Albania has strived to make the transition to a more modern open market economy and has succeeded in making the pre-1992 communist regime a distant memory. The country has pursued major economic and structural reform and has successfully established democratic institutions. Albania's economic performance has been equally impressive and growth has been robust.
Economy
Growth rates have averaged six per cent in the last twenty years, driven by an expansion in consumption and productivity growth as old industries were replaced with a new service sector. In 2008, GDP expanded by 6.1 per cent.
Along with the rest of Europe, Albania is expected to see a slowdown in 2009. The International Monetary Fund (IMF) recently revised its prediction of two to three per cent growth down to between zero and one per cent for the 2009 fiscal year. Based on this, Albania will continue to outperform other countries in the region and according to the IMF the prospect of negative growth or a recession in Albania is out of the question.
Investment Climate
Albania is making efforts to attract foreign investment and promote domestic investment. The government recognises that foreign investment is indispensable to sustained growth. It hopes that Albania will soon become the most attractive destination for foreign investment in the region. They are committed to putting the guarantees in place that investors need.
However, the implementation of laws and development of infrastructure designed to stimulate investment is happening at a slower pace than the government would like.
Industry Sectors
Textiles and Garments
Textiles and garments is the largest employer in the manufacturing sector. Building upon a strong post-war tradition of garments production, since privatisation in 1990 many local firms have created a strong reputation for themselves while foreign firms have substantially increased their share of the sector's output particularly within the export processing regime.
Many foreign firms have been operating in Albania for more than a decade and a large percentage are still increasing the scope of their operations and hiring more staff.
Export and import figures, both of which have increased in recent years, are closely related within a re-export regime that sees imports of semi-final products re-exported after several operations inside Albania.
Mining
For a small country, Albania has considerable extractable mineral resources including chromium, copper, nickel and coal. It also has significant unexploited deposits of bauxite and phosphates. According to ministry experts, these are low grade deposits. One bauxite mine is currently operating to provide input to the country’s cement industry while no phosphate rock is being mined at the present time.
Opportunities
There are a number of opportunities available to UK companies wishing to export to or invest in Albania. The most promising sectors are:
• Garment manufacture
• Shoe manufacture and leather processing
• Mining
• Oil and gas
• Agribusiness
UK Trading Relationship
Bilateral trade between the UK and Albania is relatively small. Imports and exports consist mainly of specialised industrial machinery, medicinal and pharmaceutical products and power generating machinery and equipment.
In 2008, UK exports to Albania stood at £14.6 million. Imports from the country over the same period were valued at £1.1 million.
KEY FACTS
Official Name: The Republic of Albania
Capital: TiranaArea: 28,748 sq kmPopulation: 3.2m (UN, 2008)Major language: Albanian
GDP (current): US$10.83bn (World Bank, 2007)
GDP growth: 6.0% (World Bank, 2007)
GNI per capita: US$3,300 (World Bank, 2007)
Inflation (consumer prices): 4% (2008 est.)
Labour force: 1.09m (2008 est.)
Unemployment: 12.5% (2008 est.)
Monetary unit: 1 lek = 100 qindars
Exports to UK: £1.143m (HMRC 2008)
Imports from UK: £ 14.68m (HMRC 2008)
Main Industries
Food processing, textiles and clothing, lumber, oil, cement, chemicals, mining, basic metals, hydropower.
Main Exports
Textiles and footwear, asphalt, metals, crude oil, vegetables, fruits, tobacco.
Main Imports
Machinery and equipment, foodstuffs, textiles, chemicals.
CONTACTS
UK Trade & Investment
Kingsgate House
66-74 Victoria Street
London SW1E 6SW
Tel: 020 7215 8000
Email: liz.herisz@ukti.gsi.gov.uk
Web: www.uktradeinvest.gov.uk
There are no official UKTI services
British Embassy
Rruga Skenderbej 12
Tirana Albania
Tel: 00 355 4 223 4973
Web: ukinalbania.fco.gov.uk/en
Embassy of the Republic of Albania
24 Buckingham Gate
London SW1E 6LB
Tel: 020 7828 8897
Email: embassy.london@mfa.gov.al
Web: www.albanianembassy.co.uk
