business Association Slovenačko-Kosovsko poslavno udruženje

Sponzor of SKBA RECURA Financials is a Kosovan based company focusing on financial services in Kosova and the region, including corporate finance, investment management and asset management services. For our international clients we aim to be a one-stop shop, where besides financial services we provide our clients with legal, tax, market research and logistical services through our strategic business partners. Our clients include some of


Gross Domestic Product (GDP): In 2009: € 3.792 billion, Per capital: € 1,731. Inflation: On average 2.2% per annum over the past five years. Financial Sector: Two tier banking system consisting of Central Bank of the Republic of Kosovo and eight private Banks, 10 Insurance companies and two pension schemes. Enterprises: over 40,000 active SMEs in 2009, app. 50% of total SMEs engaged in trade industry. 500 Socially Owned Enterprises of which 400 already privatized. Budget: In 2010 totaling app. € 1.461 billion. Tariff duties: 10% customs duties on imports, no duties on raw materials, capital and intermediary goods;Excise tax on fuel, tobacco alcohol and luxury goods. No duties and taxes on exports. The New Customs Code is based on EU customs code, and is fully compliant with WCO agreed rules on customs procedures and the Harmonized Commodity. Tax System: VAT 16 %, Corporate Profit Tax 10%, Personal Income Tax progressive max. 10%. Free trade: Customs-free access to the EU market based on the EU Autonomous Trade Preference (ATP) Regime,Central European Free Trade Agreement – CEFTA, over 25 million Kosovo map consumers. Labour market: Average labour cost 292 euro in 2010, skilled and well educated work force. Currency: EURO, since 1 January 2002

the best Kosovan and regional firms as well as international investment funds and venture capital investors operating or interested in the region. Despite the wide range of services, we are a small team of dedicated business people providing a service with a personal touch. With close contacts in the business community as well as the government, we are an ideal partner in any investment endeavor in the Balkans region.

Foreign Investment

• According to the Law on Foreign Investments of Kosovo, foreign investors have the same rights and obligations as residents of Kosovo and are treated equally. • Foreign investors are protected against expropriation and nationalization and have the rights of compensation • A foreign investor has the right to convert any local currency lawfully in use in Kosovo into a freely convertible currency, and to convert any freely convertible currency into any local currency lawfully in use in Kosovo. • A foreign investor has the right to transfer freely convertible currency in and out of Kosovo, including, but not limited to, amounts received in a conversion transaction • A foreign investor have the right to execute employment and other contracts with physical persons who are citizens or permanent residents of a foreign state or a geographic territory outside Kosovo for the purpose of engaging such persons to provide Lake of Gazivoda or perform, in Kosovo, professional, management, administration, supervision, or consultancy services or skilled technical functions. • Foreign investors may own real estate in Kosovo and enjoy the same property rights in respect to real estate as Kosovo citizens and legal entities. • Fully described Law of Foreign Investments you can find on web-site of Privatisation Agency of Kosovo.

Slovensko-Kosovsko Poslovno Združenje Shoqata Afariste Slloveno-Kosovare Slovene-Kosovo Business Association Slovenačko-Kosovsko poslavno udruženje

LATEST NEWS Kosovo and Slovenia strengthen cooperation in agriculture, forestry and food industry Tuesday, 10.05.2011 Deepen cooperation between Kosovo and Slovenia in the field of agriculture, forestry and food processing industry. Ministry of Agriculture, Forestry and Rural Development of Kosovo and the Ministry of Agriculture, Forestry and Food of the Republic of Slovenia, signed a Memorandum of Understanding to support participants in economic, scientific and technical in the field of agriculture, forestry and industry food processing. Source: Ministry of Agriculture, Forestry and Rural Development of Kosovo/ May 2011 Readmission Agreement is signed between the Ministry of Internal Affairs of the Republic of Kosovo and the Ministry of Internal Affairs of the Republic of Slovenia Pristine, 10 may 2011- Internal Affairs Minister, Bajram Rexhepi hosted Minister of Internal Affairs of Slovenia, Katarina Kresal. After the meeting between the two homologues, Readmission Agreement was signed between the Ministry of Internal Affairs of the Republic of Kosovo and the Ministry of Internal Affairs of the Republic of Slovenia. This agreement is a continuation of the work of MIA’s European agenda and visa liberalization. After the signing, Minister Rexhepi thanked the Government of Slovenia for the support given to the state of Kosovo, to the great contribution in the recognition and consolidation of the

state of Kosovo and now in the process of visa liberalization. Source: Ministry of Internal Affairs of Kosovo/ May 2011 PPP – Public Private Partnership in Kosovo Officials of the Ministry of Finance have done the adequate changes on the Law on Public Private Partnership after remarks and recommendations of the European Commission. These changes, are related with public procurement, and were made with the purpose of harmonization of law with EU legislation. Law on PPP, drafted two years ago, is reviewing and will be changed, in order to avoid some defects which has been identified. This law is considered as very important for the reforms which the Government is taking in economy, respectively involvement of the private sector in infrastructure and public services.. According to Lorik Fejzullahu, Head of PPP within MF, this law will specify procurement procedures, so it should be harmonized with the public procurement law. The working group has made the necessary changes, and then this law should be addressed to the normal procedures in the government then in the parliament. On the other hand, the Law on Public-Private Partnership, until now were implemented only in one case, giving by concession of the Prishtina International Airport “Adem Jashari”, while in the future were foreseen also other public infrastructure projects. Source: 2011

Slovensko-Kosovsko Poslovno Združenje Shoqata Afariste Slloveno-Kosovare Slovene-Kosovo Business Association Slovenačko-Kosovsko poslavno udruženje

Energy Regulatory Office in Kosovo The Energy Regulatory Office was established upon the promulgation by the Kosovo Assembly of the Energy Laws on June 30th, 2004. Law 2004/9 “On the Energy Regulator” establishes the independent energy regulator to set the regulatory framework for a transparent and non discriminatory energy market based on free market principles and promote competition. ERO regulates the Electricity, District Heating and Natural Gas sectors. On this links below you can find some of the laws of Energy Regulatory Office: Law on Energy: Law on Elecricity: Law on Energy Regulator: Source: / May 2011

The privatisation agency of kosovo announces the privatisation of the following new co’s on the wave 50 • NewCO Hotel ONIX Banja e Pejes – (Health Spa) about 26 ha of land with more than 38.000 m² floor space of buildings. • NewCO Ereniku Wine Cellar Gjakove –about 31034 m² of land, equipped buildings with the total footprint surface of about 4550 m², and inventory of about 2,000,000 litres of various types of wines and vintages. • NewCO Rilindja Pristina - total surface area of approx. 12,331 m² (1 ha 23 are 31 m²) and two commercial buildings of total area of approx. 2,105 m², located in Industrial Zone in Prishtina • NewCO RATAR Ajvalija, 8-10 km from Pristina, agriculture land with an approx. surface area of 527,135 m² (52 ha 71 are 35 m²). • NewCO RATAR Lapno Selo, 10 km far from Pristina agriculture land with an approx. surface area of 62,680 m² (6 ha 26 are 80 m²).

Slovensko-Kosovsko Poslovno Združenje Shoqata Afariste Slloveno-Kosovare Slovene-Kosovo Business Association Slovenačko-Kosovsko poslavno udruženje

up coming events in slovenia AGRA - 49th International Agricultural - Food Fair Time: 20-25. August 2011, Gornja Radgona, Slovenia AGRA, the 49th International Fair of Agriculture and Food Industry, taking place in Gornja Radgona, on the most fertile field of the new Europe, at the crossroads of four countries, from Saturday, the 20th to Thursday, the 25th August 2011 is featuring healthy food and all we need to produce and process it in an environmentally friendly way. 44th INTERNATIONAL TRADE FAIR Trade Fair for the most enterprising, innovative and bold Time: 7 – 14 September 2011, Celje, Slovenia Complete display of small and medium-sized businesses from Slovenia, Europe and the World. Countries and opportunities on display exhibition of ingenuity, development and remarkable achievements advice for business and home. Slovene-Kosovo Business Conference and B2B meetings Time: 08. September 2011, Chamber of Commerce and Industry of Slovenia, Ljubljana, Slovenia Chamber of Commerce and Industry of Slovenia in cooperation with “Slovene-Kosovo Business Association” from Pristina organize Slovene-Kosovo Business Conference and B2B meetings between the Slovene and Kosovo entrepreneurs. In 2010 participated about 85 businesses from Slovenia and about 25 from Kosovo, this year we expect to be larger number of interested companies to do business in Kosovo and also larger number of companies from Kosovo which are interested to find partner in Slovenia as well.

up coming events in kosovo

Slovensko-Kosovsko Poslovno Združenje Shoqata Afariste Slloveno-Kosovare Slovene-Kosovo Business Association Slovenačko-Kosovsko poslavno udruženje

SKBA Coming Events: •

Business networking “Identifying business opportunities in Information Technology sector” on 21th June 2011 at 15:00!

Business evening “Guest Speaker-succesful manager of Kosovo company” on 23th June 2011 at 17:00!

For more details about this activities you will be informed on time! Slovene-Kosovo Business Association is part of JAPTI from Slovenia (Public Agency for Entrepreneurship and foreign Investments) network of Business clubs, where Ministry of Economy is partly co-financing our activities. We wish a very pleasant welcome to our new members in April and May 2011: Vender Invest d.o.o, IFJB Lesna, Kovit projekti d.o.o, Pivovarna Union d.d, NNP Standard, Ipros d.o.o, AS domžale Moto Center. We are very thankful for trust and reliability that is given to us from our members. We strong believe in closed cooperation with all members of SKBA, and also believe that working together is one of the crucial keys in nowadays for business success. In case you have any additional question, request, or suggestion please feel free to visit us in our office, Square Mother Teresa nr.20, 10000 Pristina (Kosovo Chamber of Commerce building) or by contacting us on: Tel: +386 43 726 074 Fax: +386 43 726 084 E: W: Our main sponsors: • Ministry of Economy of Slovenia • JAPTI (Public Agency for Entrepreneurship and foreign

Investments). • IPKO • VOXMEDII • LESNA • BREWERY PEJA • NLB-Nova Ljubljanska banka • FACTOR BANKA

You can find more information about doing business in Kosovo as follows: Kosova Chamber of Commerce Ministry of Economy and Finance Ministry of Trade and Industry IPAK-Investment Promotion Agency of Kosovo Privatisation Agency of Kosovo Central Bank of Republic of Kosovo Statistical office of Kosovo Kosova Customs Newspapers

“ Newsletter No.5 will be published in July 2011”

Newsletter No.4  

Visar Dobroshi Recura Financials Business Managing Director 2. What service activities are currently the greatest prospects in Kosovo? - The...

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