EBRD activities in Kosovo UK/US-Kosovo Trade & Investment Forum 2016 • Holger Muent, Regional Head Western Balkans Kosovo Economic Development – The EBRD Perspective
1. The EBRD in Kosovo
2. Kosovo Economic Overview
3. The EBRD Strategy for Kosovo What is the EBRD?
Net cumulative business investment • International financial institution, promotes transition to market economies in 35 12 110 105 11 100 countries from central Europe to 95 10 90
central Asia and the Southern cumulative Net 85 9 80 and Eastern Mediterranean – 8 75 70 SEMED region) 7 65 60
6 55 business investment business
investment (ABI) 50 • Owned by 65 countries and two 5 45 40 inter-governmental institutions. 4 35 30 3 25 • 2 20
Capital base of €30 billion. 15 Annual business 1 10 5 • Invested over €86 billion in more 0 0 than 4,007 projects since 1991
Equity ABI Debt ABI Net Cumulative Business Investment
7 November, 2016 3 EBRD Investments in Kosovo
• Kosovo has been EBRD country of operations since 2012 • Total commitment of € 204 million in 49 projects • Largest share in infrastructure and energy; 21% of total commitments in the financial sector
Significant infrastructure projects: • North-South Railway Line • Road Rehabilitation • Transmission Network Strengthening • Municipal Transport in Pristina
7 November, 2016 4 Kosovo Economic Development – Fundamentals
• Prospective EU membership • Macro-economic stability • Strategic location • Low labour costs, young population • Regional Integration Kosovo Economic Overview
• GDP growth picked up in 2015 • EU Approximation has advanced • Improvements in Business Climate Reforms • National Development Strategy in place Kosovo – Financial Sector Overview
• Kosovo’s banking sector comprises of 10 active banks, all private, of which 8 majority foreign- owned • Liquidity and Capital Adequacy are high • Asset Quality remains very good • Lending Activity is recovering, but still low in regional context • Private Sector Loan Portfolio is divided between loans to households and loans to enterprises 35/65
Private sector credit, % GDP Private sector loans by sector, per cent share
20% YoY credit growth Households 10% 12% 0% Agriculture 2% Industry 56 54 35% 50 47 Construction 37 35 33% Wholesale and retail trade 3% 5% 10% Hotels and restaurants
BIH MNE MKD SRB ALB KOS Other services
Source: National central banks via CEIC Source: Central Bank of Kosovo
7 November, 2016 7 The EBRD Strategy for Kosovo
• Close alignment with government priorities and EU approximation process • Key themes:
• Competitiveness of Private Sector
• Energy Security and Sustainability
• Connectivity and Regional Integration
Private Sector Competitiveness Key for Future Economic Growth
7 November, 2016 8 Private Sector Competitiveness • Investment
• Through financial intermediaries:
• Reaching smaller companies
• Specialised products, focussing on underserved segments and specific investments
• Direct Investments:
• FDI
• Larger Local Investors (not in competition with local banks!)
• Advisory
7 November, 2016 9 Contacts
•For all further enquiries, please contact:
• Holger Muent Director, Western Balkans Tel: + 44 207 338 7413 Email: [email protected] EBRD, One Exchange Square London, EC2A 2JN UK
• Elena Petrovska • Head of Office Rruga Prishtinë-Fushë Kosovë • 10060 Prishtina • Kosovo • Tel: +381 38 242 07000 • Email: [email protected] • www.ebrd.com 7 November, 2016 18