Corruption Deters Investors in Kosovo, Report Says
As Kosovo tries to attract more foreign money, corruption and bribery remain a key factor deterring companies from investing in the country, a recent report said.
(kosovocompromisestuff) Sunday, May 18, 2014
The “Investors’ Perceptions of Kosovo’s Business Environment”, a report published by the International Finance Cooperation, a World Bank group and some other institutions, says “corruption and bribery is identified as an obstacle to attracting investments”.The report, published on Thursday, gives an insight into the perceptions of 103 foreign private businesses, 72 of which have already invested in Kosovo, while 31 others are potential investors.“In terms of encountered forms of corruption, the companies surveyed report that licensing procedures, or procedures for obtaining incentives are sometimes accompanied by steps that are not envisaged in the formal process of obtaining those benefits, often last longer than foreseen in the legal documents and add unpredictability for businesses,” the report noted.The fight against organised crime and corruption is one of the key criteria for Kosovo.However, the report underlines that some progress has been made since 2009 when the last survey was conducted.While five years ago a young and dynamic labour force, the emerging market and labour costs were the most positive aspects to investing in Kosovo, this report underlines the current top reasons for investing in the country as “low tax rates, ease of starting and closing a business and labour costs”.Bernard Nikaj, Kosovo's Minister of Trade and Industry, said: “The lack of the rule of law and the lack of transparency remain the biggest challenges that need to be overcome”.He said the government “has taken several steps to make the environment for foreign investments more attractive.“The main reasons for attracting foreign investors have to do with the emerging market, the new and qualified labour force, but also a simple tax environment”, he added.But the authors of the report say more needs to be done.“All respondents, which means those that have already invested and those which want to invest, said corruption needs to be fought in order to improve the environment to invest in Kosovo. The second aspect is de-bureaucratization of procedures, while 71 per cent urge authorities to improve the image of Kosovo,” Kushtrim Shaipi, executive director of IQ Consulting, which compiled the survey, concluded.The main investors in Kosovo so far are companies from Turkey, Switzerland and Germany.