Access to finance, key turning point for economic recovery

Prishtina, February 3, 2021 – Since the outbreak of the COVID-19 pandemic and the implementation of measures that restricted the movement and economic activities, the private sector, and the business community have faced access to finance as one of the main barriers to their development.

Challenges which local and foreign businesses operating in Kosovo continue to face, the dependency in remittances the opportunities and alleviation in access to finance deriving from the financial sector, as well as their perspective on the current state and economic development, were some of the key topics discussed during the virtual forum organized by the American Chamber of Commerce in Kosovo.

The Chief Executive Officer of KEP Trust, Shpend Nura stated that during the pre-pandemic period, the micro-financial sector has shown a positive trend of growth, as well as significant improvement and progress in customer service. While relating to decisions made by the financial sector, he said that offering the possibility of loan restructuring in the second quarter of 2020 as an alleviative measure for businesses has been a powerful driver of economic recovery. Nura, also stated that in order to ensure survival and economic development, coordinated response and action by economic stakeholders and relevant institutions is imperative.

Arijan Haxhibeqiri, Deputy Chief Executive Officer of Banka Ekonomike, stated that in the context of financial crises, despite the different nature of the crisis in 2008-2010, compared to the crisis during the pandemic period, developed economies have managed to create monetary and fiscal policies, in response to the negative financial impact of the crisis in 2008-2010, while the crisis caused by the pandemic has caught everyone unprepared. Haxhibeqiri added that in Kosovo, all relevant parties have given their contribution in managing the situation. Haxhibeqiri, also stressed that the trend of financing customers by banks has continued throughout this time.

Ramis Ahmetaj, Business Consultant stated that despite negative projections and challenges already known of, there is space for optimism in regards to the country’s economic recovery, in the near future. Ahmetaj also stated that market demands have been stable and also highlighted that financing contracts with foreign financial institutions are being signed, thus laying a stable foundation for the future. Further, he gave special emphasis to the need for financial intermediaries, as they have a significant impact on economic development, in creating proper strategies of action between the financial sector and businesses, as well as, in avoiding unnecessary risks.

Fiknete Balaj-Haliti, Chief Financial Officer at Cacttus and member of AmCham’s Finance Committee, as well as, moderator of this forum, referred to reports by international financial institutions, which projected a considerable decline in Kosovo’s economy, specifically the tourism, manufacturing, and exports sector. In this regard, she stated that in order for the private sector and businesses to develop, additional, more comprehensive financing resources must be created.