Economic situation The economy is picking up

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. 

Architecture in Tirana

Architecture in Tirana

Architecture in Tirana

From 2008, there was a sharp drop in growth rates. Since 2014, the economy has been recovering. In 2017, the growth rate was 3.8 per cent. For the period up to 2020, the International Monetary Fund (IMF) expects the rate to remain at a similar level.

As the rate of people leaving the country and the share of the informal sector in the economy continue to be high, the unemployment rate is difficult to estimate. According to government sources, it is about 12 per cent. A matter of particular concern is the share of youth who are neither in education or training nor hold a job, which is over 30 per cent.

Agriculture

The backbone of the Albanian economy is agriculture. While its share in gross domestic product has dropped to just under 20 per cent, it accounts for nearly 40 per cent of all jobs. Most people in the sector are smallholders who are engaged in subsistence farming. The agricultural sector and the food industry could make a much stronger contribution towards economic development. To that end, however, rural infrastructure would need to be improved significantly (roads, markets, water, energy).

Development potential

The growth of Albania's economy is driven mainly by the textile and leather industries, telecommunications and tourism. The country is one of the biodiversity hotspots in Europe. However, so far it has lacked both the political will and the financial and human resources to monitor and enforce compliance with existing environmental legislation.

Road construction in Albania

Road construction in Albania

Road construction in Albania