Kk gjilan a5 verzioni 3

PROJECT CONCEPTS

Investment Management Exhibition

MUNICIPALITY OF GJILAN

Messe, Z端rich May, 2015

Table of contents: Mayor foreword

3

Background information

5

Executive Summary

8

Investment opportunities

14

Mayor foreword Municipality of Gjilan is highly interested to host foreign investments as our Municipality is highly interested in promoting investments opportunities such Public Private Partnership in continuing success stories of joint investments of vendor and international investors.We have prioritized the attraction of investments especially in the following areas: redesigning the City Center, Construction of residential buildings, recreation zones and economic zones due to the high potential of employment and profitability for the private investors.

Municipality of Gjilan intends to easier the process of doing business for vendor and international investors as economy is the main sector that can generate income for the families living in this area. Low labor cost and favorable conditions for doing business make Gjilan one of the most attractive municipalities to invest in Gjilan.

The municipality has created preconditions for investment through public-private partnerships as these prerequisites are important for stimulating and attracting investment and generate employment. I am committed to welcome and host all the interested international investors in my office and in our municipality in order to enhance mutual cooperation.

Thank you and welcome in Gjilan.

Lutfi Haziri Mayor of the Municipality of Gjilan

Background information Kosovo is located in the Southeastern Europe, the heart of the Balkans, time zone GMT+1 and is part of Central European Free Trade Agreement (CEFTA) which is highly important for foreign investments; Kosovo is surrounded with the four neighboring countries like: Albania, Macedonia, Montenegro and Serbia.The entire territory is: 10,887 km2 – and is surrounded by mountains and divided into two sub regions of a similar size and population and plain land, It is highly important that Kosovo has one of the most favorable business conditions in the region as based on World Bank’s Doing Business Report indicators; the Government of Kosovo has taken on a thorough reform initiative to improve the business environment. It is important to mention that Kosovo has significantly improved in the procedure of business licenses, there is no registration tax for all the businesses, for the Limited Liability Companies is not required to deposit the founding capital and the protection for the investors has highly been improved in the recent years.Municipality of Gjilan is located in the southeastern part of Kosovo [in Anamorava region] with an area of 392m2. Gjilan geographical position connects with other major cities of Kosovo and the region due to the fact that Municipality of Gjilan is bordered with Kamenica, Viti , Lipjan [Prishtina], Novobërdë while with the region in the southeast is bordered with Presheva and in the east with Bujanoc [Serbia] and Kumanova [Macedonia].

According to the latest registration statistics Gjilan counts 91,489 inhabitants [based on the statistic data of registration conducted in 2013]; Municipality of Gjilan is a model of joint cooperation among different communities due to the fact that different communities live freely and without problems among each other. As for the investors the municipality of Gjilan is a “young” municipality with and open and friendly administration and management and committed to support projects for economic development and improve of the life of its citizen through focusing in the presented projects such as: - Redesigning of the city center - Construction of two residential/commercial buildings - Recreation centers All these projects can be realized through Joint Ventures between private enterprises and public institutions.

The socially owned sector is facing many problems because of huge losses during the occupation period (the 1990s) but also because of the economic transformation after the war in Kosovo, hence after 1999.

The main barriers are: the lack of current capital,provision of raw materials, lack of investment, the loss of markets, etc. The only hope for socially owned enterprises remains the faster privatization of viable enterprises. There are local and international potential investors interested in investing in the privatization of these enterprises. The private sector in Gjilan has its origins dating mainly from the end of the 1980s, namely 1989, and it has developed intensively during the last four years. Today, there are 2,737 enterprises that are registered and operate in Gjilan, employing more than 10,000 workers.

More than 75% of registered private enterprises are engaged in trading activities, employing 63% of the total number of employees engaged in the private sector. Only 3.5% of enterprises are engaged in the manufacture of new goods.

Enterprises import mainly from Macedonia, Serbia & Montenegro, Turkey, Greece, other European countries. These statistics and facts fully reason the PPP format of investment due to the success rate of other projects.

Executive Summary Re-planning and Redesigning of the City Center Changes over the years in the region and the comprehensive development of the Municipality force the adaptions for the future. In order to control and monitor the adaptation process the Municipality has drafted the Urban Development Plan for the Municipality of Gjilan.

Re-planning and redesigning of the Municipality Center, the Municipality of Gjilan is part of the EUROPAN project which includes the city center with a total area of 37330m2 whereas it is planned that within this surface to be included for adaption: a) Construction of the Municipal Administration [Municipality Building] b) Construction of the Cultural Center Building c) Public area The construction surface [point “a” and “b”] which will be treated are: 17680m2 and which is divided among a-11040m2 and b6640m2 Within these construction areas (a and b) for commercial purposes will be 5140m2 while the underground basement will be 5900m2 for parking lot. The total approximate amount for investments is: 8,768,787.00 or expressed for the points: a) 4,537,368.00 €; b) 3,129,054.00 €; c) 1,102,365.00 €;

Construction of two residential/commercial buildings The Private Public Partnership [PPP] is resulting very successfully for the economic development of the Municipality due to several success stories realized; As the Municipality is not able to cover large amount of capital investments for residential buildings the PPP form makes this easily realized.

The Municipality of Gjilan is interested to construct two residential buildings: 1. Construction of the residential/commercial building at the artisan center zone 2. Construction of the residential/commercial building at the Hotel Kristal zone These residential/commercial buildings will be realized in the cadastral plots with the numbers: 5021-0; 3722-0; 3721-0; 3709-0; 3710-0; 3708-0; 3707-0; 3706-0; 3705-0; 3702-0; which are a property of the Municipality of Gjilan. Initial characteristics are: P+3 in which the floor for residential will have 1300m2 while the commercial spaces will be 300m2. The total number of apartments in the artisan center zone will be 26. For the residential/commercial building at the Hotel Kristal zone the floor for residential purposes will have 800m2 while the commercial space will be 300m2. The total number of apartments in this building will be 20.

Recreation Center [waterpark, ice-skating & rural tourism] Tourism and recreational activities are highly attractive for investments in the recent years due to the increasing scale of interest from the families. Municipality of Gjilan even though provides several natural landscapes for relaxing recreational centers or attractions are not present for the public visits due to the lack on investments.

Therefore, investments in a Recreational Center such as waterpark through PPP format will be highly welcomed for the region of Gjilan and the entire Kosovo as such parks are not present. Municipality of Gjilan is known for the horse ranch which was realized through an Albanian living in Switzerland and this ranch is visited daily from approximately 200 families; however, this number will be bigger with an additional attraction such as the waterpark which could be used for the entire year including the winter season for ice skating.

The water park will be a perfect attraction of visitors [including people outside of the Municipality of Gjilan]. The municipality will realize one of its objectives to improve the quality of life for the residents of the Municipality, attract investors and increase the tourism offer for the visitors while in the other hand the private enterprise can generate income through entrances fees and develop a good business enterprise. A potential waterpark could be realized in several places but an attractive one could be in PĂŤrlepnica or Livoq as these two locations possess a river with sufficient water flow. In addition to the waterpark rural tourism can be easily developed in the PĂŤlepnica area due to the natural, virgin and attractive landscape and the connections with the two other attractive rural tourism zones such as DobĂŤrqan and Busavata [Kamenica]; A hiking, bicycle and horsing trail could easily be realized and this will be an added value or the waterpark or other recreational centers investments.

A potential waterpark is shown in the figure 4:

The form that will be used for investments is PPP [Public Private Partnership].

A public–private partnership (PPP) is a government service or private business venture which is funded and operated through a partnership of government and one or more private sector companies. These schemes are sometimes referred to as PPP, P3 or P3. PPP involves a contract between a public sector authority and a private party, in which the private party provides a public service or project and assumes substantial financial, technical and operational risk in the project. In some types of PPP, the cost of using the service is borne exclusively by the users of the service and not by the taxpayer.[1] In other types (notably the private finance initiative), capital investment is made by the private sector on the basis of a contract with government to provide agreed services and the cost of providing the service is borne wholly or in part by the government.

Government contributions to a PPP may also be in kind (notably the transfer of existing assets). In projects that are aimed at creating public goods like in the infrastructure sector, the government may provide a capital subsidy in the form of a onetimegrant, so as to make it more attractive to the private investors. In some other cases, the government may support the project by providing revenue subsidies, including tax breaks or by removing guaranteed annual revenues for a fixed time period.

Economic Development Office in the Municipality of Gjilan Address: Street Bulevardi i PavarĂŤsisĂŤ nr. 51 60000, Gjilan Tel/Fax: 0280/320 781 Please do not hesitate to contact us for any concern

www.kk.rks-gov.net/gjilan