Across Kosovo, the demand for essential urban infrastructure such as streets, parks, drainage systems, public transport corridors, schools, and climate-resilient riverbanks is rising rapidly. As cities expand and climate impacts intensify, public budgets are struggling to keep pace with growing investment needs. In response, representatives from central and local institutions gathered in Prishtina in February to explore Land Value Capture (LVC) as a potential tool to help bridge the infrastructure financing gap. LVC is a planning-linked approach that channels the increase in land value generated by public decisions back into public investment.
Land Value Capture refers to a set of policy tools that allow governments to recover part of the rise in land and property values resulting from public infrastructure projects or regulatory changes. When public actions increase private land values, a share of that uplift can be redirected to fund the very infrastructure and services that created it. International experience shows that LVC works best as a complement to traditional public finance, particularly in contexts where development is active, regulations are clear, and institutions can ensure transparent and predictable implementation.
In cooperation with the Ministry of Environment, Spatial Planning and Infrastructure, a two-day workshop in Prishtina brought together stakeholders from the Ministry of Finance, the Prime Minister’s Office, municipal authorities, and technical experts. Participants discussed how LVC could be incorporated into Kosovo’s legal and institutional framework and explored practical instruments suited to the country’s planning and development context. The focus was less on technical rates and more on assessing feasibility, clarifying institutional roles, and identifying the legal, administrative, and data requirements necessary for transparent application.
The initiative is supported by German Federal Ministry for Economic Cooperation and Development and co-financed by the Swiss State Secretariat for Economic Affairs, with implementation assistance from GIZ Kosovo. The discussions highlighted both opportunities and constraints, emphasizing the importance of strong coordination between municipal and central authorities to ensure accountability and consistency in any future approach.
The workshop represents the beginning of a longer, structured process. A forthcoming feasibility study on Land Value Capture in Kosovo will assess legal and institutional readiness, draw lessons from international experience, and evaluate the most realistic and impactful options. The study aims to produce a phased roadmap that links spatial planning decisions more directly with resilient infrastructure investment, ultimately supporting better outcomes for Kosovo’s cities and communities in the face of climate change and urban growth.
