PROJECT TITLE:

Technical Assistance to Further Development of Kosovo’s Trade Policy

OVERALL OBJECTIVE:

To promote Kosovo’s integration into the world economy and to develop and create the basis for a sustainable enabling environment for private sector development.

LOCATION:

Kosovo

SECTOR:

Economic Development

BENEFICIARIES:

Departments of the Ministry of Trade and Industry of Kosovo.

DURATION:

01/October/2011 - 01/October/2015

VALUE:

2,809,300.00 EUR

PURPOSE:

To assist the Ministry of Trade and Industry to develop its institutional capacity to prepare negotiating positions and to implement agreed policy initiatives in line with international trade requirements and EU practices.

TARGET AREA:

Capacity and Institutional Building in the area of trade policy making.

ACTIVITIES

Component I – Trade Policy Building all human and institutional capacities needed for the effective formulation and implementation of Kosovo’s trade policy and in particular to prepare MTI for trade negotiations with the EU Component II – Impact Assessment Building the analytical capacity and skills within of MTI with respect to trade analysis for evidence based policymaking. Component III – Trade Openness Provides capacity building to assess the impacts of customs duties and VAT exemptions on Kosovo’s economic development and its integration into the global and European economies, and advises MTI on alternative tariff and VAT structures for domestic agricultural and industrial protection, and for alleviating budget revenue losses in light of prospective tariff liberalization in the context of the EU-Kosovo SAA Component IV – Trade Statistics Support by increasing the quality of Kosovo’s trade statistics to a level that allows a thorough analysis, and offers a basis for objective decision making.

RESULTS

Component I - Trade Policy: -Substantial progress made by Kosovo towards EU membership in all aspects of international trade in goods and services; -Kosovo’s CEFTA membership developed into a force for Kosovo’s further integration into the region; -A good understanding of the issues and responses likely to be raised by negotiation of Chapter 30 of the acquis developed within MTI; -The understanding of the role of international trade policy improved among official at MTI and other trade-related institutions (including the freedoms and limits of negotiation in achieving free trade between the EU and Kosovo). Component II - Impact Assessment -Public administration informed on sensitive products which might need unusual treatment during negotiation of the Trade Agreement; -Capacity built in MTI to prepare fully relevant analyses of the international economy, and impacts of policy changes on the Kosovar economy; -A level of professional practice achieved by which officials rely on systematic analyses of consequences as part of the process of reaching informed trade policy decision. Component III - Trade Openness -A wider understanding obtained within the relevant authorities of the significance of tariffs ad VAT exemptions for the economic development of Kosovo; -All relevant stakeholders are made aware of the implications of tariffs and VAT exemptions for integration into the global and EU economies and on development of the international trading capacity of Kosovo; -In close cooperation with Component 2, analyses and trade priorities for relevant economic clusters are provided, upon which VAT exemptions and tariff structure are revised and adopted. Component IV - Trade Statistics -The quality of domestic trade statistics improved to a level that allows thorough analysis in this field and offers a basis for objective decision making.