EACCNY Country Highlight: The Republic of KOSOVO

EACC New York is inviting European countries, member states and non-member states, to share some fun facts about their country with the EACC network to showcase their home country’s cultural beauty, economic strengths, and their role in transatlantic trade & investment.

Today, we present a profile for the REPUBLIC OF KOSOVO.

A quick fun fact about your country: Kosovo is the newest and youngest country in Europe, with 70% of its population under the age of 35, and an average age of 29.1 years old.

What is a famous dish from your Country and do you like it? Do you eat it a lot? Located at the heart of the Balkan peninsula, this landlocked country is one of the region’s hidden gems. Beyond asphalt and dust, which at times seem overwhelming, one can discover rolling hills, lush green forests and meadows, high snow-covered peaks and charming old towns.

The people of Kosovo are proud of their multi-cultural and multi religious society. Its people are particularly proud of their traditions of hospitality. Guests in a Kosovo home are treated with the highest honor and respect. Kosovar hosts are always ready to offer help, a cup of coffee or a free meal – a guarantee for a great trip.

Kosovo has a very old and healthy gastronomy with traditional and mostly Mediterranean food. There are a lot of traditional dishes, but among the most popular traditional Albanian dishes are Flija, a dish of pancake like pastry layered with cream and yogurt, then would be Pite, a phyllo pastry with cheese, meat, or vegetable filling. Another characteristic dish is Llokuma, deep-fried dough puffs pairing with yogurt, cheese or ajvar, a spicy homemade spread of roasted red peppers (and sometimes eggplant) that is found on nearly every table. Among the traditional sweets Bakllava is the most common sweet to be served on special occasions.

And, of course, since we have a large diaspora in the U.S., mostly in New York, almost all the mentioned traditional dishes may be found here.

What is your Country’s strongest connection to NYC? To the US? Kosovo is a very pro-American nation. This devotion has its roots since back in the ‘90’s when Kosovo was going through the oppression under the Serbian regime. The US and other Western allies intervened to stop the ethnic cleansing campaign against the Kosovan people.

• Having this special bond with the U.S., a lot of streets and boulevards in Kosovo’s capital – Prishtina, are named after some U.S. representative, such as: Along the Bill Clinton Boulevard in Prishtina, there’s an 11-foot statue of former President Clinton, and next to that statue there is a boutique called Hillary, selling woman suits. “Kosovo will always hold a special place in my heart,” Bill Clinton said in a video message for the country’s 10th birthday on February 17, 2018.
• There’s a boulevard dedicated to George W. Bush, the American President who supported Kosovo when it officially declared independence in 2008.
• The former US Secretary of State Madeleine Albright is among the growing list of illustrious American politicians to get their own bust.
• Even Democratic US Congressman from New York and a longtime supporter of Kosovo Eliot Engel has seen a boulevard named after him.
• The now retired US Republican Senator Bob Dole is being honored twice, with a boulevard named after him and a statue also.
• There is a roadway named Beau Biden after the late son of the President Joe Biden, outside Camp Bondsteel, the U.S. military base in Kosovo.

During the struggles of the ’eighties and ’nineties, the diaspora was very involved in the affairs of Kosovo and alleviated many hardships. The Kosovo diaspora has been and continues to be a great contributor to the economy of the country mostly through remittances (15% of GDP), through investments and the circulation of talent. These are people of various ages, different professions and different generations of migration and they present different motivations and reasons to stay connected to Kosovo.

Albanian community in the US have been able to climb the ladders of success through hard work and their own talent. Particularly in New York City, there are many Kosovar/Albanian restaurants owners, businesses, young entrepreneurs, achieving political success or degrees in the medical field. Albanian New Yorkers have begun to find success in other areas as well, such as show business, where there are significant singers, models and designers.

Kosovo has a very vibrant community, with contributions and distinct presence of which has been growing for years. With increased economic and social status, our people in New York have begun carving their own identity. More restaurants like Çka Ka Qëllu, Dea – an Authentic Eatery, and Dua Caffein the Bronx and Manhattan are exclusively serving our traditional cuisine.

The presence of Kosovo’s community brings charm to the New York City Metropolitan area.

In your view, what is the hottest industry/field in your Country at the moment? Kosovo offers a range of ground-floor investment opportunities in the renewable energy and agricultural sectors. Other sectors that are becoming important to Kosovo are wood processing, wine companies, textile industry and the Information and Communications Technology (ICT) sector (developing startups, business process outsourcing and customer support centers).

The ICT sector in Kosovo is one of the most developed and promising sectors for generating economic growth. It has proven to be a highly promising sector for generating new jobs for young entrepreneurs, as well as for increasing the overall level of the country’s exports. The ICT sector is among the few sectors within the Kosovo economy that is characterized by a positive trade balance, where around 78% of already existing companies export their services.

Kosovo is expected to become an even more attractive country for foreign companies in terms of ICT services, where approximately 350 ICT professionals graduate each year and this number is expected to grow substantially in forthcoming years. Having a skilled and experienced workforce, as well as the suitable geographical area and time zone, Kosovo is a target for many foreign companies and investors.

Kosovo is also one of the top locations that has gained a lot of recognition for outsourcing services that is growing stronger day by day. There is an enormous range of benefits when outsourcing IT services, customer care, market research, and other shared services to Kosovo. This includes the country’s youth, who are well-educated, highly motivated and satisfactory with their work. The potential of this work force is characterized by the high literacy of foreign languages, such as English and German. Almost every citizen in the workforce now in their mid-20s, speaks and writes fluent English.

How is your Country attracting foreign business? The free market economy is the foundation for the economic development and the welfare of businesses in Kosovo. Kosovo’s economy has become part of the economic integration of its region, offering opportunities to expand the market by showing progress in transitioning to a market-based system and maintaining macroeconomic stability.

Kosovo’s legal framework are consistent with international benchmarks for supporting and protecting investments. The laws and regulations on establishing and owning business enterprises and engaging in all forms of remunerative activity apply equally to foreign and domestic private entities. Under Kosovo law, foreign firms operating in Kosovo are granted the same privileges as local businesses. To promote and support foreign investments, the Government of Kosovo has established the Kosovo Investment Enterprise and Support Agency (KIESA). The agency is tasked with offering a menu of services, including assistance and advice on starting a business in Kosovo, assistance with applying for a site in a special economic zone or as a business incubator, facilitation of meetings with different state institutions, and participation in business-to-business meetings and conferences.

Kosovo is a member of the International Monetary Fund (IMF), World Bank (WB), and other strong economic and financial mechanisms such as European Bank for Reconstruction and Development (EBRD), and Council of Europe Development Bank. In 2016, the Government of Kosovo ratified a strategic investment law, with the intention to ease market access for investors in key sectors. Moreover, the government partnered with USAID and other international donors to launch the Kosovo Credit Guarantee Fund, which improves access to credit.

As an important location for business development, Kosovo offers comparative advantages such as: a young and well qualified population, natural resources, favorable climatic conditions, new infrastructure, a fiscal policy with the lowest taxation in the region, a geographic position with access to the regional Central European Free Trade Agreement (CEFTA) market and that of the European Union

What is your Country’s most successful export product? Kosovo has maintained positive economic growth rates for over a decade. Currently, the most successful export product are hybrid mattresses that are being exported to the EU and US market. Kosovo’s largest exports are outsourcing services, metal and wood-based products, as well as mineral products. Additionally, wine products cultivated from old traditions in Rahovec, Kosovo have found very successful placement in the international market, including Europe and the US.

What are some best-practice insights for businesses seeking to move/expand into your Country? Kosovo’s relatively young population, low labor costs, and rich natural resources have attracted several significant foreign investments, and several international firms and franchises are present in the market. Kosovo has free trade agreements with important markets, and linkages to the EU has strengthened since the signing of the Stabilization and Association Agreements (SAAs).

Being located in the heart of the Balkans, Kosovo offers easy access to neighboring markets and CEFTA members, a market of approximately 28 million people. Kosovo’s infrastructure has been steadily improving, with the completion of a modern highway to Albania, providing easily access the Adriatic Sea Port of Durrës for less than three hours. A second highway to North Macedonia provides access to Thessaloniki Sea Port for about five hours. More than two million passengers passed through Pristina’s international airport in 2019 as well.

Labor cost has also become a competitive advantage. Kosovo has become the new low-cost investment destination. With 40-60% lower average gross wage than the CEB economies and one fifth that of more advanced EU economies, Kosovo is particularly attractive to labor-intensive industries.

Taxes in Kosovo are very low compared to neighboring countries. The tax system is kept extremely simple. Kosovo has one of Europe’s lowest corporate income tax rates and stands out for its low prices for energy. Tax policies in Kosovo are very competitive, and the current tax regime is business-friendly with a flat, 10 percent corporate income tax, personal income tax is 10%, tax on dividend 0% and the VAT is 0 and 8% to max 18%.

In the 2020 Doing Business Report, Kosovo ranked 57 out of 190 economies surveyed and was recognized as one of the top 20 most improved economies in the world.  Kosovo also scored highly in the sub-categories for ease of “Starting a Business” and “Getting Credit”, as it had been ranking 12th and 15th, respectively out of the 190 countries measured in the report and leading as a country among Western Balkans countries in those two categories. Moreover, according to Index of Economic Freedom, Kosovo’s economic freedom scored 67.4, making its economy the 53^rd freest in the 2020 Index.

Kosovo enjoys free access to the markets of Japan, Norway, Switzerland, Turkey, and the US due to the preferential trade treatment these countries offer for Kosovo products. As a member of the EU-funded Western Balkans 6 (WB6) core transportation network, which aims at improving regional connectivity, Kosovo plans to revitalize key railway lines for both domestic transport and connections with neighboring countries.

Despite the fact that Kosovo is not an official Eurozone member, it has unilaterally adopted the euro monetary as its currency ever since 2002, avoiding the risk of currency fluctuation and attracted more foreign investments.

What’s the biggest cultural difference you’ve noticed between America and your County? Home to a variety of communities and historically a crossroad of peoples, Kosovo has inherited variety of cultural influences. It must be noted at the outset that two countries share more similarities than differences.

One notable difference is the way coffee is enjoyed. In Kosovo, you will find cafes on every block of every city. Kosovo has become very famous for its own way of making coffee, especially the macchiato. While in the US, having a coffee is mostly on the rush because people are busy with their daily activities. In Kosovo, coffee is enjoyed in a more relaxing mode over a date or chat with a friend. The macchiato fits seamlessly into the daily routine of the Kosovar. But what makes it so special, is the people (bartenders) who prepare them that make them so good. People there, especially tourists love them. The trick is also how you foam the milk. You can order a macchiato almost anywhere you go in Kosovo: a roadside greasy spoon, a gas station – and they’re cheap.

In the grand scheme, what do strong European-American relationships mean to your country? The EU and the US have played a crucial role in Kosovo since the end of war. They provide political and financial support for programs related to economic growth through private sector, promotion of multi-ethnicity, support for good governance, and integration in the EU and Euro-Atlantic structures.

The progress in Kosovo as well as in the region depends very much on the transatlantic relations. The EU remains the largest trade partner for Kosovo, and Kosovo aspires to join the EU. Kosovo considers the US as a key ally and security guarantor, receiving the largest share of U.S. foreign assistance to the Balkans. The two countries also cooperate on numerous security issues.

The Republic of Kosovo is fully determined to complete the process of integration into the European Union, NATO, and other Euro-Atlantic structures. The greater the relationship between Europe and the US means more prosperity, economic development, and security for our country and the region.

Compliments of The Consulate General of the Republic of Kosovo in NY – a member of the EACCNY.