The Central Bank of Kosovo (CBK) governor, Ahmet Ismaili, presented the annual report for 2025, forecasting that Kosovo’s economy is expected to close 2025 with 3.9% growth and an annual inflation of around 3.8%.
Looking ahead, the economic growth for 2026 is projected at 4.1%, driven primarily by private consumption. Ismaili noted that while domestic and external risks remain—including geopolitical tensions and slow growth in the Eurozone—the overall outlook remains positive.
Inflation Trends:
- Inflation for 2025 is expected to reach 3.8%, slightly up from 3.6% in October.
- For 2026, inflation is projected to ease to 3.4%, with previous increases largely due to rising food prices.
Fiscal and Trade Indicators:
- The fiscal deficit widened from 5% of GDP in 2024 to 7% in 2025.
- Goods exports slowed compared to the previous two years, while imports continued to rise.
- The services sector performed strongly, with double-digit growth of 13–14%, and import of services declined.
Remittances:
- Expected to reach €1.4 billion in 2025, a 3.8% increase year-on-year.
- Projected growth for 2026 is 5.2%, though their relative share of GDP is declining due to economic expansion.
Banking Sector Developments:
- Significant increase in financial institutions in the four northern municipalities.
- Bank loans rose by 15% compared to last year, reaching €6.5 billion, nearly double compared to five years ago.
- Expansion includes 12 banks (up from 4), 31 non-bank financial institutions (up from 10), and growth in microfinance and insurance companies.
Governor Ismaili emphasized that continued growth in consumption, financial services, and human capital will support economic stability and resilience in the coming year.
