Delayed normalization of relations with Serbia hinders Kosovo’s economic growth prospects

Prishtina, May 16, 2023 – The American Chamber of Commerce in Kosovo believes that normalizing of relations between Kosovo and Serbia would have significant benefits for the business community in Kosovo, including increased trade and investment opportunities, which would help to create jobs and boost economic growth. AmCham calls on both countries to engage in constructive dialogue and to implement commitments of all previous agreements that would benefit both Kosovo and Serbia.

Despite Kosovo’s efforts to attract foreign direct investment, the country has struggled to attract significant levels of investment. Kosovo has made significant strides in recent years to improve its investment climate by reducing bureaucracy and implementing reforms to make it easier to do business.

The ongoing political tensions between Kosovo and Serbia have had a significant impact on Kosovo’s ability to attract foreign direct investment. The unresolved issues between the two countries have created an unstable environment that discourages foreign businesses from investing in Kosovo, as investors are hesitant to put their money into a country with a high level of political uncertainty, as it increases the risks associated with their investments. Additionally, the lack of a formal agreement between Kosovo and Serbia has created obstacles for businesses in terms of logistics, transportation, and trade, which further hampers FDI in the region.

In addition, the unresolved issue with Serbia has led to lost opportunities for Kosovo businesses, particularly in terms of trade and investment. The current situation has limited the opportunities for Kosovo businesses to partner with foreign investors and expand their operations. The loss of investment opportunities has hindered the growth of Kosovo businesses, which has had a knock-on effect on the country’s overall economic development.

The lack of a formal agreement between the two countries has resulted in trade barriers making it difficult for Kosovo businesses to export their goods and services to Serbia and hindering their ability to compete with Serbian businesses in the region. This has led to lost business opportunities for Kosovo firms, which has hampered the country’s economic growth and development.

AmCham strongly believes that normalizing relations would create a more predictable political environment that would increase investor confidence and encourage more FDI, which is critical for the country’s economic growth and development. This, in turn, would create job opportunities, improve living standards, and reduce poverty, which would benefit the people of Kosovo.

Finally, the American Chamber of Commerce in Kosovo reiterates that normalizing relations would increase trade and economic integration between the two countries, which would create new opportunities for businesses in Kosovo to access larger markets and benefit from economies of scale. This would, in turn, help to diversify Kosovo’s economy and reduce its dependence on the service sector and diaspora remittances. Finally, normalizing relations would also have important political and social benefits by reducing tensions and promoting regional stability, which would improve the quality of life for all people in the region.