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Š Martin Lehman


Kosovo’s Fact File


Kosovo’s Fact File Making Progress Towards EU Integration Minister Welcomes Export-Oriented Enterprises

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Economic Development Minister Highlights Opportunities High-Potential Sectors, from Mining to Food-Processing Bringing Healthcare System up to EU Standards University of Medical Sciences Rezonanca

• MUNICIPALITIES OF KOSOVO • Fushe Kosove’s Location Makes it True Gateway to Kosovo • Municipality of Fushe Kosove • Gjakova’s Mayor Cites City’s Advantages as Business Base • Municipality of Gjakova • Malisheva: Succesful International Partnerships and Great • • • • • • • • •

Investment Appeal Municipality of Malisheva Strategically Located Drenas Opens New Economic Zone Municipality of Drenas Podujevo Building on Strategic Location, Diverse Sectors Municipality of Podujevo Klina, Kosovo’s Crossroads, Welcomes FDI Municipality of Klina Istog Municipality Rolls Out the Red Carpet for Investors Municipality of Istog


Central Bank Continues to Promote Stability Financial Indicators Positive Banka Kombetare Tregtare

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Official Name:

Republic of Kosovo


Southeast Europe, between Serbia and Macedonia



Border countries: Albania, Macedonia, Montenegro, Serbia Population:

1,863,529 (2012 est.)

Ethnic Groups:

Albanians 92%, other (Serb, Bosniak, Gorani, Roma, Turk, Ashkali, Egyptian) 8%

Official Language: Albanian Currency:



10,887 sq km

Politics Government type: Republic Independence:

17 February 2008 (from Serbia)

Chief of state:

President Atifete Jahjaga (since 7 April 2011)


The president is elected for a five-year term by the Kosovo Assembly; election last held on 7 April 2011

Economy at a Glance GDP (purchasing power parity): €10.4 billion (2011 est.) GDP per capita:

€5,300 (2011 est.)

GDP real growth rate:

5% (2011 est.)


Mineral mining, construction materials, base metals, leather, machinery, appliances, foodstuffs and beverages, textiles

Total exports:

€324.33 million (2011 est.)


Major Improvements in Transport, Energy and Municipal Infrastructure Regional Water Company Prishtina Hidrodrini Regional Water Company


New Destination on the Global Travel Map Emerald Hotel

33 34 35

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Export commodities:

Total imports: Import commodities:

Mining and processed metal products, scrap metals, leather products, machinery, appliances, prepared foodstuffs, beverages and tobacco, vegetable products, textile and textile articles €2.55 billion (2011 est.) Foodstuffs, livestock, wood, petroleum, chemicals, machinery, minerals, textiles, stone, ceramic and glass products and electrical equipment Source:

The European Times PO Box 685 66 - London EC1P 1XP - United Kingdom Phone: +44 (0)208 371 2356 - Fax: +44 (0)208 371 2410 - The European Times is a trading name of Crystal Mediacorp Ltd This guide is protected by copyright. All rights reserved. This publication, or any part thereof, may not be reproduced, stored electronically or transmitted in any form, without the prior written permission of European Times. Every effort has been made to ensure information contained in this publication is correct and up-to-date. The authors and publisher accept no responsibility for any errors it may contain, or for any loss, financial or otherwise, sustained by any person using this publication. Project Managers: Brian Franck, Elliott Wood – International Business Analyst: Viktor Gjorgjieski – Project Coordinators: Seth Yumich, Brandon Beachum Regional Manager: Aukje Oostendorp Editorial: Emily Emerson-Le Moing Head of Production: Vicky Kox – Production Coordinator: Stefanie Mentens Design: Martine Vandervoort, Dirk Van Bun, Walter Vranken, Carine Thaens, Johny Verstegen


Deshmoret e Kombit Vushtrri Tel: +377 44 19 6685

Pristina–Mitrovica highway Pestova Tel: +381 28 57 2770 -


Introduction xxxxxx

Making Progress Towards EU Integration Today’s Kosovo – strategically located in South-Eastern Europe bordering fast-growing Serbia, Montenegro, Macedonia and Albania – is rapidly building a thriving economy which offers significant investment potential. Kosovo’s declaration of independence from Serbia in 2008 was supported by the UN Security Council Resolution 1244, and in July of this year, the International Steering Group for Kosovo decided to grant full rights of national sovereignty to Kosovo beginning in September 2012, helping to pave the way for the country’s EU integration. Kosovo has a democratic government currently headed by President Atifete Jahjaga and Prime Minister Hashim Thaçi. With a youthful population of around 2 million, Kosovo is multilingual and multicultural; the country’s main spoken languages are Albanian, Serbian, Bosniak and Turkish and its main religions are Muslim, Serbian-Orthodox, and Roman-Catholic. Kosovo’s Assembly (parliament), with 120 seats, represents all the country’s ethnic groups. Twenty of the seats are reserved for non-Albanian minorities; ten for Kosovo-Serbs; four for the Roma, Ashkali and Egyptian communities; three for the Bosniak community; two for

the Turkish community; and one for the Gorani community. Kosovo’s GDP grew by around 5% in 2011 to reach around €10.4 billion, with per capita GDP of around €5,300. The EU is Kosovo’s top trade partner, accounting for 38.5% of total trade in 2011, followed by the CEFTA countries (34.2%) and other markets.

Stronger ties with the EU Kosovo has received significant assistance from the international community since the end of the war and is now strengthening its ties to the EU. Tensions between Kosovo and Serbia continue, but some rapprochement between the two countries seems to be in progress. As Council of Europe Secretary-General Thorbjorn Jagland pointed out

in July, the majority of the council’s members have officially recognised Kosovo. He said, “What is important is for the joint programmes with the EU in Kosovo to continue, and Belgrade and Prishtina now have an agreement on regional cooperation.” EU Foreign-Policy Chief Catherine Ashton noted recently, “Kosovo remains an EU priority. It has a clear European perspective.” The EU has two main organisations active in Kosovo: the EU Rule of Law Mission (EULEX) and the office of the EU Special Representative (currently Samuel Zbogar), which advises the government concerning Kosovo’s drive towards European integration. Samuel Zbogar noted recently, “The EU remains devoted to continue to mediate the dialogue between Kosovo and Serbia in order to support Kosovo’s path towards the EU.”






Minister Welcomes Export-Oriented Enterprises Mimoza Kusari-Lila, Deputy Prime Minister and Minister of Trade and Industry, discusses Kosovo’s trade policies and opportunities for investors. European Times: What is the Ministry of Trade and Industry’s mission? Mimoza Kusari-Lila: We want to bring Kosovo’s trade policies fully in line with the EU’s. At the end of this year the ministry will be in charge of developing a free-trade agreement with the EU, and we are working to remove all trade barriers. Our ministry is also in charge of trade promotion. We are here to provide investors with all the information they need as well as the infrastructure which will ensure that their investments are a success. European Times: What has your ministry done to make investing in Kosovo easier? Mimoza Kusari-Lila: We have streamlined procedures for starting a business and simplified construction permits and other processes. We have opened 22 one-stop shops around the country and will open six more. Investors can now find information and register companies in almost every municipality.

Mimoza Kusari-Lila, Deputy Prime Minister and Minister of Trade and Industry

European Times: What about joint ventures? European Times: Why should investors choose Kosovo? Mimoza Kusari-Lila: The IMF ranks Kosovo’s fiscal policy the best in Europe, since it is very simple and offers many incentives. Kosovo has a 10% flat tax, no tax on reinvested profits, and only 16% VAT. In addition, we have a young, multilingual, low-cost workforce. European Times: What are some of Kosovo’s success stories? Mimoza Kusari-Lila: ICT company 3CIS, AS Foods, a successfully privatised metal-processing company, a rubberprocessing plant, and many textiles companies are a few of the examples of highly successful export-oriented enterprises in Kosovo. We want to attract more exportoriented companies which will boost our trade balance and enhance Kosovo’s reputation as a business base.


Mimoza Kusari-Lila: We strongly favour joint ventures with international companies which bring new know-how to Kosovo while Kosovo provides skilled labour and understanding of the local and regional market. One successful joint venture is IPKO, our second mobile operator. Slovenia is a key joint-venture partner, for example in the Peja Brewery and in the financial sector. Devolli, in the dairy sector, and Rugova are just two examples of excellent potential local partners. European Times: What is your personal message to investors? Mimoza Kusari-Lila: Come and invest in Kosovo! It is a young country with a youthful, skilled, motivated workforce as well as great natural resources and many high-potential sectors.


• Economic Development Minister Highlights Opportunities • High-Potential Sectors, from Mining to Food-Processing

Business & Investment

“We want to strengthen the private sector, establish legislation that promotes private investment, and create clear strategies for sectors like mining, energy and telecommunications.” Besim Beqaj, Minister of Economic Development






Economic Development Minister Highlights Opportunities Besim Beqaj, Minister of Economic Development, discusses how his ministry is helping to position Kosovo as an attractive investment target. European Times: What are your ministry’s priorities? Besim Beqaj: This is a new ministry tasked with enhancing Kosovo’s economic potential and creating more opportunities in key sectors. We want to strengthen the private sector, establish legislation that promotes private investment, and create clear strategies for sectors like mining, energy and telecommunications. We are committed to continuing to upgrade the business environment, reduce unemployment, and extend Kosovo’s economic reach. One of our major goals is to establish clear policies in the mining sector, especially concerning Trepca’s privatisation. Privatisation in Kosovo is no longer handled by the UNMIK but by Kosovo’s own institutions. European Times: What else is your ministry doing to promote the mining sector? Besim Beqaj: We have established 11 special mining zones and have created clear processes for acquiring exploration licenses. We believe public-private partnerships can work very well in the mining sector. European Times: Where does most of Kosovo’s FDI come from? Besim Beqaj: Most of our foreign investors are from Germany, the UK, Slovenia, Austria, Switzerland, Albania, Turkey, etc. Slovenia is very active in the banking, insurance and manufacturing sectors and we have recently seen an increase in Turkish investments, some of which are through international consortiums. European Times: What are sectors with particularly strong potential? Besim Beqaj: Mining and food-processing have excellent prospects. Kosovo is also a good choice for business outsourcing now that other locations are becoming expensive.


Besim Beqaj, Minister of Economic Development

European Times: Why should international investors target Kosovo? Besim Beqaj: Kosovo has a very competitive tax regime with low corporate tax, a regulatory environment fully harmonised with EU standards, streamlined procedures for launching a business, great human capital, and a level playing field for foreign investors. In addition, our new industrial parks offer well-developed infrastructure. European Times: What are some major projects in the works? Besim Beqaj: We have privatised electricity distribution and plan to build a new lignite-fuelled power plant in a project budgeted at more than €1 billion. We are expecting bids from four qualified companies for this project, which is supported by the EU and the World Bank. European Times: What is your personal message to potential investors? Besim Beqaj: Kosovo’s economy is very dynamic and growing faster than those of other countries. Kosovo will be a very attractive investment location for the coming decade and is an ideal gateway for investors looking to access the CEFTA market.


Businessxxxxxx & Investment

High-Potential Sectors, from Mining to Food-Processing Kosovo’s young economy offers many competitive advantages for investors, including extensive natural resources, from lignite to rich agricultural land; well-established construction-materials and textiles industries; a youthful, wellqualified, multilingual population; a very favourable tax regime; a strategic location; the euro as the national currency; significant tourism potential; and a business-friendly government. As Kosovo’s Minister of Economic Development, Besim Beqaj, says, “We want the private sector to drive the country’s economic development and have a direct impact on making Kosovo more attractive for investors.” Over the past few years Kosovo has strengthened its market-based economy and maintained macroeconomic stability. While Kosovo’s GDP is still heavily dependent on international aid and remittances, and per capita GDP is low, Kosovo is definitely making progress. Its GDP grew by around 5% in 2011. Kosovo continues to privatise its stateowned enterprises and has been improving its regulatory environment, infrastructure, power network and technical standards with the help of foreign partners. In June this year, Austria’s Kelag celebrated the groundbreaking of its €60 million hydropower-plant project in Kosovo and the government privatised the national electricity-distribution company (KEDS) in a sale to a Turkish consortium. In July, Bechtel and its joint-venture partner Enka completed an additional 4.5 km of the Kosovo motorway,

bringing the total distance of this key transport artery to 42.5 km.

Regional trade hub Kosovo’s small size and relatively small trade sector have helped to protect it from the worst of the global financial crisis. The EU and CEFTA markets are Kosovo’s top trade partners, and Kosovo aims to serve as a hub for EU trade with CEFTA as well as Turkey and other markets. Sectors with particularly strong investment potential in Kosovo today, according to IPAK, the country’s investment-promotion agency, include agriculture and food-processing, woodprocessing, metal-processing, construction and construction-materials manufacturing, textiles, IT, automotivecomponents manufacturing, energy, mining, tourism, banking and financial services, and IT outsourcing. Kosovo already has a number of FDI success stories, including SharrCem (Switzerland), NLB Prishtina (Slovenia), Trofta (Belgium), Stone Castle (US/Albania), Tefik Canga Design (Macedonia/Kosovo), Fer-


ronikel (UK), IPKO (Slovenia), Xella (Germany), Kosova Wood (US/ Albania), M&Sillosi (Switzerland/ Macedonia), Peja Brewery (Slovenia), and Unior Aqua (Slovenia/Kosovo). Fadil Abdullahu, CFO, Xella, explains, “Xella’s construction bricks are the result of a very effective combination of Kosovo’s high-quality raw materials and German technology.” Peja Brewery’s General Director, Sebastian Gargeta, adds, “We are very pleased with Kosovo’s skilled workforce, and also with our local suppliers.”

META L CONSTRUCTI O N Main road: Prishtina - Skopje New Industrial Zone km.8 10 000 Prishtina Tel: +381 38 58 0506

+377 44 505 104

12060 Bardhi i Madh Kosova Tel: +381 38 591 882







Bringing Healthcare System up to EU Standards Kosovo’s healthcare system, virtually destroyed during the war years, has been steadily rebuilt based on four top priorities: focussing on primary care, reforming secondary and tertiary care, improving public-health systems, and devising a workable healthcare-financing system. Progress has been made on all fronts.


University of Medical Sciences Rezonanca

Clinic and Faculty of Medicine Serving as Benchmark in Healthcare Sector The Rezonanca Clinic and the Rezonanca University of Medical Sciences are helping to drive the development of Kosovo’s healthcare sector. The Rezonanca Clinic reopened in 2000 after being destroyed in the war and now offers a wide range of world-class healthcare services, from neurosurgery and cardiac care to paediatrics, plastic surgery, abdominal surgery, radiotherapy and more. The clinic has implemented cutting-edge diagnostics equipment and technologies and has two locations in Prishtina as well as facilities in Prizren, Gjakova and Orllan-Batllave.

Family-health training centres have been opened around the country and infant and maternal mortality rates are falling. Minister of Health Ferid Agani recently announced that UNICEF’s support has helped the government expand immunisation campaigns, promote the use of iodised salt, and launch anti-smoking initiatives, among other primary-care programmes. Kosovo’s hospitals and public-health facilities have been improved, investment in private healthcare facilities is growing, and the Kosovo Health Insurance Fund has been set up with the support of the World Bank, but Kosovo’s healthcare system still falls short of EU standards. To help bridge the gap, Ferid Agani recently met with his counterpart in Albania concerning a plan to craft a joint healthcare-development strategy which would include promoting pharmaceuticals investment. With the support of USAID and private financing, Kosovo pharmaceuticals producer Nexhet Kondirolli has already opened the region’s first pharmaceutical plant which complies with EU quality standards. Its market is 10 million customers in Kosovo, Albania, Macedonia and Bosnia-Herzegovina.


The Rezonanca University of Medical Sciences, licensed by the Ministry of Education, Science and Technology, has introduced 21st century concepts in medical education. Dr. Ramadan Idrizaj, owner of both the clinic and the faculty of medicine, explains, “Our vision for our medical faculty over the coming five years is to continue to improve our medical education and research in line with EU and international standards.” The university aims to offer courses in English, to recruit the finest staff and to form partnerships with other medical institutions abroad. It offers bachelor’s degrees in many health fields. Building on a strong commitment to the highest international standards, the Rezonanca Clinic and the Rezonanca University of Medical Sciences are improving quality of life for the people of Kosovo. UNIVERSITI I SHKENCAVE MJEKËSORE UNIVERSITY OF MEDICAL SCIENCES


University of Medical Sciences Rezonanca Rr. Mbreti Zor I Nr. 1 - Prishtina Tel: +381 38 544 754 -


• Fushe Kosove’s Location Makes it True Gateway to Kosovo • Gjakova’s Mayor Cites City’s Advantages as Business Base • Malisheva: Successful International Partnerships and Great Investment Appeal • Strategically Located Drenas Opens New Economic Zone • Podujevo Building on Strategic Location, Diverse Sectors • Klina, Kosovo’s Crossroads, Welcomes FDI • Istog Municipality Rolls Out the Red Carpet for Investors

Municipalities of Kosovo






Fushe Kosove’s Location Makes it True Gateway to Kosovo Fushe Kosove, known as the Gateway to Kosovo, offers a number of significant attractions for local and foreign investors. Burim Berisha, Mayor, has received five awards from USAID for progressive leadership, and he is committed to spurring on the municipality’s continued development. European Times: What makes Fushe Kosove special as a business base? Burim Berisha: Fushe Kosove, with a population of around 34,000, stands out among other municipalities in Kosovo because of its ideal location and infrastructure. Only 5 minutes by car from downtown Prishtina, Fushe Kosove is closer to Kosovo’s international airport than any other municipality and is also the hub of the national railway system, Kosovo Railways, through which companies can ship goods all over the country and beyond. Thanks to its position and infrastructure, Fushe Kosove truly is the gateway to Kosovo.

Burim Berisha, Mayor of Fushe Kosove

River. We have received assistance from the USAID in improving our agriculture sector and now we are looking for investment in new irrigation systems to help our agriculture sector reach its full potential. In addition to growing crops, poultry and dairy production as well as meat packaging have strong growth prospects here.

European Times: What are the municipality’s top sectors?

European Times: What are your main goals for Fushe Kosove?

Burim Berisha: Before the 90s Fushe Kosove was a major centre for grain, and the city still has many mills and silos. Today, the municipality remains a thriving agricultural centre and offers around 750 hectares of agricultural land to be developed; this land has access to the Drinicaj

Burim Berisha: Reducing unemployment, improving educational, cultural and social opportunities for our local residents, and promoting sustainable development are our top priorities. In the agriculture sector, we have very skilled and experienced human resources and very attractive labour costs.


European Times: What is your personal message to potential investors? Burim Berisha: We have created a very transparent report on investment opportunities here which outlines the municipality’s geographical, cultural and economic possibilities. I would like investors to know that Fushe Kosove is a quiet, stable locality which is free of ethnic conflicts and dedicated to building a thriving community with high quality of life. This is a place where everyone, local and foreign alike, can work together and prosper in a pro-business, transparent and culturally rich environment. Fushe Kosove has a strong track record for successful business activities and we welcome new investors.


Municipalities of Kosovo


Municipality of Fushe Kosove

Excellent Business Base Just Outside the Capital Fushe Kosove municipality (also known as Kosovo Polje), which is strategically located just 8 km southwest of Prishtina, has grown to become one of Kosovo’s most dynamic districts. Formerly part of Prishtina municipality but with its own identity since 1989, Fushe Kosove municipality is overseen by Mayor Burim Berisha, Deputy Mayor Fadil Krasniqi, and Deputy Mayor for Communities Boban Filipovic. The municipality has a population of over 34,000. Mayor Burim Berisha has driven forward a wide range of projects which have improved quality of life in the municipality and enhanced its investment appeal. These projects include new and improved roads, water-supply systems, sanitation systems, parks and gardens, sports facilities, and initiatives designed to support the agriculture sector, including livestock development. One of the mayor’s projects has brought a solar-powered public lighting system to the municipality. SOE Electra has installed solar-powered lights in key locations throughout the municipality, including along major streets and intersections and near schools, clinics, religious facilities and more. Around 50% of the new lighting system is in Fushe

Kosove City while the remainder is in villages within the municipality.

Extending innovative solar lighting throughout municipality Kosovo’s Ministry of Public Administration and the municipality itself jointly funded the project. The solarpowered lighting system switches on at 5PM and switches off at 6AM. Mayor Burim Berisha says, “We are very satisfied with this project and hope that soon the solar-powered lighting system will cover the entire municipality.” Fushe Kosove’s population is ethnically diverse, and to alleviate unemployment among minorities, UNICEF has funded a project which aims to improve the education of the local Roma, Ashkali and Egyptian communities by strengthening the capacity of municipal officials. The project is one of Kosovo’s municipal action plans designed to promote the national ‘Strategy for the Integration of Roma, Ashkali and Egyptian Communities in Kosovo’ over the period 2009 to 2015.

Fushe Kosove’s economy is dominated by agriculture and smalltrading companies, and the municipality now has around 800 registered private enterprises. Fushe has exceptionally well-developed transport infrastructure; all its villages are connected to Fushe Kosove City by paved roads. Fushe is also set on the main road linking Prishtina to Kosovo’s international airport and it is the location of Kosovo’s main railway station, which offers rail connections to Skopje and other towns throughout Kosovo. Fushe Kosove municipality welcomes foreign investors, who can take advantage of a convenient location near Kosovo’s capital.

Municipality of Fushe Kosove Mother Theresa street 12000 Fushe Kosove Tel: +381 38 53 5004






Gjakova’s Mayor Cites City’s Advantages as Business Base Mayor Dr. Pal Lekaj points out why Gjakova is an excellent choice for foreign investors today. European Times: Can you describe Gjakova’s business climate? Pal Lekaj: Gjakova is known for its culture, forwardthinking people and agriculture. We have some successful companies, including one producing construction materials and another one involved in trade. We also have a few state-owned companies which we expect to become very successful once they are privatised. European Times: What opportunities does Gjakova offer foreign investors? Pal Lekaj: During the Yugoslavia years, Gjakova had 57 very successful large enterprises. As a result of the transition, almost all of these companies were closed and their employees lost their jobs. This means that Gjakova has highly skilled workers ready to be employed in the industries that once existed here. In addition, we have a technical high school where students are trained for factory work. Moreover, we have built an industrial zone which we have equipped with all the necessary infrastructure for businesses, including electricity, roads and water. We offer building land in the zone at special rates or even free. We anticipate that this zone will eventually provide around 2,000 jobs. European Times: What makes Gjakova a good base for business? Pal Lekaj: We are doing everything we can to make Gjakova an ideal business base. We have streamlined administrative procedures for registering companies and obtaining licenses. Investors can benefit from Gjakova’s very strategic position within easy access of Montenegro and Albania as well as the ports at Shengjin and Durres. Gjakova’s location makes it the perfect choice for trade-oriented companies. European Times: Can you single out some highpotential sectors?


Dr. Pal Lekaj, Mayor of Gjakova

Pal Lekaj: Around half of the municipality’s land area of 586 sq km can be used for agriculture, so food production and food-processing have the greatest potential here. In addition, our local labour force is trained to work in metal-processing, textiles and other industries. European Times: What is your personal message to potential investors? Pal Lekaj: Gjakova was very well developed in the past, and now we are doing everything in our power to repair the damage caused by war and the transition to return the municipality to its former prosperity. Gjakova offers investors a welcoming population, a skilled labour force, an excellent location, and a very supportive municipal government.


Municipalities of Kosovo

Municipality of Gjakova

Ideal Choice for FDI Gjakova, with a population of 150,800, is Kosovo’s third-biggest municipality. Located in the western part of the country, Gjakova was a thriving industrial and agricultural hub during the Yugoslavia years and is now one of Kosovo’s top locations for business. The municipality has developed an expanding private sector and still has some state-owned companies which are expected to grow rapidly once they are privatised. Gjakova is an agricultural centre with extensive arable land, extensive sources for irrigation, and a sunny climate. Both agriculture and the food-processing industry have excellent development potential in the municipality. One of Gjakova’s key attractions for investors is its highly skilled, motivated workforce, particularly in the industries that were well established here before the dissolution of Yugoslavia; these include metals, electronics, textiles, the production of wine and other beverages, woodprocessing, tobacco, the production of industrial gasses, gum production, and construction, as well as agriculture and food-processing. Labour costs are low.

Strategic location and welldeveloped infrastructure For trade-oriented companies, Gjakova offers a very convenient location within easy access of markets in nearby Albania and

throughout the region. Companies can also count on the municipality’s well-developed telecom and transport infrastructure, which includes efficient road, rail and airtransport links as well as access to ports at Shengjin, Durres (Albania) and Thessaloniki (Greece). Gjakova also offers excellent quality of life and is attracting more and more tourism visitors thanks to its natural beauty, lively cultural scene, and historic landmarks, many dating back to the 17th century. Gjakova’s Çarshia e Madhe, or Grand Bazaar, was damaged during the 1999 war but has now been almost completely renovated, and just outside the city in the village of Bishtazhin is the 18th century ‘Tailors’ Bridge’, a fine example of Ottoman stone-bridge architecture. Gjakova also hosts a prestigious film festival, among many other cultural events.

All investors in Gjakova benefit from Kosovo’s free access to the EU and CEFTA markets as well as preferential access to the US market. In addition, investors are protected by Kosovo’s regulatory environment which meets all EU standards. Gjakova’s municipal government is committed to creating the right conditions for companies to achieve success. Local leaders have simplified procedures for establishing a company and obtaining permits, and a new industrial zone provides the ideal location for new enterprises. Gjakova has a strong track record for economic growth and is ranked one of Kosovo’s most promising local economies.

Mother Theresa street Gjakova Tel: +381 39 032 1100






Malisheva: Successful International Partnerships and Great Investment Appeal Isni Kilaj, Mayor of Malisheva, highlights his municipality’s investment attractions. European Times: Can you introduce our readers to Malisheva? Isni Kilaj: Malisheva, with a population of around 70,000, is located in central Kosovo, around 50 km from each of the country’s biggest cities: Prishtina, Prizren, Peja and Gjakova. A new highway between Prishtina and Albania will pass only five km from the centre of Malisheva. European Times: What are the most promising sectors for investors? Isni Kilaj: Our main economic sectors are agriculture and tourism. Agriculture is number one. Before the war, we had 1,400 hectares of vineyards. We have wellestablished operations growing seasonal vegetables and fruits, and the area is known for its high-quality farmland and productive orchards. Livestock production, including dairy farming, offers excellent opportunities as well. Motikom, which raises lambs, and Hoting, which has around 100 hectares of orchards, are two of our most successful companies. In the tourism sector, the municipality has built a swimming pool taking advantage of the warm natural spring waters of Banja, which has the potential to become one of the best spa centres in the region. We also have an attractive cave which can be a tourism attraction, and some of the famous Mirusha waterfalls are within Malisheva municipality.

Isni Kilaj, Mayor of Malisheva

We are currently building an industrial zone near the new highway where businesses can enjoy excellent conditions. We have a history of productive international partnerships, for example with USAID and with the Norwegian government, which built the School of Competence here to train young people in new skills. This is one of Kosovo’s most successful projects.

European Times: What are you doing to attract FDI?

European Times: What is your personal message to potential investors?

Isni Kilaj: We offer free land, tax holidays for five to ten years, business registration in only one day, and the Municipal Centre for Businesses, a business-support centre launched with USAID. We are open to publicprivate partnerships, for example in the tourism sector, and our community is one of the safest in Kosovo, with no corruption and very low crime rates.

Isni Kilaj: We have greatly improved our infrastructure, including our roads and water systems, and we will continue to complete new infrastructure projects. We have created great conditions for foreign investors, including very business-friendly leaders, a safe community, and a pool of trained young people who are ready to work.



Municipalities of Kosovo

Municipality of Malisheva

Malisheva: Fertile Land in the Heart of Kosovo The Municipality of Malisheva (also known as Llapusha) is a fertile, attractive city and collection of villages covering over 306 sq km along the Mirusha River in central Kosovo. Known by residents as the ‘Heart of Kosovo’ for its location in the centre of the country, Malisheva was officially established as a municipality in 1960 for five years, and then re-established from 1986 until 1992 and again in 1999. Malisheva has a long history dating back to the Illyrian period, but today it is a thriving agricultural centre with an ethnically diverse population of 70,000 people, around 65% of them young. Mayor Isni Kilaj and Deputy Mayor Rexhep Mazreku lead Malisheva’s government and have launched a number of projects to improve the municipality’s infrastructure and services, including building a new park along the Mirusha River.

Agriculture, trade and tourism Malisheva has long been known for its fertile soil and temperate continental climate, and agriculture is the main economic activity. Malisheva’s location in the centre of the country is an added advantage since local farmers can easily access markets all over the country. The Mirusha River provides reliable irrigation for agricultural enterprises. To support the private sector, the municipality has built a modern trade centre and an industrial zone, and in 2010, Malisheva was chosen as one of two municipalities in Kosovo to host vocational education and training centres financed by the Norwegian Ministry of Foreign Affairs along with Kosovo’s Ministry of Education, Science and Technology. Two new schools, each budgeted at around €6 million, are designed to be centres of competence which will boost Kosovo’s economic development. The one in Malisheva focusses on commerce, administration and trade. Malisheva municipality is also known for the great natural beauty of its fertile river valley surrounded by

the rugged Drenica Mountains. Malisheva is also the site of some of Kosovo’s top tourism attractions, including Ilixha thermal springs in the village of Baje, Flladi Cave in Panor, Mirusha Falls in Llapqeva, the ancient Arabaxhi Bridge in Bubël, the Berisha Mountains in Berisha, Illyrian tombs in Malisheva City, and many other sites. Malisheva has privatised most of its public enterprises, including NPB.Mirusha, a leader in the agriculture sector. The municipality now has around 820 registered private businesses, most of them small, which employ a total of around 1,200 people. Around 46% of these companies are involved in trade. Malisheva municipality welcomes foreign investors, particularly in trade, agriculture and tourism projects.

Municipality of Malisheva street “Gjergj Kastrioti-Skenderbeu” Tel.: +381 29 269 043/008





Strategically Located Drenas Opens New Economic Zone Drenas municipality, at the centre of Kosovo, has a population of around 73,300 and covers some 290 sq km. Nexhat Demaku, Mayor, discusses Drenas’s investment attractions. European Times: What gives Drenas its investment appeal? Nexhat Demaku: Drenas has a very strategic location in the centre of the country with rapid access to Kosovo’s biggest cities as well as to neighbouring Albania. Agriculture is our most developed sector and we have around 16,000 hectares of arable land. One of Kosovo’s biggest investors, Ferronikeli, chose Drenas for its agricultural enterprise. Ferronikeli actively exports its products and has 1,000 full-time employees and 400 seasonal workers here. Drenas is an ideal choice for investments in the production of fruits and vegetables as well as of meat and milk products. Only around 20% of the meat consumed in Kosovo is currently produced in the country, so meat production has excellent growth potential. European Times: What about opportunities in the industrial sector? Nexhat Demaku: We have established an industrial zone where investors can build production factories for all kinds of industrial and trade-oriented ventures, and 33 factories are already operating there. Drenas also has significant


Nexhat Demaku, Mayor of Drenas

lignite and mineral resources and the mining sector has great promise. European Times: Does Drenas offer any special incentives for investors? Nexhat Demaku: In addition to our industrial zone we are building a 106-hectare economic zone which currently has two factories operating. It has rail connections and is very close to the main Prishtina-Tirana highway. This zone is already fully equipped with infrastructure, including water, electricity and roads, and we offer land there for a symbolic price on a 99-year concession basis. European Times: What are your future plans for Drenas? Nexhat Demaku: We have already invested €10 million in new road infrastructure and we are in the

process of building new schools and water and sewerage systems. We have received major support from the EU, USAID, and other international funders. Around 70% of the villages in the municipality are now connected to modern water and sewer systems. Planned projects include a developed river bank, a new municipality building, a sewage-and-water treatment plant (budgeted at around €2 million to €3 million), and initiatives to benefit the agriculture sector. European Times: What is your personal message to potential investors? Nexhat Demaku: Drenas is a peaceful, business-friendly, welllocated municipality with good infrastructure, low crime, qualified workers and many opportunities.




Municipalities of Kosovo

Municipality of Drenas

Industrial Park Illustrates Commitment to Private Sector Drenas (also known as Gllogovc) is a thriving municipality in central Kosovo which covers around 290 km, or 2.66% of the country’s total land area, and comprises Drenas City and 41 other localities, including 36 villages. The municipality’s population is over 73,300. Drenas is surrounded by the Berisha, Kasmaq, Qyqavica, Golesh and Lipovica (Blinaja) mountains and is crossed by the Drenica and Verbica rivers, which provide irrigation for the municipality’s agricultural activities.

Support for private-sector development The municipality was established before World War II as a special political and administrative district. It is well known for its mining and smeltering operations, and is the site of the Ferronikeli mining enterprise, which now employs 1,000 people. Drenas also has two quarries, in Korroticë e Epërme and Çikatova e Vjetër, which have reopened since the war. In 2004, Drenas demonstrated its support for the private sector by opening the Trade Centre in the centre of Drenas City. The municipal government coordinated the financing and also handled the construction and management of the project. The Trade Centre now contains 134 shops and offices for small businesses.

Promoting small and medium-sized enterprises Drenas was singled out by the federal government as one of five municipalities to benefit from the Delta II project to promote local economic development over the period 2005 to 2007. Delta II was co-financed by the Open Society Institute of Budapest and by participating municipalities, with technical assistance provided by the World Bank. The project was implemented by the Riinvest Institute for Development Research, based in Prishtina. Delta II aimed to promote small and mediumsized enterprises, to upgrade municipal administration in drafting and implementing local economic

development strategies, and to strengthen the partnership between the municipal government, the business community and local residents. The project laid the foundations for further private-sector growth in Drenas. One of the municipality’s advantages as a business base is that it is well connected to other parts of the country by the FushëKosova railway, the highways between Peja and Prishtina and between Bushat (Komoran) and Peja, and other local and regional roads. Today, the municipality’s economy is based mainly on agriculture and small trade-oriented enterprises, and Drenas has over 1,800 registered private businesses. Mayor Nexhat Demaku, Deputy Mayor Sherif Krasniqi and other local government leaders have launched programmes to greatly improve infrastructure, health and education services, the agriculture sector and industry throughout the municipality. Successes include a new irrigation system for local farms and the privatisation of Ferronikeli. The municipality’s infrastructure includes paved main roads connecting major villages with Drenas City, modern water systems in main urban areas and in 11 villages, and modern sewer systems in main urban areas and in 15 villages. One key goal is to improve access to reliable power supplies, particularly in rural areas.

Innovative industrial park serves as ideal base for businesses To promote local and foreign investment in its private sector, Drenas launched an industrial park in 2005. Strategically located in the village of Lower Koretica, just






17 km from the highway connecting Prishtina and Peja, the park covers 24 hectares and is designed to be an ideal location for local and foreign production enterprises. Building land of 1,000 sq m, 3000 sq m and 6,000 sq m is available. The Drenas Industrial Park provides a number of world-class services to businesses located there, including legal support for company registration; comprehensive assistance during the start-up phase; assistance with contractual issues involving purchasing property in the park; support during construction; assistance in finding local partners and workers; assistance in dealing with transport, customs, accounting, fiscal, juridical and technical issues; and preferential access to local distribution networks, processed products and raw materials. Kosovo’s Ministry of Trade and Investment is participating in the park’s development through providing roads, sidewalks, sewer and drainage systems, electricity and telephone networks,

and access to reliable water, heating and gas systems. As Kosovo’s Deputy Prime Minister, Mimoza Kusari-Lila, explains, “Drenas’s business park is a good example of Kosovo’s support for business development. Last year we made efforts to speed things up in the park by streamlining the process of establishing businesses there, and we are pleased to see the progress being made. We expect that successful production enterprises operating in the Drenas Industrial Park will help reduce Kosovo’s trade deficit, reduce unemployment and serve as a successful model which will be applied by other municipalities.”

In March this year, the Small and Medium Enterprise Support Agency (SMESA), which operates under Kosovo’s Ministry of Trade and Industry, signed a contract designed to benefit businesses operating in Drenas Industrial Park. The park is now home to 33 companies and around 39 other businesses have applied to open facilities there, while four businesses already operating in the park have received permission to expand. The industrial park illustrates the municipality’s commitment to supporting private-sector development and foreign investment in Drenas.

Municipality of Drenas Tel.: +381 38 584 074 +381 38 584 353



Municipalities of Kosovo

Podujevo Building on Strategic Location, Diverse Sectors Agim Veliu, Mayor of Podujevo, discusses the municipality’s significant investment attractions.

and we were the first municipality in the country to create an office to register new businesses here. We have many success stories, including juice-producer Laberion, recognised by the Ministry of Trade and Industry as one of the country’s most successful companies, and Agroproduct, which processes and sells food products.

European Times: How has Podujevo changed during your six years as mayor? Agim Veliu: My team and I have focussed on making Podujevo a nicer place to live in. We have completed a number of infrastructure projects, including building roads connecting all areas in the municipality. We have built a new water and sewerage system and we have also renovated schools, built parks and other green areas, created a new bank for the river and built a new bridge. We financed most of these projects with the city’s own funds. European Times: What are you planning for the future? Agim Veliu: We have prepared a feasibility study for building a major sewerage treatment plant for around €15 million, and we are looking for a donor or partner to help us complete this project. European Times: What does Podujevo offer foreign investors? Agim Veliu: We have a great location close to both the border and the capital and served by a good road. We expect that in the future a major motorway will pass through our municipality, which

“Agriculture and tourism Agim Veliu, Mayor of Podujevo

will further improve our advantages. Agriculture and tourism are the two sectors with the biggest FDI potential. Podujevo is the biggest municipality in Kosovo in area, covering 635 sq km, and half of this is good agricultural land. Part of the rest of the land can be used for building facilities to raise livestock. Podujevo also has tourism potential thanks to Batlava Lake and our beautiful mountains. We have also put aside 37 hectares for an industrial zone and we are currently looking for a partner to help us build the infrastructure for this zone. European Times: How easy is it to open a business in Podujevo? Agim Veliu: As mayor I have tried to do everything in my power to streamline the process of opening a business here. We also support new businesses with land,

are the two sectors with the biggest FDI potential. Podujevo is the biggest municipality in Kosovo in area, covering 635 sq km, and half of this is good agricultural land.” European Times: What is your personal message to potential investors? Agim Veliu: Podujevo has an excellent location, good infrastructure and services, a youthful, advantageously priced labour market and a municipal government which aims to support the business sector.




Municipality of Podujevo

Strategically Located Municipality Just North of Prishtina Podujevo, in north-eastern Kosovo around 22 km north of Prishtina, is one of Kosovo’s largest communities. The municipality has established sustainable economic growth, a modern and efficient administrative system, and high-quality education, health and social services for its citizens. Podujevo aims to provide a very positive environment for business and welcomes foreign investors.

The municipality offers a strategic location and direct access to motorway and railway connections to Prishtina, other cities in Kosovo and beyond. Podujevo City is set at the centre of Llapi province, which covers some 635 sq km and has a population of over 100,000 made up of an Albanian majority with Roma, Ashkali and Serbian minorities, all of whom are working together peacefully to build a brighter future.


Young, trained workforce One of Podujevo’s key draws for investors is its young, trained workforce. The municipality has 39 schools serving some 22,000 students, including secondary, vocational and technical institutions. Podujevo’s healthcare system is also well developed and includes a municipal family health centre and over 20 smaller clinics


Municipalities of Kosovo


appeal. Lake Batlava, the Llapi Plain and the beautiful Karadak and Kosovo mountain ranges are all easily accessed from Podujevo City and would be ideal for ecotourism, spa and hotel projects. Podujevo also has many architectural monuments, including ancient mosques and churches. The municipality’s history dates back to the 6th century AD, when a fort in what is now Podujevo (then known as Besiana in Albanian) was restored by Byzantine emperor Justinian.

and healthcare institutions. All communities in the municipality have access to these healthcare facilities. In addition to high-quality human resources, Podujevo offers extensive natural resources ready to be developed. Agriculture (including cattle-raising), food-processing and mining have particularly strong prospects. Podujevo has several companies producing bricks and metal parts, and the municipality’s trade sector is very well established. Podujevo now has 2,721 registered businesses (around 10%

of them owned by women) with a total of some 4,081 employees; most of these companies are active in trade and services, with only around 7% involved in production. Podujevo welcomes the chance to support more production-oriented enterprises.

Natural beauty and historic landmarks Podujevo municipality is also known for its varied topography and natural beauty, and the tourism sector has definite investment

Podujevo faces a number of challenges, including high unemployment and the need for substantial infrastructure improvements, including in the road network since most of the municipality’s smaller roads are unpaved. Around 35 of Podujevo’s 75 villages have not yet been connected to modern water and sewer systems, and power service in outlying villages is unreliable, particularly in the winter. The municipality’s education, healthcare and social services also need to be expanded to meet growing demand. Local leaders hope to draw international investment and support to help the municipality solve these problems and build on Podujevo’s undeniable potential.

Municipality of Podujevo Zahir Pajaziti street 11000 Podujevo Tel: +381 38 57 1227





Klina, Kosovo’s Crossroads, Welcomes FDI Sokol Bashota, Mayor of Klina, discusses the municipality’s investment appeal. European Times: Can you give us a profile of Klina? Sokol Bashota: Klina, a key Kosovo crossroads, has a population of around 38,000, with around 13,000 people living abroad. Klina municipality comprises 54 villages. The area is well known for its natural beauty, and many people take advantage of convenient train connections to Peja, Prishtina and Prizren to work in those cities but live here in Klina. European Times: What are Klina’s most promising sectors? Sokol Bashota: Agriculture has excellent development potential. Klina has high-quality farmland covering some 800 sq km, 70% of it flat, and since the municipality is crossed by six rivers, any agricultural venture has easy access to irrigation. The village of Klina, for example, has access to three rivers. Klina has five irrigation stations, 400 greenhouses available for off-season production, and seven milkprocessing centres collecting around 2,000 litres of milk per day. Mining is also a fast-growing sector thanks to the area’s large deposits of lignite and bauxite, and the local bauxite mine is being prepared for privatisation. European Times: What about tourism? Sokol Bashota: The tourism sector also has great prospects thanks to Klina’s natural attractions, including 13 waterfalls on the Mirusha River, and rich cultural heritage. Klina is on the site of an ancient Illyrian settlement dating from around 87 AD, and adventurous hikers can discover many ruins from that time. Klina hosts Folklore Fest, an annual folklore festival which attracts more than 10,000 visitors. We are actively pursuing opportunities to increase international awareness of Klina and to enhance its image within the region and in Europe. European Times: What are some major recent projects? Sokol Bashota: We have a new €2 million water-treatment plant to provide clean drinking water, and we


Sokol Bashota, Mayor of Klina

have developed modern, efficient road infrastructure in addition to our rail links. Around 80% of the roads leading into and out of Klina are asphalt, and 75% of them were completed over the past four years.

“Klina is strategically located and investor-friendly, with a youthful, educated population and many attractions for foreign investors.” European Times: What are you doing to attract FDI to Klina? Sokol Bashota: To facilitate foreign direct investment in the community, we have streamlined the process of registering a business to less than a few weeks, and we have lowered taxes and offer free land for development along with free utilities and infrastructure. Klina is strategically located and investor-friendly, with a youthful, educated population and many attractions for foreign investors.




Municipalities of Kosovo

Municipality of Klina

Thriving Agriculture Centre Today’s Klina (or Klinë) is a dynamic urban centre in the Peja district of northwestern Kosovo with a population of around 38,000. The municipality, which includes Klina City and 54 surrounding villages, is led by Mayor Sokol Bashota. Strategically located where the Klina River meets the White Drin River, Klina municipality has developed a growing private sector with around 930 registered businesses employing a total of around 4,000 people.

Long history dating back to Roman Empire The municipality has a long history. It was known as Dersniku and part of the land called Dardinia when it was part of the Roman Empire, and Profirogoniti, in his ‘Notes for the People’ written between 948 and 952, referred to Dersniku as a densely populated city. Prized then as now for its location and natural resources, the area that is now Klina was successively ruled by Slavic civilisations as well as by Greece and Byzantium, and was known as Chinna when it was an Illyrian settlement. Adopting Christianity, the city became the site of many churches built in the

Middle Ages, some of which still remain today. Klina is building on this rich heritage to develop its tourism sector.

Modern economy dominated by agriculture Klina’s modern economy is dominated by agriculture, which benefits from the area’s favourable climate, fertile arable land, geographic position and trained human resources. Local agricultural enterprises produce both crops and livestock, and the government has singled out agriculture as Klina’s main socio-economic growth engine in years to come.






The municipality has a familyhealth centre and three familyhealth clinics, and its education system includes 15 primary schools, two secondary schools and two kindergartens. In an illustration of its tolerance and diversity, Klina has seven mosques, three Orthodox churches, a monastery and six Catholic churches. Klina has a well-developed transport infrastructure which includes paved main roads connecting major villages with Klina City. Looking to the future, the municipal government has launched a number of infrastructure-development projects to support further economic growth, including initiatives to improve the municipality’s water system and electricity network. In addition to infrastructure, the municipality is making major investments in education, environmental protection, social services and agriculture.

Several infrastructure projects in the works Key projects in the works in Klina municipality include improvements to the banks of the Klina river in a €550,000 effort led by BHK. The project covers the western portion of the river from Klina City’s old stone bridge towards the White Drin River. Mayor Sokol Bashota explains, “This project has been one of the priorities in my administration. We are creating pedestrian walkways along both sides of the river which


are linked by a bridge to the city stadium. We are now completing the next phase of the project.” The groundbreaking ceremony held on August 3 this year for the new Isa Boletini school in Drenovc, a village within the municipality, illustrates Klina’s commitment to upgrading its educational facilities. The new primary school, budgeted at €400,000, is being financed by the municipality, Kosovo’s Ministry of Education and the city of Bolzano, Italy. The first phase of the project was financed by the Ministry of Education (€80,000) and by the municipality (€72,000), while the second phase, to begin in 2013, will be financed with €80,000 from the municipality, €70,000 from the Ministry and €100,000 from Bolzano. The third phase, which will complete the project, will be financed by €100,000 from Bolzano, according to Naim Musliu, the school’s director.

Agriculture, headed by Rexhepi Recep, is building 29 new greenhouses financed 60% by the municipality and 40% by the farmers who will use the new facilities. Rexhepi Recep says, “These greenhouses will greatly benefit our local farmers, particularly concerning the cultivation of fruits.” Klina Municipality also provides support to residents in need. In February this year, following a heavy snowfall, Mayor Bashota Sokol distributed sacks of flour and food to 50 local families. A new era began for the municipality when it inaugurated a new facility for municipal government offices last year. Prime Minister Hashim Thaci, along with other top government officials, attended the inauguration ceremony, which marked Klina’s role as one of Kosovo’s leading economic centres and an important contributor to the country’s economic development and investment appeal.

One of Klina’s most important recent infrastructure projects is a new paved bridge over the White Drin River, which greatly improves transport for local residents. Inaugurated in June this year, the bridge was financed by the municipality in partnership with the European Commission. Mayor Sokol Bashota comments, “This bridge was a vital necessity, and now brings together the citizens of Lug Plants.” In support of the agriculture sector, the project Directorate of

Municipality of Klina


Municipalities of Kosovo

Istog Municipality Rolls Out the Red Carpet for Investors Haki Rugova, Mayor of Istog, describes the municipality’s investment appeal. European Times: What is the history of Istog? Haki Rugova: Istog’s history dates back to the Roman Empire. During the Turkish era, Istog was known as a site for grain mills and wool-processing workshops. Istog has always been a prized location. European Times: What does Istog offer foreign investors? Haki Rugova: The municipality covers around 800 hectares, around 40% of which has not been developed, and contains a lot of building land ready for construction. Istog is known as one of the safest parts of Kosovo and offers a very positive environment for doing business. The municipality also has excellent infrastructure, including modern roads, water and sewerage systems. The municipality attracts a lot of tourism visitors, especially in the summer, which is a boost for local enterprises. European Times: How about the business climate? Haki Rugova: Business conditions are great! We have streamlined administrative procedures so that a business can be registered in only 30 minutes. Also, we have designated two industrial zones, one of which

Haki Rugova, Mayor of Istog

is already functional and has around ten factories operating. We are now planning to complete the infrastructure for the second zone, which will cover around 60 hectares. The price for the land in the zones is symbolic and everyone interested will receive land. European Times: What are top sectors for investors? Haki Rugova: The agriculture sector offers the greatest potential. We have high-quality farmland and several successful privatisations in the agriculture sector, including Devolli Group, which produces milk, and Trofta, which markets fish throughout the country. The tourism sector also has excellent development prospects thanks to our natural attractions, which include mountains suitable for ski resorts as well as the natural hot springs at Banja.

European Times: What partnerships has Istog had with international organisations? Haki Rugova: We have had several successful projects with USAID, including for public lighting, sidewalks and roads, and the EU’s IPA funds have helped us build schools and roads. The EU, KfW, GTZ, the central government and the municipality also partnered in a major project to build a new water system. European Times: What is your personal message to potential investors and partners? Haki Rugova: I guarantee that I will do everything in my power as mayor to help investors have a successful business here. We offer a very favourable regulatory environment and ample building land, and we are very open to public-private partnerships.




Municipality of Istog

Thriving Municipality Favours International Partnerships Istog, with around 40,000 inhabitants, is strategically set in north-western Kosovo and has long been known for its flourishing agriculture sector. This rapidly developing municipality, which covers around 50 villages including the town of Istog, offers significant investment attractions which include extensive natural resources, skilled and dedicated human capital, and a very business-friendly municipal government. Istog was established in 1913, and functioned as a district centre from 1912 until 1947. The district system was dissolved in 1960, but in 1978 Istog was officially designated a town. Today, Istog is one of Kosovo’s fastest-growing municipalities. It has a youthful population, with only 6% older than age 65.

sidewalk and enjoy the new lighting, they will appreciate the benefits of continuing cooperation between government and citizens for the benefit of the Istog community.”

Successful projects with USAID

Istog’s main economic sector is agriculture, which employs around 65% of the local population. Cereals, fruits and vegetables are the top crops, while Istog also has thriving stock-breeding activities as well as fisheries and a well-developed forestry sector. Stock-breeding in particular is seen as having particularly strong growth prospects in Istog thanks to abundant high-quality pastures and growing demand for meat in regional markets. Istog also welcomes investments in food-processing operations which will make use of local crops. Istog’s mountain areas are ideal for cultivating herbs, another growth segment in the agriculture sector.

Istog welcomes foreign investors. In November 2011, Istog celebrated two successful projects completed with the support of the USAID: a pedestrian walkway in Istog city and a new public-lighting system in the village of Vrella. Istog’s mayor, Haki Rugova, commented at the inauguration ceremony, “These projects supported by the USAID are particularly important for the citizens of Istog municipality since they will significantly improve our citizens’ quality of life.” USAID Special Advisor Craig Buck explains that Istog is one of 21 ‘Democratic Effective Municipalities Initiative’ partner-municipalities chosen by the USAID in Kosovo, and that Istog received the coveted USAID Municipal Service Performance Management awards in two categories last year: administrative services and urban planning. He noted at the inauguration ceremony marking the new walkway and lighting system, “Istog has worked with the USAID for many years. We at the USAID are pleased to have such a strong partnership and the results of that partnership speak for themselves with these two new projects. I hope that when the citizens of Istog stroll along this


Agriculture, trade-dominated local economy

The municipality has a dynamic trade sector, particularly concerning internal trade. In fact, trading is the dominant activity in Istog’s private sector; of the 2,036 registered businesses in the municipality, just over 700 are involved in trade.

Tourism sector with growth prospects Istog also has significant tourism appeal. The picturesque Bjeshkët e Nemuna Mountains and Mokna forest are located in Istog municipality and are rich


Municipalities of Kosovo


in flora and fauna, while one of Kosovo’s best-known natural spas, Banja, is also near Istog city. The municipality’s beautiful, unspoiled natural areas are ideal sites for sports facilities, eco-tourism services, spas, hotels and resorts. In addition to its natural attractions, Istog has a rich cultural heritage. Formerly known as the Podgur region, the area that is now Istog has been continuously inhabited since prehistoric times. Many monuments from the past can be found throughout the municipality, from mosques and Catholic and Orthodox churches to ancient towers, water mills and caves.

Istog has a well-developed educational system including pre-primary, primary and secondary educational institutions, which welcomed a total of around 9,700 school children in 2011. Istog also has its own healthcare system which includes five family healthcare centres and ten mobile healthcare units. Banja village has a Rehabilitation and Recreation Centre which is very popular among patients suffering from rheumatic diseases. Dynamic, modern Istog welcomes the chance to develop productive international partnerships and will continue to provide a business-friendly environment for investors.

One of three municipalities participating in Green Agenda To protect its heritage while also pursuing economic growth, Istog has become one of the three municipalities in Kosovo which are participating in the Green Agenda programme, which aims to promote sustainable development and the preservation of local natural resources and culture. Green Agenda cites a number of natural and cultural attractions in Istog which can be sustainably developed for tourism, including Istogu springs, Banja hot springs, and other natural springs; architectural landmarks; caves; and unspoiled mountain areas.

Municipality of Istog 2 Korriku str. 31000 Istog Tel: +381 39 45 1222




• Financial Indicators Positive


“Our major goals are to ensure Kosovo’s financial stability, support price stability, advise the government, and contribute to the efficient allocation of the country’s economic resources.” Gani Gërguri, Governor of the Central Bank of Kosovo





Central Bank Continues to Promote Stability Kosovo’s Central Bank has a successful track record in ensuring the country’s financial stability. Gani Gërguri, Governor since May 2011 discusses the bank’s policies and priorities. European Times: What are the Central Bank’s main objectives? Gani Gërguri: The Central Bank’s mandate is to license, regulate and supervise all Kosovo’s financial institutions. Our major goals are to ensure Kosovo’s financial stability, support price stability, advise the government, and contribute to the efficient allocation of the country’s economic resources. European Times: What are the Central Bank’s most important accomplishments so far? Gani Gërguri: Kosovo’s financial sector is strong, healthy and stable and includes a very sound banking sector. For example, Kosovo’s banking sector has continuously maintained a capital adequacy ratio of around 17% as well as double digit increase in both deposits and loans. This growth continued even during the global financial crisis. The share of non-performing loans has never exceeded the single digits. This success is the result of good provisioning and good buffers against threats and shocks. In addition, the introduction of the euro has had a positive effect through helping to bring about monetary and fiscal discipline. European Times: How have international institutions contributed to the development of Kosovo’s financial sector? Gani Gërguri: Kosovo has benefited considerably from the big support of international institutions since 1999 and is still working very closely with the World Bank and the International Monetary Fund. Significant support was also given by the US Treasury which, among others, has also helped us develop certain strategies at the national level. European Times: What is the current state of the banking sector? Gani Gërguri: Kosovo’s banking sector is very healthy, partly because more than 90% of our banks are foreign-

Gani Gërguri, Governor of the Central Bank of Kosovo

owned. We are also proud of the merger and acquisition process in our banking sector, which has been very smooth. We now have eight commercial banks, of which six are part of foreign banking groups. Three banks cover 75% of the market; these are ProCredit, Raiffesen and NLB. European Times: How about the insurance sector? Gani Gërguri: Kosovo’s insurance sector is developing well, with ten non-life insurance companies and three life insurance companies. Most are partners of well-known EU insurance groups. There are still significant opportunities, particularly for life insurance. European Times: What are the Central Bank’s current goals? Gani Gërguri: Our main objectives are to maintain the stability of the financial sector and to further promote our banking sector to bring additional players into the market. Also, the CBK is committed to broaden and develop other sectors of the financial markets. The government’s recently introduced securities market is developing very well. The Central Bank of Kosovo will continue to be a strong, independent and effective regulator of the country’s financial sector.




KOSOVO xxxxxx

Financial Indicators Positive International observers are praising Kosovo’s sound financial system. The World Bank, which supports Kosovo through a 2012-2015 countrypartnership programme, announced in June that it would allocate €37 million in assistance to Kosovo’s government for sustainable-employment development, in recognition of Kosovo’s successful efforts to maintain macroeconomic stability.

In addition, Johannes Wiegand, IMF’s Mission Chief for Kosovo, commented at the end of his Kosovo visit in June, “Macroeconomic and financial policies in Kosovo are on track. All end-April quantitative performance criteria and most structural benchmarks have been met. Kosovo’s economy has continued to display resilience in a difficult international environment.” He cited the ‘solid capital inflows and robust lending activity by a well-capitalised and liquid banking system’ as a key reason for Kosovo’s success. In May, the IMF confirmed a new €107 million stand-by loan for Kosovo.

2012 budget on track Finance Minister Bedri Hamza points out that all leading indicators for Kosovo’s financial sector are positive; for example, Kosovo kept its budget deficit to around 2.7% of GDP in 2011, with public debt at 5.4%. He adds that Kosovo has escaped the worst effects of the euro-zone crisis because of the country’s stable banking sector and limited integration with European banks. The Finance Minister notes that Kosovo’s 2012 budget is on track; more than 40% of it is earmarked


for capital investment, mainly on the new highway linking Kosovo with Albania. In June this year, the budget received a €30 million boost from Kosovo’s Privatisation Agency following its successful privatisation of around 65 state-owned companies. Kosovo’s financial system is overseen by the Central Bank of Kosovo, which works to ensure macroeconomic stability and regulates Kosovo’s banking sector, insurance industry, pension funds and micro-finance institutions. The Central Bank issued Kosovo’s first government securities in the form of 90-day treasury bills in January this year. Only commercial banks were able to participate in the auction, but a secondary market allows for banks and other clients to trade these securities. At the launch of the treasury bills, Central Bank Governor Gani Gërguri said, “Through issuance of treasury bills with shorter-term maturity, we are taking the first step in establishing capital markets in our country.” In March, he added confidently, “Our financing gap for 2012 is between €150 million and €160 million, and we will cover it with the issuance of government securities and with our loan agreement with the IMF.”



Banka Kombetare Tregtare

Dynamic Bank Driving National Economy Forward Banka Kombetare Tregtare (BKT) has a long history of providing world-class banking services. Established through a 1993 merger between the Albanian Commercial Bank and the National Bank of Albania, Banka Kombetare Tregtare was fully privatised in 2000 and, following a significant restructuring, achieved growth rates well beyond the average. BKT now has 60 branches in Albania and 23 branches in Kosovo. BKT is present in Kosovo since 2007. BKT Kosovo offers a wide range of universal banking services to individuals, government and corporate clients, including loans, EMV-compliant debit and credit cards, ATMs, e-banking, qualified international banking and various treasury products. BKT Kosovo increased its paid-up capital from an initial €5 million to €8 million in 2010, and its branch network has grown from one branch in Prishtina to 23 branches all around the country. Managing Director Suat Albayrak explains, “BKT Kosovo is the newest bank in the country and 2009 could be considered its first full year of operations with a full branch network. The expansion of the branch network has been accompanied by a dramatic increase in market share in both lending and deposits.” BKT is a leader in Kosovo in its product range, technologies and rates. In fact, BKT Kosovo is now widely regarded as the country’s best bank for product innovation, personal and educational loans, mortgages and credit cards.

Catalyst for economic growth BKT Kosovo is strongly committed to supporting the development of the local economy, including assisting entrepreneurs who have graduated from the USAID Entrepreneurial and Agriculture Programme. Suat Albayrak points out, “BKT Kosovo aims to continue to be the leader in introducing new products and technologies in the Kosovo market, and to serve as a catalyst for economic development. BKT plays a key role in enhancing Kosovo’s attractions for foreign investors.”

BKT Kosovo head office

Unlike other local financial institutions, BKT Kosovo focuses around 75% of its loans on trade and services. Suat Albayrak says, “The payback period of loans for trade and services is shorter than of loans for big construction projects. Thanks to this strategy, BKT Kosovo has the ability to reinvest much more quickly into the local market, spurring on the growth and development of the middle class.” BKT Kosovo benefits from the strong liquidity support of its parent bank in Albania. Thanks to its solid financial foundations, excellent track record and high-quality services, BKT Kosovo is well on the way to reaching its goal of boosting its market share up to 15% over the next five years.

Rr.Kosta Novakovic Nr.9 - Prishtina Tel.: +381 38 22 2911 -







Infrastructure xxxxxx

Major Improvements in Transport, Energy and Municipal Infrastructure Kosovo is working hard to bring its infrastructure up to international standards. A new highway linking Prishtina to the port of Durrës, Albania, is one high-profile project which demonstrates the Kosovo government’s commitment to infrastructure development as well as the opportunities for private companies to participate in major infrastructure initiatives. The highway will link up with Trans European Corridor X, which joins Western Europe and the Adriatic Sea. It is being built by BechtelEnka, a US-Turkish joint-venture partnership, and funded through Kosovo’s national budget. Fehmi Mujota, Kosovo’s Minister of Infrastructure, explains, “Our next plan is for the highway from Prishtina to Macedonia, which will boost the economic development not only of Kosovo but of the whole region. We know our limitations as far as funding, but the government has decided that infrastructure investment is the priority if we want to develop this country. We are a small, new country but we see ourselves as the key to the region.”

Public-private partnerships In 2009, Kosovo instituted a law on public-private partnerships to attract more FDI in its infrastructure programmes. According to the Investment Promotion Agency of Kosovo (IPAK), 32.8% of foreign investment in Kosovo in 2011 focused on the construction sector, including road construction. IPAK

notes that several private companies have expressed interest in participating in the construction of the planned Prishtina-Skopje highway, which is expected to begin in early 2013.

“The government has decided that infrastructure investment is the priority if we want to develop this country.” Along with upgrading its transport and communications networks, Kosovo is also modernising its municipal infrastructure to help support business growth and to improve quality of life for its citizens. The European Community Liaison Office in Kosovo launched a €27 million municipal-infrastructure

project last year which involves improving energy-supply systems throughout the country and implementing new water-supply systems in several municipalities. One of the EU programme’s initiatives will double the Mitrovica region’s water supply to provide uninterrupted potable water for approximately 250,000 citizens. These projects are part of the EU’s long-term effort to bring Kosovo closer to European standards. The USAID is another international supporter of projects to improve water and sanitation systems in Kosovo. The American organisation is working with Kosovo’s government through the Kosovo Water Institutional Sector Reform Initiative, which aims to increase private-sector participation in Kosovo’s water sector by upgrading the regulatory environment for water and sanitation projects. New investment opportunities are opening up almost every day as Kosovo continues to drive its infrastructure development forward.





Regional Water Company Prishtina

Water Company Driving Forward Ambitious Development Plan The Regional Water Company Prishtina, now the biggest water company in Kosovo, provides drinking water and wastewater-services to around 40% of the country’s population. With strong support of Germany’s KfW and the EU, the Regional Water Company Prishtina has made significant progress over the past few years and is committed to achieving the ambitious goals of its development plan for 2040. A joint-stock company since 2007, the Regional Water Company Prishtina operates 22 pumping stations, 70,000 m³ of reservoirs, around 700,000 m of water pipes, and a sewage system of around 350,000 m. CEO Gjelosh Vataj explains, “We have launched a threephase project supported by KfW, the EU and other donors and investors. In May this year, we completed the first phase, budgeted at €8 million. We have built a new reservoir and updated our pipe infrastructure. The next phase, budgeted at €17 million, will include more pipe upgrades to combat water loss. In the third phase, we will build a new water-treatment plant with a capacity of 700 litres per second and with the possibility to be extended to an extra 500 litres per second to secure reliable water services for 24 hours for everyone.”

New wastewater-treatment plant With a donation from the EU, the Regional Water Company was able to complete a feasibility study for the new wastewater-treatment plant, which will cost around €150 million and will serve three municipalities: Prishtina, Fushe Kosove and Kastrioti. Gjelosh Vataj says, “To complete this plant, we need the support of donors and investors. We want them to understand that building this plant is essential for the wellbeing of the citizens of Kosovo.” The Regional Water Company Prishtina invests €3.5 million of its own funds annually in its modernisation projects. Through its development programme, the


Gjelosh Vataj, CEO

company has already achieved a 2% decrease in water losses and at the same time has boosted its billing by 11% and collection of revenues by 16%. The Regional Water Company Prishtina attracts an average of 500 to 1,000 new customers each month. The Regional Water Company Prishtina is ranked number one in Kosovo for its reputation on the public, and it has a very strong track record of successful partnerships with international donor organisations. Now the company aims to play a key role in attracting foreign investment to Kosovo. Gjelosh Vataj says, “As Prishtina grows, more and more people are learning about our company. One of the keys to maintaining a good corporate image is transparency, and the Regional Water Company Prishtina is very transparent.” He concludes, “Overall, Kosovo has very good conditions for foreign investors, and they should come here and check out the many opportunities.”


KUR “Prishtina” - “Tahir Zajmi” p.n., Prishtina Tel: +381 38 60 3010 -



Hidrodrini Regional Water Company

Water Company Continues to Modernise Hidrodrini Regional Water Company was established in 2004 to provide reliable, world-class water and wastewater services to five municipalities in Kosovo: Peja, Deçan, Istog, Klina and Junik. A joint-stock company since 2007, Hidrodrini is upgrading its facilities and services according to EU criteria.

The company is definitely making progress. It has boosted its collection rate from 60% in 2009 to around 70% this year while reducing water losses from 74% in 2009 to 68% in 2012. Hidrodrini has also been adding around 1,500 new customers every year. Thanks to its successful efforts to improve its operations, Hidrodrini has won the confidence of international donors USAID, KfW, and the Swiss government, all of which are helping the company reach its goals.

“Hidrodrini is steadily working to meet all EU standards.” Focus on financial sustainability Managing Director Agron Tigani says that one of Hidrodrini’s challenges is to guarantee clean drinking water to all its customers. The need to upgrade water infrastructure to prevent losses as well as the need to prevent illegal connections and unpaid water bills are other problems the company must face. He says, “Hidrodrini’s current priorities are to implement the financial support we have received from KfW and to sign contracts with all our regional consumers. Over the long term, our main goals are to achieve greater administrative efficiency, to

cut down on water losses, to increase collection rates and to further improve our services. Our top target is to have a financially sustainable company.” Hidrodrini is one of four water companies in Kosovo the USAID chose to participate in its “Small Infrastructure for Water and Sanitation” programme, a five-year initiative to upgrade water systems in four municipalities by the end of this year. Hidrodrini was also one of two Kosovo water companies whose development programmes USAID supported through its “Kosovo Water Institutional Sector Reform” effort in 2009 and 2010. As it continues its drive to progress, Hidrodrini aims to create more payment options, to read water metres on time, to ensure that all water bills are correct and to use legal means to prevent unpaid water services. Agron Tigani adds that staff training is crucial for the company as it modernises its operations. He says, “We are training our employees in the use of chlorination equipment, work-safety regulations, the use of new ICT technologies, maintenance of the system and other areas.” Hidrodrini is steadily working to meet all EU standards.





“I would be happy to invite you to more actively participate and invest in Kosovo in the spheres of agriculture, tourism, infrastructure, energy, and mining.” Hashim Thaçi, Prime Minister



Tourism xxxxxx

New Destination on the Global Travel Map


Kosovo’s great natural beauty and many architectural monuments are drawing more and more international travellers, especially after The New York Times named the country one of 41 not-to-be-missed destinations in 2011. Kosovo is easily reached from throughout Europe and beyond through Prishtina International, the country’s main gateway for foreign travellers. Thanks to its strategic location on key trade routes, Kosovo has been prized by many civilisations over the centuries, including the Illyrian, Roman, Byzantine and Ottoman empires, all of which left their mark. In the Middle Ages, Kosovo saw the construction of important Serbian Orthodox churches and monasteries, many of which remain today. A mountainous land with reliable winter snowfalls, Kosovo is a natural for the development of

ski resorts, and Brezovica in the Sharr Mountains is one of Kosovo’s tourism investment opportunities. The resort has three hotels and a range of related facilities as well as nine ski lifts. Another 22,000 hectares of unspoiled mountain area – Sharrprodhimi, near the town of Dragash – has also been earmarked for tourism development. It offers exceptional potential for eco-tourism, river kayaking, skiing and other outdoor activities.

From natural springs to handicrafts Other tourism attractions include Kosovo’s many natural springs, ideal for spas; its handicrafts, including silver filigree and wood-carving; its delicious cuisine; its youthful, multilingual workforce; and its lively capital, Prishtina. As Seth Sherwood writes in The New York Times, “Thanks in part to the return of enterprising young Kosovars living abroad, Prishtina is filling with cafés, nightclubs and restaurants.” He adds that Kosovo’s

architectural treasures are the main draw for most foreign visitors, and cites Peja in particular. This ancient city contains the Patriarchate of Pec, a complex of medieval churches, and Decani Monastery, both stunningly decorated with frescoes. Kosovo is working hard to attract investors in its tourism industry. The country needs tourism infrastructure, including international-standard hotels and resorts, as well as facilities to train employees in the hospitality sector. When he meets with potential investors, Kosovo’s Prime Minister Hashim Thaçi always singles out tourism as one of his country’s highpotential sectors. At a recent meeting with Bulgarian business leaders, he said, “Kosovo has European laws which protect and defend foreign investors. I would be happy to invite you to more actively participate and invest in Kosovo in the spheres of agriculture, tourism, infrastructure, energy, and mining.” As tourism throughout the Balkans continues to grow, Kosovo will become even more attractive as a tourism FDI target.





Emerald Hotel

Kosovo’s First Five-Star Hotel Emerald Hotel in Prishtina, Kosovo’s first five-star hotel, combines contemporary elegance with luxurious amenities and services, and has quickly earned a reputation as the country’s top choice for business and leisure travellers. Safet Mehmetaj, Deputy General Manager, explains, “The Emerald Hotel is big on space and even bigger on service and amenities. Our staff provides a warm welcome and professional, personalised attention for every guest.” The Emerald Hotel has 72 nonsmoking guestrooms, including seven particularly luxurious suites. Every room and suite is equipped with air-conditioning, free wireless high-speed Internet, LCD TV with cable programming, a direct-dial telephone, a desk, a safe, a mini-bar and coffee-making facilities, extralarge bathrooms and more. Complimentary breakfasts are served each day (in the guest’s room on request), and the hotel’s food and beverage options offer a wide choice, from casual snacks to gourmet dining. Guests can have a quiet drink in the poolside bar or in the cosy bar lounge, get a bite to eat in the snack bar/deli or coffee shop, or enjoy international

and local cuisine in the fifth-floor restaurant with its expansive views. The Emerald Hotel also has a 200 sq m fitness centre and an exclusive spa as well as a boutique, a fully equipped business centre open around the clock, a transportation desk, a reception desk open 24 hours a day, laundry and drycleaning service, free parking, free airport shuttle service, a sauna, an indoor pool and a Jacuzzi. In short, the Emerald Hotel offers everything sophisticated international travellers expect in a five-star hotel.

Top choice for meetings and events For business visitors, the hotel has 1,000 sq m of state-of-the-art, adaptable meeting space, the largest hotel-based conference space in Kosovo. Smaller meeting rooms are available, and the hotel’s events team can organise and cater any type of meeting. The Emerald Hotel ballroom, for example, can accommodate up to 700


guests. Safet Mehmetaj explains, “Our events team works with you to organise any type of event from start to finish. Small meetings receive all the attention of larger gatherings at Emerald, including the hotel’s cutting-edge technology and distinctively appointed conference rooms, which can accommodate meetings for up to 100 delegates. Each meeting also enjoys the services of a dedicated Banquet Manager, who personally attends to every detail.” With its array of luxurious services and its welcoming, multilingual staff, the Emerald Hotel is the right choice for visitors to Prishtina.

Prishtina – Skopje Highway 10000 Prishtina Tel: +381 38 58 8888 contact@EmeraldHotel.Info

The European Times - Kosovo3  

The European Times is an independent media agency that specializes in in-depth promotional reports on different countries and regions worldw...

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