Economy
Monday, March 2, 2026
Markets · Policy · Development
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Economy
Economic Indicators: Kosovo last in the region in GDP per capita
According to data from the International Monetary Fund (IMF), the GDP per capita in the Balkan countries for 2024 presents a diverse picture, reflecting large differences in regional economic development. Slovenia shows the highest performance with a GDP per capita of 34.54 thousand USD, demonstrating economic stability and a high standard of living. Kosovo, with a GDP per capita of 6.33 thousand USD, stands at the bottom, highlighting structural challenges that require solutions. GDP per capita is an economic measure that represents the total value of goods and services produced in a country during a year, divided by the population of that country. It is widely used as an indicator of the standard of living and the level of overall economic well-being of a country. It also provides an easy comparison between countries to assess the relative level of economic development.
Economy
The Euro risks equaling the US Dollar
The eurozone currency has fallen to its lowest level in two years, threatening to reach parity with the US dollar, as economic indicators point to a significant slowdown. The euro’s weakness reflects concerns about sluggish economic growth and the effects of high inflation, which are affecting key manufacturing and service sectors. Survey results show a continued decline in economic activity in many eurozone countries, reinforcing expectations for further monetary measures from the European Central Bank (ECB). Financial analysts warn that if the euro’s weakness continues, parity with the dollar could happen very soon. This would be the first time the common currency has fallen to this level in more than two decades. The parity could have important consequences for international trade, raising the cost of imports for eurozone countries but making exports more competitive in global markets. This development comes at a time when major global economies are facing similar challenges, but the eurozone appears to be particularly vulnerable. Investors are closely watching the ECB's next steps as it faces pressure to balance economic growth and inflation. The euro's continued weakness could have a broad impact on global markets and the region's future economic policies.
Economy
Kosovo continues to increase its dependence on Chinese goods
Kosovo is facing a significant increase in imports from China, reflecting a growing dependence on Chinese goods. The latest economic data show a continuous upward trend in the import of goods from China, including the year 2024 until October. In 2021, the total value of goods imported from China was 452 million euros. In 2022, this figure increased to 548 million euros, marking a significant increase of over 21%. In 2023, imports from China reached 650 million euros, another increase of 18.5% compared to the previous year. In 2024 (until October), the value of imports from China has reached 614.7 million euros, indicating that the high trend of dependence on Chinese goods is continuing. Comparing the net weight of imported goods shows an important dimension of this increase. The net weight of goods imported from China has increased significantly. This shows that the increase is not only the result of inflation or price increases, but also of a larger volume of imported goods. This fact underlines the large increase in demand for Chinese goods in Kosovo.
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Has inflation increased household debt?
Rising inflation has led to rising household debt, with many Kosovor families relying on loans and credit cards to meet their financial needs. To cope with the impact of inflation, citizens are turning to credit cards to cover the rising costs of living. Financial hardship is evident, with many people reporting spending cuts and delays in paying bills. In recent years, consumer credit has increased significantly. According to the latest data, by September 2023, consumer debt had reached 450.2 million euros, marking an increase of 7.1% compared to the previous year. Credit card debt has also seen a significant increase. In 2020, credit card debt was 88.2 million euros, while by September 2023, this amount had reached 112.5 million euros. Faced with inflationary pressures, citizens have relied on credit cards as a flexible and immediate source of finance, reflecting the growing dependence on credit to meet economic challenges.
Panetta: ECB Should Adopt a More Predictive Approach to Monetary Policy
Fabio Panetta, a member of the Governing Council of the European Central Bank (ECB), has called for a change in the institution's monetary policy approach, stressing the need for more predictable and growth-focused actions. Speaking at a conference at Bocconi University in Milan, Panetta underlined the importance of adapting monetary policy to new economic realities, as inflation in the eurozone begins to stabilize and the effects of the COVID-19 pandemic gradually fade. Panetta argued that current economic conditions require a shift towards interest rates that are "neutral or expansionary", suggesting that restrictive monetary policy is no longer appropriate. He stressed that inflation is close to the ECB's 2% target, while domestic demand remains weak. According to him, there is a risk that, without sustainable measures to stimulate economic activity, inflation could fall below the desired target, creating new challenges for the economy. "Inflation is close to our target, but without a sustained recovery in demand and investment, inflation could start to fall, putting us in the face of an undesirable deflationary scenario," Panetta said. In this context, he mentioned that the ECB has undertaken several interest rate cuts in recent months, with the last cut in October bringing the deposit rate down to 3.25%. Elaborating further, Panetta called for transparency and clearer guidance on the ECB's future monetary policies. He stressed the importance of creating a safer environment for investors and consumers, by providing clear signals on the bank's intentions and future actions. According to him, a more forward-looking strategy could help stabilize market expectations, creating a more solid basis for economic growth. In his speech, Panetta noted that monetary policy should be coordinated with fiscal policies to maximize the positive effects. He called for coordinated measures aimed at boosting productivity and accelerating investment, especially in strategic sectors such as the green transition and digitalization. In conclusion, Panetta stressed that the economic stability of the euro area relies on the ECB's ability to be flexible and ready to face various macroeconomic challenges. He appealed for swift and well-decided action to support a sustainable economic recovery and ensure that inflation remains at the long-term target level.