Diaspora’s role in their home country’s economic development: The case of Kosovo

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This study critically examines the challenges faced by the Kosovo Albanian diaspora in investing in their home country. Despite being a significant economic asset, particularly through substantial remittances that contribute to the national GDP, the diaspora encounters various barriers to effective investment. Based on 53 biographical interviews (2014–2016) with migrants in Switzerland and Germany, as well as 23 interviews with key informants, including officials, trade union representatives, and civil society actors, the study highlights the absence of adequate incentive packages to support diaspora driven investments in Kosovo. The research addresses both individual and policy levels, offering recommendations aimed at enhancing the impact of diaspora financial initiatives.

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 Keywords:
 One of the important aspects of a country's economic development is Foreign Direct Investment (FDI), these investments impact on economic development and improve social aspects. At the international level as well as at the country level, FDI has a relevant significance which as an issue is related to the sustainable management policy that makes the country more attractive in absorbing FDI. The purpose of this paper is to present the trends of FDI in the Western Balkan countries with an open look in Kosovo and their comparison, investment policy management, GDP FDI correlation and comparison of the trends of the remittances .Firstly in the introduction of this paper there is a theoretical review of the literature on the definitions of FDI in the economic aspect. Secondly, FDI has been presented and compared over the years in the Western Balkans countries with a vacant look in Kosovo. Third, it analyzes the FDI trends in Kosovo based on the country of origin of these investments, etc. Fourth, in the framework of this research paper, country-level management policies were analyzed in terms of creating an incentive environment for FDI. Fifth, as part of this paperwork, there are also empirical analysis of the correlations between FDI and GDP in the case of Kosovo, etc.
 
 Keywords: Foreign Direct Investment, Investment Policy Management, Correlations, Remittances
 
 JEL classification: F21, M12, C33, F24
 
 JEL classification: F21, M12, C33, F24

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During the last fifteen years, significant SME sector was established in Kosovo. A greater dynamic regarding to the registration of new businesses can be encountered in the first three years of 1990’s and in the postwar period that can be considered as reflection of the changing business environment in the respective periods. Private enterprises in Kosovo are established since 1989. But the intensity of registration of SMEs grew separately after 1990 and continued until 1995.At this time companies were mainly organized in the form of households, the crafts, commercial enterprises, small shops, restaurants and agricultural enterprises.The establishment of these enterprises has not been the result of enabling business environment, but it came from the need to create jobs to people whose jobs were terminated form the social enterprises. In Kosovo during the last decade, a valuavle experience was achieved by increasing and development of of private enterprises, small and medium enterprises. Despite the achieved success, private enterprises constantly complain about the difficulties that they encounter when developing their business activities but as an example in Kosovo’s SME we do stil face with higher interest rates when taking loans.Likewise, these private enterprises in the country are still not well enough stimulated due to application of overwhelmed laws. Therefore it is needed a new inventory of legislative developments, but also should be requested the evaluation for the implementation of new legislation.This paper aims to reflect the role of small and medium enterprises in the post war Kosovo in economic development, increase of employment and alleviate poverty, obstacles that they encounter during their establishment and development which affect barrier not to develop entrepreneurship development innovation skills, etc, also some advantages that they assist their funcioning…

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