THE IMPACT OF FINANCIAL SUPPORT SCHEMES ON THE AGRICULTURAL SECTOR: A CASE STUDY IN KOSOVO

The agricultural sector is one of the most important components of the Kosovo economy, accounting for approximately 7.5 percent of GDP.Since 2010, the Government of Kosovo has implemented two main instruments to support this sector: the Direct Payments Program and the Rural Development Program.The purpose of this paper is to assess the impact of these programs on the development of the agricultural sector in Kosovo.To achieve this, several main objectives have been defined: a) presenting the main theories related to direct payments and grants; b) presenting the current situation of these programs and analyzing their progress; c) measuring their impact on the development of the agricultural sector in Kosovo; and d) providing recommendations for the Government of Kosovo to increase the effectiveness of direct payments and grants.To meet these objectives, statistical data from relevant institutions were analyzed using graphical methods and econometric techniques.The findings indicate that the implementation of these programs has produced positive results in some sub-sectors; however, the intended outcomes for the agricultural sector as a whole have not been fully achieved.