Capital Pristina
Population 1,807,000
Area 10,908 SQ KM (4,212 sq mi)
Currency euro (eur)
GDP USD 8.03 billion
gdp per capita USD 4,442
FDI (2014-2019) USD 1,699 million
corporate tax 10%
vat 16%


Kosovo is a parliamentary republic and a potential candidate for EU membership. It declared independence on February 17, 2008 and signed the Stabilization Association Agreement (SAA) in October 2015.

Kosovo's economy has shown progress in transitioning to a market-based system and maintaining macroeconomic stability, but it is still highly dependent on the international community and the diaspora for financial and technical assistance. Remittances from the diaspora - located mainly in Germany, Switzerland, and the Nordic countries - are estimated to account for about 17% of GDP and international donor assistance accounts for approximately 10% of GDP. With international assistance, Kosovo has been able to privatize a majority of its state-owned enterprises. However, while the rate of economic growth in the recent years has been considerable and satisfactory despite the world economic crisis – averaging 3.3% annualy since 2009 – subsequently resulting in lowering the overall poverty levels, they nonetheless could be even higher. Under the SAA, Kosovo — which gets approximately 58% of government revenue from tariffs on imports — is required to phase out tariffs on EU goods over the next seven years. Kosovo represent a good investment destination, especially in the sectors of information technology and communications, food processing and packaging, mining and metal processing, energy, textile, leather and wood processing

EU-facilitated normalization process with Serbia is on-going, which led to implementation of a number of agreements including the one on freedom of movement, telecommunications and energy distribution. The normalization process with Serbia should lead to signing of the legally binding agreement between the two sides that will fully regulate their relations. Kosovo is a member of the World Bank, International Monetary Fund, the European Bank for Reconstruction and Development, and the Council of Europe Development Bank.

The business environment in the Republic of Kosovo is becoming one of the most competitive in the region. An excellent tax system, abundance of natural resources, quick and easy business registration methods, a transparent law on foreign investments, Law on strategic investments, are just a few advantages making this country an attractive and friendly environment for foreign investors.

The Republic of Kosovo is distinguished as the country with the greatest opportunities for investment in the Balkans, hence a strong reason appealing at international investors as a primary place for their investments.


The Republic of Kosovo has been nurturing an attractive business climate by offering investment incentives in the form of more favorable tax regimes compared to other EU countries, bilateral double-taxation and multilateral trade agreements, cheap and effective labour force. Kosovo has generally strived to achieve a high level of foreign trade liberalization through being a signatory of five trade agreements – EFTA, CEFTA, SAA (Stabilisation and Association Agreement) with EU member-states, Turkey and Ukraine. Furthermore, it signed agreements for the avoidance of double taxation and investment protection treaties with many European countries.

The Stabilization and Association Agreement guarantees the alignment of national legislation with EU laws, while conditions for investment and business are becoming recognizable and predictable for foreign investors.


There are three economic zones in Kosovo. Zones are established upon the request of the municipality to the Ministry of Trade and Industry, and are administered by the municipality. Business organisations or business associations can also submit request for establishment to the ministry or to the municipality.

Types of incentives in Kosovo

Incentives Awarded aid Eligibility criteria Condition for use of aid Length of incentives Zone specific
Deferred VAT payment on selected plant machinery. Deferred payment of VAT on imports of selected plant machinery. Yes Import plant equipment and machinery. Up to 6 months No
Additional 10% deduction on heavy equipment. Additional deduction allowance of 10% on top of normal depreciation of the cost of acquisition of heavy equipment (production lines for plant and machinery) and heavy transport vehicles. Only permitted for “heavy” equipment and vehicles. Applicable for new assets or assets first placed in service in Kosovo. Only allowable on assets first used up to 31 December 2012 (note, both income tax usage period is extended to 31 December 2014). Acquisition of equipment and vehicles under the category. n/a No
No customs duty on machinery and raw material. Exemption from custom duties on machinery and raw material. The Law on 0% duties was in the Parliament in 2013 – before these incentives were provided based on UNMIK Regulation NO. 2007/31 PART C. The exempt material must be aimed at manufacturing. n/a No
No fees on business registration (Municipality of Suhareka). Exemption from fees of businesses registration that are involved in production. Manufacturing businesses. Business must be located in Suhareka. n/a No
Free use of municipal land in Peja. Free use of municipal land for business activities. No specific criteria. Conduct a new business. Up to 30 years No


Regulatory framework

Law No. 04/L-159 on economic zones, in Official Gazette of the Republic of Kosova No. 6 / 12 March 2013. The law establishes the economic zones, and is the base for drafting the national plan for economic zones, deciding site of economic zones, way of use of economic zones, promotion of economic zones, and establishment of national council for economic zones.



Global Competitiveness Index /
Ease of doing business RANK 57
Starting Business rank RANK 13
Global logistics report /

Electricity prices

  2015 2016 2017 2018 2019
Kosovo 0.063 0.059 0.066 0.064 0.061
EU - 27 0.209 0.205 0.207 0.213 0.216

Monthly salary

Net average monthly salary (2019) € 537

Gross average monthly salary (2019) € 602


Vladama bismo savetovali da poboljšaju međugranični protok robe i ljudi (carinske procedure, policijske i carinske granične sisteme).

Vidimo da region ostaje interesantan za radno-intenzivna ulaganja ako se ne dogode veća politička previranja.

Read More



Strategic partner

Karanovic Nikolic

Content partner


Content partner

I&F McCann

Communications partner