Hyseni questions LVV’s economic success: Are citizens feeling the benefits of GDP growth?

Kosovo’s 2027 budget, worth 4.27 billion euros, is expected to shape a significant part of the country’s economic and development priorities. While the government led by the Vetëvendosje Movement (LVV) presents economic growth and macroeconomic indicators as evidence of its success, the debate is shifting toward the impact these results have on citizens’ lives.

The question is not only about the size of the budget or the rate of growth in gross domestic product (GDP). What also matters is whether development is bringing greater prosperity, purchasing power, jobs and domestic production. Economists and analysts stress that economic growth on its own does not show how wealth is distributed or whether living standards are improving.

Political and economic analyst Nehat Hyseni told the newspaper “Bota sot” that inflation, real wages, employment, dependence on imports, domestic production and emigration must be considered together when assessing the economy. In his view, expanding economic activity and rising wages are positive developments, but they do not prove that all citizens benefit from that growth.

Hyseni notes that GDP has become a central argument in political and economic claims about the success of LVV’s government. He considers this an insufficient way to assess its record: GDP measures the total value of economic output, but it does not show who receives the wealth created, how it is distributed or how much people’s lives change.

According to Hyseni, this is not simply a political objection to the current government. The same standard should apply to every government, regardless of its ideological or political orientation. Growth in national output cannot be called a complete success if citizens still face a high cost of living, difficulty covering household expenses, job insecurity and a lack of economic prospects. Statistics, he stresses, should help people understand and improve their lives, rather than become the goal of the economy.

Citing International Monetary Fund data, Hyseni says real growth in Kosovo’s economy slowed from 4.6 percent in 2024 to around 3.6 percent in 2025. Growth of around 3.3 percent had been forecast for 2026. Meanwhile, nominal GDP rose from 9.68 billion euros in 2024 to 10.35 billion euros in 2025.

Those figures, he says, show that economic activity has expanded, but they do not sufficiently explain the source or quality of that growth. Hyseni says it is important to distinguish whether growth is driven by domestic production, private investment and exports, or by consumption, imports and public spending. An economy based mainly on consumption and imports, he says, has a different development structure from one that grows through production, innovation, exports and productive investment. He sees the weakening of net exports and the slowdown in private demand, also noted in IMF assessments, as signs that the country’s economic structure needs to change.

Another decisive indicator for Hyseni is inflation. Rising prices for goods and services weigh especially heavily on low-income households, which spend most of their budgets on food, energy, housing and transport. For these households, increases in food and energy prices can have far more serious consequences than they do for high-income households. He therefore argues that inflation must also be viewed through its social effects: GDP can grow at the same time as prices rise, without meaning that citizens have become wealthier.

Hyseni also cites data from the Kosovo Agency of Statistics, according to which the average net wage reached 636 euros in 2025, up from 552 euros the previous year. He welcomes the increase but cautions that an average does not necessarily describe every household’s circumstances. Very high wages earned by a small number of workers can affect the average, while the median wage marks the level that divides workers into two equal halves by pay. To understand people’s well-being, he says, it is also necessary to examine the distribution of wages, household incomes and actual living expenses.

He adds that it would be inaccurate to say inflation has made all workers poorer, since some have seen real increases in income. Nevertheless, the analysis must also include pensioners, unemployed people, families living on social assistance and low-wage workers.

In assessing structural problems, Hyseni singles out Kosovo’s heavy dependence on imports, which makes the country more vulnerable to developments in international markets. He argues that domestic production should be treated as a strategic priority of economic policy, not as secondary to consumption. Without that change, he says, growth risks continuing to rely on consumption, imports, transfers and public spending without building a sufficient foundation for long-term development.

He identifies manufacturing, the modernization of agriculture and the food industry, support for small and medium-sized enterprises, increased exports, investment in technology and improvements to energy infrastructure as necessary areas of development. According to Hyseni, such policies could create more productive jobs with better wages.

GDP growth, he says, becomes more meaningful when it is accompanied by new jobs and broader participation in economic activity. Hyseni draws attention to the low employment rate, high levels of economic inactivity among women and young people who are not in education, employment or vocational training. In his view, these point not only to a shortage of jobs but also to insufficient participation in the labor market, a mismatch between vocational skills and the needs of the economy, and continued emigration.

He argues that improved macroeconomic indicators cannot be called a complete success as long as a significant share of young people seek their future abroad. For that reason, the ability to create conditions for citizens to work, live and build a future in Kosovo should be an important measure of LVV’s economic policy.

Regarding the 2027 budget, Hyseni says the government’s responsibility is measured not only by the amount allocated but, above all, by how the money is spent. Fiscal policy, capital investment, tax policy, subsidies, vocational education and support for domestic production are, in his view, tools for shaping the direction of economic development.

A fiscal policy aimed at development, he explains, should not be limited to collecting revenue and increasing public spending. It should direct funds toward investments that create new productive capacity and raise productivity. Hyseni distinguishes between spending that temporarily stimulates consumption and investments that create economic value for many years. Investment in industrial infrastructure, energy, technology and vocational education can have long-term effects, while spending that does not improve productivity may yield limited results. The 2027 budget should therefore be judged by its results for the economy and citizens’ lives, not only by its size.

In conclusion, Hyseni calls for LVV’s government to be assessed using a broader set of economic and social indicators: real GDP per capita, purchasing power, real wages and pensions, employment, poverty, inequality and the structure of domestic production. He stresses that neither every positive result can be attributed to the government alone nor every economic problem blamed exclusively on it. Nevertheless, the government bears political responsibility for the policies it implements and the priorities it chooses.

In his view, Kosovo needs a more serious, professional and evidence-based economic debate than an exchange of political statements about GDP growth rates. Economic growth is important and positive, but the ultimate goal should be a productive, competitive and sustainable economy that creates jobs, real income and prosperity. The challenge, he believes, is not only to produce more but also to create more domestic value, distribute wealth more fairly and give citizens genuine opportunities for a better life.

For Hyseni, the question facing LVV’s government and every other government in Kosovo is whether citizens’ lives are improving alongside the growth shown in economic statistics. Success, he stresses, is measured not only by the billions in GDP but also by the ability of ordinary citizens to live better, work with dignity and see a future in their own country.