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Economic Monitor Kosovo

  • Kosovo
WA 7 | October 2024
Macroeconomic Analyses and Forecasting
Overview
  • Economy to grow by 3.8% in 2024, after 4.1% in 2023; strong performance in regional comparison
  • Main drivers of growth: private consumption, but also higher public investment
  • After a peak in 2022, the rate of inflation continues to decrease; Jul-24:  2,2%
  • With an average salary of EUR 570(in 2023), KOS remains wage competitive in the region
  • Current account deficit declined from over 10% in 2022 to 7.7% of GDP in 2023
  • Remittances account for almost 14% of GDP and are a key economic factor in the country
  • Low budget deficit in 2023 of 0.2% of GDP; deficit projected to increase to 1.4% of GDP in 2024, driven by lower reception of grants and higher expenditure
  • Strong increase of public investment (+ 1 pp of GDP) in 2023; but still large under-execution
Special issues
  • FDI.Inflows reached record high in 2023 (8.8% of GDP), but need to be diversified more
  • Energy and climate policy. New Draft National Energy and Climate Plan and Nationally Determined Contributionsoutline great ambitions in the energy and climate policy space

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