Political crisis in Kosovo deters potential investors

Political crisis in Kosovo deters potential investors

Pristina, 23 November 2015/Independent Balkan News Agency

By Elton Tota

Government of Kosovo says that it offers favorable conditions for foreign investors who are interested on investing their capital in the country.

But, economy experts say that the political crisis and corruption are the main factors that prevent this process.

The head of the Agency for Investments and Support of Enterprises in Kosovo, Besian Mustafa, says that Kosovo offers favorable conditions for foreign investors.

Among other advantages he mentions the cheap labor cost, cheap market without customs charges in the EU market, lowest taxes in Europe and easy procedures for doing business.

Mustafa has also mentioned the new tax package, which will stimulate foreign investments in Kosovo.

“The new tax package provides relief for production lines, machinery, raw material, etc. The Stabilization and Association Agreement recently signed with the EU will also offer new opportunities for businesses in Kosovo and the growth of presence for foreign companies in Kosovo”, Mustafa stresses.

Mustafa also points out that Kosovo’s government is finalizing the bill on strategic investments, where according to him, this law will determine the domains of strategic development for Kosovo and will simplify investment procedures. At the same time, this bill will also enable direct negotiation between the government and strategic investors.

Economy professor, Naim Gashi told IBNA that teargas let off in the parliament of Kosovo is the worst signal that can be sent to international partners and potential investors.

He says that unfortunately, Kosovo is not able to build national consensus for strategic projects.

“Currently, Kosovo is ahead of the finalization of two big contracts in the aspect of foreign investments; the new thermal power plant and Brezovica. Violence in parliament shows political instability and hesitation among foreign investments. Last year we also had an institutional gridlock and that crisis is also being reflected in this year’s macroeconomic performance”, Gashi says.

Gashi suggests that all parliamentary parties must bear in mind the economic consequences that this gridlock can cause and that a solution must be found in order to enable institutional stability, which is so important in attracting foreign investments.

Expert of economic affairs, Shkelzen Dakaj told IBNA that the political crisis is having an impact in the economy of the country. He says that many investors are leaving the country as a result of this crisis.

“The violent actions in the parliament of Kosovo and the radical protests of the opposition indicate that the political crisis is escalating. Under these circumstances, those who have invested so far in Kosovo, will remove their capital. Meanwhile, those who have planned to invest, will go to other countries which offer more security and more stability”, Kelmendi says.

As far as direct foreign investments are concerned, Kosovo is behind the countries of the region. International reports present the youngest state in Europe as a black hole for foreign investors. /ibna/