kosovo – basic facts

Investment Promotion Agency of Kosovo Government of theRepublic of KosovoMinistry of Trade & Industry

Kosovo – Basic FactsKosovo – Basic Facts

Area: 10,887 km2

Population: 1.8 millionCapital: Prishtina (population 400K)Main Ethnic Groups: Albanian 90%, Serb 5%, others 5% Diaspora: Approximately 800,000 live abroadLanguages: Albanian, Serbian and EnglishCurrency: EuroGDP 2010: €4.2 billion (€ 2,320 per capita)Major Markets: EU, CEFTABorders with: Albania, Macedonia, Montenegro and Serbia


GDP growth 2006 – 2011 (in EUR)GDP growth 2006 – 2011 (in EUR)

4.0% 5.0% 5.4% 3.8% 4.6% 5.3%


FDI growth 2006 – 2011 (in mm FDI growth 2006 – 2011 (in mm EUR)EUR)

4.0% 65.4% -16.8% -22.0% 28.0% 8.0%


FDI 2007 – 2011 by Country (in FDI 2007 – 2011 by Country (in mm EUR)mm EUR)


FDI 2011 by Sectors (as % of total FDI 2011 by Sectors (as % of total FDI)FDI)


Why invest in Kosovo?Why invest in Kosovo?


Liberal Trade RegimeLiberal Trade Regime

•CEFTA 2007

• Central European Free Trade AgreementAlbania, Bosnia and Herzegovina, Croatia, Kosovo, Macedonia, Moldova, Montenegro, Serbia

•Population: 32 million

•GDP (2009): €180 billion

• Autonomous Trade Preferences with the European Union

• Unlimited duty-free access to the EU market, renewed 2011-2015

•Generalized System of Preferences with the US• Preferential duty-free entry for about 4,800 products

•Trade Preferences with: Japan & Norway


A Good Strategic LocationA Good Strategic Location

Regional CenterDistance from Prishtina (km)

Skopje 85

Sofia 270

Thessaloniki (port city)

315

Tirana 260

Durres (port city) 260

Shengjin Port 230

Belgrade 360

Sarajevo 390

Bar (port city) 350

Vienna 930

Budapest 732


Youngest Population in EuropeYoungest Population in Europe

• Average age – 27 years old

• 15,000 new university graduates every year (70,000 students)

• University of Prishtina operates under bologna system

• Several American and British Universities

• English and German Languages are widely used


Very Low Taxes and WagesVery Low Taxes and Wages

• Corporate profit tax: 10%

• Income tax 0 -10 % (Progressive)• €0 – 80 = 0%• €80 – 240 = 4%• €240 – 450 = 8%• €450+ = 10%

• Mandatory pension contribution: 5%

• Value Added Tax: 16 %

•Customs: 0% import tariff on some raw materials and a range of capital and intermediary goods.

• Average Wage: 280 EUR/month


Legislation and AgreementsLegislation and Agreements

• Legal system completely re-built since 1999, largely EU-compatible

• Law on Foreign Investments requires equal treatment for foreign and domestic investors

• Bilateral Agreements on Investment Protection and Promotion:

• Protection and Security,

• Free Transfer of Funds,

• Free Repatriation of Profits and Dividends,

• Protection against Retroactive Application of Laws,

• Protection against Expropriation


Business Environment in KosovoBusiness Environment in Kosovo

• Euro – official currency

• Over 60,000 active SMEs

• Sound banking system

• Free Land for Foreign Investors

• Improving Business Environment reforms in place• Business Registration in one day• Chartered Capital is zero• Municipality Permit is eliminated• Administrative Procedures for export and import are reduced by 70%• 50% of oil related licenses and many other licenses have been

eliminated• New Fiscal Package


Economic StabilityEconomic Stability

Kosovo has the lowest level of debt in Europe, mainly due to its conservative fiscal policy

Source: Economist, IMF

Sovereign Debt as % of GDP in

2011


Good Investment OpportunitiesGood Investment Opportunities

First Core Target Sectors• Business Process Outsourcing (BPO)• Automotive Components• Electronic Components (EMS) – Electronic Manufacturing Services• Agribusiness – Food Processing and Packaging

Second Core Target Sectors• Mining and Energy• Wood and Metal Processing• Decorative Stone• Tourism – New Brezovica Ski Resort• Construction• Textile


Good Investment Opportunities - Good Investment Opportunities - PTKPTKPrivatization of the Post and Telecommunication of Kosovo (PTK)

Low market penetration that allows for significant growthCompany is debt-free and owns 70% of market share in mobile and 94.5% in fixed telephonyHigh profitability

Revenue of EUR 161 million

EBITDA margin of 46% in 2011 or about EUR 74 million

Net profit of EUR 48 million

Modern technical infrastructureLazard Freres and Raiffeisen Investment selected as transaction advisor


Good Investment OpportunitiesGood Investment Opportunities

Industrial Battery Factory L.L.C.•Located in Industrial Zone of Peja town on around 14.18 hectares with road and rail access and a factory floor area of 18,900 m2•Two production lines.•Machines and tools in good working order. Currently underutilized.•Dedicated willing workforce with technical know-how

Hotel Onix Banja e Pejes and Health Spa L.L.C•Situated on 26 hectares of land with built up floor area of 38,000 m² in 4 hotels and other facilities•Unique water spring mineral composition and disease treatment on the West Balkans•Opportunity to develop the Spa as a country club and Health Spa with restaurants, sports centres and swimming pool


Survey: Investing in Kosovo - Survey: Investing in Kosovo - AdvantagesAdvantages


Why BudapestWhy Budapest

It has a strategic location, in the very heart of EuropeOffers rich networking opportunitiesOver 130 foreign companies in Hungary, 69% of them had a regional center, and 44% had already in Budapest


How can the Embassy of the How can the Embassy of the Republic of Kosovo in Hungary Republic of Kosovo in Hungary help you?help you?•Provide comprehensive information on relevant actors

involved in promotion of investments

•Facilitate visits and meetings with relevant actors in involved in promotion of investments, and with businesses in Kosovo

•Contact:

Embassy of the Republic of Kosovo in Hungary

Szabadsag ter 7, 1054 Bp.

Tel. +36 1 688 7872

Fax. +36 1 688 787

Contact person:

Mr. Delfin Pllana, Minister-Counselor


THANK YOU FOR YOUR THANK YOU FOR YOUR ATTENTION!ATTENTION!

kosovo – basic facts

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