Mountain landscape near Valbona, Northern Albania

Albania Moving closer to European Union membership

Since 1990, Albania has made a transition from a Stalinist dictatorship to a parliamentary democracy. Among policymakers and within society in Albania, there is a basic consensus in support of democracy and the rule of law, a market-based economy, NATO membership (since 2009) and a regional policy that is geared towards mutual understanding. Albania's most important foreign policy goal is to become a member of the European Union. In 2014, the country was awarded candidate status by the EU.

The most urgent tasks in terms of domestic policy are the improvement of people's living conditions and the creation of jobs, especially in rural regions. Poor infrastructure, inadequate public services and a lack of economic opportunities are causing people, especially young people from rural areas, to leave for the cities or for other countries.

Development cooperation

In 1988, Albania became the first cooperation partner for Germany's bilateral development cooperation in South-Eastern Europe. The overarching goal of the two sides' cooperation is to improve people's living conditions. One effective instrument in this endeavour is helping the country to bring its standards more closely in line with those of the EU. To that end, Albanian-German development cooperation focuses on energy, drinking water supply, wastewater and waste management, and sustainable and socially compatible economic development.

The Skanderbegplatz with a sculpture of the national hero Skanderbeg and the Palace of Culture in the Albanian capital Tirana

Need for systematic reforms Internal link

The government under Prime Minister Edi Rama, which has been in power since 2013, has launched significant reform efforts to foster the rule of law. It has achieved some initial successes in the fight against corruption and organised crime. However, many reform endeavours have not yet been implemented systematically enough.

Street traders in Tirana, Albania

Poverty and lack of opportunities Internal link

Poverty in Albania has declined significantly in the last two decades. However, about one in seven Albanians is still considered to be living in poverty. Older people and members of minority groups are particularly affected.

Architecture in Tirana

The economy is picking up Internal link

Over the last 20 years, Albania has made major economic progress. The country saw growth rates of over five per cent on a regular basis for some time. Due to its close trade links with the EU, and especially with its neighbours Italy and Greece, the euro crisis had a temporary negative impact on the country's economy.

German development cooperation with Albania

For Albanian-German development cooperation in 2018 and 2019, Germany has provided Financial cooperation loans and grants totalling 147.9 million euros and Technical Cooperation resources totalling 20.5 million euros. In addition, a "promotional loan" of 150 million euros was agreed during the 2018 government negotiations in order to support reforms in the energy sector. Of that amount, 100 million euros will be provided by KfW , and 50 million euros by the French government aid agency AFD.

Albanian-German development cooperation focuses on the following priority areas:

  • Energy
  • Water / wastewater / waste
  • Sustainable economic development (including vocational training)

Albania is also part of numerous multi-country regional projects run by the BMZ. Examples include the Open Regional Funds for foreign trade, energy efficiency, municipal services, EU integration and biodiversity.

Construction of high-voltage transmission line near Shkoder, Albania

Ensuring an environmentally friendly supply of power Internal link

Germany's activities in Albania are intended to help ensure that the country, and the entire region of South-Eastern Europe, has a power supply that is stable, sustainable and secure, and covers its costs. They also aim to make a contribution to global climate protection.

Discussion about water supply project in the village Mishter, Gurre, Albania

Nationwide services, environmentally sound disposal Internal link

Merely a little less than 70 per cent of Albania's people have access to a reliable supply of safe drinking water. Considerable infrastructure deficits can be found in rural areas in particular.

Training of chefs in a vocational school in Kamza, Albania

Creating opportunities for young people Internal link

Nearly all Albanian companies are micro, small or medium-sized enterprises (MSMEs). Many of them operate in the informal sector. The education system and especially the vocational training system are not geared towards enterprises' needs.

Further information
Information from the Federal Foreign Office on Albania External link
Information from the KfW Development Bank on Albania External link
Information from GIZ on Albania External link