Page 30 - bne IntelliNews Southeastern Europe Outlook 2025

By September 2024, there was a notable recovery, as industrial production grew by 1.0% compared to September 2023. This improvement was largely attributed to an 18.1% surge in mining and quarrying and a 1.0% rise in manufacturing.
Despite these short-term declines, the manufacturing sector has shown resilience, with an annual growth rate of 6.2% since 2000. By contrast, the energy sector faced ongoing challenges, particularly in electricity and gas supply, which recorded a sharp 5.6% decline in September and had seen larger drops earlier in the year, including a 17.4% decrease in May.
2.5 Macroeconomy – Kosovo
Key economic figures and forecasts
2016 2017 2018 2019 2020 2021 2022
Real GDP (% y/y) 5.6 4.8 3.4 4.8 -5.3 10.7 4.3
Unemployment rate (avg, %) 27.5 30.5 29.6 25.7 25.9 20.7 12.6
Consumer prices (avg, % y/y) 0.2 1.5 1.1 2.7 0.2 3.3 11.6
Consumer prices (eop, % y/y) 1.3 0.5 2.9 1.2 0.1 6.7 12.1
General budget balance (% of GDP) -1.0 -0.9 -2.5 -2.6 -7.6 -0.9 -0.2
Public debt (% of GDP) 14.46 16.37 17.04 17.63 22.44 21.53 20.04
Current account balance (% of GDP) -8.0 -5.5 -7.6 -5.7 -7.0 -8.7 -10.3
Official FX reserves ($ bn) 0.637 0.819 0.881 0.966 1.1 1.24 1.25
Gross foreign debt (% of GDP) 33.38 32.77 30.31 30.96 36.95 37.14 38.64 Source: World Bank, statistics office, Thomson Reuters, RBI/Raiffeisen RESEARCH
2.5.1 GDP growth
Kosovo’s government expects GDP growth to reach 5.6% in 2025, following an estimated 4% growth in 2024. The International Monetary Fund projects a GDP growth rate of 4% for Kosovo in 2025, following 4.2% growth in 2024, driven by strong private consumption and larger public investment, with a return to 3.8% growth in 2029, consistent with previous forecasts, while the World Bank projects an economic growth of 3.9%.
Kosovo’s GDP saw a real increase of 4.05% in the third quarter of 2024 compared to the same period of 2023, following a 4.27% growth in the previous quarter, according to statistics office data.
30 SE Outlook 2025 www.intellinews.com