Doing Business in Kosovo - US Department of State

Market Challenges Return to top
Despite a flat 10% corporate tax rate and low employer contributions to employee pensions,
Kosovo’s population -- estimated at just below 2.0 million people -- may present a challenge to
investment in industries requiring a substantial economy of scale to realize profitability. An
exception may be where the investment in Kosovo can be part of a regional business strategy.
The government is also trying to improve its “ease of doing business” indices by removing
unnecessary regulations, licensing and permit requirements, but needs to do more.
Kosovo’s traditionally weak judicial system is an impediment to foreign investment and has
inspired little investor confidence that business interests will be fully or efficiently protected
under the law. The Kosovo Bar Association includes virtually no firms capable of providing legal
services at a level expected in more developed business markets. Kosovo’s poor physical
infrastructure, including a general lack of modern roads, office space, and dilapidated rail
facilities also present challenges for companies.
There are concerns about the quality and skill of Kosovo’s labor pool. Although Kosovo has a
young population (an estimated 60% are under 30 years of age), the decimation of the
education system in the 1990s had led to a generation that is of working age, but without the
necessary training and development to be a successful workforce.
Market Opportunities Return to top
Kosovo and its citizens are highly pro-American and would welcome U.S. investment in various
sectors:
Energy Sector: Kosovo’s vast lignite coal resources, strategic regional location, along with the
substantial power deficit in Southeastern Europe, provide opportunities for Kosovo to become a
power supplier in the Balkans region.
Mining: The mining sector is an important contributor to Kosovo's economy but has declined in
relevance due to a lack of investment in equipment, facilities and the development of new
mines. This sector has significant foreign investment potential, and the Independent
Commission of Mines & Minerals (ICMM) has issued over 500 exploration and mining licenses
since 2007.
Telecommunications: This sector offers significant investment potential, as the current national
provider is unable to meet growing demand for better mobile phone products and services at
reasonable prices. The Kosovo Government recently re-launched its privatization effort of the
national phone carrier, Post and Telecommunications of Kosovo (PTK), which provides both
mobile and landline services
Health: There is an urgent and growing need for quality basic and specialized health and medical
services, facilities and products. Many Kosovo citizens travel to other countries to meet their
health care needs and local solutions present a potentially lucrative opportunity for outside
investors.