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USAID is promoting a structural shift in Kosovo’s economy from remittance-dependent consumption to production, jump-starting new export industries, reducing the trade deficit, building Kosovo’s brand as a source of quality goods, and investing in business-enabling reforms and assistance to facilitate this transition.  In spite of these advances, Kosovo still struggles with high levels of poverty, wide-spread unemployment, and an overdependence on imports. USAID is helping Kosovo address these issues by working on programs that promote economic diversification, increase access to credit and private sector contributions to growth, and improve the business-enabling environment.  

With USAID support, the Government of Kosovo is eliminating burdensome regulations and creating a more business-friendly environment, leading to Kosovo’s jump in the World Bank Doing Business rankings from 60th to 40th, and from 13th to 10th for Starting a Business in 2017.  USAID has assisted Kosovo strengthen government institutions, enhance fiscal transparency, and introduce key measures such as a legal framework for corporate insolvency.  These improvements are critical to driving private sector-led growth, fostering innovation, and mobilizing foreign and domestic investment.  

The Kosovo Credit Guarantee Fund (KCGF) -- launched with USAID assistance in 2016 with financial support from the Government of Kosovo -- is tackling a key constraint to economic growth in Kosovo: lack of access to credit for small and medium-sized enterprises (SMEs).  The KCGF stimulates lending by providing a partial loan guarantee to serve as a collateral substitute, allowing banks to reduce their risk and their collateral requirements.      

USAID’s direct support to the private sector has jump started key by helping companies expand production, connect to export markets, improve productivity, and build workforce skills.  In the agricultural sector, USAID’s market-driven approach invests in new technologies and higher value crops, focusing on introducing modern farming methods and increasing market reach and productivity.


Kosovo has achieved a great deal since declaring its independence in 2008.  It has developed institutions, undertaken institutional reforms, held several free and fair elections with peaceful transitions, and gone through the process of decentralization.  To improve its rule of law system, Kosovo’s Basic Courts have reduced their backlog and introduced mediation within the courts.  And with the milestone October 2017 integration of Serb judicial authorities into Kosovo’s government, the Judiciary now operates in the whole country.

Despite these achievements, important challenges remain, and Kosovo’s young population demands greater transparency, efficiency, and accountability from its government institutions.  USAID is working with the Government of Kosovo to strengthen judicial independence and rule of law; to improve communication between elected officials and their constituents; and to ensure that the Assembly of Kosovo has sufficient oversight on the executive.  These are critical steps to combatting pervasive corruption and an erosion of public trust in their government’s ability to provide basic services.

The Government of Kosovo is committed to leading and implementing reforms that will lead toward greater efficiency and transparency. This has provided USAID with an opening to partner with the Government on key reform issues and to focus assistance on strengthening the implementation of laws, oversight, management, and increased professional skills.  Such opportunities exist within the Kosovo Judicial Council (KJC), the Kosovo Judicial Academy (KJA), and with the courts themselves.  Commercial law, property rights, and alternative dispute resolution (ADR) mechanisms receive USAID’s particular attention as they underpin the reforms needed to spur economic development. Moreover, the importance of free legal aid is an essential service to meet people’s legal needs.

Opportunities also exist to further strengthen the National Assembly and civil society organizations as they advocate for Kosovo’s citizens and provide oversight of the executive branch of government. In addition, USAID supports Kosovo’s decentralization efforts and will help build municipalities’ capacity to practice accountable governance and to respond to the needs of all their citizens.

USAID has been engaged in Kosovo’s education system throughout its 19 years of assistance.  Initial assistance focused on increasing access to education by providing infrastructure improvements (construction and renovation) in schools throughout Kosovo.  This was followed by concentrated reform efforts at the primary (grades 1- 5) and lower secondary (grades 6-9) levels.  In alignment with the Government’s decentralization policies, support focused on building the capacities of the Municipal Education Departments to manage the education system at the local level.  Areas of concentration include improving early grade reading and providing quality courses in math, science and technology.  Critical need areas remain, including addressing the lower-to-secondary dropout rate and further enhancing school management and teaching skills.

At the tertiary level, current university curricula – specifically at the University of Prishtina which is the major body of higher education in the country – has not been modernized and is of poor quality, leaving many graduates ill equipped to meet today’s workforce requirements.  In order to partially meet the demand for a more skilled workforce, USAID has provided scholarships, mostly at the Master’s Degree level, in targeted sectors that are aligned with USAID’s development objectives. 

Last updated: June 23, 2020

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