Kosovo: Trade Profile
Kosovo is one of the most open economies in the region, with trade representing 110% of its GDP (World Bank, latest data available). The government is currently negotiating Kosovo’s membership in the World Trade Organization (WTO) but has not made much progress in this regard since 2017. According to data by the national Agency of Statistics, in 2022, the country’s main exports comprised base metals and articles thereof (23.1%); miscellaneous manufactured articles (19.5%); plastics, rubber and articles thereof (13.9%); mineral products (11.3%); and prepared foodstuffs, beverages, and tobacco (7.6%); whereas imports were led by mineral products (18.5%); prepared foodstuffs, beverages, and tobacco (11.6%); machinery, mechanical and electrical equipment (11.1%); and base metals (10.5%).
According to official data, the country's exports to the EU-27 accounted for 33.9% of the total in 2022 (mostly to Germany (9.5%), Italy (5%), and the Netherlands (3.2%), followed by the U.S. (14.8%), North Macedonia (12.9%), and Albania (11.1%). Germany (10.8%), China (9.7%), Serbia (6.6%), Greece (5.4%), North Macedonia (5%), and Italy (4.9%) were the main import partners. In 2016, Kosovo implemented the Stabilization and Association Agreement (SAA) negotiations with the EU, focused on trade liberalization. Products exported to the European Union are tax-exempt because the country benefits from the non-reciprocal preferential agreement granted to countries participating in the Stabilisation and Association Process. However, border tensions with Serbia impede the expansion of trade, although the government recently announced the removal of the tariff on imports of goods from Serbia and Bosnia and Herzegovina.
Kosovo has a small domestic market and limited industrial production, and its imports remain higher than exports. In 2022, Kosovo's trade deficit surged by 20% to EUR 4.7 billion (equivalent to USD 5 billion). Exports saw a significant rise of 22% to EUR 920.4 million, whereas imports escalated by 20% to EUR 5.6 billion during the same period. The country’s overall trade balance was estimated to be in deficit by 32.6% of GDP. According to preliminary figures from the Kosovo Central Bank, in 2023, Kosovo's trade deficit amounted to approximately EUR 5.1 billion, with imports exceeding exports. Exports in 2023 declined by roughly EUR 57.3 million compared to the previous year, when they reached their highest level in twenty-two years, totaling EUR 920.4 million. Imports in 2023, however, experienced a significant surge from the previous year, increasing by approximately EUR 273.5 million to reach EUR 5.9 billion, the highest level since 2001.
| Foreign Trade Indicators | 2017 | 2018 | 2019 | 2020 | 2021 |
|---|---|---|---|---|---|
| Imports of Goods and Services (Annual % Change) | 2 | 20 | 0 | -14 | n/a |
| Exports of Goods and Services (Annual % Change) | 11 | 1 | -2 | -12 | n/a |
| Foreign Trade (in % of GDP) | 40 | 44 | 81 | 73 | 60 |
| Imports of Goods and Services (in % of GDP) | 22 | 25 | 38 | 36 | n/a |
| Exports of Goods and Services (in % of GDP) | 21 | 22 | 44 | 37 | n/a |
Source: World Bank - Latest available data.
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Latest Update: May 2024
