MFA: Strategic opportunities for foreign exporters
The covid-19 pandemic hit Kosovo at a time when it was at its peak in some European countries. Kosovo could thus use the experience of previously affected countries and prepare as much as possible. Measures to protect the population taken by the government led to a temporary restriction of economic activity. The pandemic thus deprived a number of companies of contracts, which led to layoffs or the termination of their activities. According to current economic forecasts, due to the pandemic, GDP fell by 7.5% in 2020.
In 2021, economic recovery and GDP growth of 3.7% are expected. The deficit state budget for 2021 is expected to have revenues of USD billion and expenditures of USD billion. A significant contribution to Kosovo’s national income is remittances from members of the diaspora, which represent 10% of the country’s GDP. Kosovo is also significantly dependent on foreign development aid, which amounts to approximately 9% of GDP.
The Kosovo government has prepared a number of support measures (interest-free government loans, grants for farmers, financial support for exporters, deferment of loan repayments and VAT, etc.), which will lead to an increase in the current account deficit and public debt in the coming years. The national debt program assumes that the total debt level will rise to an acceptable 26% of GDP in 2021 and to 27% of GDP in 2022. Inflation this year should reach 1.8%, with a slight increase to 1.9% likely in 2022.
Post-COVID-19 opportunities
Mining, mining and oil industry
According to allcountrylist, there are significant deposits of base metal ores and lignite on the territory of Kosovo. Mining of mineral resources is mainly carried out by state-owned companies. In the case of coal mining, it is the state company Kosovo Energy Corporation, which also supplies and, in principle, controls the Kosovo energy industry. Kosovo’s mining and quarrying industry is outdated and unsatisfactory not only in terms of productivity, but also in terms of work safety.
Mines need new mining machines, trucks, loaders, conveyor belts, material sorting equipment, modern control systems, wireless communication systems for miners, technologies for alternative methane combustion, security systems for monitoring the movement of people underground, industrial explosives, etc. Czech companies could also be applied in the field of exploration of new deposits, including feasibility studies.
Energy industry
The current electricity system of the Republic of Kosovo is outdated and unreliable. In this context, the Government of Kosovo has prioritized the modernization and improvement of the country’s energy sector and requested support and assistance from its development partners, including the World Bank and the European Commission. The main goal is to increase energy efficiency, develop renewable energy sources, integrate into regional energy markets and support reliable, sustainable and affordable energy production. The vast majority of electricity production is provided by thermal power plants, which cannot operate at full capacity for technical reasons.
For the further development of Kosovo’s energy sector, the construction of new capacities and the modernization of existing ones will be necessary, as well as the wider introduction of renewable energy sources. Czech companies could be used mainly in the field of subcontracting generators, turbines, filters and desulphurization devices, control systems and other parts for the construction, modernization and increase of efficiency of thermal power plants.
Another possibility for Czech companies to participate in the planned modernization of Kosovo’s energy sector is participation in the construction of the Bajgora wind power plant (105 MW) in the north of the country. Czech companies could participate in the project, for example, by supplying control systems, generators, bearings, fans, or even entire towers (tubes) for wind power plants.
Water management and waste industry
The lack of modern wastewater treatment plants in Kosovo causes the pollution of most surface sources of drinking water. The result is an inappropriate quality of water supplied to the public water network. The condition of the water supply systems is also completely unsatisfactory, and will need to be modernized. The waste industry also needs renewal, which will require extensive investment in modern technologies. That is why the Kosovo government includes environmental improvement projects in its program priorities. Also on the part of municipalities, there is an increased interest in comprehensive waste management solutions.
The Republic of Kosovo offers great potential in the field of water management and waste industry. Czech companies could apply with supplies of wastewater treatment plants, devices and projects to prevent water loss, technologies to reduce water consumption in industries, and supplies of measuring equipment for the water management and waste industries.
Healthcare and pharmaceutical industry
The pandemic has revealed the deep underfunding and shortcomings of Kosovo’s healthcare system, which will need to be modernized from the ground up. There is thus a real potential for Czech exports in this area. In addition to the complete construction and renovation of hospitals, Kosovo’s healthcare sector will need modern equipment, such as medical instruments, medical beds, operating equipment, diagnostic equipment and rehabilitation equipment.
There is also room for cooperation in the area of supply of medicines and medical equipment, which is mainly imported. The international community has pledged financial assistance to Kosovo in the form of soft loans – the European Bank for Reconstruction and Development (USD 41 million for health), the European Union (USD 117 million – health, economy) and the World Bank (USD 54 million – health). Czech companies could use these financial resources and participate in the modernization of Kosovo’s healthcare system.
Rail and rail transport
The reconstruction of existing and the construction of new railway lines are part of the plans to develop the connectivity of the countries of the Western Balkans. A priority project in Kosovo is the total reconstruction of the north-south railway route (Route 10) between the border with Serbia and North Macedonia (Leshak – Kosovo Polje – Elez Han) with a length of approx. 150 km. The mentioned project was classified as a priority and received financial support from the European Bank for Reconstruction and Development. Reconstruction work on the southern section of the route began in 2017.
The modernization of the railway transport infrastructure is related to the modernization of the technical background and fleet of carriers, where Czech companies that supply, for example, control systems, components for rolling stock, or carry out general repairs of locomotives, wagons, etc., could apply.
