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Business Environment and Foreign Direct Investment in Kosovo: an Overview of the Relationship Between Institutional Reforms and FDI

Author

Listed:
  • Hykmete Bajrami

    (University of Prishtina, Faculty of Economics, Prishtina, Kosovo)

  • Lulzim Krasniqi

    (South East European University, PhD Candidate, Tetove, North Macedonia)

Abstract

This paper analyses factors outlining the doing business environment, with reference to Kosovo, by focusing on some of the main determinants of attracting Foreign Direct Investments (FDI). It accentuates that in order to create favorable conditions to increase the flux of FDI, transition countries, including Kosovo, need to conduct a wide range of structural reforms, related not only to the reform of portfolios directly related to economy, but also to the improvement of the legal system and functioning of the democratic system in general. The paper used literature review and analysis of set of reforms undertaken from Kosovo institutions in order to attract FDI and improve the business environment. Moreover, the paper elaborates some of the important factors defining the doing business environment. There is a wide consensus in terms of recognizing the role of FDI for transition economies. Kosovo recognizes the significance of FDI and their impact on country economic development. For this purpose, its institutions have undertaken a range of reforms in terms of improving doing business environment. It is accentuated that Kosovo has many preconditions for increasing FDI inflows thanks to its natural resources, human capital, free access to major markets etc. However, apart from progress made in improving the doing business environment, Kosovo faces numerous challenges related not only to structural reforms of resources directly related to economy, but also with improving legal system and better functioning of the democratic system in general.

Suggested Citation

  • Hykmete Bajrami & Lulzim Krasniqi, 2019. "Business Environment and Foreign Direct Investment in Kosovo: an Overview of the Relationship Between Institutional Reforms and FDI," Economic Research Guardian, Weissberg Publishing, vol. 9(2), pages 99-108, December.
    • Handle: RePEc:wei:journl:v:9:y:2019:i:2:p:99-108
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    References listed on IDEAS

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    More about this item

    Keywords

    Business environment; Foreign Direct Investment; Structural reforms;
    All these keywords.

    JEL classification:

    • Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • P48 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies

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