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Kosovo:
Economy

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Economy - overview
Definition
Over the past few years Kosovo's economy has shown significant progress in transitioning to a market-based system, but it is still highly dependent on the international community and the diaspora for financial and technical assistance. Remittances from the diaspora - located mainly in Germany and Switzerland - account for about 30% of GDP. Kosovo's citizens are the poorest in Europe with an average annual per capita income of only $1800 - about one-third the level of neighboring Albania. Unemployment - at more than 40% of the population - is a severe problem that encourages outward migration. Most of Kosovo's population lives in rural towns outside of the capital, Pristina. Inefficient, near-subsistence farming is common - the result of small plots, limited mechanization, and lack of technical expertise. Economic growth is largely driven by the private sector - mostly small-scale retail businesses. With international assistance, Kosovo has been able to privatize 50% of its state-owned enterprises (SOEs) by number, and over 90% of SOEs by value. Minerals and metals - including lignite, lead, zinc, nickel, chrome, aluminum, magnesium, and a wide variety of construction materials - once formed the backbone of industry, but output has declined because investment has been insufficient to replace ageing Eastern Bloc equipment. Technical and financial problems in the power sector also impedes industrial development. The US has worked with the World Bank to prepare a commercial tender for the development of new power generating and mining capacity. The official currency of Kosovo is the euro, but the Serbian dinar is also used in the Serb enclaves. Kosovo's tie to the euro has helped keep inflation low. Kosovo has maintained a budget surplus as a result of efficient tax collection and inefficient budget execution. While maintaining ultimate oversight, UNMIK continues to work with the EU and with Kosovo's government to accelerate economic growth, lower unemployment, and attract foreign investment. In order to help integrate Kosovo into regional economic structures, UNMIK signed (on behalf of Kosovo) its accession to the Central Europe Free Trade Area (CEFTA) in 2006. In February 2008, UNMIK also represented Kosovo at the newly established Regional Cooperation Council (RCC).
GDP (purchasing power parity)
Definition - World rank and map
$4 billion (2007 est.)
GDP (official exchange rate)
Definition
$3.237 billion (2007 est.)
GDP - real growth rate
Definition - World rank and map
2.6% (2007 est.)
GDP - per capita
Definition - World rank and map
$1,800 (2007 est.)
GDP - composition by sector
Definition
agriculture: 20%
industry: 20%
services: 60% (2007 est.)
Labor force
Definition
832,000 (June 2007 est.)
Labor force - by occupation
Definition
agriculture: 21.4%
industry: NA
services: NA (2006 est,)
Unemployment rate
Definition - World rank and map
43% (2007 est.)
Population below poverty line
Definition
37% (2007 est.)
Distribution of family income - Gini index
Definition - World rank and map
30 (FY05/06)
Inflation rate (consumer prices)
Definition - World rank and map
2% (2007 est.)
Investment (gross fixed)
Definition - World rank and map
29% of GDP (2006 est.)
Budget
Definition
revenues: $1.364 billion
expenditures: $1.008 billion (2007 est.)
Public debt
Definition - World rank and map
NA
Agriculture - products
Definition
NA
Industries
Definition
mineral mining, construction materials, base metals, leather, machinery, appliances
Electricity - production
Definition - World rank and map
3.996 billion kWh (2006)
Electricity - consumption
Definition - World rank and map
4.281 billion kWh (2006)
Electricity - consumption per capita
Definition - World rank and map
2,013 kWh (2006)
Oil - production
Definition - World rank and map
0 bbl/day (2007)
Oil - consumption
Definition - World rank and map
NA bbl
Oil - proved reserves
Definition - World rank and map
NA bbl
Natural gas - production
Definition - World rank and map
0 cu m (2007)
Natural gas - consumption
Definition - World rank and map
0 cu m (2007)
Natural gas - consumption per capita
Definition - World rank and map
0 cu m (2007)
Natural gas - proved reserves
Definition - World rank and map
NA cu m
Current account balance
Definition - World rank and map
-$58.3 million (2007)
Exports
Definition - World rank and map
$148.4 million (2007)
Exports - commodities
Definition
mining and processed metal products, scrap metals, leather products, machinery, appliances
Exports - partners
Definition
Central Europe Free Trade Area (CFTA) 56% (2006)
Imports
Definition - World rank and map
$NA
Imports - commodities
Definition
foodstuffs, wood, petroleum, chemicals, machinery and electrical equipment
Imports - partners
Definition
EU 35%, Macedonia 15%, Serbia 13%, Turkey 8% (2006)
Reserves of foreign exchange and gold
Definition - World rank and map
$NA
Debt - external
Definition - World rank and map
according to the national bank of Serbia, Kosovo's external debt was around $1.2 billion; Kosovo was willing to accept around $900 million (2007)
Economic aid - recipient
Definition
$324 million (2007)
Currency (code)
Definition
euro (EUR); Serbian Dinar (RSD) is also in circulation
Exchange rates
Definition
euros per US dollar - 0.7345 (2007)


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