April 8 (SeeNews) - The World Bank has revised up its 2016 economic growth outlook for Kosovo to 3.6% from previously estimated 3.5% amid expected political stability, planned implementation of large investment projects and growing domestic demand.
The bank improved also its 2017 growth forecast to 4.0% from 3.7% previously, it said in a report, released late on Thursday.
It expects public and private investments to continue to contribute positively to the country's economy, with the Stabilization and Association Agreement (SAA) with the EU, signed in 2015, providing a further boost to foreign direct investments (FDI).
A recent approval of the investment amendment to the fiscal rule will open up additional fiscal room for productive investment in strategic sectors and boost public investments and economic growth in coming years.
The outlook is subject to downside risks such as weaker than planned execution of public investment and potential political and social unrest leading to lower FDI, the report reads.
Kosovo's large current account deficit is expected to remain little changed at 9.6% of GDP this year.
In 2018, Kosovo's economic growth is expected to rise by 4.1%.
In 2015, Kosovo's economy expanded by 3.5% according to preliminary central bank data.