USAID Kosovo Compete Activity — Annual Report, Year 1

The activity focuses on three key export-oriented sectors: Wood Processing, Food Processing, and Information and Communications Technologies (ICT). The project utilizes a market system approach to address systemic constraints and develop strategic interventions. During the Inception Phase, USAID Compete conducted a Market System Constraints Analysis and a set of Sector Assessments to identify key baseline analyses for the three focus sectors. This analysis informed the development of five-year Sector Action Plans, which were developed in collaboration with stakeholders from the Kosovo private sector, business associations, donors, development partners, and government institutions. The Sector Action Plans outlined strategic interventions for the first year of the project. The Implementation Phase saw the initiation of the Year 1 Work Plan and Sector Action Plan activities across all sectors and work streams. Key achievements under these work streams included the organization of a Diaspora Convention, which led to over 140 B2B meetings and seven precontract business agreements. The convention aimed to facilitate the inclusion of local suppliers in franchise business chains and the establishment of an Export Hub to involve smaller-scale and minority-owned producers. Additionally, USAID Compete facilitated the establishment of an Export Finance Facility Working Group to improve Kosovo companies' access to export financing. The group consisted of key industry, donor, and financial sector actors. USAID Compete also produced a concept note on the feasibility of expanding equipment leasing services in Kosovo, which is widely identified as a key constraint. Furthermore, the project initiated a pilot program for the introduction of corporate governance practices on a cost-share basis. This program aimed to enhance business sophistication and competitiveness among Kosovo companies. The project also agreed with the ICT sector associate (STIKK) to initiate the establishment of a Virtual Showroom for Kosovo's ICT products and services. The USAID Kosovo Compete Activity has made significant progress in its first year, laying the groundwork for future interventions and activities. The project's focus on market system development, diversified finance, business sophistication, and skills development is expected to contribute to the growth and competitiveness of Kosovo's private sector.