From Regulation to Practice: Three Questions with Kreshnik Kurtishi on SME Green Transition in Kosovo

As Kosovo’s SMEs face growing pressure to align with EU green standards, the challenge is no longer ambition, but implementation. With the Greening Private Enterprises in Kosovo (GPEK) project now launching its first phase (2026-2031), Project Manager Kreshnik Kurtishi explains how legal and regulatory barriers affect SMEs’ ability to invest in green solutions, and what targeted reforms and digitalization can do to make the transition more practical, predictable, and business-friendly.

What systemic regulatory and institutional barriers hinder SME green investment in Kosovo, and why is addressing them urgent now?​​​​

​​From my perspective, the issue is not that Kosovo lacks policies or ambition, but that the system remains too fragmented and difficult to navigate for SMEs. In practice, many businesses that want to invest in solar energy, energy efficiency, or circular production models still face lengthy and unclear approval processes. Permits often involve multiple institutions, requirements are not always consistent, and procedures vary across municipalities. This creates uncertainty, delays, and additional costs that discourage investment. At the same time, institutional responsibilities are not well coordinated. SMEs are often left to navigate the system on their own, without clear guidance or predictable timelines. 

From a Market Systems Development perspective, these are systemic constraints embedded in how rules, roles, and incentives function across the ecosystem. When these functions are weak or misaligned, even motivated SMEs struggle to act. Digitalization is an important part of the solution. Streamlining and digitizing permitting processes, improving access to information, and creating interoperable systems across institutions can significantly reduce uncertainty and transaction costs.

This is especially urgent now as external pressure is increasing. EU regulations such as Carbon Border Adjustment Mechanism (CBAM), ESG reporting, and product standards are already shaping market access and buyer expectations. 

Through GPEK, we aim to address these challenges by facilitating systemic improvements across the ecosystem rather than creating parallel structures. This includes strengthening business services, expanding access to green finance, and supporting more effective public private dialogue. One concrete initiative we are planning is a targeted, time bound legal and regulatory streamlining effort, working closely with ministries, municipalities, and business associations. The focus will be on identifying and piloting practical improvements such as simplifying procedures, clarifying requirements, and introducing digital solutions that can reduce bottlenecks and be scaled over time.

What practical, system-level steps can Kosovo take to make EU green transition requirements achievable for SMEs?

Alignment with EU frameworks must be translated into something SMEs can apply in their daily operations. Many key strategies and regulations are already in place and broadly aligned with EU priorities. The challenge lies in implementation, capacity, and accessibility.

From a Market Systems Development perspective, alignment happens when supporting functions such as information, advisory services, and coordination mechanisms work effectively around SMEs. To accelerate this, I see three priorities:

• First, translating EU requirements into practical tools and guidance, including simplified manuals, sector specific standards, and digital tools that make compliance more accessible.

• Second, strengthening intermediaries such as chambers, associations, and business service providers. These actors are essential in helping SMEs understand and implement complex requirements like ESG reporting or carbon monitoring.

• Third, strengthening public private dialogue mechanisms, supported by data and continuous feedback loops.

Within GPEK, we are connecting these elements. The planned regulatory streamlining initiative will be closely linked with public private dialogue platforms, ensuring reforms reflect real business constraints. At the same time, business service providers will help translate regulatory changes into practical support for SMEs, creating a bridge between policy and implementation.
When these elements are aligned, EU integration transforms from a compliance requirement into a strategic pathway for strengthening SME competitiveness.

What systemic and regulatory changes should Kosovo pursue to enable SMEs to drive the green transition? 

By the end of the project, I would like to see a system where the green transition is driven not by donor projects or external pressure, but by functioning local institutions, aligned incentives, and capable market actors. This requires progress across multiple dimensions, including better information and data, stronger business services, improved access to finance, and more effective regulatory frameworks working together as a system. Regulatory processes should become simpler, faster, and more predictable, supported by digitalized systems that reduce administrative burden and improve transparency. We should also see stronger coordination between institutions, particularly between ministries and municipalities, ensuring consistent implementation across the country. 

At the same time, the broader ecosystem, including business services, financial institutions, and data systems, should become more mature and interconnected. SMEs should have access to relevant advisory services, tailored financial products, and practical, user-friendly data, including through digital platforms. 

Success for us means that these functions continue to work beyond the project itself. GPEK’s role is to facilitate this transition by piloting solutions, strengthening local actors, and embedding mechanisms such as public private dialogue and sustainable service models. 

Ultimately, I would also like to see a shift in mindset. Sustainability should no longer be seen as a compliance requirement, but as a business opportunity, a way to reduce costs, access new markets, and build resilience. If we achieve this, SMEs will not just follow the green transition, they will actively shape it.