COMMISSION STAFF WORKING DOCUMENT Albania 2022 Report Accompanying the document Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions 2022 Communication on EU Enlargement policy

EN EN
EUROPEAN
COMMISSION
Brussels, 12.10.2022
SWD(2022) 332 final
COMMISSION STAFF WORKING DOCUMENT
Albania 2022 Report
Accompanying the document
Communication from the Commission to the European Parliament, the Council, the
European Economic and Social Committee and the Committee of the Regions
2022 Communication on EU Enlargement policy
{COM(2022) 528 final} - {SWD(2022) 333 final} - {SWD(2022) 334 final} -
{SWD(2022) 335 final} - {SWD(2022) 336 final} - {SWD(2022) 337 final} -
{SWD(2022) 338 final}
Offentligt
KOM (2022) 0528 - SWD-dokument
Europaudvalget 2022
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1. INTRODUCTION ......................................................................................................3
1.1. CONTEXT .................................................................................................................3
1.2. SUMMARY OF THE REPORT .....................................................................................3
2. CLUSTER 1: THE FUNDAMENTALS OF THE ACCESSION PROCESS .................8
2.1. FUNCTIONING OF DEMOCRATIC INSTITUTIONS AND PUBLIC ADMINISTRATION REFORM
..................................................................................................................................8
2.1.1 Democracy.........................................................................................................8
2.1.2. Public Administration Reform........................................................................13
2.2. RULE OF LAW AND FUNDAMENTAL RIGHTS..................................................................17
2.2.1. Chapter 23: Judiciary and fundamental rights............................................17
2.2.2. Chapter 24: Justice, freedom and security..................................................37
2.3. ECONOMIC CRITERIA....................................................................................................51
2.3.1. The existence of a functioning market economy............................................51
2.3.2. The capacity to cope with competitive pressure and market forces within the
Union ..........................................................................................................59
2.4. PUBLIC PROCUREMENT, STATISTICS, FINANCIAL CONTROL........................................62
Chapter 5: Public procurement .................................................................................62
Chapter 18: Statistics ................................................................................................64
Chapter 32: Financial control ...................................................................................66
3. GOOD NEIGHBOURLY RELATIONS AND REGIONAL COOPERATION 68
4. ABILITY TO ASSUME THE OBLIGATIONS OF MEMBERSHIP.................71
CLUSTER 2: INTERNAL MARKET ........................................................................................71
Chapter 1: Free movement of goods.........................................................................71
Chapter 2: Freedom of movement of workers..........................................................73
Chapter 3: Right of establishment and freedom to provide services ........................74
Chapter 4: Free movement of capital........................................................................75
Chapter 6: Company law ..........................................................................................77
Chapter 7: Intellectual property law .........................................................................78
Chapter 8: Competition policy..................................................................................79
Chapter 9: Financial services....................................................................................80
Chapter 28: Consumer and health protection ...........................................................82
CLUSTER 3: COMPETITIVENESS AND INCLUSIVE GROWTH ................................................85
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Chapter 10: Digital transformation and media .........................................................86
Chapter 16: Taxation ................................................................................................87
Chapter 17: Economic and monetary policy.............................................................88
Chapter 19: Social policy and employment..............................................................90
Chapter 20: Enterprise and industrial policy ............................................................94
Chapter 25: Science and research .............................................................................96
Chapter 26: Education and culture............................................................................98
Chapter 29: Customs union.....................................................................................100
CLUSTER 4: THE GREEN AGENDA AND SUSTAINABLE CONNECTIVITY ............................102
Chapter 14: Transport .............................................................................................102
Chapter 15: Energy.................................................................................................104
Chapter 21: Trans-European networks ...................................................................107
Chapter 27: Environment and climate change........................................................109
CLUSTER 5: RESOURCES, AGRICULTURE AND COHESION ................................................113
Chapter 11: Agriculture and rural development .....................................................114
Chapter 12: Food safety, veterinary and phytosanitary policy ...............................115
Chapter 13: Fisheries ..............................................................................................116
Chapter 22: Regional policy and coordination of structural instruments ...............118
Chapter 33: Financial and budgetary provisions ....................................................119
CLUSTER 6: EXTERNAL RELATIONS..................................................................................121
Chapter 30: External relations ................................................................................121
Chapter 31: Foreign, security and defence policy ..................................................122
ANNEX I – RELATIONS BETWEEN THE EU AND ALBANIA..................................125
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1. INTRODUCTION
1.1. Context
Albania has continued to implement the Stabilisation and Association Agreement and the
meetings of the joint bodies under the agreement took place.
Albania has continued to maintain overall focus on the EU reform agenda, despite the challenge
of addressing the economic and social consequences of the triple shock of the 2019 earthquake,
the pandemic and of the Russian war of aggression against Ukraine. It has continued to meet all
the conditions set out in the Council Conclusions of March 2020 for the first Inter-governmental
Conference1
. On 19 July, the Intergovernmental Conference on accession negotiations took place
with Albania. The Commission immediately launched the screening process.
Albania’s maintained its record of full alignment with the EU’s common foreign and security
policy (CFSP). As a non-permanent member since January 2022, Albania has been actively
engaged in the UN Security Council as a co-penholder of resolutions condemning the aggression,
thus aligning with the EU position when co-sponsoring and voting on UN resolutions on Russia's
invasion of Ukraine and its humanitarian impact, and also when voting on the suspension of
Russia in the Human Rights Council. Albania’s stance is a strong signal of its strategic choice of
EU accession and of its role as a reliable partner.
1.2. SUMMARY OF THE REPORT2
As regards the political criteria, in the new legislature, resulting from the 2021 elections, which
were held following the cross-party agreement of 5 June 2020 the elected members from the
largest opposition parties took their seats in parliament. The parliament elected the new President
of the Republic. Internal conflict within the largest opposition party (DP), affected parliamentary
life. On EU oriented reforms, parliament passed a time-limited constitutional extension of the
vetting bodies mandate and nine laws aimed at alignment with the EU acquis. The government
maintained a focus on reforms related to the country’s EU path and reinforced its coordination
structure for EU integration, but it needs to further advance the EU reform agenda, together with
the opposition and all segments of society. The establishment of several government agencies
around the Prime Minister’s Office, without a comprehensive steering framework and without a
systematic attention to oversight and reporting lines, raises questions in relation to the standards
of public administration. A new decentralisation strategy beyond 2022, remains to be adopted
and upstream consultation at local level will be essential. Despite funding improvements, limited
progress was made to implement the roadmap on creating an enabling environment for civil
society.
1
https://data.consilium.europa.eu/doc/document/ST-7002-2020-INIT/en/pdf and
https://www.consilium.europa.eu/en/meetings/european-council/2020/03/26/
2
This report covers the period from June 2021 to June 2022. It is based on input from a variety of sources, including
contributions from the government of Albania, the EU Member States, European Parliament reports and information
from various international and non-governmental organisations. It also includes the results of comparative
assessments and indices produced by other stakeholders, in particular in the area of rule of law.
The report uses the following assessment scales to describe the state of play: early stage, some level of preparation,
moderately prepared, good level of preparation and well advanced. To describe progress made during the reporting
period, it uses the following scale: backsliding, no progress, limited progress, some progress, good progress and very
good progress. Where appropriate, also interim steps have been used.
4
Albania is moderately prepared in the area of public administration reform. It made limited
progress in strengthening line ministries’ capacity to implement regulatory impact assessments
and hold public consultations. It started preparations for the salary reform and expanded the
automated payroll system. Implementation of the 2015-2022 public administration reform and
the 2014-2022 public financial management reform strategies continued. The IT systems for
integrated planning are not yet fully functional. However, bodies subordinate to ministries
(agencies) continued to be created without a comprehensive steering framework, systematic
attention to oversight or clear reporting lines. They also further exacerbated the issue of tasks
entrusted to staff hired under the Labour Code, instead of to civil servants. Provisions on merit-
based recruitment in the civil service law remain to be fully implemented, especially for senior
level positions. The number of provided online services continued to increase, but this also raises
questions about equitable access for citizens with limited digital skills.
Albania’s judicial system has reached a moderate level of preparation. Comprehensive justice
reform continued, resulting in good progress overall. Two new judges were appointed to the
Constitutional Court in March and September 2022, further improving the court’s ability to carry
out its mandate. There was also progress with the High Court, which now has 15 sitting judges,
enabling it to reduce the case backlog for the first time in six years, to start unifying the case law
and to appoint judges to the Constitutional Court. Further appointments to the High Court are
expected. However, long proceedings, a low clearance rate and a large case backlog continue to
negatively impact the efficiency of the judicial system. To tackle these problems, a new judicial
map was adopted following consultations. Additional efforts are still required to put it into effect,
as well as to improve the case management system and the training system for magistrates.
The temporary re-evaluation of all judges and prosecutors (the vetting process) has continued to
advance steadily. Under the aegis of the European Commission, the International Monitoring
Operation has continued to oversee the process independently. By 12 September, the vetting
institutions had completed 554 first-instance cases. Around 64% of the vetting dossiers
processed so far resulted in dismissals, resignations or the termination of mandate of vetted
magistrates. The vetting institutions must continue to refer cases to the prosecution services
where there are indications of criminal offences.
The Specialised Structure for Anti-Corruption and Organised Crime (SPAK), comprising
the Special Prosecution Office (SPO) and the National Bureau of Investigation (NBI), continued
its operations. After a budget increase in 2021, the SPO now has 17 prosecutors in place, the
recruitment of eight financial investigators is underway and the NBI reached its full operational
capacity of 60 investigators after a second round of recruitment.
Albania has some level of preparation in the fight against corruption. It continued its efforts to
build on its track record of investigation, prosecutions and convictions in the fight against
corruption and delivered some results. These efforts need to continue. However, greater political
will, further structured efforts, and adequate resources and skills remain necessary. The SPAK
Court delivered several important final decisions on high-ranking state officials, including a
former Minister of the Interior and a former Prosecutor General. Although the vetting of
members of the judiciary is an administrative process, it continues to bring results in the fight
against corruption within the judiciary. A new General Anti-Corruption Directorate was created
in the Ministry of Justice. Overall, despite some progress, corruption remains an area of serious
concern. Increasing the number of final convictions of high-level officials remains an important
5
priority to further tackle a culture of impunity. The sectors that are most vulnerable to corruption
require targeted risk assessment and dedicated measures.
Albania has some level of preparation in the fight against organised crime. It made some
progress in meeting last year’s recommendations. Strong and fruitful cooperation with EU
Members States, Europol and Eurojust has led to tangible results. Albania continued to show
commitment to counter the production and trafficking of cannabis. Good progress was made on
the seizure and confiscation of assets related to organised crime. This effort must continue in the
future. Efforts also need to continue to ensure increased prosecutions and final convictions,
especially at high-level. Countering cybercrime, trafficking in human beings and money
laundering remain areas in which additional results are needed. The phenomenon of child sexual
abuse online remains a concern. The country progressed steadily in the implementation of the
Financial Action Task Force (FATF) Action Plan to improve effectiveness in the field of anti-
money laundering, but Albania remained on the list of jurisdictions under increased monitoring.
Financial investigations need to accompany systematically criminal proceedings. Albania
adopted a new national cross-sector counter-terrorism strategy and action plan in December
2020.
On fundamental rights, Albania complies overall with international human rights instruments
and has ratified most international conventions on the protection of fundamental rights. Some
progress was made in using alternatives to detentions and, in particular, in developing the
probation service, which remains fully operational, including for juvenile offenders. Albania
adopted a new lesbian, gay, bisexual, transgender, intersex and queer (LGBTIQ) action plan,
which includes measures to fight discrimination, improve access to services and approve the
legal gender recognition law and a national action plan for equality, inclusion and participation
of Roma and Egyptians. Enhanced efforts to consolidate property rights through the registration
and digitalisation of cadastral data are needed and the sector remains prone to corruption, while
the compensation process has stalled. On the protection of national minorities, Albania adopted a
new piece of implementing legislation that creates a fund for civil society projects in support of
minority rights. However, adoption of the remaining implementing legislation, including on
freedom to self-identify as a member of a national minority and on the use of minority
languages, is still pending. Preparations for the long awaited population and housing census
continued, including with pilot censuses in minority population areas, however the census was
postponed to 2023. Further actions need to be taken to strengthen data protection and align
national legislation with the EU General Data Protection Regulation (GDPR).
Albania has some level of preparation/is moderately prepared in the area of freedom of
expression. No progress was made in the reporting period. The intersection of business and
political interests continued to hamper media independence and the quality of journalism.
Disinformation including smear campaigns are recurrent, especially in online media whose self-
regulation needs to be ensured. The atmosphere of verbal attacks, smear campaigns and acts of
intimidation against journalists has not improved. Any changes to the Media Law need to be in
line with the Venice Commission opinion and must be submitted for consultation with media
organisations. It remains important to ensure that the media have direct and transparent access to
governmental institutions and their activities. The regulatory performance of the Audio-visual
Regulatory Authority (AMA) needs to be improved and the independence and resources of the
public service broadcaster should be strengthened.
6
Albania adopted a new and better-budgeted national strategy on gender equality and continues
its efforts to ensure adequate state funding to implement it at central and local level. Efforts are
needed to ensure that all national strategies at central and local level are gender mainstreamed
and spend budget in ways that take gender into account. On citizenship, Albania should refrain
from developing an investors’ citizenship scheme (golden passports) as it would pose risks as
regards security, money laundering, tax evasion, terrorist financing, corruption and infiltration by
organised crime, and would be incompatible with the EU acquis.
On migration, the legal framework on migration is largely aligned with the EU acquis but needs
updating, and must provide a clear framework for managing and coordinating migration. The
number of irregular migrants apprehended in Albania in 2021 decreased by about 15% compared
with 2020. No progress was made in referrals to asylum procedure and the implementation of
return procedures in line with the legal framework. Albania’s visa policy should be aligned with
the EU one.
The number of Albanian citizens lodging asylum requests in EU Member States remains
lower than the peak of 2015, but increased sygnificantly in the summer of 2021, and thus still
requires continuous and sustained efforts. Dialogue and cooperation with the countries most
affected have continued, in addition to thorough border checks and awareness-raising on rights
and obligations under the visa-free regime. Albania should keep addressing the phenomenon of
unaccompanied minors. The Commission is monitoring the trend very closely in the framework
of the post-visa liberalisation monitoring mechanism.
On the economic criteria, Albania made good progress and is moderately prepared for
developing a functioning market economy. The impact of the COVID-19 pandemic on the
economy, the budget deficit and the public debt ratio were lower than expected, but Russia’s war
against Ukraine caused price increases and lower trade. Fiscal space remains limited. Revenue-
related reforms progressed, but investment expenditure remains weak. Frequent budget revisions
weaken fiscal credibility. Inflation increased above target. Increased public service digitalisation,
financial inclusion, and labour inspections benefitted the business environment and the
formalisation of the economy, but the informal economy remains significant. Public consultation
remains weak. Albania made some progress and is at some level of preparation to cope with
competitive pressure and market forces within the EU. Energy and transport infrastructure,
digitalisation and education improved, but entrepreneurial and technological know-how remain
low, with unmet investment needs in human and physical capital, skills and education gaps, and
low R&D spending. Low export diversification increases vulnerability to external shocks.
Regional integration and exports increased but remained below potential.
On public procurement, Albania is moderately prepared, the country has made good progress,
in particular by adopting further implementing legislation and launching an electronic appeals
and complaint system. On statistics, Albania is also moderately prepared, it made limited
progress on aligning with ESA 2010 standards, faster publication and transmission to Eurostat,
but the Population Census Law has been further postponed. Albania is moderately prepared in
most areas on financial control, where the country made some progress, notably on public
internal financial control and internal audit.
Albania is moderately prepared in most of the areas of the internal market, namely the free
movement of goods, services and capital, company law and competition policy. The same
applies to financial services and to intellectual property law, both chapters where the country has
7
made good progress thanks to the reduction of non-performing loans and to the adoption of
legislation on copyright and on industrial property rights. Albania has made some progress with
the adoption of a new law on foreigners as well as by fulfiling some of the recommendations of
the Moneyval report. However, in the area of competition policy, the State aid authority needs to
be made independent and sufficiently resourced. Preparations are at an early stage on consumer
and health protection, where the country made limited progress.
Albania has achieved a moderate level of preparation in many areas linked to competitiveness
and inclusive growth, namely digital transformation and media, taxation, economic and
monetary policy, enterprise and industrial policy, education and culture. The same goes for the
customs union, where the pan-Euro-Mediterranean area rules of origin are applied, and bodies
involved in the fight against smuggling and counterfeit goods are strengthened and cooperate
better. The adoption of a tax and criminal amnesty against the advice of the EU and Moneyval
could jeopardise progress in this area as well as in the fight against money laundering. Albania
has some level of preparation in social policy and employment, and research and innovation.
Albania has made some progress in education in particular with the adoption of the new National
Strategy for Education and Action Plan 2021-2026, but progress was limited on the economic
and monetary policy.
As regards Green Agenda and sustainable connectivity, Albania is moderately prepared on
energy, environment and climate change. It has some level of preparation in the areas of
transport policy and of trans-European networks and some progress was achieved in developing
transport and energy networks. It made progress on civil protection and is ready to join the
Union Civil Protection Mechanism. The country has made limited progress in the other areas
covered by this cluster and ongoing efforts to address issues with vessels Flag State Control and
to align legislation need to continue. Limited progress was made in further aligning the EU
acquis on water management, chemicals and environmental crime. The impact of strategic
investments on biodiversity and nature protection requires attention. This cluster and the reforms
concerned have significant links to Albania’s Economic Reform Programme, the Commission’s
Economic and Investment Plan and the Green Agenda for the Western Balkans endorsed by
Albania in December 2020.
Albania has some level of preparation in most areas linked to resources, agriculture and
cohesion, namely agriculture and rural development, food safety, veterinary and phytosanitary
policy, fisheries, and financial and budgetary provisions. It is moderately prepared as regards
regional policy and coordination of structural instruments. Albania has made some progress in
agriculture and rural development, notably with the establishment of a farm register and better
administrative capacity for rural development. Good progress was observed on fisheries, with the
continued operationalisation of the Vessel Monitoring System (VMS) and allocation of human
resources to monitor and report on the activities of fishing vessels. Albania as a contracting party
of the General Fisheries Commission for the Mediterranean (GFCM) is fully implementing
fishing effort recommendations. Some progress was made on financial and budgetary provisions.
Progress was however limited on food safety, veterinary and phytosanitary policy, on regional
policy and coordination of structural instruments. In this respect, inter-agency coordination for
pre-accession assistance needs improvement, and issues need to be addressed as regards strategic
planning, implementation and monitoring capacity of infrastructure projects under the Economic
and Investment Plan.
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Albania has reached a good level of preparation as regards external relations, foreign security
and defence. On the external relations chapter of negotiations, Albania made some progress as
it continued alignment of legislation in the field of dual use goods and to implement CEFTA
additional protocols. As regards the EU’s Common Foreign and Security Policy, Albania
maintained full alignment with all relevant EU decisions and declarations, including with the EU
restrictive measures following Russia’s unprovoked aggression against Ukraine. As a non-
permanent member since January 2022, Albania has been actively engaged in the UN Security
Council in promoting and defending the rules-based international order.
2. CLUSTER 1: THE FUNDAMENTALS OF THE ACCESSION PROCESS
2.1. FUNCTIONING OF DEMOCRATIC INSTITUTIONS AND PUBLIC ADMINISTRATION REFORM
2.1.1 Democracy
In the new Assembly, resulting from the 2021 general elections, which were held following the
cross-party agreement of 5 June 2020, the elected members from the largest opposition parties to
parliament took their seats in Parliament. With the gradual improvement of the pandemic
situation, parliament slowly returned to in-person meetings. As regards EU-related reforms, the
Assembly reached cross-party consensus on constitutional amendments to extend the term of the
judicial vetting bodies. The Assembly also elected the new President with the votes of the
majority. The deep division within the largest opposition Democratic Party, dominated the
political environment and has hampered legislative work, such as furthering electoral reform.
Elections
On February 2022, the Parliament decided to set up an ad hoc parliamentary committee on
electoral reform, which is meant to follow-up on OSCE/ODIHR recommendations for the April
2021 elections and had a term of six months. The committee was constituted on 17 June. At the
expiry of its term in August 2022, it had only held its constitutive meeting.
During the reporting period, the Constitutional Court ruled against a provision of the Electoral
Code according to which electoral subjects need to pass a national threshold of 1% in order to
enter parliament, arguing that it discriminates against independent candidates. Earlier, the
Constitutional Court had ruled to abrogate the provision related to the distribution of
parliamentary seats in view of the preferential vote. The impending electoral reform will need to
address these decisions.
In line with ODIHR recommendations, the Central Election Commission has continued efforts to
strengthen its oversight role over campaign financing. In addition, the CEC has initiated high-
level discussions on the implementation of out-of-country vote.
On 6 March 2022, Albania held by-elections in six municipalities. The President of the Republic
decreed by-elections on 20 January, after a ruling of the Constitutional Court on the validity of
the 2019 local elections. Vacancies were created in the municipalities of Shkoder, Vore and
Lushnje after the mayors were discharged, in application of the law on the integrity of elected
officials. In Durres and Diber the mayors had resigned, and in Rrogozhine the mayor had passed
away. Eleven political parties registered to take part in the by-elections, fielding 19 candidates,
out of which three were women. Electronic voting and counting was piloted in one municipality
and biometric identification of voters was implemented in all polling stations. The ruling
Socialist Party won five municipalities, while a coalition of two opposition parties won the
9
remaining one. Two out of six mayors are women. No electoral subject contested the results. The
newly elected mayors will be in office for nearly one year, as regularly scheduled local elections
are expected to be held in 2023.
Parliament
The new Parliament was constituted on 10 September 2021, following the 25 April 2021
legislative elections. In these elections, preferential voting was implemented for the first time
and three MPs were elected through this mechanism. Additionally, three party leaders won
mandates in two constituencies, following a provision of the Electoral Code allowing party
chairs to run in multiple districts. The rule has been criticised by OSCE/ODIHR in their final
report on the April 2021 elections.
Out of 140 Members of Parliament, 50 are women (35%) and 47% of all MPs are elected for the
first time. Thirty-three MPs are under 40 years old.
In the new legislature, the elected MPs from the largest opposition parties took their seats in
contrast with the relinquishing of mandates that took place in 2019. Internal conflict within the
largest opposition party (DP) affected parliamentary life, stalling notably the work on electoral
reform. This has also weakened the role of the Parliament in exercising its main constitutional
functions. Still, the Parliament found the necessary wide basis to pass a time-limited constitutional
extension of the mandate of the vetting bodies. Important committees continue to be chaired by
opposition MPs.
Over the reporting period, the opposition sought the setting up of three inquiry committees, with
two of them being approved. Out of these two, the one dealing with the incinerators contracts
brought its work to completion.
Concerning its oversight function, MPs filed 21 requests for interpellations, out of which four
with the Prime Minister who nonetheless did not attend in person. The parliamentary oversight
of the work of independent institutions remains limited to the consideration of their annual
reports.
Higher ethical standards in Assembly proceedings are needed to foster more constructive
political dialogue between opposition and majority.
As regards Parliament’s role in the EU integration process, 9 of the laws passed in Parliament
were aimed at alignment with the EU acquis. The National Council for European Integration has
made efforts to further consolidate its role in EU integration issues.
With the improvement of the pandemic situation, the Parliament resumed meetings in person.
Parliamentary proceedings continued to be livestreamed on social media. Under the new
legislature, the Parliament has increased its efforts towards more transparency by offering more
statistical data on parliamentary activity. Parliament held consultations with civil society and
media on transparency standards, which need to be adopted. However, the publication of
parliamentary documentation, such as minutes of plenary sessions and committee meetings,
should be more timely, and more user friendly. Public consultation with civil society and interest
groups remained formal.
On 4 June 2022, Parliament elected Mr Bajram Begaj, former Chief of Defence, as the new
President of the Republic, without the support of the opposition, who refused to vote. Mr Begaj,
the sole candidate, was elected on the fourth round by a simple majority vote, after the first three
10
rounds requiring a qualified majority of 3/5 of the MPs failed. Shortly before the Assembly vote,
the incumbent President released Mr Begaj from the Armed Forces.
Parliament also elected the incumbent Governor of the Bank of Albania for a second term, filled
vacancies in the Audio-visual Media Authority (AMA) and in the steering board of the National
Broadcaster despite considerable delays. Hearing sessions were held with the candidates for the
position of the Ombudsperson but the vote was postponed until after the reporting period.
Parliament also elected the new chair of the Competition Authority, without conducting a
hearing session with the candidate.
Governance
The Albanian government has continued to maintain overall focus on reforms on the country’s
EU path, despite the challenge of addressing the economic and social consequences of the triple
shock of the 2019 earthquake, the COVID-19 pandemic and, more recently, of Russia’s war of
aggression against Ukraine. The government needs to continue, through its policy priorities and
its communication, to focus firmly on advancing the EU reform agenda, together with the
opposition and all segments of society. When it comes to preparations for accession negotiations,
there is a need to enhance communication, coordination, and expertise within the administration
as well as EU compatibility checks of all draft legislation.
The establishment or reinforcement of several government agencies around the Prime Minister’s
Office (Agency for co-governance, Agency for Media and Information, Agency for Strategic
Programming and Aid Coordination - SASPAC) without a comprehensive steering framework
and without a systematic attention to oversight and reporting lines, raises questions in relation to
the effective coordination and service delivery of public administration bodies.
Following the first Intergovernmental Conference on accession negotiations of July 2022, the
government appointed a new Chief Negotiator, at Minister of State level and with increased
resources. In the context of accession negotiations, there is a need to achieve sound coordination
among subordinated bodies and line ministries, enhance capacities of agencies working towards
EU integration and to ensure the alignment of the National Plan for European Integration with
sectoral strategies. The EU integration structures within the government had already been
substantially modified in October 2021, following the decision to set up a new agency for donor
coordination, the State Agency for Strategic Programming and Assistance Coordination
(SASPAC). The head of this new agency took over the role of National IPA Coordinator, a
function hitherto directly fulfilled by the previous Chief Negotiator for Accession of Albania to
the EU. Under the new set up, the political steer, the strategic planning and the coordination of
EU-related matters are shared among the Ministry for Europe and Foreign Affairs, the Minister
of State and Chief Negotiator, and SASPAC. As a new body, SASPAC needs to ensure a more
systematic coordination on EU integration and EU assistance with IPA Units, the Central
Finance and Contracts Unit (CFCU), and local government units. Strong cooperation as well as
expertise and among responsible national bodies should be ensured to facilitate the successful
implementation of the IPA programmes, including IPARD.
In 2021, progress was made in monitoring the execution of the National Plan for European
Integration and the new plan for 2022-2024 was adopted in February 2022 and is being
monitored on a weekly basis. In May 2022, the government decided to close all the front offices
delivering national administrative services at local level and decided to move towards 100%
11
online services at short notice. The rapid shift has raised, however, questions in terms of quality
and accessibility in the transition.
The territorial administrative reform needs to be further consolidated as part of the wider
decentralisation agenda. During the reporting period, the annual monitoring report for the year
2020 on the implementation of the decentralisation and local governance strategy has been
issued. A systemic monitoring and the related mechanisms need to be ensured. The new
decentralisation strategy beyond 2022, remains to be adopted. Consultation at local level, during
its elaboration, will be essential for the strategy to capture and address the priority needs.
In February 2022, the Parliament decided to set up an ad hoc committee on the territorial and
administrative divisions in the country, the term of which ran until 30 September.
Local government units (LGUs) still lack sufficient financial resources and administrative
capacity to exercise their greater policy making powers effectively. Women representation in
local government continues to require improvement. The LGUs’ fiscal autonomy remains at risk,
as most of their budget is dependent on national transfers. The delivery of quality public services
at local level remains limited. The financial situation of municipalities has been made ever more
complicated by the economic shocks, with further shrinking own resources available to LGUs.
Implementation of the Civil Service Law remains to be improved at the local level. Temporary
employment contracts for civil service positions, although decreasing, continue to be rather
frequent in the LGUs.
Despite the COVID-19 pandemic, municipalities have encouraged public participation in their
decision-making, by organising online Council meetings open to the public and other innovative
means. However, the institutional framework for effective and inclusive participation needs
further strengthening. On transparency, some improvement has been noted, as all municipalities
are now publishing online their Council’s decisions. As regards the transparency programme to
be adopted by each municipality, shortcomings have been identified regarding the publication of
mandatory information in its rubrics.
The Consultative Council continues to operate as the main forum for institutional dialogue and
coordination between central and local governments. The network of EU local coordinators has
strengthened the LGUs’ involvement in the EU accession process. However, the frequent staff
turnover in the EU municipal units endangers their ability to perform. Co- and pre-financing
issues persist at local level, despite the creation of a fund of 200 million Albanian LEK in the
state budget for 2022. Complex procedures for opening dedicated bank accounts as well as
receive VAT refund also represent serious obstacles to Albanian municipalities accessing
funding from the Instrument for Pre-Accession (IPA).
On territorial planning, the need to revise local plans to account in particular for civil
protection elements remains. Coordination of the national sectoral strategies with local plans is
weak.
Civil society
The implementation of the new Law on registration of Non-Profit Organisations adopted in June
2021 has not started yet. The High Judicial Council received a budget allocation to procure the
electronic register of Non-Profit Organisations and concluded a contract for its implementation
in May 2022. There has been no progress in the implementation of the roadmap on an enabling
12
environment for civil society, notably as regards the law on voluntarism. The institutionalised
cooperation between civil society and the Government still needs to be strengthened to ensure
meaningful participation of Civil Society Organisations (CSOs) in decision-making processes,
including in the context of the EU accession negotiations. Progress, albeit limited, has been made
in the field of VAT refund.
An empowered civil society is a key component of any democratic system and continues to be
recognised as such by the State institutions.
Albania’s legal and regulatory framework on the right to freedom of assembly and association is
generally in line with international standards. Restrictions related to the COVID-19 pandemic
that brought limitations to the freedom of assembly were waived in early 2022. The new Law on
Registration of Non-Profit Organisations adopted in June 2021 is expected to ease the
registration process and enhance transparency, but its implementation has not started yet. It also
aims at fulfilling the FATF Action Plan (see Chapter 24 – Justice, Freedom and Security). The
establishment of a national electronic register under the responsibility of the High Judicial
Council, foreseen under the new law, is due by end of 2023.The High Judicial Council has now
received a budget allocation to procure the electronic register and concluded a contract for its
implementation in May. In the meantime, CSOs continue to register as per the old law of 2001
and its lengthy registration process.
There has been no progress in the implementation of the roadmap on an enabling environment
for civil society. It remains strongly dependent on donor support. Additional efforts and
resources are required to advance its implementation. No progress has been made regarding the
law on voluntarism listed as one issue to be addressed under the roadmap. The monitoring
mechanism of the roadmap is not fully functioning.
While the 2014 Law on public consultation, laying down the procedural norms for transparency
and public participation in decision-making, is generally in line with European standards,
consultations often remain formal rather than meaningful exercises. In addition, the scope of the
law still needs to be extended to government decisions (see also Public Administration reform).
The ability of the National Council for Civil Society to voice priorities of CSOs in policy-
making processes remains weak. The Law on the National Council has still not been amended to
reflect changes in ministerial portfolios and representation in the Council, and to improve its
functioning.
The Agency for the Support of Civil Society remains the main public body providing financial
support for civil society. Its budget is now back at pre-COVID levels, but public funding remains
insufficient to sustain CSOs’ activities, in particular in social services.
Limited progress has been made in the field of VAT refund, with the implementation of the
instructions on VAT reimbursement for CSO beneficiaries of EU funding and other donor grants.
There is now evidence of the first cases of successful VAT refund. However, the process remains
lengthy and cumbersome. Improvements are needed for a more efficient implementation of VAT
reimbursement.
There is still no progress as regards tax incentives for corporate donations as these do not
promote company donations to CSOs and as there are no tax incentives for individual donations.
13
2.1.2. Public Administration Reform
Albania remains moderately prepared in the area of public administration reform. It made
limited progress in delivering on last year’s recommendations. Capacities for public
consultations and regulatory impact assessments were strengthened, preparations for the salary
reform started, and the automated payroll system was expanded. Implementation of the 2015-
2022 public administration reform and the 2014-2022 public financial management reform
strategies continued. However, bodies subordinate to ministries (agencies) continued to be
created without a comprehensive steering framework, systematic attention to oversight or clear
reporting lines. They also further exacerbated the issue of tasks entrusted to staff hired under the
Labour Code, instead of to civil servants. Provisions on merit-based recruitment in the civil
service law remain to be fully implemented, especially for senior level positions. Albania has
rolled out a comprehensive platform for digital services – a rapid shift towards 100% online
services took effect on 1 May 2022. However, it needs to ensure equitable access for citizens
with limited digital skills.
The Commission’s 2021 recommendations remain mostly valid. In the coming year, Albania
should, in particular:
 increase the capacities for policy planning and monitoring and ensure that the central
administration’s supervisory and subordinated bodies are well-structured and assigned clear
roles;
 prepare new public administration and public financial management strategies in line with
relevant sectoral strategies, while at the same time review
the effectiveness of the current monitoring structures;
 effectively implement the provisions on merit-based recruitment in the civil service law at all
levels, especially at senior level; reform the salary system for civil servants and further
expand the automation of the payroll system.
Strategic framework for public administration reform
Throughout 2021, the government continued to monitor the implementation of the 2015-2022
public administration reform strategy and the 2014-2022 public financial management
reform strategy. Despite the COVID-19 crisis, the Albanian institutions made substantial efforts
to maintain a good implementation of the public administration reform strategy. Progress has
been achieved in results-oriented monitoring, including performance analysis. However, the
implementation of the public administration reforms requires a continued political steer.
Financial sustainability needs to be improved through better reviewing of overall financial
resources, as currently, the reform implementation depends heavily on funding from external
donors.
Policy development and coordination
The legal basis and the institutional set-up for coherent policy making system are partially in
place. The quality of performance and the regularity of the integrated policy management groups
mechanism vary across sectors. Albania should strengthen its efforts to improve evidence-based
policy making by increasing the administrative capacities of line ministries in policy planning,
14
monitoring, and data collection. The three pillars of the integrated planning system3
must
become fully functional and the user training for civil servants must continue, in particular on
data quality and indicators.
The National Strategy for Development and Integration, which is the top reference document for
the planning system, expired in 2020. The new strategy, covering the period up to 2028, needs to
be drafted and adopted. The authorities need to improve coherence between policy planning and
budgeting by making full use of the Integrated Planning System Information System. The newly
created state Agency for Strategic Programming and Aid Coordination has the mandate to
enhance coordination. However, the roles and responsibilities of the Agency and the
Department for Policies and Good Governance in the Prime Minster’s Office need to be
clarified. Further efforts are needed to improve the administrative capacity of line ministries and
the Prime Minister’s Office. (See Chapter 32 - Financial control). The Prime Minister’s Office
rulebook still needs to be adopted.
The administration needs to further strengthen its capacity in inclusive and evidence-based
policy and legislative development. Progress was achieved in increasing the use and quality of
regulatory impact assessments for legislative proposals and trainings on these issues were
delivered across the administration. The government needs to continue its efforts to improve
regulatory impact assessments.
On public consultation, the electronic web-portal is operational, and the regulatory framework
has been improved. The usage of the electronic register continued, but the share of legal acts
undergoing public consultation and usage of the electronic register decreased in 2021 to 65.8%
from 79.6% in the previous year. The quality control of public consultations needs to be
strengthened to focus on content rather than on process.
Public scrutiny of government work needs to be further improved. Parliamentary oversight
of government performance, including sub-ordinated agencies, needs to be strengthened.
Regulatory and institutional monitoring, and the reporting framework for government
performance continue to be fragmented. Communication to citizens about ongoing reforms
efforts needs to be improved. The harmonisation of reporting practice requires the Integrated
Planning System Information System to be fully rolled out.
Public financial management
The Ministry of Finance and Economy is in charge of the public financial management
reform. Several posts, including at management level, remain unfilled in the Ministry. The
2019-2022 public financial management strategy is expiring, and the government needs to draft
and adopt a new programme. The new reform programme should be developed following a
detailed analysis of the implementation of the current strategy and after conducting extensive
public consultations. The finalisation and publication of the 2021 report on public financial
management monitoring report was delayed.
During the reporting period, the 2022-2024 medium-term budget programme was adopted, based
on the newly developed Albanian financial management information system. The 2022 budget
and the execution of the 2021 budget were in line with the revised organic budget law.
Integration of the e-procurement and treasury system made progress on improving commitment
3
These are: the Integrated Planning System Information System, the Albanian Financial Management Information
System, and the External Assistance Management Information System.
15
checks. Consultation on the medium-term revenue strategy was launched in January 2022, but
the final version has not yet been produced.
Budget transparency remains satisfactory with the publication of all key budget documents,
which allows for sufficient public debate. More timely publication of the budget execution
reports and the audit report, in particular reporting on arrears, is needed. Albania further
strengthened its capacity for gender-responsive budgeting, based on a legal obligation to this
effect in the central and local government finance management cycle.
Public service and human resources management
Progress on merit-based recruitment, promotion and dismissal needs to be consolidated by
applying consistent standards across the public administration.
Greater legal compliance is needed in recruitment procedures. The merit principle needs to be
complied with both for senior and entry level positions. Across the public administration, job
descriptions are not yet fully in line with the categories set out in the civil service law.
In 2021, the number of dismissals of civil servants decreased to 346 from 619 in 2020 and the
authorities explained that these were in compliance with the civil service law. The backlog in
implementing court decisions confirming dismissal of civil servants as unlawful has been further
reduced during the reporting period. A system to monitor and follow up the final court decisions
has been created and is managed by the Department of Public Administration.
The human resources management information system continues to be filled with the
necessary data, although at a slow pace. It does not yet cover the entire public sector, does not
include completely up-to-date data on civil servants and it still needs to be extended to the local
level. The data it contains on civil servants needs to be up-to-date. The government has managed
to put in place measures to create a coordination mechanism between central and local level to
monitor and evaluate human resource management.
The remuneration system is based on a job classification system that needs to be revised
including with a broad public consultation. The lack of a salary policy based on clear criteria for
pay supplements and salary increases weakens the fairness and coherence of the system. The
automation of the payroll system through the human resources management information system
needs to be extended to the whole public sector.
The Albanian School of Public Administration continued to adapt its training programmes for
professional development in line with the COVID-19 measures. Compared to the previous year,
it increased the thematic scope and the number of trained public servants. However, the lack of
infrastructure hinders its capacity to deliver online courses. A training cycle on quality
management has not yet been set up. The administrative skills of local-level civil servants need
to be improved.
Accountability of the administration
The legal framework for the organisation of the central administration does not provide a
comprehensive and coherent framework to ensure that supervisory and subordinated bodies are
held accountable. Agencies such as the State Agency for Strategic Programming and Assistance
Coordination, the Agency for Media and Information and the Co-Governance Agency need to be
better structured and assigned clear roles. The law on the organisation and functioning of the
state administration does not set a clear typology and criteria for the creation of subordinated
16
bodies. Additionally, policy-making institutions do not always monitor policy implementation by
their subordinated agencies and these agencies do not always report on their performance.
Legal changes are needed to improve how policy-making functions are defined, including setting
requirements for planning and performance reporting by subordinated bodies and supervisory
ministries. State administration workflow and decision-making processes should be more
transparent. The legal framework for ensuring managerial accountability needs to be improved.
The citizens’ right to good administration needs to be strengthened. The implementation rate
of the Ombudsman’s recommendations fell to 50% in 2021, from 55% in 2020 and 62% in 2019.
The Assembly should strengthen its cooperation with the Ombudsman and address the problem
of the lack of responsiveness of public administration bodies. In December 2021, a public
consultation was launched to amend the law on the right to information, which regulates
citizens’ right to access public information. An increasing number of public authorities have
adopted and published transparency programmes (300 in 2021, up from 239 in 2020).
A legislative framework is in place for the right to administrative justice. The capacity of the
administrative court system and the appeal panels to deal with cases is limited, which led to an
increased backlog in 2021. Legislation is in place to protect the right of citizens to seek
compensation and is applied in practice in judicial cases. However, there is no mechanism for
regular monitoring and analysis of the administrative and judicial practice in such matters, and
the government does not gather data on payments made in public liability cases and reasons for
them.
In November 2021, Parliament adopted the law on co-governance, thus giving substantial powers
to the Agency for Dialogue and Co-governance, which previously administered an online
platform for citizens’ complaint. The agency reports directly to the Prime Minister. It can
conduct inspections on public institutions, based on citizens’ complaints, and apply
administrative sanctions or propose disciplinary measures. This reform has raised concerns about
(i) the agency’s impact on policy planning and coordination, (ii) the impact of the new law on the
code of administrative procedures, (iii) the agency’s impact on the separation of powers between
the executive branch and the judiciary.
Service delivery to citizens and businesses
The institutional and legal frameworks for public service delivery are in place to ensure a user-
oriented public administration. In 2021, the number of one-stop-shops and e-services, even if
at different levels of automation, continued to increase, and information to citizens on public
services became more accessible. The new e-government law is in public consultation. On 1 May
2022, the government decided at short notice to close the ‘front desks’ delivering national
administrative services at local level, with a view to moving towards putting 100% of service
online, with the declared aim of improving service delivery and reducing corruption. The rapid
shift has raised questions about the quality and accessibility of service to citizens with limited
digital skills. Some business associations have reported technical difficulties, in particular when
submitting mandatory files.
The Code of Administrative Procedures provides the legislative framework for simplifying
administrative procedures in line with international standards. The process of legal
harmonisation with the Code must be completed.
17
2.2. RULE OF LAW AND FUNDAMENTAL RIGHTS
2.2.1. Chapter 23: Judiciary and fundamental rights
The EU’s founding values include the rule of law and respect for human rights. An effective
(independent, high quality and efficient) judicial system and an effective fight against corruption
are of paramount importance, as is the respect for fundamental rights in law and in practice.
Albania has some level of preparation/is moderately prepared in implementing the EU acquis
and European standards in the area of the judiciary and fundamental rights. Good progress was
made, in particular through continued implementation and consolidation of the comprehensive
justice reform. There have been two additional appointments to the Constitutional Court, which
further enhance the court’s ability to perform its mandate. The High Court has increased its
efficiency with the appointment of six additional judges, and has started to reduce its backlog of
cases and to unify the case-law. The vetting process for judicial appointments has continued to
advance steadily. Operational efforts to fight corruption are delivering some results, including
criminal procedings and financial investigations in several high-level cases, which resulted in a
few final convictions. These efforts need to continue and intensify. On fundamental rights, there
was some progress in a number of areas, but efforts to implement policies should continue.
Faster progress should be made on the first registration of properties and other transitional
processes. Albania has adopted another piece of implementing legislation related to the 2017
framework law on the protection of persons belonging to national minorities; the remaining
implementing legislation needs to be adopted not least to ensure self-identification. On personal
data protection, Albania should take measures to prevent the recurrence of massive breaches of
personal data and accelerate efforts to align its legislation with the EU acquis on personal data
protection.
Functioning of the judiciary
Albania is moderately prepared on the functioning of the judiciary. Good progress was made,
with the continued implementation of justice reform. A time-limited constitutional extension of
the term in office of the vetting bodies was adopted, thus ensuring uninterrupted and consistent
continuation of the vetting process. To date, 64 % of the vetting dossiers processed have resulted
in dismissals, resignations or termination of mandate of vetted magistrates. Following new
appointments of judges, the High Court has reduced the backlog of cases for the first time in six
years and reached the quorum to make appointments of judges to the Constitutional Court,
proceeding with one such appointment. The Specialised Structure for Anti-Corruption and
Organised Crime (SPAK) Court delivered several important decisions pertaining to high-level
officials, including a former Minister of the Interior and a former Prosecutor General. Limited
progress was made on the recommendation to improve the case management system and the
legal training system, which has been pending for some years. The efficiency of the judicial
system is negatively affected by the length of proceedings, the low clearance rate and the large
backlog of cases.
Recommendations for the coming year:
 further advance the process of re-evaluating judges and prosecutors (vetting) and, where
possible, increase the pace of procedures with due regards to the quality of the process;
 consolidate efforts to enhance the efficiency and transparency of all courts and prosecution
offices, including through fast and decisive action to set up a modern Integrated Case
18
Management System and with the rollout of a solid implementation plan for the new judicial
map;
 continue to consolidate the capacity of the judicial system and its self-governing institutions,
while making quality and efficiency improvements at the School of Magistrates.
The comprehensive transitional re-evaluation (vetting) of all judges and prosecutors continued to
advance at a steady pace. The International Monitoring Operation, deployed under the aegis of
the European Commission, continued to exercise independent oversight.
By 12 September 2022 the vetting institutions had completed 554 vetting cases at first instance.
Of these, 405 decisions are final. Overall, around 64 % of the vetting dossiers processed so far
have resulted in dismissal or termination due to resignations by the assessees or reaching the
retirement age. The outcome of decisions of the first-instance vetting body, the Independent
Qualifications Commission and, where applicable, of Appeal Chamber decisions, is as follows:
228 dismissals, mostly for issues relating to unjustified assets; 195 confirmations in office; 128
decisions on termination of the vetting proceedings; and three decisions to suspend the assessees.
The Independent Qualification Commission has formally initiated investigations in all pending
vetting cases. The International Monitoring Operation has continued to perform its oversight role
in the vetting process and has issued opinions on first-instance assessments, including 23
recommendations for appeal, and five dissenting or concurring opinions after the final decisions.
The vetting institution of Public Commissioners has followed all recommendations for appeal.
In the same period, the Appeal Chamber delivered 157 decisions and registered 291 cases. Of
these, 67 were appealed by the Public Commissioner, 227 by the assessees themselves, and three
cases were appealed by both the assessees and the Public Commissioner. Overall, there are 134
pending vetting cases. However, 6048 cases were registered and treated based on information
from the public.
The vetting institutions are expected to continue to refer cases to prosecution services where
there are indications of criminal offences. By 12 September 2022, 30 files had been submitted to
the Special Prosecution Office, including 12 cases involving former judges of the High Court
and the Constitutional Court. Of these, two investigations have resulted in convictions, the
remaining being either pending or were discontinued.
Strategic documents
The new cross-sector justice strategy and its action plan for 2021-2025 have been adopted by the
Council of Ministers and need to be implemented effectively. The Ministry of Justice has
strengthened its internal capacities to collect and report data. The Sectoral Steering Committee
for Justice Reform operates at the technical level through two thematic groups. Further
improvement of coordination between the justice institutions remains necessary.
New specialised bodies
The Specialised Structure for Anti-Corruption and Organised Crime (SPAK), comprising the
Special Prosecution Office (SPO) and the National Bureau of Investigation (NBI) is now
operational. In a context of workload increase, staff shortages has been one of SPAK’s main
challenges. The SPO has 17 prosecutors in place, and a budget allowing for 20. The recruitment
of eight financial investigators is underway and a media coordinator took up duty in September
2021. Following a second round of recruitment, the NBI reached its full operational capacity of
19
60 investigators in June. As provided by law, an International Commission consisiting of two
criminal justice experts nominated by the EU and two by the US government, continued to
monitor the development of the NBI.
Management bodies
The judiciary self-governing institutions have continued to fully exercise their functions. The
High Judicial Council (HJC) and High Prosecutorial Council (HPC) partially renewed their
membership, including both magistrates and lay members. Parliament and lay member
appointing bodies should ensure greater competition and transparency in the appointment
process. Two vacancies for non-magistrate members remain open at the HPC.
The HJC advanced with the appointments of judges to vacant positions and continued to approve
a significant amount of pieces of secondary legislation regulating the activities of the judicial
system and courts. The HPC has continued to promote district prosecutors. The HPC needs to
ensure the implementation of rules for the promotion and evaluation of prosecutors. The HPC
should ensure close cooperation with the General Prosecution Office in view of correctly
implementing the legal framework in place. This increased cooperation would be of particular
importance when evaluating and promoting prosecutors.
Independence and impartiality
The 2016 justice reform created the legal and institutional framework to guarantee the
independence and impartiality of magistrates. The independence of the judiciary is guaranteed by
the Constitution. However, concerns continued to be raised about alleged attempts to interfere
and exert pressure on the judicial system. The training of magistrates should remain focused on
integrity and judge-craft. More work to raise awareness on integrity and judicial independence
should take place at all levels. Legal provisions are in place to guarantee independent procedures
to appoint, promote, evaluate and dismiss judges and prosecutors, and to ensure that is possible
to appeal all related decisions. The remuneration of judges and prosecutors meets the highest
public salary standards for the country. However, the lack of transparent procedures to promote
prosecutors remains a priority issue.
The rollout of a modern Integrated Case Management System has been pending for many years
and is necessary to improve the efficiency and transparency of the justice system. Since several
courts have very few judges and the Integrated Case Management System is not used, the
random allocation of cases is not widely applied.
It is a criminal offence to exert undue influence over a judge or a prosecutor. However, in
practice there have been no reports from judges or prosecutors of such attempts. No measure has
been taken against public officials or politicians waging accusations against magistrates, but to
address them the independent institutions governing the justice system have proactively reacted
against such public accusations, classifying them as undue influence and pressure.
Accountability
The High Justice Inspector (HJI) continued to be fully operational, initiating and conducting
disciplinary investigations against magistrates. The HJI continued to be understaffed and could
not reduce the accumulated backlog, despite the allocation of additional staff and premises, and
an increased budget. The recruitment of additional inspectors and improvement of HJS’s
capacity remain necessary. During the reporting period, the HJI received 1 257 complaints. It
20
processed 4 124 complaints in total and started 22 investigations, of which 17 resulted in
disciplinary proceedings.
The HJC budget has been gradually increased, and all minutes of meetings and decisions are
being made public. Outreach to the media and distribution of materials to the public need to be
stepped up to proactively inform people about the HJC’s activities.
The HJC made progress in evaluating judges at all levels. Evaluations are now conducted
regularly, and the backlog of evaluations is being steadily reduced. The HJC suspended one
judge based on HJI investigations. The HPC should swiftly finalise all the necessary secondary
legislation for evaluating prosecutors. Most HJI requests to dismiss prosecutors were rejected by
the HPC in 2021. Close cooperation between the institutions governing the justice system should
continue. The HJC and HPC held their first joint meeting during the reporting period.
Coordination on a regular basis is needed.
The HJC adopted three strategic documents on the administrative investigation of whistle-
blowers and the review of corruption cases within the HJC. The HPC, HJC and HJI regularly
published their decisions and the minutes of their plenary meetings.
Professionalism and competence
The system for recruiting, selecting, appointing, transferring, and dismissing judges and
prosecutors is managed exclusively by the self-governing institutions of the judiciary. Continued
implementation of judicial reform further reduced political influence throughout the appointment
process, thus ensuring a merit-based career system.
Two new judges were appointed to the Constitutional Court in March and September 2022,
bringing the current number of judges in office to eight out of nine, five of whom are women.
The appointment process for the remaining Constitutional Court position is underway. The legal
provisions in place define the criteria to become a judge of the Constitutional Court. The
evaluation process, including the ranking of candidates needs to be more transparent and take
into account the Venice Commission recommendations.
The number of judges at the High Court increased to 15, with six new judges appointed during
the reporting period. The High Court can now work in three chambers and adjudicate all
categories of cases. It also reached the quorum to make appointments to the Constitutional Court.
It started to reduce its backlog of cases. However, this backlog remains very high, and more
judges and legal advisers are necessary to help reduce it further.
Quality of justice
The quality of the initial and continuous training at the School of Magistrates (SoM) requires
improvement and a further increase in the cohorts of students, and therefore graduates, is needed
in light of the continued dismissals arising from the vetting process. The HPC and HJC, in
cooperation with the SoM, approved the training calendar for the 2022-2023 academic year. For
the 2022-2023 academic year, the intake of new students only increased by 20 people compared
with the previous term, which seems insufficient in the light of the number of judicial vacancies.
The SoM needs to intensify its efforts to strengthen its academic staff and to ensure competitive
and transparent recruitment procedures. The periodic evaluation of judges and prosecutors takes
into account the continuous training of judges and prosecutors and includes assessments
provided by the SoM. The continuous training should improve its methodology and focus more
on daily needs as well as on case studies for judges and prosecutors. On the other hand, the initial
21
training requires a substantial revision, consistent with the objective of training specialised
judges in various field of law, while enhancing its practical focus, notably with courses on legal
writing and reasoning. The total budget allocated to training initiatives at the SoM in 2021
amounted to EUR 2,101,845, an increase of 27% compared with the previous year. The SoM
needs to coordinate assistance from donors and CSOs more proactively. As an observer of the
European Judicial Training Network (EJTN) it should benefit more proactively from the EJTNs
activities and the expertise within the network.
Albania had 307 full-time judge positions (10.8 per 100,000 inhabitants) and 300 full-time
prosecutor positions (10.5 per 100,000 inhabitants) in 2021. According to the European
Commission for the Efficiency of Justice (CEPEJ), the European averages are 21 judges and 12
prosecutors per 100,000 inhabitants. The 2021 budgetary allocation for the judicial system was
about EUR 40 million. This amounts to EUR 14.5 per inhabitant. Court infrastructure remains
poor overall and future budget allocations need to address with greater determination the
pressing needs of the judicial institutions.
Court activity is monitored through quarterly reporting of the courts and data is made public in
the annual reports of the HPC and HJC.
Alternative dispute resolution continues to be limited and needs to be further reinforced.
Awareness of the citizens about the alternative dispute resolution service is low and needs to be
improved.
Efficiency
The length of proceedings, the low clearance rate and the high number of unresolved cases
continue to affect the efficiency of the judicial system.
Appeal courts continue to have a high number of inherited cases and are affected by the high
number of judicial vacancies, with only 30 out of 78 appeal judges in office. Albania adopted a
new judicial map as per the legal requirements, following a consultation process and the support
from international experts, including through EU funding. The new judicial map aims to re-
distribute the backlog among the courts more fairly by reallocating judges and courts to the areas
with the greatest backlog. In addition, it intends to create the possibility for more specialisation
of judges in specific areas of law in order to improve quality. A solid implementation plan for the
new judicial map will be needed. The average length for a case at appeal level is 893 days.
However, at the Tirana Appeal Court, the average length for a criminal case is 5 820 days.
The courts with the highest backlog are the High Court, the Tirana District Court and the
Administrative Court of Appeal. The latter has 18 415 cases, of which 9 938 are older than two
years. The High Court has the highest backlog with over 35 822 cases, of which 27 843 are older
than two years (77%). However, following the new appointments to the High Court, the
clearance rate has increased considerably to 117% for criminal cases and 193% for
administrative cases. The recruitment of new administrative and legal experts, the improvement
of working methods and the increase of communication and transparency remain key tasks.
Further efforts are required to improve the collection and reporting of judicial statistical data. It
is urgent to set up a new Integrated Case Management System through determined policy,
planning and budgetary efforts, and ensure its inter-operability across the entire justice system, in
line with CEPEJ methodology.
22
Progress continued by the HJC on the measurement of court efficiency through the adoption of
the necessary regulation and statistical charts for the evaluation of the performance of
magistrates based on CEPEJ indicators. The HJC approved new rules for satisfaction surveys as
a means to monitor the performance in all courts. More rules and indicators on efficiency should
be promptly approved by the HJC.
There are 18 cases pending before the Council of Europe Committee of Ministers for supervision
of execution of final judgments of the European Court of Human Rights.
Despite COVID-19, all institutions proceeded with their regular work, including improving IT
tools to hold online meetings. In 2021, COVID-19 did not affect court proceedings, and hearing
were held in camera during all the reporting period.
Fight against corruption
Albania has some level of preparation in the fight against corruption. Despite some progress,
increased efforts and political commitment in fighting corruption, it remains an area of serious
concern. Overall, corruption is prevalent in many areas of public and business life. The
Specialised Anti-Corruption and Organised Crime Structure (SPAK) conducted criminal
proceedings and financial investigations in several high-level cases. Some final convictions of
high-ranking state officials have been pronounced. The vetting of members of the judiciary
continues to bring results in the fight against corruption within the judiciary. A new General
Anti-Corruption Directorate was created at the Ministry of Justice to improve coordination at the
central level; its efficiency remains to be demonstrated. Increasing the number of final
convictions of high-level officials remains an important priority to further tackle a culture of
impunity. Sectors most vulnerable to corruption require targeted risk assessments and dedicated
actions. Since the 2021 recommendations were only partially implemented, these remain valid.
In the coming year, the country should in particular:
 further progress towards establishing a solid track-record of investigations, prosecution, and
adjudication of corruption cases, and seizure and confiscation/recovery of criminal assets
resulting from corruption-related offences;
 ensure that the Specialised Structure for Anti-Corruption and Organised Crime (SPAK)
further addresses high-level corruption, enhances its staff and resources, as well as its
coordination with law enforcement, prosecutorial and judicial entities in charge of corruption
prevention;
 ensure that criminal proceedings are consistently and systematically initiated against judges
and prosecutors accused of criminal conduct during the re-evaluation process;
 effectively address the recommendations of the Council of Europe’s Group of States against
Corruption (GRECO) and timely implement the related action plan; adopt
integrity/prevention of corruption plans within all line ministries and State authorities.
Track record
Efforts continued on improving the track record of investigations, prosecutions and
convictions in the fight against corruption. However, greater political will and more structured
and consistent efforts, including adequate resources, tools and skills, remain necessary. The
number of corruption cases sent to court was 440 in 2021, including 31 cases sent by the SPO.
23
Final convictions of persons for corruption offences amounted to 235 at first instance and 99 at
appeal and final court level. The overall number of cases referred for prosecution in 2021 was
3 351.
On high-level state officials, there was some progress. In 2021, 89 cases were opened (73 in
2020) and 2 indictments were issued involving 5 people (against 11 indictments involving 20
people in 2020). There were no convictions of officials on high-level corruption charges. A
former Prosecutor General was given a final sentence of two years inprisonment and five years
probation for concealing assets. A former Minister of Interior received a final sentence of three
years and four months imprisonment for abuse of power.
Criminal proceedings and parallel financial investigations were conducted by SPAK in several
high-profile cases, involving politicians and members of Albanian institutions, the judiciary,
local authorities and the business sector. This includes notably the arrests of a former Minister of
Environment and of a member of Parliament as part of an investigation into the concession
contracts on urban waste treatment (the incinerators’ affair). After approval by the SPAK Court
of Appeal, the investigation against a former Minister in relation to the fatal Gërdec explosions
in 2008 was reopened.
Investigations should result in a substantial number of final convictions of high-ranking state
officials. Continued efforts are needed to tackle the culture of impunity for high-level state
officials.
In 2021, the network of Anti-corruption coordinators, responsible for administrative
investigations, presented 12 reports on criminal activities concerning 4 institutions (State
Cadastre Agency, General Directorate of Road Transport Services, National Food Authority and
General Directorate of Customs) while 85 administrative measures were taken against 11
institutions.
The vetting of members of the judiciary continued to have a positive impact on the fight against
corruption. The SPO has followed up criminal investigations for vetted-out High Court and
Constitutional Court judges and prosecutors. Efforts to ensure that dismissed magistrates are
brought to justice should continue. Of the 300 high-level officials of the state police, Guard of
the Republic and Service for Internal Affairs and Complaints (SIAC) 66 were vetted, leading so
far to 6 dismissals and 7 resignations. The vetting process remains crucial to restore public trust
in the judiciary and the law enforcement bodies of the state.
In 2021 SPAK Courts continued to build the track record in the field of corruption with 52 final
convictions (136 people) at first instance and 22 convictions against (44 people) in corruption
cases. Some progress was made in 2021 on the seizure and confiscation of assets in corruption
cases, with assets seized amounting to a total value of around EUR 21.5 million. However,
additional efforts are needed, in particular on effective follow up through confiscation. In the
first half of 2022, almost 37 million worth of assets were seized, but only minor amounts
confiscated.
On asset declarations by high-level state officials, 15 cases were referred by the High
Inspectorate for the Declaration and Audit of Assets and Conflicts of Interest (HIDAACI) to law
enforcement agencies in 2021, down from 72 in 2020. There were no final convictions on cases
referred by HIDAACI.
24
The law on whistle-blowing and whistle-blower protection continued to be implemented. In
2021, 11 cases were registered and adminstrativly investigated and one request for protection
against retaliation was received by HIDAACI. The public and private sector made progress in
creating respectively, 362 and 527 units responsible for adopting internal regulations on whistle-
blowing, and continued to submit reports to HIDAACI.
In 2021, HIDAACI issued fines as an administrative measure in 82 cases of refusal to declare,
conflict of interests and failure to comply with the law on whistleblowing and whistle-blower
protection. The large majority of these measures were upheld by the administrative courts.
As regards internal control mechanisms, the state Supreme Audit Institution reported estimated
damages and financial losses to public finances in 2021 of almost EUR 18 million. In 2021, the
institution referred 14 cases involving 62 executives for prosecution, including a former Minister
of Health and a former director of the Port Authority in Durrës. A case refered for prosecution in
2020, on a tender of EUR 27 million for the supply of police uniforms, led to arrests by SPAK of
public officials in July 2021. (See also Chapter 32 – Financial Control).
On access to information, the Commissioner for Information and Data Protection administered
992 complaints, and continued the review of 44 complaints carried over from 2020. In 698 of
those cases the applicant was provided with the information requested, as a result of the
administrative inquiry process. As for the institutional framework, the law on the right to
information envisages administrative accountability of public officials who fail to comply with
its obligations, sanctioned by fines of up to EUR 2 500 and the possibility for the Commissioner
to take disciplinary actions against the person responsible.
Anti-corruption measures continue to have a limited impact in particularly vulnerable areas
(roads, cadastre, property, customs, tax administration, education, health, public procurement,
PPP contracts, etc.). More action is needed and a strategy based on a general analysis of the
problem should be adopted. Internal checks and inspection mechanisms in the public
administration remain weak and ineffective. Corruption remains prevalent in the health and
property sectors and within the police. It particularly affects women as regards access to justice,
in social services and higher education.
Institutional framework
Prevention of corruption
With the aim of improving the central anti-corruption coordination, a new General Anti-
Corruption Directorate was created within the Ministry of Justice, incorporating competences
and functions that were previously part of the Prime Minister’s Office. Its mission is to conduct
administrative investigations on denunciations for abusive, corrupt, or arbitrary practices
regarding law enforcement, as well as to identify violations of law by public officials. Effective
inter-institutional coordination should be ensured between the new governmental structures
involved in fighting against corruption. The efficiency of the new anti corruption directorate
remains to be assessed.
The institutional and operational capacity of the anti-corruption network in line ministries, at the
local and the central coordination level continued to increase slightly.The recruitment of staff in
the General anti-corruption directorate in the Ministry of Justice still needs to be completed. The
network of anti-corruption coordinators at national and regional level has grown to 78
coordinators in 44 state institutions.
25
HIDAACI made progress in its work by establishing an Electronic System of Declaration of
assets and private interests, which is now fully operational. HIDAACI postponed the deadline
for submitting declarations until October 2022, while providing trainings on the system to those
concerned.
Within the overall anti-corruption framework, the role of the State Supreme Audit Institution
remains to provide recommendations to the government to address systematic weaknesses. The
e-procurement, e-appeals and e-complaints systems helped to increased transparency in the area
of public procurement. In April 2022, the Ministry of Justice submitted its self-assessment
compliance report to the Council of Europe’s Group of States against Corruption (GRECO), as a
follow up to GRECO’s first report of the fifth round. The report deals with preventing
corruption and promoting integrity in central government and law enforcement agencies, and
lists 24 recommendations for Albania. The 12 subordinate institutions and agencies of the
Ministry of Justice have finalised the process of integrity risk assessment and have approved
their integrity plans. Besides the Ministry of Justice, the Ministry of Interior and the Ministry of
Finance and Economy have also adopted their integrity plans.
In November 2021, Parliament adopted the law on co-governance, which provided the Agency
for Dialogue and Co-governance with substantial new powers (see above on Public
Administration Reform). Since the Agency is also mandated to follow up on corruption
complaints, its interaction with the network of anti-corruption coordinators and the division of
roles between the two organisations need to be clarified.
Law enforcement
The specialised bodies in charge of investigating, prosecuting and adjudicating complex
corruption cases – the Anti-Corruption and Organised Crime Courts and the SPAK, comprising
the Special Prosecution Office (SPO) and the National Bureau of Investigation (NBI) – remained
fully operational during the reporting period.
Legal framework
Albania remains a party to all international anti-corruption conventions, including the United
Nations Convention against Corruption. It has continued to improve its legal framework for
preventing and combating corruption.
The Albanian parliament still needs to adopt a unified law on political party and campaign
financing, and also address remaining OSCE/ODIHR recommendations. As electoral campaigns
are moving increasingly online, special attention should be paid to online and third-party
campaigning.
Concerns about the misuse of state resources during electoral campaigns persist. The Central
Election Commission fined the mayor of Durreës for using public resources during her electoral
campaign for the March 2022 by-elections. Such incidents, and others related to vote-buying
practices in April 2021 elections, confirmed the need for more transparent political party
finances in line with international and European standards.
Albania’s legislation is partially in line with the OECD Convention on Combating Bribery of
Foreign Public Officials in International Business Transactions.
Strategic framework
26
Overall, the implementation of the inter-sectoral strategy against corruption is still on track.
However, weaknesses as regards the need to improve ownership, to strengthen institutional
capacities and increase the budget for the strategy’s activities are still present. Although the
strategy includes monitoring indicators, the impact of anti-corruption structures on preventing
public sector corruption remains difficult to measure. The 2022-2023 action plan to implement
the extended strategy remains in place. Consultations with relevant stakeholders before the
approval of the reports have improved, including the use of the public consultation platform.
Some progress was made in awareness-raising and efforts in this area need to be sustained.
Fundamental rights
Albania generally complies with international human rights instruments and has ratified most
international conventions on the protection of fundamental rights. During the reporting period,
some progress was made, notably with the adoption of a new and better-budgeted national action
plan for LGBTIQ persons, a national strategy on gender equality and a national action plan for
equality, inclusion and participation of Roma and Egyptians in Albania. The use of alternatives
to detention and, in particular, the probation service have also made some progress. On property
rights, the registration and digitalisation of cadastral data continued, but at a slow pace. The
compensation process for property unjustly expropriated during the communist area has slowed
down during the year, pending amendments to legislation. The sector remains prone to
corruption. Efforts must intensify, including on completing the legislative framework and by
making further progress in first registration and compensation processes. On the protection of
national minorities, one additional piece of implementing legislation was adopted and
preparations for the long awaited population census continued. However, the adoption of the
implementing legislation on the most sensitive issues is still pending and the population and
housing census was postponed to 2023. On the protection of personal data, Albania needs to take
measures to prevent massive breach of personal data from happening again and must accelerate
efforts to align its legislation with the EU General Data Protection Regulation (GDPR). Overall,
the recommendations from last year were partially implemented.
Recommendations for the coming year:
 adopt pending implementing legislation on minority rights, particularly on self-identification
and the use of minority languages, and increase the capacities of the state Committee on
National Minorities;
 allocate sufficient resources and finalise the legal framework, to complete the transitional
processes in the area of property rights, and to improve the transparency and quality of the
property register;
 improve data protection, in particular by adopting the revised law on personal data protection
aligning with the EU General Data Protection regulation, by strengthening the Office of the
Information and Data Protection Commissioner, and by raising awareness, including in
public institutions;
 implement the national strategy for gender equality, the law on gender equality and ensure
gender mainstreaming and gender-responsive budgeting for sectoral strategies.
Overall, Albania continues to comply with international human rights instruments and most
international conventions have been ratified. However, the Optional Protocol to the Convention
27
on the Rights of Persons with Disabilities and the Optional Protocol to the International
Convention on Economic, Social and Cultural Rights have not yet been signed.
In March 2022, the Committee of the Convention on the Elimination of all Forms of
Discrimination against Women adopted a list of areas, where Albania needs to demonstrate
progress, including the legislative framework and definition of discrimination against women,
employment, gender-based violence, and disadvantaged and marginalised groups of women.
Albania submitted its first report on the implementation of the Council of Europe Convention on
preventing and combating violence against women and domestic violence (the Istanbul
Convention). The conclusions of the Committee of the Parties to the Istanbul Convention,
published in December 2021, noted the urgency of increasing resources to put legal provisions
into practice.
As part of Albania’s participation in the European Union Agency for Fundamental Rights
(FRA), assessing the level of implementation of human rights legislation, policies, and strategies
remain a challenge due to the absence of comprehensive monitoring and data.
Albania continues to ensure good cooperation with the European Court of Human Rights
(ECtHR). On 15 June 2022, there were 400 cases against Albania (19 of which were
communicated cases) pending before the court. The court delivered four judgments concerning
Albania during the reporting period, of which three found breaches of the European Convention
on Human Rights (ECHR). Four judgments are under supervision by the Committee of Ministers
on inter alia the prohibition against ill-treatment, the length of judicial proceedings, the non-
enforcement of judicial decisions and the right to property. There were 75 new applications
allocated to a judicial formation of the ECtHR and the court dealt with 224 applications
concerning Albania in 2021, of which 220 were declared inadmissible or struck out.
The Ombudsman (People’s Advocate) continued to promote and enforceme human rights. The
institution’s budget was slightly raised in 2021. Of the 267 recommendations issued in 2021,
almost half were accepted and at least partially implemented, 22% remained unanswered and
several late and/or incomplete answers negatively affected the work of the Ombudsman.
Progress needs to continue on improving the follow-up to these recommendations.
During the state of emergency related to the COVID-19 pandemic in 2021, the Ombudsman
raised concerns about democratic participation, freedom of movement and assembly, restrictions
on the right to family life and privacy, and proactively promoted principles of legality and
proportionality with regards to legislation in light of the pandemic. The significant and stable
number of discrimination cases filed with the Commissioner for Protection from Discrimination
(CPD) shows the public’s increased awareness and trust in this institution. The ECtHR upheld a
claim based on a binding decision of the CDP from 2015, although the case was never tried in
national courts, contrary to Albania’s claim. The ECtHR ruled that it was not necessary to seek
redress in courts if there is an enforceable and binding decision of the Commissioner. In 2021,
324 cases were filed with the CDP, of which 168 were in the field of employment and 143 in the
field of goods and services. The CDP issued four main recommendations. Two related to draft
laws to combat sex crimes. Another was on the implementation of the national gender equality
strategy. Another recommendation was on the 2021-2025 national action plan for equality,
inclusion and participation of Roma and Egyptians.
28
On the right to life, limited progress was made in investigating cases and strenghten the
institutional and legislative framework on missing persons since the communist era. In October
2021, the Fier district prosecutor ordered the exhumation of a secret grave in the former prison
camp in Ballsh, a known grave site. The order has not yet been implemented. Implementing
legislation amending the law on the right to information about the former state security
documents of the Socialist People’s Republic of Albania remain to be adopted. In March 2022,
the new structure of the authority for information on the documents was approved by Parliament
and cooperation agreements on the identification and recovery of missing persons were signed
between the authority and the state police. Additionally, a new directorate was created with a
clear mandate to enhance inter-institutional cooperation on the identification and recovery of the
bodies of missing persons. Continued political will is important to increase the number of cases
solved and to raise public awareness on this matter.
On the prevention of torture and ill-treatment, in November 2021 the European Committee
for the Prevention of Torture and Inhuman or Degrading Treatment or Punishment (CPT) carried
out an ad hoc visit to Albania. The CPT reviewed progress made in transferring forensic
psychiatric patients to proper facilities, and examined the conditions of the prison hospital. The
medical and custodial staff were assessed to be generally satisfactory and no allegations of ill-
treament of patients by staff were reported. However, poor material conditions remain, as well as
structural deficiencies, including the lack of communal spaces for group activities and of outdoor
yards. A memorandum of understanding with a joint action plan was signed by the Minister of
Justice and the Minister of Health and Social Protection to implement recommendations of the
CPT and judgments of the ECtHR concerning forensic psychiatric patients and prisoners with a
mental disorder. Following an additional agreement, the Zaharia prison was closed, and forensic
psychiatric patients were transferred to the Lezha prison. Progress in the renovation of the Lezha
prison continued. However, it remains over-populated and conditions in its forensic psychiatric
facility need to be brought up to a satisfctory standard. Efforts are also needed to increase the
number of staff and their competence.
The National Preventive Mechanism (NPM) carried out 68 periodic inspections which were
followed by 76 recommendation and handled 38 complaints, and nine ex officio cases concerning
conditions in prisons and treatment of prisoners. The NPM also handled four complaints against
the state police for violence and unjustified escorting. According to the Ombudsman’s reports,
most of these cases occurred during arrest and interrogation, especially in the context of public
protests.
The prison system and detention centres remain an issue of concern. Long standing issues
include political influence, corruption, and poor management, as well as shortage of staff, poor
infrastructure, lack of healthcare and security. Lack of inspections, employment and reintegration
programmes for prisoners are other issues of concern.
Across the country, the number of inmates is now below the capacity of the prison system, with
95% of the capacity used.
The General Director of Prisons, appointed in December 2021, has demonstrated a proactive
commitment to improve prison facilities, including review of prison security and the
rehabilitation of prisoners. Special attention should be paid to de-radicalisation in prison and
post-releases.
29
Although the 2019-2022 action plan for the development of the prison system will soon no
longer apply, it remains relevant as the new penitentiary legal package still needs to be
effectively implemented. A sub-legal act on the employment of prisoners was adopted in October
2021 and the Minister of Justice has undertaken efforts to provide employment to 580 prisoners.
In 2021, the use of alternatives to custody continued to grow. The probation service remains
fully operational in the whole country and provides alternatives to imprisonment, including for
juvenile offenders. However, the use of electronic monitoring, has been suspended since 2017
because of an unsettled legal dispute.
Legislation on protection of personal data still needs to be further aligned with the EU General
Data Protection Regulation (GDPR) and the related “law enforcement” directive4
. The process of
modernization has been launched. A draft law aiming to achieve this alignment has been
submitted to public consultations, which lasted from half June to half July 2022. Additional
human and financial resources will need to be allocated to the Office of the Information and Data
Protection Commissioner (IDP) for the effective performance of its tasks and exercise of its
powers, to fulfill its expanded role. On 22 July 2022, Albania ratified the 2018 Protocol
amending the Council of Europe Convention for the Protection of Individuals with regards to
Automatic Processing of Personal Data (CETS 223).
By 19 May 2022, the IDP received 496 complaints and carried out 56 administrative inspections,
which represents a slighlty higher level of activity compared to 2020. The IDP issued 42
recommendations and 34 administrative sanctions. After the personal data leak that emerged
during the 2021 general elections, a new serious and massive breach of personal data occurred in
December 2021, when a database containing personal data of more than 600 000 employees in
the private and public sector was leaked. The Commissioner launched an administrative
investigation of this in the General Directorate for Taxation on the matter. One cross-cutting
finding of the IDP during its administrative inspections has been the lack of awareness in public
institutions of the obligations set out in the law on personal data protection.
Overall, freedom of thought, conscience and religion was generally upheld. The state
continued to provide the same level of financial support to religious communities. In May 2022,
the state allocated EUR 935 000 to the Catholic, Sunni Muslim, Orthodox, and Bektashi
communities for the administrative functioning of the communities and religious education. The
dependence of some religious groups on financial support from third parties creates
vulnerabilities. The restitution of properties belonging to religious groups and taken by the state
during communism remains an unresolved issue.
Freedom of expression
The country has some level of preparation / is moderately prepared in the area of freedom of
expression. No progress was made over the reporting period. The independence of media and
the quality of journalism remain hampered by the intersection of business and political interests.
Disinformation campaigns are recurrent especially in online media. The reporting period saw
cases of threats, intimidation, and online smear campaigns against journalists reporting on rule of
law, corruption and justice issues.
4
Law Enforcement Directive 2016/680.
30
Last year’s recommendations still need to be implemented and therefore, remain valid. In
addressing the persisting shortcomings, Albania should:
 adopt a policy of zero tolerance for intimidation and attacks against journalists, as well as for
threats against the media, including in political discourse and in the margins of
demonstrations;
 ensure that the legal requirements for transparency of media ownership and financing, and its
limitations thereto, as well as requirements on public advertising, are aligned to international
standards;
 implement the Labour Code and strengthen the protection of Albanian journalists’
employment and social rights.
Intimidation of journalists
Political actors continued to voice anti-media sentiments and use denigrating language against
journalists, on a number of occasions. During the reporting period, four new cases of alleged
physical violence against journalists in the exercise of duty were formally registered with the
prosecutor's offices of general jurisdiction. Two of the cases were closed and two are still subject
of preliminary proceedings. In July 2021, police detained two journalists who were filming an
ongoing operation against narcotics. In November 2021, an investigative journalist and a
cameraman were almost pushed into a ravine by a police officer as they approached the murder
site of a case they were reporting on. In January 2022, nine journalists and media crews were
impacted by the police response to a protest in Tirana, but authorities argued that the police
actions did not target the media. In the same month, a cameraman was arbitrarily forced by a
municipal police to leave a local protest he was covering. In March 2022, the Audio-visual
Media Authority (AMA) issued a statement condemning threats by business actors against two
journalists. In February 2022, online media claimed that cyber-attacks targeted them following
the publication of a taped conversation between a mayor and local football authorities. In April
2022, two journalists reporting on the vetting process received threats and were intimidated,
allegedly on behalf of an official with vested interests. Overall, the atmosphere of verbal attacks,
smear campaigns and acts of intimidations against journalists has not improved.
Legislative environment
It is essential that any possible change to the media law should be in line with the Venice
Commission Opinion and submitted to proper consultation with media organisations. Albania
still needs to introduce legislation to strengthen transparency in public advertising.
Implementation of legislation/institutions
In February 2022, Parliament filled six vacancies out of the seven members of the audio-visual
regulatory authority, thus making the authority fully operational. The independence of some
AMA members has been questioned due to their political links.
It remains important to ensure direct and transparent media access to governmental institutions
and their activities and to factual non-partisan public information. Some media organisations
have encountered difficulties in accessing factual government information and have expressed
concerns about the common practice of the authorities and political parties of providing pre-
prepared written or audio-visual content. This notably stems from the need for all government
public relations to be handled by the newly created Media and Information Agency. (MIA).
31
Public service broadcaster
In March 2022, Parliament formally launched the process to fill two vacancies on the steering
board of the public broadcaster, which is composed of 11 members. The vacancies have yet to be
filled.
In October 2021, the anti-corruption special prosecution body, SPAK, issued arrest orders for the
former Director General of the Public Broadcaster and three members of the Commission for
Offer Evaluation, who are charged with breaching public procurement rules. In June 2022, the
Special Appeal Court against Organised Crime and Corruption, sentenced the former Director
General to two years in prison. He was also stripped of the right to exercise public functions for
5 years. In November 2021, the public broadcaster’s steering board elected a new Director
General of Albanian Radio and Television.
Economic factors
High-profile business group have increased their economic penetration in the media market
during the reporting period. Media organisations and activists have continued to raise concerns
about the use of media channels to promote owners’ economic interests and political agendas.
Market and audience concentration and lack of transparency of media funding continue to
remain issues of concern as regards media freedom in the country. Tax evading practices by
media owners have been denounced by media freedom organisations.
Internet
Indicatively, there are around 800 online media outlets operating cross Albania, with most of
them registered outside the country and a more limited number registered with the Electronic and
Postal Communications Authority under the domain .al.
The state generally refrains from filtering and blocking online content. However, media freedom
organisations claim that there are no specific legal provisions to enforce and protect the net
neutrality. Albania has signed up to the Declaration for the Future of Internet of 28 April 20225
.
Signed by more than 60 international partners to date, the Declaration sets out the vision and
principles of a trusted Internet.
Digital media are still under strong influence by political actors, businesses and by third parties
in terms of funding and content. Media freedom organisations have highlighted the lack of
regulation to ensure transparency in online advertising by political parties and candidates during
electoral campaigns.
The development of a Strategy on better internet for kids aimed, among others, at facilitating a
child-led process, as well as detecting and retorting child sexual abuse material online should be
considered.
Freedom of artistic expression
Freedom of artistic expression is broadly guaranteed. In the first quarter of 2022, the government
removed the ban imposed on artistic and cultural activities due to COVID-19 restrictions.
Professional organisations and working conditions
5
Declaration for the Future of Internet | Shaping Europe’s digital future (europa.eu)
32
Professional associations of journalists face many hardships in terms of limited financial
resources, personal skills, and the overall ability to set up a structured dialogue with the
government to advocate in support of the media community.
Lack of job security and poor working conditions have made journalists and media workers
vulnerable to self-censorship and less resilient against disinformation.
The lack of enforceable employment contracts continues to remain an issue of concern,
especially in local and online media. Many media employees do not have employment contracts,
while many journalists do not receive their salaries on time or are dismissed without respecting
the procedures of the Labour Code. According to data provided by the Union of Journalists, one
quarter of media workers are working without a contract. Reportedly, about 80% of reporters are
paid minimum wages and almost 48 % of wages were delayed by 2 to 6 months.
Self-regulating activities need to be stepped up, in particular by the Alliance for the Ethical
Journalism, a group that brings together stakeholders, including online ones, who pledge to
comply with the Code of Ethics.
Freedom of assembly and association is guaranteed by the Constitution. Civil society
organisations and the Ombudsperson expressed their concerns about disproportionate
interventions by police forces in March 2022 during civil protests against the increase in fuel and
food prices. Detention and arrests of protesters were criticised by human rights organisations,
who argued that they were not carried out in line with Albanian law and international practices.
Issues of labour and trade union rights are covered in Chapter 19 - Social policy and
employment.
Challenges remain in the area of property rights. Further efforts are needed to finalise the
transitional ownership processes and registration of property deeds, and the restitution of and
compensation for property unjustly expropriated during the communist era. It is estimated that
approximately 80% of the data on registered properties is incorrect and almost 10% of the
country’s territory remains unregistered. An efficient and transparent property registration and
integrated land management system, which offers clear and secure property titles, needs to be in
place to ensure the right to property in practice.
Several acts of implementing legislation provided by the law on cadastre and by the law on
transitional ownership processes are still absent. These should be finalised and adopted as a
matter of priority.
There was some progress as regards the process of registration and digitisation in the cadastre.
By 10 June 2022, first registration had been completed in 2 758 cadastral zones, compared with 2
717 reported last year and there are currently 12 zones where the process is ongoing. There was
progress in digitizing property files through the scanning and uploading of kartelas. Over 1.9
million files are now digitised, although 2.3 million files awaits digitlisation. Around 300
cadastral zones still lack first registration, comprising around 300 000 properties. Furher efforts,
including allocating the necessary resources, are needed to complete the first registration.
There is a high turnover of employees in the state Cadastre Agency (SCA), including in
managerial posts, and serious allegations of corruption seem to be supported by arrests made by
the SPAK. The property sector has been identified by the General Directorate of Anti-Corruption
as one of the most exposed to corruption. The SCA needs to urgently conduct a risk assessment
and adopt a subsequent action plan to adress corruption and other irregularities related to
33
property registration. The transparency of the SCA should be further improved, including by
publishing annual reports on its activites.
In 2021, the Agency for the Treatment of Property (ATP) executed 6 decisions corresponding to
a value of almost EUR 2.4 million. Since February 2021 no decisions on the right to
compensation have been issued and the execution of final decisions has been suspended, due to
a review of the law on the compensation process by the Constitutional Court. The expired
mandate of the ATP left just under 7 000 requests of ownership recognition to be dealt with by
the courts. As of today, just under 800 decisions with a financial evaluation have been executed,
with total compensation awarded corresponding to EUR 65 million. Even with the compensation
scheme adapted to standards set by the ECtHR and the Constitutional Court, additional measures
should be taken to ensure the effective application of the current law, including a review of the
compensation funds and a clear regulation of the use of alternative forms of compensation.
Legislative amendments in 2018 ensure joint registration of marital property. However, data
shows that men possess and administer property to a much greater extent than women, and
women still lack basic information on their property rights. Data reported by the Ombudsperson
shows a high numbers of complaints from members of the Roma and Egyptian communities
about violations of property rights.
On non-discrimination, the legal and policy framework is generally aligned with EU standards.
Its implementation needs to be further strenghtened including by providing specialised training
to judges and prosecutors. In 2021, the Commissioner for Protection from Discrimination (CPD)
continued to handle a stable number of cases of alleged discrimination, mostly in the areas of
employment and services. Laws on hate speech are in line with international standards. Better
enforcement and greater awareness raising are needed to eliminate hate speech, particularly in
rural and remote areas. In 2021, the CPD handled seven cases regarding the use of hate speech,
including on the grounds of race, gender or sexual orientation. On hate crime, some progress was
made in building the capacities of law enforcement agencies to responde to this phenomenon.
However, further awareness-raising and capacity-building among criminal justice officials about
hate crimes is still needed. Moreover, the ODIHR recommendations on the collection of data and
statistics on hate crimes have yet to be fully implemented. Eight cases of hate crimes were
reported to the police.
The 2021-2030 national strategy on Gender Equality and its action plan are well aligned with
the EU Gender Action Plan III6
. The strategy has become more affirmative in addressing the
rights of all women and men, focusing on people who face intersecting forms of discrimination
and vulnerability, young people and social reforms and has introduced a dedicated section on
humanitarian emergencies.
Albania pursues its efforts to ensure adequate state funding to effectively implement the new
strategy at central and local level. All activities have been costed and the overall funding gap has
been significantly reduced. Efforts are needed to ensure that all national strategies implemented
at central and local level are gender mainstreamed and apply gender-responsive budgeting.
Provisions on referral mechanisms between different levels of care, training for healthcare
providers, youth friendly services, and outreach to vulnerable groups remain unaddressed in the
law on reproductive health. The Ministry of Health and Social Protection has made efforts to
6
Gender Action Plan III – a priority of EU external action (europa.eu).
34
monitor and provide training to health personel on identifying and addressing the issue of
gender-biased sex selective abortion. However, efforts should continue to ensure monitoring of
the practice. Women living in rural and remote areas, Roma, and Egyptian women, but also
LGBTIQ individuals, face limited access to primary health care, and to sexual and reproductive
healthcare services.
On gender-based violence, in February 2022, Albania ratified the International Labour
Organisation Convention on Violence and Harassment in the World of Work (Convention No.
190). However, the national legal framework needs to be further harmonised with its provisions
to ensure full implementation. The current legal framework is not fully aligned with key
international standards, including the Istanbul Convention, and lacks a focus on the reintegration
of, and access to services for, victims and survivors of violence.
In 2021, the police identified and treated 5 312 cases of violence and other crimes committed in
domestic relations, a 13% increase against 2020. Among them, 3 266 cases of domestic violence
were handled with a request for a protection order and 1 630 cases were referred to prosecution
offices. In both instances, a slight increase on the 2020 figures was recorded. 638 perpetrators of
domestic violence were arrested and 123 detained. Domestic violence increased during the
lockdown period. Eighteen women and girls were murdered within family relationships in 2021,
compared with six in the previous year. More efforts are needed to reverse this trend, including
through better law enforcement, institutional messages on ending violence against women and by
increasing women’s awareness of their rights and available services. Currently, there are local
referral mechanisms for reporting gender-based violence in all 61 municipalities. However, these
mechanisms, andrehabilitation and integration programmes for vulnerable women, need to be
reinforced.
The legal framework governing the rights of the child is in place and some progress was made
in institutional capacity-building for its effective implementation. The practice of child marriage
still exists, and is primarly driven by gender inequality, poverty and social exclusion. The lack of
official data does not make it possible to provide an accurate picture of the prevalence of child
marriage. Laws to protect adolescents from child marriage are ineffective or applied
inconsistently. However, throughout 2021 the government prioritised addressing child marriage
in its budgeted national policy framework for the first time, and the 2021-2026 national agenda
for the rights of the child, approved in 2021, contains objectives and measures to combat this
harmful practice. The national deinstitutionalisation plan was included in Albania's 2021-2023
economic reform program with a financial package to develop alternative childcare services and
to close social care institutions. Additional efforts are needed to further implement and tackle all
violations of children’s rights.
Violence and sexual violence, including online, remains a concern. In 2021, Child Protection
Units managed 2 389 cases of children in need of protection. There was a slight increase in the
number of child protection workers (up from 223 to 241), but this remains vastly below the total
number needed. A comprehensive legal framework on the status and responsabilities of social
workers needs to be adopted. Further efforts are needed to ensure an adequate and systematic
response to all types of violence against children.
For children in conflict with the law, pre-trial detention continues to be the main reason for
depriving them of their liberty. However, progress was made with an increased use of diversion.
The Albanian state police has created child-friendly interview units in 12 police
35
departments/stations. Efforts are ongoing to train police personnel in using the child-friendly
interview units in these twelve police departments/stations and in conducting professional
forensic child-friendly interviews. In February 2022, the Director of the Juvenile Criminality
Prevention Centre was recruited. With the staff now fully in place, the centre needs to advance in
carrying out its mandate and demonstrate its effect on the situation of children in conflict or
contact with the law.
No progress was made on the rights of persons with disabilities. Albania’s framework
legislation on the rights of persons with disabilities remains only partially in compliance with the
UN Convention on the Rights of Persons with Disabilities (UNCRPD) and gaps must to be
addressed. Albania still needs to ratify the Optional Protocol to the Convention on the Rights of
Persons with Disabilities. The 40% gap in funding for the 2021-2025 national action plan for
people with disabilities remains to be addressed – without which it cannot be comprehensively
implemented. More robust efforts are needed to address discrimination and violence against
persons with disabilities, to improve overall accessibility, promote employment, and to collect
statistical data on their situation. Adults and children with disabilities continue to be placed in
residential care centres, in violation of their rights under the UNCRPD. The quality of education
for children with disabilities, especially children with a hearing impairment, continued to raise
concern. Although numbers increased in 2021, there remain an insufficient number of teaching
assistants for children with disabilities in the pre-university education system. Additional efforts
are needed to provide training on inclusive education approaches for all teachers and on early
detection of disabilty.
In Albanian society, discrimination against lesbian, gay, bisexual, transgender, intersex and
queer (LGBTIQ) persons is still very prevalent, especially as regatds access to healthcare,
education, justice, employment and housing. Members of the LGBTIQ community continue to
experience physical aggression and hate speech, particularly in social media. Albania does not
have legislation recognising civil cohabitation or same-sex marriage, which would require
amendments to the family code.
In November 2021, the new national action plan for LGBTIQ persons (2021-2027) was
approved, based on an inclusive and participatory consultation process. It is essential that the
plan is adequately financed and that political will for its enforcement is demonstrated to make up
for the deficiencies in implementing the previous plan. The new action plan includes various
measures to fight discrimination, improve access to services and to approve the legal gender
recognition law. In 2021, police officers, prosecutors and gender focal points in line ministries
continued to receive training on preventing discrimination on the basis of sexual orientation and
gender identity. The shelter for LGBTIQ persons continued to provide care, support and
advocacy to homeless LGBTIQ individuals. State funding continues to cover only 40% of the
shelter’s budget and the fact that it remains very dependent on donors creates uncertainty for
the continuation of services.
Among other initiatives, the tenth Tirana Pride was organised on 21 May but public awareness
and acceptance of LGBTIQ persons remain low, particularly in rural areas. Hate speech and
discriminatory language in the media, especially online, and from politicians and criminal
offences and discrimination against members of the trans-community remain a problem. In 2021,
the CPD handled four cases of hate speech against the LGBTIQ community. According to
CSOs’ data, only 7.1% of people in the LBGTIQ community reported incidents of
36
discrimination, of which 5.8% were reported to the police. Of the total number referred cases,
only 20.3% were resolved.
On procedural rights, the legal basis for free legal aid is complete and is being applied. Primary
and secondary legal aid are delivered at central and local level. The number of people that have
benefited from free legal aid has increased considerably since the approval of the law in 2017.
Despite the legal framework on free legal aid and institutional set up to guarantee it, only few
children benefit from legal aid compared with the number of children involved in criminal law,
family and civil law and administrative law processes. The budget allocated for legal aid in 2021
amounted to EUR 547 696, an increase of 31% against the previous year. The budget
implemented in 2021 amounted to EUR 245 739 (up from EUR 140 488 in 2020). However, the
dedicated state budget should be further increased to make the legal clinics fully functional. The
staffing of the free legal aid directorate is now complete, and 10 centres are in operation across
the country. It remains important to improve the collection and reporting of statistical data on
free legal aid. Awareness raising efforts should continue at all levels. Some progress was made
on standards for interviewing children in conflict with the law. Limited progress was made on
other procedural rights. There was no progress on addressing remaining issues with regard to
other procedural rights of suspects and accused persons. Concerning the right to information in
criminal proceedings, the refusal or failure to grant access to a case file should be subject to
judicial review, with effective remedies. On access to a lawyer, adequate facilities for
confidential client-lawyer consultations need to be ensured by courts, prosecutors’ offices, and
the police. On the presumption of innocence, there should be a clear legal prohibition on public
references to guilt made by public authorities.
On the adoption of the remaining implementing legislation related to the 2017 framework law on
the protection of national minorities, in December 2021 the Government adopted additional
legislation to create a fund for civil society projects in support to minority rights, bringing the
number of pieced of implementing legislation adopted to nine. However, to date, the
implementing legislation on the crucial issues of free self-identification of national minorities
and the use of languages remains to be adopted. The state Committee on National Minorities was
created. A series of pilot censuses were conducted during the reporting period, including in areas
populated by minorities, ahead of the full-scale population and housing census expected to take
place in 2023. It is important for Albania to conduct the national census in a smooth and
transparent manner and in line with international standards.
Overall limited progress was achieved in the social inclusion of the Roma and Egyptian7
minorities. In november 2021, the new national action plan for equality, inclusion and
participation of Roma and Egyptians in Albania (2021-2025) was adopted, following an
inclusive and participatory consultation process. The action plan is funded by the state budget
(78.8%), municipalities (13.7%) and donors (0.7%). The gap in financing of 6.8%, needs to be
addressed. The institutional capacity of the Ministry of Health and Social Protection, in charge of
the coordination of Roma-related policies, remains weak. The human resources capacity of the
social inclusion department needs to be strengthened. Participation of Roma in the local
administration needs to be improved, and inter-ministerial, national and local coordination on
Roma inclusion should be further strenghtened.
7
In line with the use in the EU Roma Strategic Framework, ‘Roma’ is used as an umbrella term, without denying
the specificities of different groups.
37
Following the removal of distant learning and quarantine measures related to the COVID-19
pandemic, the participation of Roma and Egyptian children in the education system slightly
improved. Roma and Egyptian children have also continued to benefit from scholarships and
part-time education programmes, as well as free textbooks and transportation to remote schools.
However, segregation in schools remains an issue that should be systematically addressed. In
May 2022, the ECtHR noted that Albanian authorities had failed to take steps to desegregate
Roma and Egyptian children in a primary school in Korça and to implement the decision of the
CPD ordering the Ministry of Education and Sports to improve the situation. The overall
employment rate of Roma and Egyptians, already very low, continued to worsen due to the
COVID-19 pandemic. Efforts to safeguard and improve the socio-economic standards of Roma
and Egyptian minorities, in line with the Poznan Declaration and the Western Balkan Investment
framework should be put to the forefront. After two years of delay due to COVID-19 restrictions,
the Fifth EU-Albania Policy Dialogue on Inclusion of Roma and Egyptian Communities (aka
Roma Seminar) took place in April. Health insurance coverage for Roma and Egyptians remains
low. Roma and Egyptians continue to benefit from a 5% quota through implementation of the
law on social housing. Access to personal documents has improved for both communities.
However, other barriers such as the lack of digital skills and access to technology continue to
prevent Roma and Egyptian people from fully enjoying their rights and accessing most public
services, which are now digital (healthcare, education, employment, social protection etc.).
Additional efforts and resources are required to accelerate the inclusion of Roma and Egyptians,
tackle antigypsyism and discrimination as well as educational and spatial segregation, and reduce
the gap with the rest of the population.
On citizenship rights, the agency in charge of special citizenship programmes, set up under the
authority of the Minister of the Interior, has been staffed during the reporting period with four
employees. In March and April 2022, the Council of Ministers decided to create two
programmes for acquiring Albanian citizenship on the basis of special merit in the fields of arts,
culture, education, science and sports, without requiring applicants to have a prior residency in
Albania to be eligible. In late July 2022 the Council of Ministers adopted a decision allowing the
Ministry of the Interior to launch a tender for a public-private partnership that would serve to
rollout an investors’ citizenship scheme (golden passports). Such a scheme would pose risks as
regards security, money laundering, tax evasion, terrorist financing, corruption and infiltration by
organised crime, and would be incompatible with the EU acquis. As a candidate country,
Albania should refrain from developing such a scheme.
2.2.2. Chapter 24: Justice, freedom and security
The EU has common rules for border control, visas, residence and work permits, external
migration and asylum. Schengen cooperation entails lifting border controls inside the EU.
Member States also cooperate with Albania in the fight against organised crime, corruption and
terrorism, and on judicial, police and custom matters all with the support of the EU Justice and
Home Affairs Agencies, which have the most advanced level of engagement with Albania.
Albania has some level of preparation/is moderately prepared to implement the EU acquis in
the area of Justice, freedom and security. Some progress was made overall. The Specialised
Structures against Organised Crime and Corruption (SPAK) are building an initial track-record
of law enforcement cases and implementation of the Financial Action Task Force (FATF)
Action Plan has progressed significantly. The track-record on money-laundering and high-level
corruption cases remains insufficient, financial investigations need to be further developed, and
38
the FATF Action Plan must be completed. Albania has continued its positive engagement with
all the EU Justice and Home Affairs agencies. No progress was made in referrals to asylum
procedure and the implementation of return procedures in line with the legal framework. The
number of asylum applications lodged by Albanian nationals in EU Member States and
Schengen-associated countries remains lower than the pre-pandemic level, but increased since
the summer of 2021, and thus still requires continuous and sustained efforts. Albania should
keep addressing the phenomenon of unaccompanied minors. Albania’s visa policy should be
aligned with the EU’s. Since only partial progress was made with the Commission’s 2021
recommendations, these remain valid.
In the coming year, Albania should in particular:
 continue developing the systematic use of parallel financial investigations when dealing with
organised crime, illicit trafficking, terrorism, and money laundering;
 swiftly achieve the overdue completion of the action plan agreed with the Financial Action
Task Force (FATF) on preventing money laundering and countering terrorism financing
with a view to delist Albania from the FATF list of jurisdictions under increased monitoring
for strategic deficiencies;
 implement the asylum law and resume referrals to the asylum procedure; align return
procedures with the existing legal framework; continue to address the issue of unfounded
asylum applications and fully align national legislation with the EU list of visa-required
third countries.
Fight against organised crime
The country has some level of preparation in implementing the EU acquis in this area. Some
progress was made in meeting last year’s recommendations. The cooperation with EU Members
States, Europol and Eurojust has remained strong and fruitful. Albania continued to show
commitment to counter the production and trafficking of cannabis. Good progress was made with
regards to the seizure and confiscation of assets linked to organised crime, and must continue in
the future. Efforts also need to continue to ensure increased prosecutions and final convictions,
especially at high-level. Countering cybercrime, trafficking in human beings and money
laundering remain areas in which additional results are needed. All forms of child sexual abuse
online should be criminalised and persecuted.
In the coming year, Albania should in particular:
 keep strengthening the fight against organised crime, including through cooperation with EU
Member States, as well as EU agencies, including Europol and Eurojust and increase the
proactive use of Europol’s Secure Information Exchange Network Application (SIENA) for
the exchange of information and its practical extension to additional law enforcement
agencies;
 establish without delay an asset recovery office in line with the EU acquis that is in charge of
the identification and tracing of criminal assets, as foreseen by national legislation;
 ensure that the Special Procecution Office and National Bureau of Investigation continue to
increasde operational access to all relevant databases.
Institutional set-up and legal alignment
39
The Albanian State Police (ASP) has a total of 11 804 officers, equivalent to 260 officers per
100 000 inhabitants, compared with an EU average of 333 per 100 000 inhabitants (Eurostat,
2018-2020). Staff rotations are frequent, affecting the ASP operational capacity. After the
transfer of some of the former Serious Crime Prosecution Office’s competences to local
prosecution offices, judicial police officers need further training to investigate, in particular on
financial crime, money laundering and illicit trafficking offences. Albania should provide the
relevant institutions with adequate resources in order to ensure continuity in the fight against
organised crime.
The Specialised Anti-corruption and Organised Crime Structures (SPAK) have started to build
track record of investigations and convictions on organised crime with 48 new investigations and
128 convictions (for 418 persons) at first instance and 41 final convictions (116 persons) at
appeal level in 2021. The Special Prosecution Office now has 17 prosecutors in place. NBI
currently has access to five databases and has engaged in bilateral agreements to access nine
additional ones by the end of 2022. This trend should continue and NBI should be given access
to all databases bringing value to their investigations.
The second batch of investigators for the National Bureau of Investigation (NBI) – 32
individuals - have been selected and vetted. They completed their four months of initial training
and took up duty in June 2022, thus filling the 60 positions of NBI investigators. NBI has signed
a number of agreements with other law enforcement agencies allowing in particular access of
NBI investigators to databases of the Albanian State Police and of the General Directorate for
Taxation.
The legal framework was further aligned with the EU acquis, especially in the field of anti-
money laundering. The beneficial ownership (BO) register was further populated with data and
comprised 96% of businesses and 86% of NGOs as of March 2022. However, no sanctions were
applied for those who have not complied with this reporting obligation as the initial deadline for
registration has been extended to end of June 2022 and the sanctions regime has been updated in
the context of amendments made to the Law on the establishment of the BO register in March
2022. The further application of administrative sanctions in case of violations against the
transparency obligations by obliged entities needs to be monitored. The central register of bank
accounts which became operational at the end of July 2021 has allowed for faster investigations.
Albania progressed in the harmonization of legislation of firearms and explosives with the EU
acquis, howeover it should make progress in the establishment of necessary infrastructure and
legal basis for the deactivation of firearms and allowing the voluntary surrender and/or
legalization of firearms as an important means for reducing illegal possession of firearms.
Albania has a robust legal framework for confiscating criminal proceeds. However, the
establishment of an asset recovery office, as required by the Law on the administration of seized
and confiscated assets from 2019, is overdue.
Albania still needs to adopt legislation targeting unjustified wealth, for example by introducing
the measure of extended confiscation and by introducing financial ceilings for cash transactions.
Albania should further allow ‘suspicious transactions reports’ as evidence in court.
The use of surveillance videos by police forces in several cases has demonstrated the need to
strengthen legal safeguards and ensure legal consistency. Surveillance data have been used
outside control from the judiciary. The right to privacy should be enforced.
40
While Albania is party to the Budapest Convention on cybercrime, it has yet to sign the Second
Additional Protocol to the Convention on enhanced co-operation and disclosure of electronic
evidence, which has been opened for signature on 12 May 2022. In relation to negotiations for a
United Nations convention on cybercrime based on resolution 74/247 of the United Nations
General Assembly, Albania demonstrated voting patterns that are fully convergent with the
position taken by the EU and its Member States. On the basis of the National Cyber Security
Strategy 2020-2025, new legal and sub-legal acts on cybercrime remain to be adopted. In July
2022, Albania was a victim of a large-scale cyberattack, which led to the temporary disruption of
most public online services. (See also chapter 31 Foreign Security and Defense Policy)
The strategic framework consists of the Strategy against organised and serious crimes for 2021-
2025 and its Action Plan for 2021-2022 as well as a new cross-cutting anti-corruption Strategy
for 2015-2023 and its Action Plan for 2020-2023. A new Action Plan 2021-2023 for the fight
against trafficking in human beings was adopted in November 2021.
Implementation and enforcement capacity
Albania pursued its efforts towards building a track record on fighting organised crime. In
2021, there were 41 new cases referred to prosecution (up from 22 in 2020); 14 indictments for a
structured criminal group in 2021 (against 15 in 2020) and 19 cases were closed with 75 persons
with final convictions at appeal level (compared with 13 persons in 2020).
In 2021 the Special Prosecution Office (SPO) initiated 304 criminal proceedings – 92 for
organised crime and 212 for corruption, which represents an increase of 50% compared with the
year before. During the same period, 31 criminal procedures for corruption and 15 procedures for
organised crime were sent to trial. 23(against 94 defendants) convictions at first instance were
reached by the special court and 52 (against 136 defendants) at appeal level in 2021.
As regards the track record for serious crimes, there was a further increase in 2021 with 3 913
new cases referred to prosecution, up from 2 838 in 2020; this increase is mostly due to an
increase of referrals of drug trafficking cases (3 078 referrals in 2021 compared with 2 086 in
2020). New referrals for trafficking in human beings and money laundering remained at similar
levels in 2021, compared with 2020. For serious crimes, 791 cases resulted in indictments in
2021, compared with 581 in 2020. In 2021, there were 375 people with final convictions for
serious crimes compared with 261 in 2020. The use of special investigation techniques and
proactive investigations should be stepped up.
On international police cooperation, a Europol Liaison Officer was deployed in Tirana until
the end of 2021 and allowed to further develop cooperation between Albania and EU Member
States’ police forces. In 2021, 95 police operations were carried out in cooperation with
international partners: 78 of them were in the field of narcotics, 14 in the field of illicit
trafficking, and 3 in the field of cybercrime.
In 2021, there were eight joint investigation teams (JITs) with the involvement of Albanian
partners (4 in 2020), resulting in 30 joint operational meetings. Albania has a police liaison
officer in Europol and is planning to deploy a second one.
Compared with 2020, in 2021 there were 3 143 fewer Secure Information Exchange Network
Application (SIENA) messages shared by the Albania State Police with international partners,
representing a 35% decrease. This drop can be explained by the re-centralisation of access to
SIENA channel within one Directorate of the Albanian State Police. An agreement was signed in
41
November 2021 between the Albanian State Police and the Special Prosecution Office and the
National Bureau of Investigation respectively to allow them to access SIENA. A similar
agreement had been made in January 2021 between the Albanian State Police and the Customs.
However, these connections have still not been made operational. This should be tackled as
matter of priority by relevant actors involved. The General Directorate for Taxation and the
Financial Intelligence Unit have not made the necessary steps to obtain access to SIENA.
Albania continued to cooperate with EU police services through the European Network of
Fugitive Active Search Teams (ENFAST), in which it has an observer’s status. The country
stepped up its participation in the European Multidisciplinary Platform against Criminal Threats
(EMPACT). In 2022, Albania committed to participate in 120 operational actions in 10 of the 15
EMPACT operational action plans (OAPs), including as action-leader for one and co-action-
leader for two operational actions. In 2021, Albania participated in 61 EMPACT operational
actions, including as action leader in one. Albania appointed a National EMPACT Coordinator.
Albania continued to participate actively in EMPACT Joint Action Days promoting cooperation
in against firearms trafficking, the smuggling of migrants and drugs trafficking, motor vehicle
crime, and trafficking in human beings and document fraud.
The cooperation with Interpol has continued to yield positive results. The flow of information
sent via the Interpol global police communication channel 24/7 system to the National Contact
Bureau Interpol Tirana has grown by 14 % in 2021. The cooperation between the Albanian
Security Academy and the EU Agency for Law Enforcement Training (CEPOL) is well
established and based on a working arrangement. A dedicated contact point is in place. Albania
continues to benefit full access to the CEPOL Exchange Programme and to participate in the
CEPOL-led Partnership against Crime and Terrorism project in the Western Balkans, which runs
until October 2023.
On domestic operational capacity, legal and institutional reforms have strengthened the
capacities of the ASP’s Operational Directorate. During 2021, special investigative measures
were used in 301 cases as regards money laundering investigations. Albania should continue to
use and develop the use of special investigation techniques and proactive investigations.
Law enforcement authorities’ response to organised crime, notably the investigation of large
criminal networks, needs to be more proactive and systematic. Special units within the police and
prosecution have access to 40 national registers, but they still lack direct access to the electronic
register of mobile phone subscribers and IP addresses from internet service providers.
The planned reform of the Security Academy for police training has not progressed. The frequent
alterations of the legal framework in a very short period of time in 2021 suggest that the
direction of such reform is still not clear.
Financial investigations are not systematically accompanying criminal proceedings from the
start, and their effectiveness remains limited. Financial investigation techniques of police and
prosecutors still needs improvement. However, progress in asset seizures was notable in 2021.
For 2021, Albania reported that close to EUR 50 million worth of assets were seized based on
Article 287 of the Criminal Code “laundering the proceeds of crime of criminal activity”
(compared with EUR 15 million in 2020), and EUR 21.5 million worth of assets were seized
based on the “anti-mafia law” (but none confiscated), compared with EUR 4.8 million in 2020 of
which 150 000 had been confiscated. For the first 6 months of 2022, assets of value of about
42
EUR 178 000 were confiscated in money laundering cases. For organised crime in 2021, the
value of the asset seizures was high at EUR 28 million (only EUR 12 000 worth of assets
confiscated), but confiscations picked up in the first half of 2022 with more than EUR 1.7
million worth of confiscated assets.
There is no strategic or systematic approach to identifying and confiscating criminal assets
located abroad or not reachable. In addition to the tools for freezing, managing and confiscating
criminal assets under the anti-mafia law, Albania should adopt and implement rules on the
extended confiscation and precautionary freezing of assets. It should also urgently improve its
capacity to manage frozen or confiscated assets so that they do not lose economic value.
Albania continues to be a coutry of origin, transit and destination of trafficking in human
beings, but the numbers of victims of trafficing of Albanian origin has significantly decreased in
2020-2021 period. Albanian women and children are subject to trafficking for sexual
exploitation, forced labour and criminal exploitation to neighbouring countries and EU Member
States. There are indications of increased trafficking of women and children for sexual
exploitation and begging in Albania. Children placed in institutions and children from the Roma
and Egyptian communities are particularly vulnerable to trafficking. The Prosecution’s Office
registered 10 new criminal proceedings for trafficking in human beings in 2021, compared to 28
in 2020. The number of final convictions remained very low with two cases with three final
convictions, same as in 2020. The national referral mechanism for (potential) victims of
trafficking remained functional. Assistance was provided in all cases. In 2021, 159 victims or
potential victims were identified and assisted, compared with 86 in 2020. Identification of
potential victims remains insufficient within the Albanian territory, also among vulnerable
migrants entering Albania. The national Action Plan against trafficking in persons 2021–2023
was adopted in November 2021 as a part of the National Strategy against Organised Crime 2021-
2025. Its implementation should be supported by adequate funding. NGO-run shelters remain
underfunded. Victim-centred investigations and prosecutions are not conducted consistently.
Anti-trafficking efforts should increase, in particular by strengthening the child protection
system. Successful reintegration remains difficult because core protection, care and social
services from the state are insufficient. Prevention efforts, especially on strategic
communication, should be steppedup.
Dedicated awareness raising campaigns should be developed to target communities at risk of
trafficking in human beings. The hotline 116 006 for victims of trafficking should be made
functional. The improved legislative framework for victims, including amendments to the
Criminal Procedural Code, is yet to be implemented. Police, prosecutors and judges should
receive dedicated training on these changes and the rights of victims.
On trafficking in firearms, large numbers of firearms are available in Albania. These are used
by Albanian criminal groups and trafficked, primarily to neighbouring countries. Albania is both
a destination and a transit country for light firearms. There were 39 new criminal cases registered
at the Prosecutor’s Office in 2021, compared to 7 in 2020 and 17 persons final convictions in
2021, a similar level to 2020. There was a significantly higher number of seizures inland
compared to those at the border. The exchange of information among different national
stakeholders (law enforcement agencies, prosecution and judiciary system) is still low, which
clearly jeopardizes the receipt of unified data from the police and prosecution office.
43
The track record on fighting cybercrime and internet fraud in 2021 remains limited with 79
cases referred to the Prosecutor’s Office compared to 56 in 2020 with one final conviction, same
as in 2020. Albania should establish a more effective law enforcement response focusing on the
detection, traceability and prosecution of cyber criminals. Albania should raise awareness among
the prosecutors to enhance the use of the 24/7 points of contact network established by the
Council of Europe Convention on Cybercrime. The ASP Cybercrime unit has a central forensic
laboratory but should increase its capacity to deal with such cases. Capacities for investigating
and prosecuting crimes against children committed through the internet need to be strengthened.
Legislative amendments to criminalise all forms of online child sexual abuse remain to be
adopted.
Albania has a large informal sector and its economy is primarily cash-based. Crimes that
generate large amounts of money include drug trafficking, tax evasion, smuggling and trafficking
in human beings. As regards money laundering, Albania is on the Financial Action Task Force
(FATF) list of jurisdictions under increased monitoring since February 2020 and in spite of
significant progress, did not complete the implementation of the FATF Action Plan by the
February 2022 deadline. Amendments to the law on anti-money laundering aimed at aligning
with the EU’s fourth and fifth anti-money laundering directives were adopted in Parliament in
December 2021. Both the centralised bank account register and the beneficial ownership register
are now in place. The beneficial ownership registry has now been largely populated but sanctions
have not yet been imposed on non-registered legal entities. Amendments to the law on notaries
and a new law for the supervision of real estate agents were adopted in January 2022, as well as
the necessary by-laws.. In July 2021, the General Prosecution introduced a dedicated electronic
register “PRESTO” to ensure all money laundering cases are tracked with a view to increase
effectiveness in the seizure and confiscation of criminal proceeds.
The adoption of a tax and criminal amnesty against the advice of the EU and Moneyval could
jeopardise progress in this area – see also chapter 4 – Free Movement of Capital and 16 –
Taxation.
In 2021, 317 cases of money laundering were referred to prosecutors, against 280 in 2020.
Despite this increase, the track record of persons with final convictions for money laundering
remains almost inexistent (four in 2020 and only one in 2021).
The ASP’s witness protection programme has worked satisfactorily. In 2021, 24 witness
protection operations were performed, compared to 19 in 2020.
Cooperation in the field of drugs
Institutional set-up and legal alignment
The Ministry of the Interior and the Ministry of Health and Social Protection/Institute of Public
Health are the lead bodies in the fight against drug trafficking and drug abuse respectively.
Albania does not have a specific National drugs strategy. The Strategy against Organised Crime
adopted in December 2020 foresees to improve the legislation on psychoactive substances and
precursors and to update the list of prohibited psychoactive substances. The establishment of a
National Centre of Information on Drugs (national drug observatory) is overdue. Albania has not
yet established a national early warning system on the information exchange about new
psychoactive substances. Consultations for establishing the Early Warning System and updating
the legislation regarding psychoactive substances and precursors started. Albania continues to
44
implement the working arrangement with the European Monitoring Centre for Drugs and Drug
Addiction (EMCDDA) and makes efforts to increase its reporting capacity on drug-related issues
in line with EMCDDA guidelines/protocols and needs sufficient resources for this task. Under
the Strategy Against Organised Crime 2021-2025, the Albanian State Police approved in January
2022 an Action Plan for 2022 on the “Prevention and crackdown on criminal activity of
cultivation of narcotics plants”.
Implementation and enforcement capacity
Drug trafficking is the most common form of serious criminal offence in Albania and the number
of identified cases continued to increase. In 2021, the police identified 3 168 offences related to
drug cultivation, production, sale and trafficking of narcotics compared to 2 086 in 2020,
involving 3 927 alleged offenders (3 205 in 2020).
Albania’s law enforcement authorities have maintained a good level of cooperation with their
counterparts in EU Member States in tackling the trafficking of narcotics. During 2021, 212
police operations in the field of narcotics took place, out of which 78 saw the cooperation of
Albania’s international partners.
National Police Operations
Albania remains the only country in the region that allows monitoring by another country: since
2013, Italy’s Ministry of Economy and Finance Enforcement Agency (Guardia di Finanza) has
carried out aerial surveys to detect cannabis plantations in Albania. 70 flight missions were
operated by Guarda di Finanza in 2021, surveying 6.5 million km2 and allowing 92 500 plants
to be found and destroyed, which represents about 35% increase compared with 2020. In
addition, ASP continued monitoring by drones. The quantity of cannabis seized in Albania
continued to decline, from about 4.3 tons in 2020 to 3.6 tons in 2021. However, the number of
cannabis plants seized increased from 137 000 to 166 000 between 2020 and 2021.
All other drugs saw an increase in amounts seized in 2021 compared to 2020: from 1 kg to 208
kg of hashish, from 51 kg to 8 1kg of heroin and from 6 kg to 725 kg of cocaine.
The lack of secure storage for drugs and drug precursors prior to destruction remains an issue of
concern. The practice of keeping only a small sample as material evidence for court proceedings
(instead of the entire quantity seized) is not yet established. Albania needs to establish the legal
base for an appropriate process for the destruction of precursors.
Fight against terrorism
Institutional set-up and legal alignment
Albania has a comprehensive legal framework for preventing and combatting the financing of
terrorism and is fairly advanced in aligning with the main building blocks of the EU acquis. It is
a party to all Council of Europe counter-terrorism conventions, including those covering the
seizure and confiscation of the proceeds of crime and the financing of terrorism. The authorities
should ensure effective implementation of targeted financial sanctions mandated by the UN
Security Council, inter alia by enhancing the involvement of financial institutions and other
relevant actors and through effective inspections, in line with the FATF action plan. The work on
preventing risks of terrorism financing in the case of instrumentalisation of non-profit
organisations by radicalised groups needs to continue.
45
The national cross-sector counter-terrorism strategy and action plan from December 2020
continue to be implemented. The national Action Plan on Countering Violent Extremism (CVE)
is outdated and its action plan has expired and Albania should adopt the new strategy and action
plan as a matter of priority. The new strategy should be fully aligned with the EU policy and key
principles on CVE.
Albania has continued to make good progress in implementing the bilateral arrangement with the
EU on operationalising the Joint Action Plan on Counter-Terrorism for the Western Balkans.
The Counter-Terrorism Directorate of the Albanian State Police is the lead body on counter-
terrorism, under the jurisdiction of the Special Prosecution Office and Special Courts. State
Intelligence Service and the Defence Intelligence and Security Agency are also active in the
field. The ASP’s community policing personnel is involved in preventive and early-warning
efforts. The Coordination Centre for Countering Violent Extremism is in charge of capacity-
building, coordinating CVE activities across government institutions and overseeing the
implementation of the national CVE strategy. The CVE Coordination Centre was moved from
the Prime Minister’s Office to the Ministry of Interior in April 2022. Albania should ensure that
the new set-up provides for the continuity of the centre’s work and that the centre will continue
to have the authority and resources to carry out its important inter-ministerial coordination
function. The work done in the last years to improve the capacities to prevent Violent Extremism
at local level should be continued; local communities and local security councils should be
further empowered in their preventive capacities. Measures and capacities to address terrorist
content online should be improved.
Implementation and enforcement capacity
The police referred ten cases of terrorist offences and financing of terrorism to the Special
Prosecution Office and the judicial district prosecution offices in 2021, involding 11 suspects.
There were no court convictions for terrorist offences or terrorism financing in 2021. The
authorities repatriated ten adult women and 27 minors from the camps in Syria in October 2020,
August 2021 and May 2022. The CVE Coordination Centre and the ASP’s Counter-Terrorism
Directorate have led the inter-institutional work on their reintegration and rehabilitation in an
effective and professional manner, with the Counter-Terrorism Directorate also carrying out
criminal investigations and ensuring monitoring. No criminal charges have been brought against
any of the returnees so far. In total, 81 Albanian nationals returned to Albania from Syria and
Iraq. Around 35 to 45 Albanian nationals are estimated to remain in Syria; at least 45 are
believed to have died in the conflict zone. The authorities continue to seek to return the
remaining women and children from the camps in Syria. The CVE Coordination Centre has
engaged in capacity building at local and national level on preventing and countering violent
extremism, including in cooperation with civil society.
Regional cooperation and the exchange of sensitive information with international partners
remains satisfactory. While progress was made, Albania should make more proactive use of the
Europol European Counter-Terrorism Centre’s communication platforms products, services and
capabilities. It should continue to collaborate with the Europol Internet Referral Unit. It actively
participated in the implementation of the Western Balkan counter-terrorism initiative, under the
Integrative Internal Security Governance (IISG).
Albania should continue to focus on the reintegration and rehabilitation of returnees from Syria,
and on the investigation and prosecution of those suspected of criminal offences. It should
46
strengthen the case management and referral mechanisms for returnees and individuals at risk of
radicalisation. Prison radicalisation and online terrorist content continue to require attention.
Albania should also continue to investigate links between organised crime and terrorism, as well
as ensure the alignment with the EU legislation on explosive precursors and update the indicators
for Firearms Focal Point on the base of Council recommendations of July 2021.
Judicial cooperation in criminal and civil matters
In 2021, the Albanian Liaison Office to Eurojust registered 21 cases at the request of the
Albanian authorities, 16 of which have been completed. 51 new cases have been opened with
Albania Liaison Office at the request of EU Member States competent authorites. Five new
Agreements for setting-up Joint Investigation Teams (JITs) were concluded.
Amendments to the Law on judicial cooperation in criminal matters with foreign jurisdictions
adopted in July 2021, have proved useful to facilitate the setting-up of joint investigation teams,
but further efforts will be needed to align the national legislation with the EU acquis.
A bilateral extradition Agreement was signed between Albania and Spain in September 2021 and
entered into force in February 2022.
On judicial cooperation in civil matters, in 2021 Albania received 273 requests for mutual legal
assistance and sent out 97 requests, numbers similar to 2020. On judicial cooperation in criminal
matters, in 2021 Albania received 913 requests and sent out 870 requests (981 and 1 182 in
2020).
Albania should finalise the internal procedures for acceding to the 2005 Hague Convention on
Choice of Court Agreements and the 2007 Protocol on the Law Applicable to Maintenance
Obligations. It should further improve international cooperation, the timely implementation of
multilateral instruments, and its institutional capacity.
Legal and irregular migration
Institutional set-up and legal alignment
The Ministry of Interior is the main actor in the field of migration. The main bodies under its
supervision responsible for implementing migration policies are the Department of Border and
Migration in the ASP General Directorate and the Directorate of Anti-Trafficking and Migration
at the Ministry of Interior. The Ombudsman and the child protection unit under the Ministry for
health and social affairs play an important role in monitoring and providing services to incoming
migrants. The National Agency for Employment and Skills also covers services, employment
programmes and vocational training programmes for foreigners, stateless persons and refugees.
The legal framework on migration is largely aligned with the EU acquis but needs updating in
line with recent developments on the EU side. Albania has a readmission agreement with the EU
and implementing protocols are in place with 12 Member States. Albania has reiterated its
interest to conclude an implementing protocol with Greece. Draft readmission agreements have
been sent by the Albanian authorities to several countries of origin, so far to no avail. New draft
of readmission agreements was sent to Egypt. Drafts have also been prepared to be sent to
Tunisia and Bangladesh. In 2022, negotiations started on a Bilateral Partnership Agreement in
the field of migration with India, which would include provisions on readmission.
47
The implementation of the national migration strategy and action plan for 2019-2022 has
continued, with monitoring reports being issued regularly and a mid-term review conducted in
2021 with IOM support.
Implementation and enforcement capacity
In 2021, 10 1028
irregular migrants were detected in the country, compared to almost 12 000 in
2020. The nationals most represented were from Syria (52%) and Afghanistan (14%).
Reception capacities have increased in 2021 with the refurbishment of Babrru National
Reception Center allowing for up to 250 beds, and a dedicated family friendly space. The only
closed reception center for third-country nationals who are the subject of return procedures in
Karreç, with a total capacity of 150 beds, still requires urgent refurbishment. The total capacity
of all reception facilities, State-run, NGO-run, or run by local municipalities is approximately
580 beds. Albania does not have separate facilities for unaccompanied minors. The Ministry of
Interior has updated its contingency plan for a possible substantial number of arrivals of migrants
and asylum seekers, but the plan has not yet been adopted at Council of Minister level. Such a
plan needs to include appropriate budget allocations and clear modalities for its triggering. The
case management of unaccompanied children is not handled as an integrated process, as required
by the law on asylum.
The overall staffing of the ASP’s Department for Border and Migration remains limited, with
1 663 employees, an increase of 25 staff compared to 2020. Comprehensive training and joint
exercises have been organised for key border officials and frontline officers. However,
permanent training structures should be established in compliance with basic training standards
for EU border guards. The high turnover of officers continues and should be addressed. Border
and Migration Police officers should increase their capacities to identify refugees and migrants
with specific needs. Coordination with child protection and anti-trafficking departments should
also improve. Reports of refugees and migrants being returned to Greece outside a legal and/or
procedural framework, without adequate pre-screening, have continued over the reporting
period. Albania should apply return procedures in compliance with the Law on foreigners and
ensure that its return mechanism for irregular migrants is in line with the EU acquis including as
regards fundamental rights.
The readmission agreement with the EU is functioning well, with Albania swiftly honouring
requests from Member States for the readmission of both its own and third country nationals. In
2021, 22 025 return decisions were issued to Albanian nationals and 8 555 were effectively
returned. Cooperation between Albania and Frontex on return operations is very good. On 25
January 2022, Frontex organised in Albania its first fully-fledged Frontex-led return operations,
returning approximately 50 Albanian irregular migrants from several EU Member States with
support of Albanian authorities
In 2021, there were two cases of voluntary return to countries of origin.
In August 2021, Albania started temporarily hosting Afghan evacuees. Up to 2 500 have been
hosted in open facilities near the coast line in Albania, with the support of international NGOs.
All Afghan evacuees applied for temporary protection in the country, granted to them by a
Council of Ministers decision adopted on 25 August 2021. Most of them have now been resettled
to other countries, mostly to Canada (1374), US (315), and EU countries (73).
8
UNHCR figures
48
As of March 2022, the Albanian authorities granted the right of residence in Albania, for a
period of up to one year without the need of obtaining residence permit, or the right to request
temporary protection status to refugees from Ukraine. From 24 February 8 763 Ukrainian
citizens have entered Albania while 6 991 have left. All have been hosted in Albania in private
accomodation. None of them have applied to benefit from temporary protection. Only a few have
applied for asylum in the country, but all of them withdrew their request.
Asylum
Institutional set-up and legal alignment
The law on asylum is largely aligned with the EU acquis. Efforts have been focused on
developing by-laws for its implementation with all 15 by-laws adopted. Efforts should continue
and appropriate consultations should be held with the European Union Asylum Agency (EUAA)
on the practical guidelines for their implementation. Although the law grants asylum seekers the
right to access public services at the same level as Albanian nationals, lack of alignment with
other legal acts prevents an effective access. An efficient and quality implementation of the law
remains to be achieved and would require additional administrative capacities.
Albania has the necessary institutions in place to handle asylum claims. Administrative appeals
may be lodged with the National Commission for Refugees and Asylum.
Implementation and enforcement capacity
Albania continues to be primarily a transit country, considered as such both among the refugee
and migrant community and by the Albanian authorities. In 2021, 10 102 migrants9
were
apprehended in the country, compared with almost 12 000 in 2020. In 2021, only 85 persons
made a claim for asylum with the Border and Migration Police, compared with 2 102 persons in
2020, whereas more than 80 % of all arrivals in 2021 were self-reportedly from countries with
high protection rates. This confirmed the change of practice noticed since the reopening of
borders in June 2020, by which referrals to asylum procedures are not implemented. Access to
asylum procedures should be restored.
As most asylum seekers leave the country after a few days, most asylum claims are not pursued.
In 2021, nine applications were formally lodged. No applicant was granted refugee status, but
seven were granted subsidiary protection.
On asylum procedure, the capacities of the Border and Migration Police to identify persons
with specific needs remain insufficient. The Directorate for Asylum, Foreigners and Citizenship
also needs capacity and training assessing individual claims, particularly the information on
country of origin and cases involving vulnerable people. The lack of qualified interpreters at the
temporary receptions centers during and after pre-screening should be addressed and the hiring
of female interpreters encouraged to increase reporting on violence and on potential trafficking
cases. A pre-screening instruction which is under revision to ensure coherence with the existing
legal framework should be adopted swiftly.
Shortcomings have remained in the implementation of return procedures at the border with
Greece and should be addressed.
9
UNHCR data
49
The increased monitoring by the Ombudsperson’s Office in border areas and their engagement
with the Border and Migration Police on their findings reinforces Albania’s rights-based
approach towards asylum seekers.
The status of about 2 700 Iranians (from the People’s Mujahedeen of Iran) relocated to Albania
in 2015 and 2016 has yet to be decided. They currently hold temporary residence permits on
humanitarian grounds.
Visa policy
The Commission’s August 2021 fourth report under the visa suspension mechanism10
concluded
that Albania continues to meet the visa liberalisation requirements. Abania’s visa policy is still
not fully aligned with the EU’s, as regards the list of countries whose nationals require an entry
visa. Albania has all year round visa-free arrangements with Armenia, Azerbaijan, Belarus,
China, Guyana, Kazakhstan, Kuwait, and Türkiye, which are not on the EU’s visa-free list. In
December 2021, Albania revised the decision to grant visa-free access to third country nationals
who are residents in the United Arab Emirates (UAE) by allowing access only to those with a ten
year residence permit in UAE Nationals from Bahrein, Egypt, India, Oman, Qatar, Russia, Saudi
Arabia and Thailand, who need a visa to travel into the EU, still benefit from seasonal visa
lifting. This was extended from 30 of September until the end of 2022, except for Egypt and
Russia. Overall, the practice of temporary lifting visa requirement is in not in line with the EU
acquis.
According to Eurostat data, the number of Albanian citizens lodging asylum requests in EU
Member States increased by 63% in 2021 compared to 2020, from 6 925 to 11 300 applications,
but remains below the pre-pandemic level (20 415 in 2019). This sharp increasing trend started
in July 2021, corresponding to the lifting of travel restrictions to the EU linked to the COVID-19
pandemic. This increasing trend continued in the first half of 2022 with 4 995 applications
lodged in the period January-May. The recognition rate of asylum increased from 4.5% in 2020
to 5.8% in 2021 (5.2% in 2020 and 9.0% in 2021 including humanitarian status).
In 2021, 4 611 Albanian nationals were refused permission to exit Albanian territory at border
crossings compared to 6 180 in 2020. This decrease by 25% can be attributed to the increased
awareness about these measures among the population. Beyond thorough border checks,
awareness-raising campaigns on rights and obligations under the visa-free regime, and
addressing the underlying reasons, dialogue and structured cooperation through the
implementation of action plans with the most affected EU countries, should continue. The
Commission is monitoring the trend very closely in the framework of the visa suspenssion
mechanism.
Unaccompanied minors travelling from Albania to EU Member States remain a source of
concern. Greater attention should be given to the successful reintegration of returnees, especially
the most vulnerable, such as Roma and Egyptians, where no notable actions were taken in 2021.
Migration counters established in municipalities should be formalised and strengthened to
facilitate their reintegration and more police officers should continue to be trained to escort
returnees to Albania.
10
COM(2021) 302 final and SWD(2021) 206 final
50
Schengen and external borders
Institutional set-up and legal alignment
The Law on Border Control introducing Advance Passenger Information and Passenger Name
Record (PNR) in Albanian legislation is not in line with the EU acquis. A passenger information
unit was established in February 2022 within the Albanian State Police. The Albanian authorities
are aware that the transfer of PNR data from the EU to Albania is not possible in the current
legal framework. The legislative framework for the management of Albania’s external borders
is not yet fully in line with EU standards, while its IBM strategy 2021-2027 and action plan
2021–2023 are broadly aligned.
Implementation and enforcement capacity
The EU is assisting Albania in building an integrated radar system for the surveillance of the
‘blue’ (sea) border. Albania has committed to invest significant resources to modernise border
infrastructure and improve surveillance of the ‘green’ (land) and ‘blue’ borders. The total
information management system database system is connected with Interpol’s system, enabling
the border police to identify internationally wanted persons, stolen vehicles and lost/stolen travel
documents. Albania should establish a risk-analysis system based on the Common Integrated
Risk Analysis model developed by Frontex.
Inter-agency cooperation continued to improve. The Navy, Coast Guard and Border and
Migration Police conducted regular joint, integrated ‘blue’ border patrols. The Albanian State
Police and the General Directorate of Customs signed in April 2022 a Joint Order to strengthen
joint inspections with a view to crack down on narcotics trafficking, smuggling and other cross-
border crimes. The border police’s investigative powers need to be strengthened, in particular to
detect cases of people-smuggling and trafficking in human beings.
Albania participated actively in the Western Balkan Risk-Analysis Network. Operational
cooperation with neighbouring countries continued to be good, while bilateral cooperation
should be further stepped up. The agreement with Greece on the establishment of a police and
customs cooperation centre on the Greek side of the border was ratified by Albania in February
2022. Albania has to ensure that the US-sponsored PISCES system for personal identification is
operated in line with the EU acquis on personal data protection. In 2021, the Department for
Border and Migration issued 16 serious disciplinary measures against border police for
corruption and abuse of office, slightly more than in 2020.
51
2.3. ECONOMIC CRITERIA
'In line with the conclusions of the European Council in Copenhagen in June 1993, EU
accession requires the existence of a functioning market economy and the capacity to cope with
competitive pressure and market forces within the Union.
Economic governance has become even more central in the enlargement process in recent years.
The Commission's monitoring takes place in two processes: the Economic Reform Programme
exercise and the below assessment of compliance with the economic criteria for accession. Each
enlargement country prepares an Economic Reform Programme (ERP) annually, which sets out
a medium-term macro-fiscal policy framework and a structural reform agenda aimed at ensuring
competitiveness and inclusive growth. The ERPs are the basis for country-specific policy
guidance jointly adopted by the EU and the Western Balkans and Türkiye at ministerial level in
May each year.
2.3.1. The existence of a functioning market economy
Albania has made good progress and is moderately prepared for developing a functioning
market economy. Supported by a broadly appropriate policy mix, the Albanian economy
showed resilience and rebounded faster than expected in 2021, making up for most economic
losses caused by the COVID-19 pandemic. Russia’s war against Ukraine has hit the Albanian
economy indirectly through higher commodity prices and lower growth in its main EU trading
partners, but did not translate into a negative impact on growth in the first quarter of 2022.
However, risks are clearly on the downside ahead. The budget deficit and the public debt ratio
increased less than projected in 2021, but fiscal space remains limited, heightening the
Table 1.1: 2019 2020 2021
Albania - Key economic figures
GDP per capita (% of EU-27 in PPS)
1)
30 30 30 32
Real GDP growth 2.7 2.1 -3.5 8.5
Economic activity rate of the population aged 15-64 (%), total 64.4 69.6 69.1 69.3
female 55.4 61.7 61.2 61.4
male 73.8 77.6 77.1 77.3
Unemployment rate of the population aged 15-64 (%), total 15.7 12.0 12.2 12.1
female 14.4 11.8 12.4 12.4
male 16.7 12.1 12.1 11.8
Employment of the population aged 15-64 (annual growth %) 3.0 2.4 -1.9 -0.4
Nominal wages (annual growth %)
2)
2.6* 3.8 2.7 6.3
Consumer price index (annual growth %) 1.8 1.4 1.6 2.0
Exchange rate against EUR 136.5 123.0 123.7 122.5
Current account balance (% of GDP) -8.4 -7.9 -8.7 -7.7
Net foreign direct investment, FDI (% of GDP) 8.5 7.5 6.7 6.4
General government balance (% of GDP) -3.3 -1.9 -6.7 -4.5
General government debt (% of GDP) 69.8 65.8 74.5 73.2
Notes :
1) Eurostat
2) average gross monthly wages, average of 2015-2018
Source: national sources
2013-18
average
52
country’s vulnerability to external shocks. There was good progress on revenue-related
reforms, but weaknesses persist on investment expenditure planning and execution. The
regular use of normative acts for frequent revisions to the budget and the budget law weakens
fiscal credibility. Inflation has increased to above the target, which prompted the central bank
to raise the policy rate in several steps.. The business environment benefitted from a higher
level of digitalisation of the public services. This also contributes to the formalisation of the
economy, along with the rising financial inclusion and successful activities to reduce
underreported labour, although a large part of the economy remained informal. Consultations
of the public by the government did not improve significantly. As some of last year’s
recommendations to improve the functioning of the market economy were not fully
implemented, in the coming year Albania should in particular:
 provided the economic recovery is well entrenched, foresee in the medium-term fiscal
plan a gradual reduction of the public debt ratio and arrears, using the regular legislative
process when amending the budget,
 implement the reform of public investment management procedures;
 begin implementing the medium-term revenue strategy after broad public consultation and
based on an operational plan.
Economic governance
Albania remained committed to stability-oriented policies but some weaknesses in
economic governance persist. Following the sharp increase in Albania’s public debt and deficit
in 2020, due to the COVID-19 pandemic, the IMF and the EU provided financial support to
cover financing needs. EU support included EUR 180 million macro-financial assistance, which
were fully disbursed in 2021 following Albania’s fulfilment of the policy conditions attached to
the assistance, including public finance, good governance and social policy. The government
used normative acts instead of the regular legislative procedure (i) to amend the 2021 and 2022
budgets multiple times, (ii) to suspend the fiscal rule requiring a decreasing debt ratio and (iii) to
postpone the new primary balance rule to 2024. This practice, which is contrary to jointly
adopted policy guidance, which Albania partially implemented. Post-earthquake reconstruction
progressed.
Albania submitted its Economic Reform Programme 2022-2024 to the European Commission at
the end of January 2022, in which it confirmed its commitment to return to its pre COVID-19
fiscal consolidation path as soon as the economic recovery allows, and underlined its plan to
achieve a positive primary balance in 2024. In March and September 2022 Albania revised its
budget to accommodate the high cost of energy subsidies and the social support extended in
relation to the price hikes in the wake of the impact of the Russian aggression against Ukraine.
Macroeconomic stability
Albania’s economy showed resilience
during the COVID-19 pandemic.
Previously, Albania’s real GDP growth
averaged 2.7 % (2013-18). Following a
smaller-than-projected contraction of 3.5 %
in 2020, a stronger-than-expected economic
53
recovery pushed real growth of GDP to 8.3 % in 2021. Most expenditure categories exceeded
their 2019 levels, driven by both public and private investment, private consumption, and
external demand. The continuing post-earthquake reconstruction and a stable and liquid financial
sector supported exceptionally strong investment growth (negative since 2019). Increasing
employment in the second half of 2021 helped the labour market to recover almost all the ground
lost during the COVID-19 pandemic. This, coupled with increasing wages, fuelled private
consumption. Goods exports, mainly electricity and construction material, exceeded 2019 levels,
while exports of services remained slightly below their pre-pandemic level, despite growing
tourism from neighbouring countries. Growth in investment and consumption drove a rise in
goods imports, leading to a negative real growth contribution of net exports in 2021.
Russia’s war against Ukraine is indirectly hitting Albania’s economy. The economic
importance of rainfall-dependent hydroelectric production remains a key contributor to the
volatility to GDP growth. A real growth rate of 6% in the first quarter of 2022 showed the
continuing recovery of the Albanian economy, supported by private consumption, exports and
investment. Business and consumer confidence remained upbeat in April and May, despite even
more strongly increasing transport and food prices. The price hikes have prompted the
government to provide about 2% of GDP in support for pensioners, vulnerable households,
farmers and transport companies in addition to the general support to keep regulated electricity
prices stable. Eurostat data shows that convergence to EU income levels has been slow, with per-
capita GDP (at purchasing power parity) remaining at 30 % of the EU average until 2020 and
increasing to 32 % in 2021.
A smaller trade deficit, coupled with high GDP growth and rebounding remittances, helped
to narrow the current account deficit in 2021. In 2016-2020, rising service exports and
remittances helped the current-account deficit to narrow from an average 10.9 % of GDP in the
five-year period 2010-2014 to an average of 7.7 % in the 2015-2019 period. Following the
widening of the current account deficit in
2020 to 8.7 % of GDP, due to the drop in
the export of services (i.e., tourism) and
private transfers from Albanians abroad, the
rebound in exports and remittances, in
combination with the high GDP
denominator, reduced the current account
deficit by 1 ppt. to 7.7 % of GDP in 2021.
In the first quarter of 2022, the same
elements continued to support the further
decrease of the 4-quarter moving average
current account deficit to about 7 % of
GDP.
FDI remained below pre-crisis levels and debt-creating capital flows continued to
contribute to financing the current account deficit. Foreign direct investment (FDI) inflows,
which already started to decrease from their peak levels above 8 % of GDP in 2015-2019, due to
the completion of a few large energy projects, fell to 6.4% of GDP in 2021, but it started to
recover in the second half of 2021, and rose by 24% year-on-year in the first quarter of 2022. In
the five years until 2020, FDI fully financed the current account deficit, but since 2020 debt-
creating inflows contributed to around 15 % of its financing. These flows included two EUR 650
54
million sovereign Eurobonds issued in 2020 and 2021, the latter lasting 10 years11
, the longest
maturity bond issued so far. External debt, mostly consisting of long-term government debt,
climbed from 60 % end-2019 to 64.3% of GDP in 2020, then fell to 63.1 % in 2021 (due to the
high GDP). Foreign exchange reserves rose from EUR 3.9 billion in 2020 to EUR 4.9 billion in
2021 and continued to increase in 2022, supported by interventions of the Bank of Albania. Their
import coverage increased from an average equivalent of about 7 months in 2015-2019 to almost
9 months of imports in 2021 and continued to provide an adequate safeguard against external
shocks in the first quarter of 2022. In 2021 the Albanian lek’s exchange rate to the euro returned
to its pre-2020 trend of continuous appreciation, albeit at a very moderate pace. Except for a
short period of volatility in March 2022 the moderate appreciation to the euro continued in 2022,
whereas the Lek depreciated to the USD by 10.8 % year-on-year in June 2022.
Annual inflation has accelerated sharply since end-2021 and led the central bank to start
raising its policy rate. The monetary and exchange rate policy framework has not changed. The
Bank of Albania (BoA), which operates under an inflation-targeting regime (with a target of
3 %) coupled with a floating exchange rate, supported the economy with its record low policy
rate of 0.5 % (set in March 2020) during the pandemic-induced slowdown and the large gap to
the inflation target. Annual inflation averaged 1.8 % over the last five years, edging slightly
higher to 2 % in 2021, but still below the BoA’s target. Prices rises for food and transport pushed
the inflation rate towards the central bank’s target at the end of 2021 and accelerated strongly in
the first half of 2022, in particular as of March, pushing the overall inflation rate to a historic
high of 7.5 % in July, more than double the target. In response to the persisting price pressures,
the central bank began a gradual policy normalisation in March 2022 and raised the policy rate in
several steps to 1.75% in August 2022.
High GDP and revenue growth helped to
lower fiscal deficit and public debt ratios
in 2021. The fiscal deficit remained below
2 % of GDP in 2015-19, supported by
increasing revenue and decreasing interest
expenditure, but increased sharply in 2020
to 6.8 % of GDP, due to the impact of the
pandemic. The strong economic rebound
fostered higher-than-expected revenue
growth (19.3 % y-o-y ) in 2021, which,
along with high GDP growth, and lower-
than-planned public investment spending, helped to reduce the public deficit to 4.5 % of GDP, 2
pps. lower than expected. The high GDP denominator also led to a decrease of the public debt
ratio from its peak of 74.5 % in 2020 to 73.1 % in 2021, compared to its pre-crisis level of
65.8 % in 2019. Revenue growth remained strong in the first half of 2022, while expenditure
lagged slightly behind plan resulting in a fiscal surplus in June 2022. Revenue reforms have
progressed, but weaknesses in public investment management persist. Revenue
administration reforms in 2021 erased the high VAT refund arrears, sped up the VAT refund
process, and increased collection efficiency. Public consultations on the long foreseen medium-
term revenue strategy (MTRS) began at the end of 2021 but were suspended by the government
in March 2022, reportedly because of the impact of the Russian invasion of Ukraine. The MTRS
11
With an initial yield of 3.75%, just 0.1 pp. higher than for the 7-year maturity Eurobond issued in June 2020.
55
aims to increase revenue and collection effectiveness, reduce exemptions, and make tax policy
more reliable and balanced in its distributional effects. It should also contribute to reducing
informality and the use of cash and overall will be a crucial tool for a sustainable, growth-
friendly increase in revenue needed to finance the large spending needs on health social
protection, education and research. Although investment spending has increased strongly since
2017, it lagged behind the frequently revised plans, and remained very much backloaded, with a
third of total capital expenditure in 2021 executed in December alone. This signals a continuing
weakness in public investment management, which, in combination with the related contract
arrears and the frequent budget revisions by normative act, weakens the credibility of the budget.
The macroeconomic policy mix supported the strong recovery. The original fiscal plans for
2021, and the decision to advance the Eurobond placement to pre-finance the 2022 deficit, were
prudent. Good revenue performance and the decrease of the still high debt ratio have slightly
improved the limited fiscal space to deal with the initial economic fallout of Russia’s invasion of
Ukraine, but tightening financing conditions may restrict the budgetary room for a more active
fiscal policy. The BoA’s continuation of a very loose monetary policy stance until March 2022
was appropriate in view of the persistently below-target inflation rate and supported the
economic recovery. Its provision of liquidity and its temporary money market intervention
supported financial and external stability. The policy response to the in 2022 has so far proven
effective in limiting the increase in the inflation rate compared to regional peers. However, this is
also due to the costly general electricity, support for the energy sector which has constituted a
volatile and non-transparent fiscal liability already before the recent energy price increase
because of the rainfall-dependency of Albania’s hydro-electricity production and low energy
efficiency.
Functioning of product markets
Business environment
A higher level of digitalisation supports the formalisation of the Albanian economy. Pushed
by the COVID-19 pandemic, e-learning, digital training services and e-commerce are rising
among businesses. More online public and financial services are being made available as the
government aims to offer 95 % of public services online (though the rapid shift has raised
questions on delivery and accesibilty). This goes hand in hand with efforts of the Bank of
Albania and commercial banks to increase the digitalisation of payment services, which already
strongly increased the use of payment cards.Efforts to digitalise the Albanian cadastre within the
next two years are ongoing, however so far delays and discrepancies regarding the information
on property deeds persist. In line with the recommendations of FATF/ICRG, Albania has
established a “Beneficial Ownership Registry”, in which all owners of existing commercial or
non-profit entities have to be registered by 30 June 2022. The registry adds to transparency of
economic actors and implements a key requirement of the EU anti-money-laundering directive.
Nevertheless, the informal economy remains large – is the IMF estimated that it accounted for
about one third of GDP12
in 2019, and it is most widespread in trade, tourism, manufacturing and
construction.
Progress on improving legal certainty for businesses has been mixed, while concerns about
the effective consultation and implementation of legislation and strategies persist. The
12
IMF 2019, WP 19/278, “Explaining the Shadow Economy in Europe: Size, Causes and Policy Options” estimates on shadow
economy in 2016 in Albania between 28% and 30% depending on the model.
56
adoption of the new “Unified Law on Investment”, originally planned to be adopted in 2020, has
been further postponed, delaying the expected improvement of legal security of investors. In
mid-2021 Albania adopted a new “Business Investment Development Strategy” (BIDS) 2021-
2027. This provides the basis for the government’s support to SMEs and investment and foresees
progress in deregulation by eliminating licenses. Businesses increasingly report challenges in
finding skilled staff, and a low level of know-how and digital skills, which has led to strong
salary increases in some sectors. The introduction of an online consultation platform as the
government’s main channel to consult the public on draft legislation and strategies has actually
reduced effective consultation when the public does not use it, which was the case for the
Economic Reform Programme 2022-2024.
State influence on product markets
High food and energy prices triggered increased government support and intervention in
the price-setting mechanism of the private sector. In the last quarter of 2021 food and energy
prices were already rising in response to high demand, strong growth and supply chain problems,
but the prices jumped even higher following Russia’s invasion of Ukraine. Albania adopted a
financial support package (“social resiliance package”) in March 2022 and extended it in July
2022 of estimated 2% of GDP for targeted cash assistance and for the long-established but
increasingly costly subsidisation of the electricity prices13
. In the face of popular protests against
steep fuel and food price increases, the government established two temporary boards
(“Transparency Boards”) with representatives of the government and the private sector in March
2022, which are empowered to set ceilings for wholesale and retail prices of selected petrol-
based and food commodities. These are updated regularly to reflect international price changes
while keeping the profit margin stable.
The state’s presence in the economy is limited and Albania’s reported state aid fell below
0.5% of GDP. According to recently established sector accounts, the public sector’s share of
gross value added of the economy was about 10.5 % in 2018. The share of public sector
employment14
decreased from 16.3 % of total employment in 2014 to 14.3 % in 2017 before
picking up to 15.3 % in December 2021. Following an increase in tate aid in 2020 to about EUR
248.5 million, or 1.96 % of GDP, almost triple the level in 2019 (5 % of GDP), it then reportedly
dropped to 0.25 % of GDP in 2021. The share of horizontal aid in particular dropped in 2021 to
about 50 % of its level in 2019. However, the State Aid Office still lacks insititutional
independence and the comprehensiveness of the data reported remains therefore unclear.
Privatisation and restructuring
Efforts to define and monitor public sector corporations and their fiscal risks are ongoing.
Using ESA2010 methodology, in 2020 the Institute of Statistics distinguishes between 167 extra-
budgetary units of the central (including some enterprises) and local government (water utilities
and football clubs) and 26 non-financial public corporations and 2 public financial corporations,
not including the Albanian Investment Corporation (AIC) which is owned and funded by the
state to manage state assets and mobilise private capital for the development of investment
projects of public interest. The last budget amendment of 2021 allocated a capital transfer of
ALL (Albanian lek) 2 billion (about EUR 16 million) to the AIC, but the 2022 budget foresees a
13
The increasing international prices for electricity imports are so far not reflected in the prices for households and SMEs. The
state budget balances the differences for the state-owned electricity distributor.
14
As a share of total employment of the 15–64-year-olds, according to LFS (INSTAT)
57
return of these funds to the budget. Established end 2019, the AIC became operational in July
2021 and has begun to review state assets, formalise partnerships with governmental institutions
and to prepare a project pipeline.
Albania reports that it has initiated a valuation of the state’s shares in 21 corporations, with less
than 50 % state capital in 2022, in order to evaluate the State’s voting power in these
corporations. It has reportedly merged 6 state-owned companies in 2021, and prepared the
privatisation, restructuring and liquidation of several other state-owned companies for 2022. The
Ministry of Finance and Economy (MOFE) continued its regular monitoring of public-private
partnerships (PPPs), for which the direct budgetary liabilities remained stable15
below 3% of
revenue, and expanded its fiscal risk assessment to state owned enterprises (SOEs) in the water
and energy sectors.
Functioning of the financial market
Financial stability
The financial sector remained stable and asset quality improved in 2021, though risks
persisted from the high use of the euro in the domestic economy. In 2021 the BoA ended the
temporary measures it had introduced in view of the impact of the COVID-19 pandemic without
a negative impact on key indicators. The ratio of non-performing loans to total loans continued to
decline from 8.4 % in 2019 to a historic low of 5.3 % by the end of the second quarter of 2022.
Banking sector profitability improved during 2021, but fell sharply in the first quarter of 2022
(with return on equity decreasing to 7.4 % in March 2022 from an average of 12.2 % in 2021,
and return on assets falling from average 1.3 % to 0.8 % in the same period), but overall the
banking sector remained stable, sufficiently capitalised and liquid. The banking sector’s capital
adequacy remained well above the regulatory requirement at average 18.1 % in 2021 and 17.9 %
in March 2022, and the liquidity ratio16
fell from average 33.6 % in 2021 to 28.0 % in March
2022. However, the banks’ relatively large exposure to government securities (about 25 % of
bank assets) and the ongoing high use of euro in the domestic economy17
continue to pose risks,
although the share of loans not hedged against security risks decreased compared with 2020. The
small but growing non-bank financial sector expanded to 38 institutions18
but its share of GDP
was unchanged at 12 %. This includes the insurance market, which is estimated at about 2.3 % of
GDP, dominated by non-life insurance.
Access to finance
Favourable financing conditions and the modernisation of payment systems improved
access to finance. Total credit growth averaged 6.9 % in 2021, up from 6 % in 2020, and it
accelerated further to 11.9 % (y-o-y) in the first quarter of 2022. Lending to the private sector19
also accelerated, to 13.8 % year-on-year in June 2022, increasing the private credit-to-GDP ratio
from average 37.8 % in 2020 to 38.5 % in March 2022. The implementation of the “National
15
According to the budget law, budgetary expenses related to PPPs are to be limited to below 5% of previous year’s revenue.
However, this does not include PPP related liabilities, which are below the line, e.g. linked to powere purchasing agreements
and the like.
16
Liquid assets as share of total assets
17
Foreign currency loans accounted for 51% of the loan portfolio end-2021, while the share of unhedged loans decreased by
4.9pps.
18
Including 12 insurance companies, 8 investment funds, and a number of institutions providing microcredit, financial leasing,
factoring, money transfer and electronic payment services.
19
Annual average growth adjusted for written-off loans and exchange rate impacts
58
Retail Payment Strategy20
” progressed well and led to an increase in financial inclusion (around
69 % of adults had a bank account in 2021, up from 40 % in 2017) and in electronic payments
(up by 29.5 % in 2021). The creation of a depository of biometric data of the population supports
the security of the rapidly-increasing online banking sector. In addition, the BoA initiated an
enhanced regulation of consumer loans and consumer protection from unjustified or
intransparent interest rates, based on EU best practice. The operation of a new domestic
settlement platform for interbank euro payments since January 2022, is also part of the strategy,
and is expected to reduce costs for payment sevices. Following a positive assessement of its
supervisory framework in 2021, BoA requested the formal equivalence process with the EU
framework, which would further reduce costs and support the competitiveness of the Albanian
banking sector.
Functioning of the labour market
Following a slight increase of
unemployment and inactivity in 2020,
rebounding growth supported the recovery
of the labour market in 2021. Solid
employment growth averaging 3.7 % in the
2015-2019 period helped lower the
unemployment rate (age group 15-64) from
17.5 % to a record-low of 11.7 % by Q1 2022.
Following a deterioration of all labour market
indicatorsin 2020, the reboundig economy
2021 improved the situation on the labour market: the unemployment rate returned to 12.05 %,
the inactive population decreased by 1.5 pps and labour-force participation increased to 69.3 %
but remained slightly below the average 2019 level of 69.6 %. The gap between male and female
labour force participation remained large and unchanged at 15.9 pps since 2019. However, in
2020 and 2021 there were some structural changes in the labour market. The unemployment rate
of tertiary educated persons dropped strongly, while it increased for workers with primary
education and also for young people (15-24). Emigration dropped by almost 50 % in 2020
compared with 2019 due to international COVID-19-related mobility restrictions, but jumped
back in 2021, in particular the number of young people (20-29) dropped more than double as
much as in 2020. Coupled with a falling birth rate this led to a high population decrease of 1.3 %
in 2021. However, due to the rising participation rate, the decrease in the labour force (- 0.5 %)
was more moderate, roughly at the same level as in 2020 and 2019.
Nominal wage growth accelerated to 6.6 % in 2021 from 2.4 % in 2020, partly reflecting a
reduction in under reported wages. Shortages of skilled labour and increases of public setor
wages, mainly in health and education, pushed the average nominal monthly wage to EUR 465
in 2021. A leak of salary data of about 630 000 citizens in 2021 enabled a recently established
special anti-informality unit of the government to target the widespread practice of under
reporting salaries on individual business level, a and the tax authorities repeated their call on
businesses and self-employed to correct their respective revenue declarations. These measures
significantly reduced the number of employees receiving the minimum wage (about EUR 243)
and contributed to the statistical wage increase.
20
The implementation of the strategy achieved key legislation for transposing the EU Payment Services Directive 2, including
low cost basic current accounts and licensing and supervision of payment services providers by the BoA as of January 2022.
59
2.3.2. The capacity to cope with competitive pressure and market forces within the Union
Albania has made some progress and has some level of preparation to cope with competitive
pressure and market forces within the EU. Energy and transport infrastructure, the digitalisation
of the economy and education outcomes have improved, but significant gaps to regional and
European levels remain. Albania’s competitiveness is hindered by a lack of entrepreneurial and
technological know-how, significant levels of informality, unmet investment needs in human and
physical capital, and persistently low spending on R&D. Efforts to improve vocational training
and to address the skills mismatch continued and institutional preparations for the Youth
Guarantee Plan progressed. Regional integration and exports increased but remained below
potential. The lack of product and geographical diversification of exports add to Albania’s
vulnerability to external shocks.
As some of the Commission’s 2021 recommendations to improve competitiveness and to sustain
long-term growth were not fully implemented, in the coming year Albania should in particular:
 Finalise the Youth Guarantee Implementation Plan and begin its implementation;
 Improve business support services as well as consultation mechanisms with businesses and
social partners and with their cooperation develop a strategic action plan for implementing
anti-informality policies;
 Continue to increase the shares of spending in total public expenditure on education and
R&D, as well as on health and social protection to fund the agreed improvement of social
services and the higher reimbursement of medical costs for vulnerable groups.
Education and innovation
Efforts to improve the labour market relevance of education and vocational training
progressed but skill mismatches and high unemployment of young people persist. The share
of young people in tertiary education among the 20-24 age group gradually increased, from
12.3% in 2016 to 14.9% in 2021, but the shares of young people in vocational training or upper
secondary education hardly changed. In contrast to 2020, the unemployment rate of tertiary
educated persons fell below the total rate (15-64 age group) and that of low educated increased.
Simultaneously, businesses reported increasing shortages of skilled labour, while the still high
unemployment rate of secondary educated jobseekers indicates that skill mismatches and quality
issues of vocational training persist, and the ongoing reforms of the vocational education and
training (VET) system have still to show results. In 2021, Albania updated the professional and
qualification standards and the respective curricula for three of the eight21
of its National
Catalogue of the professional qualifications, in cooperation with vocational training facilities and
business representatives, to better reflect market needs and to encourage a diversified offer of
qualifications. Albania also progressed in aligning the Albanian qualification framework with the
European qualification framework (EQF) 22
and receive the approval23
of the EQF Advisory
21
So far levels 2-4 (of 8 levels) were revised, they describe skills comparable to lower secondary (2), upper secondary and
vocational diploma (3 and 4).
22
The EQF helps to understand and compare the skill levels of national qualifications across countries, and promotes lifelong
learning. Since 2012 all new qualifications carry a EQF reference in the EU.
23
This means that certificates and diplomas awarded according to the Albanian framework can include the reference to the
corresponding EQF level.
60
Board for its framework. Preparations for drafting and coordinating the implementation plan of a
Youth Guarantee Scheme in Albania have started.
Statistics on research and innovation remain below standard and funding of education and
research below needs. Data availability related to the research and innovation capacity of
Albania is very limited, and therefore, unlike its regional peers, the country is not included in the
European Innovation Scoreboard. In addition, Albania does not report reliable comprehensive
data of public expenditure on research and development, because of institutional weaknesses in
reporting. However, the allocated budgetary funds of the main ministries remain negligible and
below 1 % of GDP as do the planned budget allocations. Although Albania was ranked one place
higher in 2021, the Global Innovation Index (GII) still assigned it the lowest rank among 39
European countries. This is mainly the result of low scores in the areas of “human capital and
research” and in “knowledge and technology outputs” (below the average of the upper middle-
income group) in combination with low secondary schooling expenditure and university ranking.
Albania continued to participate in the Horizon 2021 programme, however it had the second
lowest number of projects and funding in the region (after Montenegro) and was ranked 15th
of
214 countries. In 2021, Albania became a member of the EUREKA network and under the “EU
for Innovation” project Tirana universities established “Tirana Inc.” to support entrepreneurship
and innovation among students, while a governmental working group is about to draft a follow-
up national strategy on scientific research.
Physical capital and quality of infrastructure
Following several years of decline, investment recovered in 2021, benefitting mainly real
estate and ICT. Private investment fell from 19.1 % of GDP in 2015 to 16.8 % in 2019, and
15.7 % in 2020 while total investment decreased from an average of 24.5 % of GDP in 2015-
2017 to 22.3 % of GDP in 2019. However, from mid-2020 investment started to recover and in
2021 real gross fixed capital formation (GFCF) rose to 24.1 % of GDP, fuelled by public-
financed post-earthquake reconstruction, but also private and foreign investment in other sectors,
such as trade, hospitality and ICT picked up. Public investment (including that of local
governments) averaged 5.4 % of GDP over the 2015-2019 period, before jumping to 7 % of GDP
in 2020 and 2021. FDI-inflows, which contracted by 13 % in 2020, rose by 10 % in 2021, mainly
in the mining and real estate sectors, but remained slightly below 2019 levels. The revival of the
deteriorated railways network started with support of multilateral development banks in 2021,
when a contract was signed to restore the connection between Tirana and Durres, the main port.
Digital infrastructure continued to improve and the share of enterprises with faster (>10MB/s)
network connection increased from 79.8 % in 2020 to 90.5 % in 2021, but internet use and
websites of enterprises show only small growth. In June 2022, the government adopted a digital
agenda with a corresponding action plan for 2022 – 2026.
Albania has started to establish a power exchange and adopted a new national energy and
climate plan. Following the amendment of the power sector Law, which improved compliance
with the EU acquis on energy and allowed for the effective separation of the electricity
distribution system operator from the production operator, Albania was ranked 25th in the
Energy Transition Index (WEF) in 2021, the highest in the Western Balkans. Early 2022, it
began to establish the Albanian power exchange, another milestone for an integrated organised
electricity market agreed with the energy community. Almost all electricity in Albania is
produced from hydropower, which creates a dependency on unpredictable rainfall exacerbated
by climate change. This in turn results in fluctuating electricity import needs and calls for more
61
efforts to diversify electricity sources, for which the government mainly involves private
investors, as is the case for two new photovoltaic parks it agreed on in 2022. In December 2021,
the Government adopted a draft National Energy and Climate Plan 2020 – 2030, but has yet to
substantially improve the plan by addressing the comments of the Energy Community Secretariat
regarding a missing link between the targets, policies and measures, the lack of public
consultation, and to base it on sound cost-benefit analysis.
Sectoral and enterprise structure
The economic struture continued to shift gradually away from agriculture and towards
services and industry. The weight of the agricultural sector in GDP gradually declined from
19.7 % in 2015 to its lowest level in the last decade of 17.7 % in 2021, when the sector
experienced a 1.5 pps drop in investment and a 3.2 % drop in real growth. Manufacturing’s share
in GDP recovered in 2021 to 6.2 % while that of industry as a whole rose by 1.3 pps to 13.3%.
Construction’s share climbed from 9.0 to 9.5 % of GDP in 2021. Services gradually increased
their value added in real GDP to 48.4 % in 2020 but decreased to 47.7 % in 2021, and they also
represent the largest share of employment (44.3 % in 2021). Employment in the manufacturing
sector, which had gradually increased to 11.2 % in 2020, remained at the same level in 2021,
whereas the decline in agricultural employment accelerated by 2.4 pps to 33.7 % of total
employment in 2021. Agricultural employment decreased in almost all parts of the country,
however, in more than half of the Albanian prefectures it still accounted for over 50 % of
employment and agricultural wages remained the lowest of all sectors, reflecting the still low
productivity. Business registrations recovered, and the number of enterprises with more
than five employees increased. Following a 1.5 % decrease in 2020, the overall number of
active non-agricultural enterprises increased by 1.1 % in 2021, and new registrations were 20 %
higher than in 2020. Continuing the trend seen in 2016-2019, the number of enterprises with
more than five employees rose significantly in 2021. In particular, enterprises with 5-49
employees increased their share from 8.8 % to 12.7 % of all enterprises and played a stronger
role in terms of investment and value added. The share of enterprises with more than 50
employees climbed by 0.5 pps to 1.7 % and they employed more than half of all employees.
Although microenterprises with 1-4 employees, mostly farms and small traders, remained the
vast majority, their share decreased to about 85.6 %, down from 90 % in 2020.
Economic integration with the EU and price competitiveness
The EU remained Albania’s main trading and investment partner, despite Albania’s
gradual diversifcation of trade partners. Overall external trade averaged 77.3 % in GDP
2015-2019, dropping to 61 % of GDP in 2020 before re-bounding to 76.4 % of GDP in
2021. Exports remain dominated by services, and the EU remained the main destination
for both goods and services exports. Due to faster growth in trade with non-EU countries,
the EU’s share in Albania’s foreign trade has decreased somewhat, with exports to the EU
accounting for 72.2 % of the total in 2021 (down from an average of 76.4 % in 2015-
2019), while the share of imports from EU, which averaged 60 % in 2015-2019, fell to
54.4 % in 2021. On the other hand, the goods trade volume with CEFTA countries
gradually increased from 5.7% in 2019 to 7.6 % of GDP in 2021. Kosovo remained
Albania’s main export destination in CEFTA, whilst most of its imports in CEFTA came
from Serbia. FDI flows to Albania from the EU increased by 26.5 % in 2021, much more
than from the rest of the world (7.8 %), and they made up 59.7 % of all FDI inflows. The
62
EU’s share in FDI stocks remained high at 54 %. The index of the real effective exchange
rate of the Albanian lek continued to increase, by 1.8 % in 2020 (3.5 % in 2019) albeit at a
slower pace than its 2015-2019 average of 3.7 %.
2.4. Public procurement, statistics, financial control
Chapter 5: Public procurement
EU rules ensure that public procurement of goods, services and works in any Member State is
transparent and open to all EU companies on the basis of non-discrimination and equal
treatment.
Albania is moderately prepared in public procurement. Good progress was made during the
reporting period, in particular by adopting further implementing legislation to the new law on
public procurement, launching an electronic appeals and complaint system, developing and
implementing of certified training course on public procurement, publishing first monitoring
reports on the public procurement strategy and deploying real time “open data” on procurement
activities, and including procurement related corruption risks in institutions’ integrity plans.
Further efforts are needed to improve compliance with procedures and prevent corruption in the
procurement cycle. The Commission’s recommendations from 2021 were largely implemented.
In the coming year, Albania should in particular:
 monitor the implementation of the new public procurement law, in particular increase use of
the most economically advantageous tender (MEAT) award criterion;
 step up efforts on alignment of the legislative framework with the EU acquis in particular the
area of concessions and public-private partnerships (PPPs);
 ensure that conditions of intergovernmental agreements concluded with third countries
comply with EU acquis requirements contained in the SAA, notably in the area of public
procurement.
Institutional set-up and legal alignment
The legal framework on public procurement is largely in line with the 2004 EU directives on
public procurement and procurement of utilities as well as relevant administrative and budget
provisions. The new law on public procurement, which entered into force in 2021, further
aligned the framework with the 2014 EU public procurement directives, but thresholds set for
competitive procurement of goods and services remain higher. The implementing legislation of
the new law was adopted in 2021. The Law on concessions and public-private partnerships
(PPPs) is partly aligned with the EU Directive on the award of concession contracts.
63
The Public Procurement Agency (PPA) is the central public procurement entity mandated to
propose regulatory measures and monitor compliance with public procurement rules, and since
the new law, also to verify the compliance of cancelled procedures and to monitor contract
implementation. The PPA also provides contracting authorities with information, support and
guidance as well as manuals for economic operators. In December 2021, the PPA introduced
“open data” with real time information on public procurement procedures, and archives as of
2010.
Implementation and enforcement capacity
Albania’s public procurement market represented about 10.7 % of GDP in 2021 as compared
to 9.4 % (in 2020) and 4.8 % (in 2019). Increases in 2020-2021 were largely driven by post-
earthquake reconstruction and a decline in GDP due to COVID-19 economic impact. In 2021,
the average number of bids per tender was 2.5 as compared to 2.57 in 2020 and 2.37 in 2019.
The planning and preparation of public procurement procedures are generally transparent and
efficient. Public procurement forecasts are published regularly.
In December 2021, the procurement regime for social services was approved. Capacity building
in contracting authorities on the new bylaws is ongoing.
All legal and financial instruments used in the area of public procurement and concessions,
including inter-governmental agreements concluded with third countries for the implementation
of joint projects, should comply with the principles of transparency, competition, equal treatment
and non-discrimination.
On the monitoring of contract awarding and implementation, following close monitoring by
the PPA, the number of negotiated procedures without prior publication continued to fall in 2021
to 143 as compared to 151 (not considering COVID-19 and reconstruction) in 2020, accounting
for 3.4 % in terms of value of all procurements in that period. The use of framework agreements
increased further in terms of numbers (873 compared to 677 in 2020) with a similar total value
procured through framework agreements (approx. EUR 354 million in 2021).
Albania has a central electronic public procurement portal on which it publishes tender and
contract notices and other important information and guidance. Use of the portal is mandatory,
including for low-value procurement. The procurement forecast register is prepared and posted
online.
By the end of 2021, the PPPs/concessions registry contained information on 229 contracts, six of
which had been signed in 2021. The technical skills and capacity to design and assess
concessions and PPPs require further development.
The PPA applies a monitoring system to assess procurement performance, procurement
compliance and contract implementation. In 2021, in line with the new law, contracting
authorities submitted contract implementation plans for signed contracts to the PPA. The new
contract management electronic system, covering the full lifecycle of contracts, is being piloted.
The contracting authorities need to continue to build capacity to manage public procurement
processes in line with the new law through training of more officials in contracting authorities
than in the previous year (1 555 persons trained in 2021 as compared to 970 in 2020). Regarding
integrity and conflicts of interests, the PPA issued instructions on the declaration of conflicts
of interest by procurement officials and adopted a regulation on prevention of conflicts of
interest in the exercise of public functions in the PPA. The State Audit Institution (SAI) reported
64
irregularities in public procurement, with an estimated loss to the state budget of around EUR 3.1
million (as compared to EUR 2.8 million in 2020, based on a smaller sample). In 2021, the PPA
imposed fines on 102 employees and proposed disciplinary measures for 145 employees.
Efficient remedy system
The Constitution and the Law on public procurement contain provisions on the right to legal
remedy that are mostly in line with the Remedies Directive. The remedy system is easily
accessible to economic operators, without discrimination, though subject to a fee.
The PPC is an independent review body with 36 posts, six of which are vacant, dealing with
complaints related to public procurement procedures. Its decisions can be challenged before the
Administrative Court of Appeals. The processing of complaints within the legal time limit
improved further in 2021 to 89.2 % (as compared to 78 % in 2020) with a similar number of
complaints received (768, as compared to 741 in 2020). In October 2021, the PPC launched a
new e-appeals and e-complaints management system for electronic submission and management
of cases as well as e-signature of documents and acts. The new system provides real-time
statistics, monthly bulletins and information for interested parties, including for visually
impaired people through a special access engine.
The capacity of the PPC and the Administrative Court to deal with a high number of appeals
needs to be further improved. As a result of a cooperation agreement concluded by the PPC with
the University of Tirana to develop specialised training courses on public procurement, PPC staff
completed a 13-week certified training course (on various topics) from September to December
2021.
Chapter 18: Statistics
EU rules require that EU Member States are able to produce statistics based on professional
independence, impartiality, reliability, transparency and confidentiality. Common rules are
provided for the methodology, production and dissemination of statistical information.
Albania is moderately prepared on statistics. Limited progress was made to address last year’s
recommendations. There was also progress on further alignment with ESA 2010 standards, faster
publication of statistics, and increased transmission to Eurostat. The official statistics programme
2022-2026 was also approved and the preparations for the Population and Housing Census are
ongoing. The role of Albania’s National Statistical System (INSTAT) was further strengthened,
and its resources improved; however, data collection methods need to be modernised and the
statistical production processes improved.
In the coming year, Albania should in particular:
 implement the Population and Housing Census 2023 and prepare the plan and secure the
resources for the census of agriculture holdings in line with the relevant EU acquis and
international standards;
 improve the role of Albania’s National Statistical System (INSTAT) as the coordinator of the
national statistics and expand the number of statistical agencies;
 INSTAT should increase the production and transmission of timely and high-quality data to
Eurostat.
65
On the statistical infrastructure, Albania’s law on official statistics is in line with the European
Statistics Code of Practice, and most classifications are in line with EU standards. The
Programme on Official Statistics 2022-2026 was approved in March 2022 and Albania’s
National Statistical System (INSTAT) has started its implementation. The Annual Plan for 2022
was not yet approved in June 2022. In August 2022, INSTAT announced that the Population and
Housing Census would be postponed to 2023 due to technical issues. While it made some effort
to fill the vacancies, further efforts need to be made to reduce the turnover and to ensure that the
staffing levels are sufficient to ensure production needs and that staff are well trained in the latest
statistical developments.
On macroeconomic statistics, annual and quarterly GDP data are produced according to the
production and expenditure approach, in current and previous year prices as well as in chain-
linked volume and seasonally adjusted. Supply and use tables and derived input-output tables are
harmonised with the definitions of the European System of National and Regional Accounts
(ESA 2010). On national accounts, data transmission to Eurostat has gradually improved in
terms of timeliness, mainly regarding the length of time series for annual national accounts.
However, significant improvement is still needed to achieve full compliance (mainly quarterly
GDP by income approach as well as population and employment data). Despite progress on
alignment with ESA 2010 standards, Albania still needs to further enhance compliance with the
methodological requirements, implementing achieved improvements in the next benchmark
revision in 2024. Gross National Income (GNI) Inventory describing sources and methods used
to compile national accounts, is then to be updated. Efforts are also needed to ensure the
completeness of the excessive deficit procedure notification tables, which are sent regularly to
Eurostat on a best-effort basis. Improvements are also needed in government finance statistics to
meet the requirements of the EU acquis. INSTAT produces and publishes the harmonised index
of consumer prices and ensures the generation of income accounts.
On business statistics, data collection and production have improved. Albania carries out an
industrial production survey, although data is not currently collected or transmitted to Eurostat.
Albania is partly compliant for all short-term statistics domains (industry, construction, retail
trade and other service). However, some important indicators are still not transmitted to Eurostat,
in particular on industrial production, industrial turnover, and services producer prices. INSTAT
continues to achieve quite high response rates in both business and household surveys.
On social statistics, INSTAT continues to conduct the labour force survey regularly, and micro-
data are provided to Eurostat, but it still does not produce job vacancy statistics. Labour cost
statistics are calculated based on a labour cost survey. INSTAT continues to conduct the survey
of income and living conditions wave (SILC) and the data has been validated and published by
Eurostat. Data on households and children poverty has been released using the EUROSTAT EU-
SILC survey. Statistics on external migration and asylum are partly aligned with the EU acquis.
Crime statistics are disseminated on annual basis and are fully based on administrative sources.
Crime statistics in Albania are classified based on national criminal code and laws, but INSTAT
is working on the mapping with the International Classification of Crime for Statistical Purposes
(ICCS). Collection of gender-disaggregated data has improved - the new official statistics
programme includes provisions to collect and analyse gender statistics. Further efforts are
needed to produce disaggregated data for certain groups, especially prevalence of violence and
harassment at work; and on data disaggregated by both sex and geographical location, age,
ethnicity, disabilities, and migratory status. The population and housing census was previously
66
postponed to 2022 due to the impact of the COVID-19 pandemic and the national elections,
however it has now been postponed to 2023 due to technical issues. Progress was made in the
preparation of this census, including communication activities and a second pilot census, Albania
needs however to ensure funding for its full implementation, and to use administrative data
where possible.
Agricultural statistics are partially aligned with the EU acquis. The quality of the data still
needs to be improved on the administrative registers, such as the farmer register, individual
register of animals and the animal holding registers. INSTAT also needs to finalise necessary
documents for the census of agriculture holdings, which is still planned for 2024, including a
corresponding action plan and budget, and ensure the necessary funds for its successful
implementation.
Environmental statistics are only very partly aligned to the EU acquis, while energy statistics
are moderately aligned. INSTAT and the national Agency of Natural Resources produce monthly
and annual energy statistics for commodity balances for all energy products (fuels) used in
Albania as well as prices of electricity for households and industry. Material flow accounts are
well aligned to the EU acquis. Air emission accounts, physical energy flow accounts and
environmental taxes by economic activity remain partially in compliance with the EU
requirements. Waste statistics have improved but they are not fully aligned yet. Data on
packaging waste are increasingly substantial as they are the basis for a new EU Budget own
resource on non-recycled plastic packaging waste. Albania already collects data on municipal
waste.
Chapter 32: Financial control
The EU promotes the reform of national governance systems to improve managerial
accountability, sound financial management of income and expenditure, and external audit of
public funds. The financial control rules further protect the EU’s financial interests against
fraud in the management of EU funds and the Euro against counterfeiting.
Albania is moderately prepared in the area of financial control. Some progress was made
during the reporting period, especially with the implementation of the policy document for the
strengthening of public internal financial control (PIFC), guidelines for auditing arrears, approval
of revised performance audit manual, and further alignment with the EU acquis on counterfeit
banknotes and coins. Internal control is not yet ensured across budget entities and it should be
enhanced through a stronger engagement between the Supreme State Audit Institution, the
Parliament and the Ministry of Finance and Economy.
Since only partial progress was made with the Commission’s 2021 recommendations, these
remain valid. In the coming year, Albania should in particular:
 implement the instructions on financial delegation of responsibilities and issue instructions
on delegation of management responsibilities with a view to improving managerial
accountability;
 monitor and follow-up the implementation of recommendations made in the annual PIFC
report across budget institutions;
 increase parliamentary scrutiny of audited bodies in the implementation of external audit
recommendations, through more frequent parliamentary hearings and the establishment of a
parliamentary monitoring framework to regularly assess government’s follow-up action.
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Public internal financial control
A strategic framework for PIFC is in place. PIFC measures are included in the public financial
management and the public administration reform strategies, and further defined in the 2021-
2022 PIFC policy document. The Ministry of Finance and Economy is responsible for
monitoring implementation but strengthened efforts are needed on implementation of PIFC
reforms beyond the Ministry.
Managerial accountability is not yet fully embodied in the legislation and administrative
practice. The adopted instructions on the delegation of financial responsibilities need to be
implemented and accompanied by delegation of operational and administrative responsibilities in
order to improve overall managerial accountability. In practice, a very small number of
administrative decisions are delegated to lower levels due to the centralised decision-making
system. The reoccurrence of arrears is an indicator for the not yet fully effective attribution of
responsibilities and commitment controls (See also section: Public administration reform).
The legislation on internal control is largely in line with international standards. In December
2021, the methodology for monitoring the performance of the internal control systems of public
entities and the financial management and control manual were approved. In 2021, more
institutions defined mission statements, objectives and outputs. During the reporting period, the
Central Harmonisation Unit supported five institutions in finalising books of business processes,
implementing delegation instruction and reporting lines, and establishing risk registers. Risk
management is still at an early stage at all levels and needs to be better incorporated in the
management of financial and operational processes. The budget inspection function, which is
centralised within the Ministry of Finance and Economy, performs ex-post activities upon
request.
The legislative framework on internal audit practice is in line with international standards. In
2021, the number of certified auditors in the public sector increased to 342, from 318 in 2020.
The internal audit function still does not issue audit opinions on the effectiveness of the internal
control systems across budget entities. The internal audit quality control procedures still need to
comply with the standards and become fully operational.
The Central Harmonisation Unit provides methodological guidance and capacity building and
monitors internal control and internal audit performance in the public sector on the basis of
quality reviews and self-assessment reports from institutions. In 2021, the Central Harmonisation
Unit issued an opinion of compliance of the internal audit activity for 25 assessed units, with
only 36% found partially or fully compliant. The annual PIFC report was presented to the
Council of Ministers and is being discussed in Parliament as part of the approval of the actual
2021 budget.
External audit
In line with the standards of the International Organisation of Supreme Audit Institutions,
Albania’s constitutional and legal framework provides for independence of the State Audit
Institution. Legal amendments are required to strengthen the scope of the audit mandate to cover
all public entities.
In accordance with its 2018-2022 strategic development plan, the State Audit Institution is
implementing actions to improve its institutional capacity. It needs to prepare and adopt a new
development plan for 2023 and beyond. It implements annual professional development for audit
68
staff, focusing in 2021, among others, on public procurement, concessions/PPPs, and the new
performance audit manual.
The quality of audit work needs to be further improved to fully comply with the International
Organisation of Supreme Audit Institutions’ standards. In November 2021, the revised
performance audit manual was approved. The State Audit Institution audit objectives have
shifted from compliance and regularity audits towards performance audits. It follows a risk-
based external audit approach.
The impact of audit work has shown some progress. The Albanian Supreme State Audit
Institution continues to compile annual reports on their performance, publishes them on its
website and reports accordingly to the Parliament. In 2021, the State Audit Institution reported
that 80% of accepted recommendations are in the process of being implemented, and some of
them have been fully implemented. Despite the high rate, with more than 90%, of the
recommendations having been accepted by the relevant institutions, the rate of fully
implemented recommendations needs to be further improved (in 2021 the rate was only 50%).
Protection of the EU’s financial interests
Albania has ensured some level of acquis alignment in the area. However, it still needs to fully
harmonise its legislation with the EU Directive on the fight against fraud to the EU’s financial
interests by means of criminal law. The national anti-fraud coordination service, has
established a network involving other relevant authorities such as the Specialised Structure
against Corruption and Organised Crime and meets regularly. The manual of procedures for
irregularities was revised and approved in December 2021. A national anti-fraud strategy still
needs to be adopted. Albania cooperates with the European Commission on investigations
and in 2021, it reported five cases of irregularities and suspected fraud. Although cooperation
with the anti-fraud coordination service on investigations has improved, more efforts in
developing a solid track-record on reporting of irregularities and on cooperation on
investigations are still needed in particular regarding law enforcement authorites.
Protection of the euro against counterfeiting
Albania further aligned with the acquis regarding the definition of counterfeiting banknotes and
coins, as well as the procedures for gathering, storing and withdrawing them from circulation. In
August 2021, the Bank of Albania approved regulations on medals and tokens similar to euro
coins, and on the reproduction criteria for banknotes and coins. Technical analysis is performed
by the national analysis centre of the Bank of Albania and the Scientific Police Institute. Formal
cooperation between the Bank of Albania, the State Police in the Ministry of the Interior and the
General Prosecutor’s Office should be established. In 2021, Albania seized 569 euro coins and
banknotes totalling approximately EUR 9 600, representing 38% of all seized counterfeit
currencies in the country, as compared to 18% in 2020.
3. GOOD NEIGHBOURLY RELATIONS AND REGIONAL COOPERATION
Good neighbourly relations and regional cooperation form an essential part of Albania’s
European integration process and contribute to stability, reconciliation and a climate conducive
to addressing open bilateral issues and the legacies of the past.
Albania maintained its engagement in a number of regional cooperation initiatives, such as the
Central European Free Trade Agreement (CEFTA), Energy Community, Transport Community,
69
the South East European Cooperation Process (SEECP) and the Regional Cooperation Council
(RCC)24
. In May 2022, Albania concluded one-year long Chairmanship-in-Office of the the
EUSAIR-AII (the EU Strategy for the Adriatic-Ionian Region) and hosted the Forum of the
Foreign Ministers of the members of the region. In June 2022, Albania hosted the Ministerial
Meeting of the Western Balkans Platforms on Culture & Research and Innovation & Education
and Training. Albania’s wider engagement in the field of youth, education, culture, as well as
civil society reached another momentum in the context of the activities of Tirana as the European
Youth Capital for 2022.
Following the May 2022 Foreign Affairs Council, EU foreign ministers held, for the first time,
an informal exchange of views with Western Balkans counterparts. The EU and Western
Balkans Leaders Meeting on 23 June 2022 reaffirmed their EU perspective of the region and
gave impulse to intensify cooperation, in particular on integration into EU measures on food and
energy supplies and independence, as well as to support capacity building for cyber security and
the social agenda, notably involving youth in the economy. The meeting was also an opportunity
to discuss closer political cooperation, including foreign policy alignment of the Western
Balkans with EU positions and restrictive measures.
At the EU-Western Balkans summit in Brdo pri Kranju in October 2021, the six Western
Balkans leaders reaffirmed their commitment to inclusive regional cooperation, strengthening
good neighbourly relations and investing more decisive efforts in establishing the Common
Regional Market. The summit announced a range of concrete deliverables benefiting the Western
Balkans, including the first set of actions under the Economic and Investment Plan; the pledge to
boost COVID-19 vaccination rates; the path towards lower roaming costs; an innovation agenda
for the Western Balkans; green lanes to reduce border waiting times and Transport Community
action plans for smart transport and sustainable connectivity. The Common Regional Market
(CRM), as agreed by the leaders of the Western Balkans at the 2020 Berlin process summit in
Sofia, will be critical in increasing the attractiveness and competitiveness of the region. It will
help Albania to speed up the recovery from the aftermath of the pandemic, notably to attract
investors looking for diversification of supply and shorter value chains and to maximise the
benefits of the infrastructure investments under the Economic and Investment Plan. A number of
important decisions to facilitate the movement of workers remain blocked. It is important that all
parties play a constructive role in building the Common Regional Market and deliver on their
joint commitments set out in the CRM action plan.
Albania, North Macedonia and Serbia seek to deepen regional cooperation in a number of areas,
notably economic integration through the Open Balkan Initiative (OBI), implementing some
elements of the common regional market on which no formal agreement has been reached yet.
Three OBI summits have been held over the reporting period.
In October 2021, Albania along with other Western Balkan partners endorsed the action plan for
the Green Agenda for the Western Balkans, which aims at reflecting the European Green Deal
and contributing to the sustainable socio-economic development and the green recovery of the
region after the pandemic. Albania should contribute to successfully implement this joint
regional vision, with high level of ambition, putting sustainable development, resource
efficiency, nature protection and climate action at the centre of all economic activities.
24
Albania actively participates in around 35 regional organisations and initiatives.
70
Albania generally maintains good bilateral relations with other enlargement countries and
neighbouring EU Member States.
Relations with Bosnia and Herzegovina remained friendly and without open issues, with
occasional high-level bilateral visits. The two countries are still to establish full-fledged bilateral
embassies, as agreed the previous year. Trade flows remain low.
Albania’s relations with Kosovo remained good overall. During the reporting period, the 7th
and
8th
government-to-government meetings with Kosovo took place, respectively in November 2021
and in June 2022, where 32 bilateral agreements, protocols and memoranda of understanding
were signed mainly on facilitating free movement of people and trade exchange, education,
infrastructure, and culture. The two governments agreed to waive requirements for granting
temporary (5 years) residence permits, and a new border crossing-point has been opened in
Shishtavec, easing control procedures for customs. The two governments also signed a
memorandum of cooperation for a feasibility study for a Durrës-Pristina railway segment and an
agreement on natural gas supplies from the Vlora thermal power plant. Numerous high-level
visits of government members as well as parliamentary committees took place during the
reporting period. In November 2021, the President of Albania made an official visit to Kosovo.
In April 2022, Albania and Kosovo conducted a joint police operation to tackle corruption in
their joint border crossing-point in Vërmicë. Albania has continued to support the EU-facilitated
Belgrade-Pristina dialogue.
Relations with Montenegro remained good overall. In December 2021, the Foreign Minister of
Montenegro visited Albania. Cross-border cooperation was strengthened, in particular after the
opening of the joint border point Grabom-Zatrijebačka Cijevna.
Relations with North Macedonia remained good, including with frequent high-level visits from
both sides. In February 2022, new joint border crossing points between Albania and North
Macedonia were opened. The agreement between the government of North Macedonia and the
Council of Ministers of Albania on mutual recognition of approvals for Authorized Economic
Operator for Security and Safety (AEOS) has been signed in December 2021.
Relations with Serbia remained good. In November and December 2021, the Prime Minister of
Albania and the Serbian President paid reciprocal visits in the context of the Open Balkans
initiative (OBI). In the context of tensions on agricultural trade due to Russia’s war in Ukraine,
Serbia announced its decision to export 30,000 tonnes of wheat to Albania and in return, Serbia
would use the port of Durrës to import oil from the Gulf countries.
Relations with Türkiye have continued to strengthen, as notably reflected in the exchange of
high-level visits. The President of Türkiye, accompanied by seven ministers, visited Albania in
January 2022. A number of bilateral agreements were signed in the fields of law enforcement,
culture, youth, and natural disaster management. In December 2021, Albania’s Speaker visited
Ankara, and in March 2022, the Prime Minister of Albania subsequently visited Istanbul.
Türkiye continues to exercise pressure on Albania to deliver on dismantling the so-called Gülen
movement in the country.
Relations with Greece remained good with continued political dialogue. Greek minority rights,
in particular, property rights of the Greek minority remain a subject of disagreement in the

This designation is without prejudice to position on status, and is in line with UNSCR 1244(1999) and the ICJ
Opinion on the Kosovo declaration of independence.
71
bilateral relations. On the issue of the delimitation of the maritime border, both sides agreed to
jointly refer the case to the International Court of Justice .
Relations with Italy remained very good. Political dialogue intensified with high-level visits on
both sides. In November 2021, the Prime Minister of Albania visited Rome. The cooperation in
the field of defence, civil emergencies, justice and home affairs further strengthened, including
the fight against cybercrime, trafficking in human beings, illegal migration and asylum. As of
2022, Albanian immigrants that have worked in Italy will be able to receive pensions based on
their Italian contributions.
4. ABILITY TO ASSUME THE OBLIGATIONS OF MEMBERSHIP
CLUSTER 2: INTERNAL MARKET
This cluster covers: free movement of goods (Chapter 1); freedom of movement for workers
(Chapter 2); right of establishment and freedom to provide services (Chapter 3); free movement
of capital (Chapter 4); company law (Chapter 5); intellectual property law (Chapter 7);
competition policy (Chapter 8); financial services (Chapter 9); and consumer and health
protection (Chapter 28). This cluster is key for Albania’s preparations for the requirements of the
EU’s internal market and is of high relevance for early integration and the development of the
Common Regional Market.
Albania is moderately prepared in most of the areas of the internal market, namely the free
movement of goods, services and capital, intellectual property law, competition policy, and
financial services, whereas its preparations are at an early stage on consumer and health
protection. Albania has some level of preparation regarding freedom of movement of workers,
with some progress registered with the adoption of a new law on foreigners. Good progress was
made in intellectual property thanks to the adoption of legislation on copyright, as well as on
industrial property rights. There was also good progress on financial services by the
implementation of the non-performing loan (NPL) resolution strategy, leading to their reduction.
Albania has made some progress in particular by implementing legislation on compulsory
insurance in transport and in fulfiling some of the recommendations of the Moneyval report, but
the State Aid Commission needs to be made independent and sufficiently resourced. Preparations
are at an early stage on consumer and health protection, as the country made limited progress; it
needs to align to EU health acquis and learn lessons from the COVID-19 pandemic to strengthen
health emergency preparedness.
Chapter 1: Free movement of goods
The free movement of goods ensures that many products can be traded freely across the EU
based on common rules and procedures. Where products are governed by national rules, the
principle of the free movement of goods prevents these creating unjustified barriers to trade.
Albania has some level of preparation/is moderately prepared in the area of free movement of
goods. There was limited progress overall and on last year’s recommendations, notably on
alignment with the EU "new and global approach" product acquis. Despite progress on the
general principles and on structures related to the quality infrastructure, last year’s
recommendations remain valid, as efforts are still needed to ensure legislative alignment and to
strengthen enforcement.
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In the coming year, the country should in particular:
 complete the alignment of its legislation with the EU acquis relevant to the quality
infrastructure;
 further strengthen the enforcement capacity of the Market Surveillance Inspectorate.
General principles
Albania removed the remaining measures in place that affected the production, distribution,
and marketing of industrial products in the previous reporting period. Plans for further
alignment with the EU acquis are set out in the 2022-2024 national plan for European integration
adopted in February 2022, and in the current consumer protection and market surveillance
strategy.
Non-harmonised area
Albania still has no action plan for screening national technical regulations for compliance with
Articles 34-36 of the Treaty on the Functioning of the European Union (TFEU).
Harmonised area: quality infrastructure
Albania’s legislation on accreditation and market surveillance is partially aligned with the EU
acquis. Administrative structures already exist to deal with technical regulations, standardisation,
conformity assessment, metrology, accreditation, and market surveillance, but recruitment of
specialised staff to the Market Surveillance Inspectorate is still ongoing. Albania has mutual
cooperation agreements on accreditation, standardisation, and conformity assessment with
countries in the region and other non-EU countries.
On standardisation, Albania adopted implementing legislation in November 2021 designed to
align with the EU acquis. Albania’s General Directorate of Standardisation (GDS) is a full
member of the European Telecommunication Standards Institute (ETSI), an affiliate member of
the European Committee for Standardisation (CEN) and the European Committee for
Electrotechnical Standardisation (CENELEC), and an associate member of the International
Electrotechnical Commission (IEC). It applied to become a full Member of CEN/CENELEC in
July 2021. National standards are adopted in conformity with European standards (CEN,
CENELEC and ETSI standards). During the reporting period, 2 225 European and international
standards were adopted (including 844 CEN, 454 CENELEC, 400 ETSI ones, as well as 336
ISO, and 191 IEC standards). 100 % of the harmonised European standards were adopted as
harmonised Albanian Standards in implementation of technical harmonised Directives and
Regulations.
Albanian legislation on the accreditation of conformity assessment bodies is partially aligned
with the EU acquis. Staff at the General Directorate of Accreditation (GDA) increased from 14
to 20 employees, but two positions are still vacant. There are 97 accredited conformity
assessment bodies (47 testing laboratories, 4 medical laboratories, 1 calibration laboratory, 6
certification bodies of management system, 11 certification bodies of persons and 28 inspection
bodies). GDA is a signatory of the European Cooperation for Accreditation Multilateral
Agreement (EA MLA) in the fields of inspections and management systems certification, testing
and certification of persons, a full member of the International Laboratory Accreditation
Organisation Mutual Recognition Agreement (ILAC MRA) in the field of inspection, and has a
mutual recognition agreement with ILAC. The General Directorate of Metrology (GDM)
73
maintained its capacity of 104 employees and is fully operational. It is a full member of the
International Organization of Legal Metrology (OIML), European Association of National
Metrology Institutes (EURAMET) and International Measurement Confederation (IMEKO), and
an associate member of the European Legal Metrology (WELMEC) and International Bureau of
Weights and Measures (BIPM-CGPM).
The state inspectorate for Market Surveillance (SIMS), which was restructured in June 2020
with an increase of the number of possible employees from 69 up to 80 staff (currently
employing 65 staff), should continue to increase actual staff numbers, including inspectors. In
the reporting period, SIMS carried out more than 1 700 inspections, leading to 152
administrative measures, including 86 fines and 25 urgent measures. In total, 31 different
products (3 697 units), have been taken off the market.
Harmonised area: sectoral legislation
In the area of ‘new and global approach’ product legislation Albania adopted implementing
legislation in the reporting period designed to be fully aligned with the EU acquis on personal
protective equipment. It also adopted a law that only allows pyrotechnical articles that have
fulfilled conformity procedures and have the CE marking affixed to be placed on the Albanian
market. However, alignment has not yet started on cableways, gas appliances, simple pressure
vessels, outdoor equipment noise emissions, explosive atmospheres equipment, construction
products, recreational craft, or on eco-design and energy labelling.
As regards the ‘old approach’ product legislation, Albania evaluates that its legislation is
partly aligned with the EU acquis on pre-packaging, textiles, footwear, crystal glass, aerosol
dispensers, and units of measurement. Its legislation is designed to be fully aligned on
Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH), on chemical
classification, labelling and packaging (CLP) and on detergents. Implementing legislation was
adopted in June 2021 designed to be aligned with the EU acquis on measuring bottles. Albania is
not aligned on Good Laboratory Practice (GLP).
Albanian legislation is not aligned on drug precursors, though the list of controlled substances
complies with the relevant lists in the EU acquis. On procedural measures, Albania is partly
aligned on firearms, crystal glass, footwear, textile labelling and mixtures, and the pricing of
medicinal products. Albania remains partially aligned with the EU acquis on defence and
security procurement, on defence products, and on the return of cultural objects unlawfully
removed from the territory of a Member State.
Chapter 2: Freedom of movement of workers
Citizens of one Member State have the right to work in another Member State and must be given
the same working and social conditions as other workers.
Albania has some level of preparation in freedom of movement for workers. Some progress
was made on the implementation of the 2021 report’s recommendations regarding free
movement of family members of EU citizens, strenghtening of social security bilateral
agreements and the development of the IT system for mapping job seeker vacancies that is
preparing the implementation of the European network of employment services (EURES) upon
accession. In the coming year, Albania should:
 continue the development of the IT system to enable connection to EURES;
74
 adopt the implementing legislation for the new law on foreigners’;
 continue negotiating and implementing new bilateral agreements on social security, notably
with EU Member States.
As regards access to the labour market, Parliament adopted a new law on foreigners, enabling
simplified procedures for EU citizens settling in Albania, in line with the EU acquis in this area.
Further steps need to be taken to finalise the adoption of the related implementing legislation.
In preparation for joining the European network of employment services (EURES), Albania
has established an integrated database for its employment services that will facilitate exchanges
of information between IT departments on civil status, the tax system, the compulsory healthcare
system and the economic assistance system. The IT system to enable connection with EURES
needs to continue to be developed.
On the coordination of social security systems, Albania has bilateral agreements in place with
Austria, Belgium, Czechia, Germany, Hungary, Luxembourg, North Macedonia, Romania, and
Türkiye. The agreement with Kosovo was ratified by Albania in March 2022. The negotiations
with Bulgaria for a new agreement were concluded in 2021, and its entering into force was
postponed to 2023. Exchanges on coordinating social security schemes have taken place with
Croatia, Greece, Serbia, and Montenegro. A technical cooperation agreement is in place to
continue negotiations for a bilateral agreement with Italy. Negotiations and implementation of
new bilateral agreements on social security between Albania and further EU Member States have
yet to be fostered.
Chapter 3: Right of establishment and freedom to provide services
EU natural and legal persons have the right to establish themselves in any Member State and to
provide cross-border services. For certain regulated professions, there are rules on mutual
recognition of qualifications. Postal services are open to competition since 2017.
Albania is moderately prepared in the right of establishment and freedom to provide services.
Some progress was achieved in the reporting period, in particular in the field of postal services
through the legal alignment made in the area of cross-border parcel delivery services. The
screening exercise of the legislation to be aligned with the Services Directive continued and its
scope was widened. The country should focus on fully implementing the Commission’s
recommendations from 2021 which still remain valid.
In the coming year, Albania should in particular:
 finalise the screening of the existing legislation to identify barriers to the freedom of
establishment and free movement of services with a view to further aligning its legislation
with the Services Directive;
 step up efforts to align its legislation with the EU acquis and ensure appropriate institutional
capacity in the area of mutual recognition of professional qualifications.
On the freedom of establishment and the free movement of services, the screening of the
existing legislation - to identify barriers with a view to aligning it with the Services Directive -
continued during the reporting period. So far, the exercise was completed for 20 sectors
involving the review of 151 pieces of legislation, which resulted in identifying 80 pieces of
legislation that will need to be revised to remove provisions that are contrary to the Services
75
Directive. In total, 18 sectors are still in the screening process. The National Business Centre
functions as a one-stop-shop for registering businesses and issuing licences, authorisations and
permits. The e-Albania.al governmental portal serves as a single contact point for electronic
public services and as of May 2022, almost 95% of services are offered online.
On postal services, the national legislation is aligned with the EU postal acquis. Albania is
aligned with the Postal Services Directive since 2017, when the postal market was opened to
competition, and with the Regulation on cross-border parcel delivery services since January
2022. Supporting bylaws were adopted in June 2022, as regards, for example, parcel delivery
services and transparency on cross border tariffs. Albania also adopted a new policy document
on postal services, setting objectives to improve future postal sector performance in line with the
EU postal acquis. There is currently one universal service provider (Albanian Post S.A.)
designated for a period of 5 years, starting from July 2020, and 33 other postal service providers
on the market.
No progress was made during the reporting period on aligning the professional qualifications
framework with the EU acquis on the mutual recognition of professional qualifications. A
roadmap on professional qualifications is yet to be finalised. Institutional capacity in this area
still needs to be strengthened.
Chapter 4: Free movement of capital
In the EU, capital and investments must be able to move without restriction and there are
common rules for cross-border payments. Banks and other economic operators apply certain
rules to support the fight against money laundering and terrorist financing.
Albania is moderately prepared in the area of free movement of capital. Some progress was
made on the implemention of Moneyval recommendations and of the FATF Action Plan, but
limited progress was made on enabling EU citizens to acquire land. There was also progress on
increasing financial literacy and in implementing the national payment system legislation.
In the coming year, Albania should in particular:
 finalise the implementation of the FATF Action Plan and continue to address the Moneyval
recommendations;
 avoid jeopardising the progress in this area by adopting a tax and criminal amnesty against
the advice of the EU and Moneyval;
 progress in the adoption of the relevant legislation that would provide EU citizens with the
right to acquire land, which is outstanding since 2016.
On capital movements and payments, Albania is late in delivering on its commitment under
the 2006 Stabilisation and Association Agreement (SAA) to amend the arrangements for the
acquisition of property by EU nationals/entities, a step due since 2016. Provisions regulating the
acquisition of agricultural real estate by foreigners remain unchanged and uncertainties over
ownership rights continue to discourage investment.
On payment systems, foreign banks can open branches and agencies in Albania and offer cross-
border payments. In October 2021 Albania adopted legislation to partly align with the EU acquis
on direct debits and credit transfers. The measures introduced by BoA in the context of COVID-
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19 restrictions in March 2020 to reduce the costs of payment systems services and to promote
home banking remain in place.
The National Payment System Committee, which is open to representatives of non-bank
financial institutions and payment system operators, is implementing the national retail payments
strategy (NRPS) 2018-2023. The law on payment services, designed to be aligned with the EU
Payment Service Directive II (PSD II) provisions on transparency conditions and information
requirements for payment services, came fully into effect in July 2022. Implementing legislation
for this law was adopted in the reporting period, regulating the public register of payment service
providers, amending the existing regulations on licensing of payment institutions and electronic
money institutions, regulating the banking activities of banks and foreign banks’ branches. It also
sets strong customer authentication requirements and common and secure open communication
standards. In May 2022, the scope of application of the regulation on International Payment
Account Number was extended to other payment service providers beyond banks in cases when
the IBAN is used. The financial literacy of the Albania’s adult population is increasing (67 %
now have a payment account of which 55 % are held by men, 45 % by women, compared to 40
% in 2014), as is the use of electronic payments (12 electronic transactions per capita per adult,
compared to 4 in 2016).
On the fight against money laundering, Albania continues its efforts to address the deficiencies
in technical compliance identified by the 2018 Moneyval mutual evaluation report. Albania is
still on the Financial Action Task Force’s (FATF) list of jurisdictions under increased
monitoring. There was steady progress in the implementation of its FATF Action Plan, though its
completion is overdue since February 2022. The final pending action items from the Action Plan
relate to sanctions with regard to beneficial ownership information/transparency obligations and
increased convictions and confiscations. Amendments to the law on money laundering designed
to align it with the EU acquis were adopted in December 2021. The Register of beneficiary
owners became operational at the end of June 2021 with data registered by businesses and
NGOs, though amendements extended the registration deadline to June 2022.
Albania has legislation in place on risk management standards and licensing requirements of
financial institutions, including non-banks and foreign exchange bureaus, following the
Moneyval recommendations. The latest Moneyval report (June 2022) noted improvements on
technical compliance with FATF recommendations and led an upgraded rating for three of them,
i.e., the transparency of beneficial ownership of legal persons, supervision of financial
institutions, and the legal framework for mutual legal assistance with foreign counterparts on
non-conviction-based confiscations. Although the IMF reiterated in May 2022 its advice to
Albania not to engage in a possible tax amnesty, given concerns about its impact on tax
compliance as well as money laundering and governance risks, in June the government published
for consultation a draft law on fiscal and criminal amnesty to those who will do voluntary assets
disclosure. The adoption of such a law against the advice of the EU and Moneyval could
jeopardise progress in this area – see also chapter 24 – Justice Freedom and Security and 16 –
Taxation. The Albanian Financial Intelligence Unit (FIU) has increased its staff, and trained its
employees on financial investigation techniques, asset tracing, seizure and confiscation, risk-
based implementation techniques, and cybercrime prevention indicators. The head of the FIA
was changed twice in a short period by the government.
In 2021 the BoA increased its inspections on foreign exchange offices (FEO) by 22 % to (90
FEOs inspected, compared to 74 in 2020). Substantial discrepancies were identified in 26 FEOs,
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which led to 12 license revocations – the others received recommendations and penalties. The
Public Oversight Board carried out three thematic inspections focused on preventing money
laundering and the financing of terrorism, identified irregularities were refered to the Finance
Intelligence Unit. In 2021, the Financial Supervisory Authority started an assessment on the
Virtual Assets and Virtual Asset Service Providers and regulations on cryptocurrencies in order
to adjust them according to the FATF recommendations. The Albanian Financial Intelligence
Unit (FIU) received 1 581 suspicious transaction reports in 2021, 12 % more than in 2020; 247
of which were referred to law enforcement agencies, slightly less than in 2020.
Chapter 6: Company law
The EU has common rules on the formation, registration and disclosure requirements of a
company, with complementary rules for accounting and financial reporting, and statutory audit.
Albania is moderately prepared in the field of company law. No progress was made in the
reporting period, therefore the recommendations of last year remain valid.
In the coming year, Albania should in particular:
 Finalise the review of the existing legislation in the area of company law to identify
amendments needed to complete alignment with the EU acquis and makes progress to
introduce such amendments,
 further align the legal framework on accounting, transparency and audit with the latest EU
acquis in these areas.
Although there is some alignment with the EU acquis in a range of company law areas, there
was no legislative progress in the reporting period. Further alignment is needed with the 2019
company law acquis on the use of digital tools and on cross-border operations, as well as with
rules on the encouragement of long-term shareholder engagement. A corporate governance code
for listed companies still needs to be developed. The National Business Centre is responsible for
company registration, allowing free online registration and online access to data. Many services
are offered only online through the e-Albania electronic service window, in particular since May
2022. Electronic exchange of data between the Albanian business register and EU Member
State’s business registers is possible, while proper integration among these databases requires
further development.
On transparency, the 2020 Law on capital markets provides specific transparency rules for
listed companies in areas related to initial reporting and financial reporting including fines in
case of non-compliance. A regulation concerning listed companies aiming at further alignment
with the relevant EU acquis on transparency requirements was drafted and published for
consultation.
In the area of company reporting, the Law on accounting and financial statements is partially
aligned with the EU Accounting Directive. The National Accounting Council (NAC) monitors
the enforcement of financial reporting and accounting standards. On non-financial reporting,
there are only guidelines to comply with the EU Directive on disclosure of non-financial and
diversity information by certain large undertakings and groups. On statutory audit, the Public
Oversight Board (POB) is the independent competent authority for quality assurance (with its
own budget). Since June 2021, the POB conducted 9 inspections of statutory auditors/audit firms
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Albania should further strengthen POB capacity and align its framework with EU statutory audit
rules.
Chapter 7: Intellectual property law
The EU has harmonised rules for the legal protection of intellectual property rights (IPR) and of
copyright and related rights. Rules for the legal protection of IPR cover, for instance, patents
and trademarks, designs, biotechnological inventions and pharmaceuticals. Rules for the legal
protection of copyright and related rights cover, for instance, books, films, computer
programmes and broadcasting.
Albania has some level of preparation/is moderately prepared on intellectual property rights.
Good progress was made during the reporting period, in particular with the adoption of the
National Strategy for Intellectual Property 2022 – 2025 and the legislative alignment with the EU
acquis in the areas of copyright and other related rights as well as industrial property rights. In
the coming year, Albania should in particular:
 adopt the implementing legislation for the amendments to the law on copyright and other
related rights;
 continue to improve the functioning of collective management organisations and the payment
of royalties to right holders;
 further align legislation on industrial property rights and the IPR enforcement system.
In the area of copyright and neighbouring rights, the two main bodies responsible are the
General Directorate of Industrial Property (GDIP), which is in charge of registering,
administrating and promoting intellectual property objects and the Copyright Directorate of the
Ministry of Culture. The National Copyright Council, comprises five members appointed by the
Minister for Culture, is responsible for certifying the tariff methodology.
In April 2022, the Parliament adopted amendments to the “Law on copyright and other related
rights”, which further aligns the legal framework with the EU acquis in the areas of a) certain
permitted uses of orphan works; b) certain permitted uses of certain works and other subject
matter protected by copyright and related rights for the benefit of persons who are blind, visually
impaired or otherwise print-disabled, and c) on the term of protection of copyright and certain
related rights. The amendments also regulate the functioning of Collective Management
Organisations (CMOs) including the distribution manner and percentage of the fee as well as the
remuneration collected by the CMOs.
On industrial property rights, a law on trade secrets was adopted in July 2021 to align the legal
framework with the EU acquis in this area. The new National Intellectual Property Strategy 2021
– 2025 passed the phase of public consultation.
In 2021, there were 1 404 national and 2 107 international applications for registration of
trademarks (compared to, respectively, 1 164 and 2 936 in 2020). In 2021, 49 applications for
registration of industrial designs were submitted to the GDIP (compared to 15 in 2020). The
number of applications for national patents amounted to 23 for 2021, almost the double of the
applications recorded in 2020.
The State Inspectorate for Market Surveillance (SIMS) is responsible for the monitoring of the
enforcement of intellectual property rights. In 2021, the Copyright Division of the SIMS carried
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out 501 inspections resulting in 80 administrative measures (53 fines and 27 warnings). The
SIMS industrial property division carried out 11 inspections, resulting in 8 administrative
measures (7 fines and one warning) in 2021.
In 2021, the customs administration suspended the release of 3 000 products suspected of
infringing IPR (compared to over 23,000 such products in 2020).
Chapter 8: Competition policy
EU rules protect free competition. They include antitrust rules against restrictive agreements
between companies and abuse of dominant position, and also include rules on concentrations
between companies which would significantly impede effetive competition. EU rules also set out
a system of State aid control. Governments are only allowed to grant State aid if restrictive
conditions are met, with a view to preventing distortion of competition.
Albania has some level of preparation / is moderately prepared in competition policy. There
was limited progress during the reporting period, in particular with the adoption of guidelines
by the Albanian Competition Authority (ACA) on best practises in the area of merger
procedures. However, no progress was made in legislative alignment with the EU acquis in the
area of State aid. Despite recommendations in previous years, the operational independence of
the State aid Commission (SAC) has not yet been ensured. Its enforcement record needs to be
significantly improved. Recommendations from the previous year were not met and remain
valid.
In the coming year, the country should in particular:
 ensure the operational independence of the SAC and significantly increase the administrative
capacity of SAC’s secretariat;
 further align the legislative framework in the area of State aid with the EU acquis;
 step up efforts to raise awareness of the SAC with respect to line ministries, regional and
local authorities in order to ensure prior notification of aid measures and strengthen the
enforcement of State aid rules.
Antitrust and mergers
Albania’s legislative framework is broadly in line with the EU acquis and the Stabilisation and
Association Agreement (SAA). The Law on the protection of competition is largely aligned with
Article 101 TFEU (restrictive agreements) and Article 102 TFEU (abuses of dominant position).
It also provides for prior control of mergers, in line with the Merger Regulation. Implementing
legislation is broadly in line with the relevant EU regulations and Commission guidelines. In the
reporting period, the Albanian Competition Authority (ACA) approved guidelines on best
practices in cases of implementation of procedures for the control of concentrations, in line with
the EU best practices in this area.
As regards the institutional framework, the ACA is responsible for implementing the Law on
the protection of competition. It is an operationally independent authority reporting to
Parliament. It can adopt implementing legislation, impose fines and remedies, prohibit mergers
or authorise them, with or without conditions. Parties may appeal against the ACA’s decisions
before the courts. As regards enforcement capacity, the ACA has maintained its number of staff
to 46 and its staff has benefitted from relevant training. On implementation, in 2021 the ACA
took 94 decisions, including 28 on prohibited agreement, 16 on abuse of dominant position, 33
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authorising concentrations. In the first half of 2022 ACA took 37 decisions, including 3 on
prohibited agreement, 4 on abuse of dominant position and 24 authorising concentrations. In the
reporting period, the ACA concluded sector enquiries in the hospital services market, fertilisers
and LNG instruments. The ACA should continue its positive efforts to strengthen the
enforcement of competition rules.
State aid
On legislative framework, the Law on State aid largely reflects Articles 107 and 108 TFEU.
The implementing legislation is partially aligned with the EU acquis only in some areas e.g. the
General Block Exemption Regulation. Further alignment with EU implementing legislation on
State aid control is needed.
As regards the institutional framework, the State Aid Commission (SAC) is responsible for
implementing the Law on State aid. Its operational independence, which is required by the SAA,
remains to be ensured given that it still depends on the Ministry of Finance. The SAC can order
the recovery of illegal and incompatible aid but has not done so to date. Its decisions are subject
to court appeal.
The enforcement capacity of the SAC remains insufficient as the staffing of its secretariat needs
to be significantly increased. On implementation, the track record on State aid control remains
very poor. The State Aid Commission approved only one decision in 2021 and 3 decisions in the
first half of 2022 on the authorisation of State aid. No negative or recovery decision was taken.
Advocacy activities among aid grantors need to be stepped up to ensure prior notification of aid
measures.
Liberalisation
The Law on State aid applies to all legal and natural persons performing an economic activity.
There has been no investigation of State aid for public undertakings or undertakings with special
or exclusive rights.
Chapter 9: Financial services
EU rules aim at ensuring fair competition among, and the stability of, financial institutions,
namely banking, insurance, supplementary pensions, investment services and securities markets.
They include rules on authorisation, operation and supervision of these institutions.
Albania is moderately prepared in the area of financial services. Good progress was made on
last year’s recommendation on further alignment with Basel III, the resolution plans and the
retail payments, and by the partial implementation of the policy guidance on non-performing
loans (NPL), leading to a reduction in NPLs. Progress was also made on the operationalisation of
the bankruptcy legislation, and on compulsory insurance and collective investments.
In the coming year, Albania should:
 finalise the drafting and adopt the strategic documents on financial education and on capital
market development;
 improve collateral execution, including through solving the impasse on private bailiff
services;
 increase the use of the national currency.
On banks and financial conglomerates, the Bank of Albania (BoA) continued to align its
banking regulation with Basel III, notably on the capital adequacy ratio. It adopted legislation
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designed to be aligned with the EU acquis on the internal liquidity adequacy assessment process,
which provides a regulatory framework to ensure adequate levels of liquidity reserves. National
legislation on the capital adequacy ratio and on the net stable funding ratio of banks were both
amended in order to further align with the EU acquis on new credit risk requirements, the latter
enters into force on 1 January 2023. National legislation designed to further align with the EU
acquis was also adopted on establishing and operating asset management companies, and on the
conditions for the types of agreements to be protected in partial asset transfers and liabilities of
banks under resolution. For the first time since the establishment of the Resolution Authority and
in line with regulatory deadlines, BoA completed resolution plans for all banks.
The non-performing loan (NPL) ratio continued to decrease, to 5.42 % in April 2022 compared
with 7.9 % in April 2021, and remained at a similar level in the second quarter of 2022. BoA
adopted a decision on consumer credit and mortgage credit in September 2021 to ensure fair
market practices with regards to interest rates, commissions and penalities applied on loan
products, especially by non-bank financial entities. It amended national legislation on the
functioning of its credit registry and on conditions and procedures on information and data use
and revision, but further action on credit scoring is still needed. National legislation was
amended in November 2021 on transparency of banking and financial products and services to
align with the worldwide reform on reference indexes, including the EU’s. While the full
implementation of the bankruptcy law enables further execution of the NPL Resolution Strategy,
part of the collateral execution system is currently subject to court proceedings, which reduces its
efficiency.
Albania has a system to identify systemically important banks that is similar to EU practice, and
the BoA has an investment policy for the financial assets of the resolution fund. New national
legislation on the leverage ratio of banks and on the net stable funding ratio of banks, designed to
further align bank legislation with Basel III, entered into force in January 2022. In response to
the impact of the COVID-19 pandemic, BoA also temporarily suspended the 2019 and 2020
dividend distribution for banks, in order to boost capital and support lending. It renewed this
decision in January 2022.
In the area of insurance and occupational pensions, national legislation on compulsory
insurance in the transport sector is designed to align with the relevant EU acquis, the law
provides for voluntary implementation of the bonus malus system by insurance agencies.
Implementing legislation was adopted during the reporting period enabling full implementation
of the Law, including an application for personal injury calculation in cases of road accident. The
insurance market continues to be dominated by the non-life insurance companies (8 out of 12
companies). In February 2022, the Albanian Financial Supervisory Authority (AFSA) lifted
measures taken to ensure financial sustainability during the COVID-19 pandemic to require
insurance companies to suspend the distribution of profits for 2020 via dividends or other forms
of payment. In March 2022, the AFSA became a member of the International Association of
Insurance Supervisors (IAIS) Multilateral Memorandum of Understanding, an international
supervisory cooperation and information exchange agreement
Regarding the financial market infrastructure, the Albanian Stock Exchange, which is a
private entity, continues to only trade government bonds. Following its suspension in April 2022,
the public stock exchange is no longer registered as a licensed financial subject and is not
operational. A Central Securities Depository (AFISAR) remains in place, operated by the BoA.
The Albanian Securities Registry (ALREG), a private company, ensures the settlement of non-
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government securities. The agreement between BoA and AFSA, stipulates that BoA is
responsible for minimising the systemic risk, and AFSA is responsible for investor protection.
Since March 2021, ALREG is an indirect participant in the BoA’s Albanian Interbank Payment
System. The guarantee fund’s regulation was adopted by the Board of AFSA. This means tha the
post-trade infrastructure is fully operational. Albania’s legal framework on capital markets is
partially aligned with MiFID II, as well as the EU acquis on transparency, market abuse,
prospectuses, settlement and central securities depositaries. Albania’s capital market consists of
two segments: i) government securities and ii) bonds issued through private placement. During
the reporting period, AFSA has licensed two banks to perform investment services. Currently
there are 13 entities which operate in the capital market, mainly banks, and one central securities
depository and one securities exchange. Implementation of the compliance and risk-based
supervision of the collective investment undertakings will be based on the manual adopted by
AFSA in May 2022. Relevant entities are required to increase the frequency of their reporting to
AFSA on net redemptions and liquidity indicators.
The expiry period of the privatisation vouchers was extended until December 2023. Regarding
securities markets and investment services, AFSA continues to supervise regulated markets in
accordance with the Law on capital markets.
Chapter 28: Consumer and health protection
EU rules protect consumers’ economic interests and in relation to product safety, dangerous
imitations and liability for defective products. The EU also ensures high common standards for
tobacco control, blood, tissues, cells and organs, and medicines for human and veterinary use.
The EU also ensures high common standards for upholding patients’ rights in cross-border
healthcare and tackling serious cross-border health threats including communicable diseases.
Preparations are at an early stage in the area of consumer and health protection. There was
limited progress on last year’s recommendations with the adoption of the new policy framework
for health 2022-2030. The policy addresses not only emergency preparedness but all aspect of
the health system. Significant progress still needs to be made to implement the One Health
approach and all-hazard health preparedness, to strengthen the policy framework and ensure that
everyone in Albania has quality healthcare coverage, as revealed by the COVID-19 pandemic.
There was some progress on alternative dispute resolution of consumers.
In the coming year, the country should in particular:
 further align its legislation with the EU health acquis on substances of human origin, on
medicines for human and veterinary use, and on tobacco control, and accede to the WHO’s
Framework Convention Protocol to Eliminate Illicit Trade in Tobacco Products;
 increase the allocations of financial and human resources in the health sector, specifically in
primary health care, and use the lessons learnt from the COVID-19 pandemic to strengthen
all-hazard health emergency preparedness, including threats beyond communicable diseases
and responses both at central and local level, and increase quality and consistency of data;
 guarantee equal access to quality health services for vulnerable populations, including Roma
and Egyptian minorities, older people, people with pre-existing mental health problems, with
disabilities, rural or remote populations, notably for women and girls belonging to these
groups who are often subjected to multiple forms of discrimination.
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Consumer protection
On horizontal aspects, in the reporting period Albania’s Consumer Protection Commission
(CPC) met seven times and took five decisions related to misleading/unfair commercial
practices. During the same period, CPC received 65 complaints (58 by individual consumers,
consumer organizations or local government, 7 from businesses). 30 complaints were resolved,
28 were referred to competent authorities, and the others are being processed. Implementing
legislation adopted in July 2021 completes the legal basis for the General Directorate on
Alternative Dispute Resolution of consumers, setting the criteria for the functioning of structures
for alternative dispute resolution.
National legislation is partially aligned with the EU acquis on product safety. In the reporting
period the State Inspectorate for Market Surveillance (SIMS) carried out more than 1 700
inspections, checking more than 7 000 products of which 441 were found in non-conformity,
leading to 152 administrative measures (51 warnings, 86 fines and 25 urgent measures). In total,
31 different products (3 697 units), have been banned from trading. On non-safety-related
issues, progress was made towards partial alignment to the EU acquis on distance marketing of
consumer financial services by the adoption of implementing legislation in December 2021
designed to improve the rules on the information to be provided to consumers by traders.
Public health
On public health, a new policy framework covering the period 2021-2030 was adopted in April
2022 and the 2020-2025 action document on primary health care is being implemented. Public
spending on health remains low overall, with disproportionate allocations for primary health
care, especially maternal and child health. Further investment is needed to progressively ensure
universal health coverage, especially to address the needs of hard-to-reach groups and the most
disadvantaged. The mortality rate remains high, particularly neonatal, under 5, and infant
mortality (at 8, 9, and 11 per 1 000 live births respectively). The quality of neonatal care is a
particular concern. Health governance remains unclear, and the inadequate quality of primary
health care services is a key bottleneck. Among cases reported in 2021 by the State Supreme
Audit Institution to the prosecution, one case involved a former Minister of Health. Albania has
ratified most international conventions related to the protection of fundamental rights, but
obstacles persist across the country on the right to health and to sexual and reproductive health
services, particularly for vulnerable groups. Abortion care is guaranteed by law, but women from
vulnerable groups, especially Roma and Egyptians, face barriers getting it.
The Ministry of Health and Social Protection (MHSP) and the National Agency of Information
Society (NAIS) are responsible for e-health. MHSP implements and operates an electronic
system for collecting and reporting health information of medical records based on European
Core Health Indicators (ECHI), but the system is still not operational. An e-register (available
on the e-Albania portal), upgraded with more functions in 2021, is used for the identification of
insured persons and the generation of health cards. It enables the registration of patients to
healthcare centres and determines their benefit category based on its interaction with other
institutional databases. A new hospital information management system, which will include an
electronic database of patients’ medical records, is being implemented in four regional hospitals.
Despite progress in statistical governance, technological health infrastructure/equipment and
human resources remain inadequate, especially in rural areas.
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Albania’s legislation on blood, tissues, cells and organs is not fully aligned with the relevant
EU acquis, and there is no system in place to report alerts, serious adverse reactions, events or
provide feedback. On tobacco control, the law to protect public health against tobacco products,
designed to be aligned with the EU acquis, is being implemented, but Albania still needs to
accede to the World Health Organization’s Framework Convention Protocol to Eliminate Illicit
Trade in Tobacco Products, and to further align its legislation with the EU acquis. In the field of
serious cross-border health threats including communicable diseases, the COVID-19
pandemic has shown significant shortcomings. The legal basis for communicable disease
prevention and control is designed to be in line with the EU acquis, but the implementing
legislation has still not been adopted. Albania has an antimicrobial resistance (AMR) action plan.
Though Albania strengthened its national alert, response and surveillance system for
communicable diseases during the COVID-19 pandemic, no national plan for implementing
international health regulations was in place when the pandemic broke out, and its impact was
exacerbated by a lack of systemic preparation and low public health resilience.
During the COVID-19 pandemic, Albania made some progress on vaccine distribution and
coordination, although the vaccination rate is lower than expected. The pandemic further
stretched the health care system’s capacities to provide immediate access to medical supplies,
protective equipment, and the digital infrastructure required to maintain essential services and
protect health care personnel and patients, showing it lacks resources. In 2021 Albania took
adequate measures to respond to the pandemic, moving from a lockdown approach to a regulated
one, with schools remaining open, although education was partially disrupted. Maternal and
child health service delivery were negatively affected due to temporary shortages of health
personnel. The pandemic highlighted weaknesses in the area of health emergency management
and preparedness, especially in infection prevention and control (IPC) and epidemiological data.
Albania should invest in epidemiological research and monitoring to capitalise on the lessons
learnt from the COVID-19 pandemic, in terms of health system resilience and coordination, and
in staff training. The capacities of the health personnel as well as system-related challenges in
ensuring IPC standards were addressed through capacity-building interventions, and
development of the IPC protocols officially endorsed by the Ministry of Health and Social
Protection in March 2021. Albania continues to participate in the EU Health Security Committee
as an observer, and, as a signatory, makes use of the EU Joint Procurement Agreement on
medical counter-measures. It is part of the European COVID-19 Surveillance Network, reporting
COVID-19 data to the European Surveillance System (TESSy) managed by the European Centre
for Disease Prevention and Control (ECDC), and is part of viral respiratory disease surveillance
networks managed by European Centre for Disease Prevention and Control (ECDC) and reports
to it on several communicable diseases, though it should improve the timeliness and
completeness of the reported data it provides.
Albania’s legislation on patients’ rights in cross-border healthcare has not yet been aligned
with the EU acquis, while its legislation on medicines for human and veterinary use is partly
aligned. There was no significant progress on standards in the pharmaceutical sector. There is
still no specific legislation to address the risk of falsified medicine in the legal supply, although
some provisions are in place. Additional efforts are needed to protect the public from falsified
medical products and cross-border cooperation for sustainable access to medicines and their
correct use. There were no developments or expertise available on paediatric medical products,
medical products for the diagnosis, orphan medical products, medical products based on genes
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(gene therapy), cells (cell therapy) or tissues (tissue engineering). Albania needs to increase
investment and capacity building in this sector.
On preventive measures, a national cancer control plan is in place. Appropriate structures for
cancer screening services are in place, but a cancer registry has still not been established. A
breast cancer screening programme is in place, which includes systematic examinations for 50-
60 year old women, along with free clinical breast examinations. There is a national plan for
cervical cancer screening, but health care service integration issues limit its effectiveness.
COVID-19 severely impacted the prevention and control of non-communicable diseases, though
essential treatment services were ensured.
On nutrition and physical activity, malnutrition is a critical issue, especially for children and
pregnant women. Albania needs to develop a nutrition plan and raise awareness in schools and
community centres on the risks of malnutrition. National legislation on the pricing of medicinal
products is partly aligned with the EU common procedural framework and acquis. On drug
abuse prevention and harm reduction, prevention activities are only sporadic, and should be
conducted in a more systematic way. The National Drug Observatory, established in 2011,
should be given adequate resources for it to function fully.
On health inequalities, implementation of the 2020-2025 Primary Health Care Strategy should
provide better access to health care services for vulnerable communities, as well as an increased
community primary health care coverage, giving priority to vulnerable groups. The national
community health care programme continues to provide residential health care mainly for
marginalised Roma and Egyptian minorities. While there was an increase in the number of Roma
and Egyptians in informal settlements benefiting from health services delivered by mobile teams
and HIV awareness activities were conducted for Roma and Egyptians communities. Health
insurance coverage for Roma and Egyptians remains, however, low. A National Plan for
Equality, Inclusion and Participation for Roma and Egyptians 2021-2025 was approved in
November 2021 to facilitate their access to healthcare. The health mediator should also help
decrease healthcare barriers for Roma and Egyptians. Further efforts are needed to improve
access to services for other groups, including women, people with disabilities and populations in
rural or remote areas, and for mental health for children.
CLUSTER 3: COMPETITIVENESS AND INCLUSIVE GROWTH
This cluster covers: digital transformation and media (Chapter 10); taxation (Chapter 16);
economic and monetary policy (Chapter 17); social policy and employment (Chapter 19);
industrial policy (Chapter 20), science and research (Chapter 25); education and culture (Chapter
26); and customs (Chapter 29).
There is a moderate level of preparation in Albania in many areas linked to competitiveness and
inclusive growth, namely digital transformation and media, taxation, economic and monetary
policy, enterprise and industrial policy, education and culture. The same goes for the customs
union, where the pan-Euro-Mediterranean area rules of origin are applied, and bodies involved in
the fight against smuggling and counterfeit goods are strengthened and cooperate better. Albania
has some level of preparation in social policy and employment, and research and innovation.
Albania has made progress in particular with the adoption of the new National Strategy for
Education and Action Plan 2021-2026, but progress was limited on the economic and monetary
policy.
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This cluster and the reforms concerned have significant links to Albania’s Economic Reform
Programme. Socio-economic reforms must be pursued to help address the existing structural
weaknesses, low competitiveness, high unemployment, as well as the impact of both the
COVID-19 pandemic and of the Russian war in Ukraine.
Chapter 10: Digital transformation and media
The EU supports the smooth functioning of the internal market for electronic communications,
electronic commerce and audio-visual services. The rules protect consumers and support the
universal availability of modern services.
Albania is moderately prepared in the field of digital transformation and media. Limited
progress was made on implementing the recommendations of the previous report. The 112
emergency number was activated in Tirana and resources were allocated for its extension to 12
additional regions. Further progress was made with the adoption of the 2022–2026 Digital
Agenda and on e-government services. The Law on e-on Electronic Document, Electronic
Identification and Trust Services in Electronic Business was adopted in 2021, fully aligning
national legislation with the EU eIDAS Regulation.
In the coming year, Albania should in particular:
 complete the extension of the 112 emergency number to 12 additional regions;
 adopt relevant legislation in line with the new European Electronic Communications Code;
 improve the collection of statistical data on digital performance and digital competitiveness.
On electronic communications and information and communications technologies (ICT),
some progress was made in implementing the single European emergency number 112. As
planned in the medium-term budget programme 2021-2023, the deadline for the unified
emergency number 112 to be extended to 12 other regions of Albania is end of 2022.
In 2021, fixed internet broadband penetration covered 559 394 subscribers (508 254 household
subscribers and 51 140 businesses), which is a 10 % increase from 2020. The penetration rate
was about 20 % of the population with 58.7 % of the households being covered. The gap in fixed
internet-broadband penetration between urban and rural areas remains. Rural areas account for
40 % of the population, but only 109 652 subscribers are connected to the fixed broadband, while
in urban area 449 472 subscribers are connected. The mobile penetration rate at the end of 2021
was 73 % compared with 70 % at the end of 2020. In 2021, there were 2 million active users of
mobile broadband, which is the same as in 2020. The volume of data usage during 2021 are 155
million GB from mobile network and 952 million GB from fixed network.
In the area of information society services, the National Agency of Information Society has
finalised the 2022–2026 Digital Agenda of Albania, which was adopted in June 2022. The law
on e-on Electronic Document, Electronic Identification and Trust Services in Electronic Business
was adopted in 2021, fully aligning national legislation with the EU’s eIDAS Regulation.
The revised Action Plan 2020–2022 of the Digital Agenda continued to be implemented and
some of the completed activities included the digitisation of Archives for General Directorate of
Civil Registry, the National Employment Service System “Dua Pune” (I need a job), the
electronic platform e-Transport, the digitalisation of customs services, the e-Invoice system and
the National Forest Information System.
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Regarding the on-line public services, during the reporting period, 95 % of the applications for
1 217 public services were done online, with 6 295 567 e-sealed documents downloaded in 2021
by 2 537 042 registered users (2 336 510 citizens and 200 532 businesses) on the e-Albania
portal. This adds up to 13 771 931 e-services uses in 2021.
Regarding the establishment of a multiannual radio spectrum policy program, the deadline to free
up the 700 MHz for 5G networks initially set up for 30 June 2022, was postponed because the
National Frequency Plan is not yet finalised. The new draft national frequency plan was
approved in November 2021, introducing important changes to the spectrum available for new
services and technologies, mobile broadband including bands for 5G. The process for spectrum
coordination with neighbouring countries is not yet finalised; Montenegro, Italy and Croatia are
still pending. A Memorandum of Understanding on 5G for digital transformation in the Western
Balkans was signed in Tirana on 2 November 2020 by ministers of Western Balkans and in
2021, a draft 5G roadmap was prepared by the Albanian authorities but still needs to be adopted.
The National Authority on Electronic Certification and Cybersecurity has taken some new steps
to align further the Law on cybersecurity with the EU Directive on the security of network and
information systems. Albania has established a list of critical information infrastructures and the
necessary implementing legislation. The National Strategy for Cyber Security 2020–2025 and its
Action Plan are in place since 2020.
Albania still needs to improve the collection of statistical data on digital performance and digital
competitiveness.
On audio-visual policy, in February 2022, the parliament filled 6 vacancies out of the 7
members of the audio-visual regulatory authority (AMA), thus making the authority fully
operational and ending a long institutional deadlock. The independence of some of the members
has been questioned due to their alleged political links.
Chapter 16: Taxation
EU rules on taxation cover value added tax and excise duties as well as aspects of corporate
taxation. They also deal with cooperation between tax administrations, including the exchange of
information to prevent tax evasion.
Albania is moderately prepared in the area of taxation. Limited progress was made, in
particular by addressing last year’s recommendations, including compliance with agreed
payment schedules for VAT refunds and reducing the stock of arrears in VAT refunds, the
approval of a new calendar on tobacco excise, and consultation of the draft medium term
strategies which includes proposals to address tax expenditures. The adoption of a tax and
criminal amnesty against the advice of the EU and Moneyval could jeopardise progress in this
area – see also chapter 4 – Free Movement of Capital and 4 – Justice Freedom and Security.
In the coming year, Albania should in particular:
 Implement measures to reduce tax expenditures, in particular due to exemptions;
 simplify the taxation system to further encourage enhanced tax compliance;
 provide the needed capacities and undertake the measures to ensure the effective
implementation of the automatic exchange of tax information with EU Member States in line
with the OECD Global Standard
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On indirect taxation, the standard VAT rate is 20 % and the reduced rates are 6 % and 10 %. In
2021, Albania restricted its VAT exemption on the import of machinery and equipment to apply
only where said imports exceeded a value of approx. EUR 4.2 million. The quarterly stock of
VAT refund arrears is regularly published. Repayment of large taxpayers and faster VAT refund
payments resulted in a stock reduction to EUR 4 million by end-2021 as compared to EUR 80
million by end-2020. The COVID-19 response remains in place until 2029, according to which
only taxpayers with annual turnover above EUR 81 750 (the previous threshold was EUR
16 350) are subject to VAT and those with annual turnover above EUR 40 870 can opt to be
subject to VAT.
Excise taxation is partially aligned with the EU acquis. As of July 2022, the excise level for
liquefied gas is unified, irrespective of purpose of use. In November 2021, a new calendar on
tobacco excise rates was approved. It envisages a 15 % increase over four years to approx. EUR
65 per 1 000 cigarettes by 2026, thus gradually aligning with the EU minima. Small producers of
alcoholic beverages continue to enjoy reduced tax rates.
Regarding direct taxation, financial institutions are legally required to calculate, withhold, and
declare income tax on income from savings. Following changes made in direct taxation in 2020
to support taxpayers affected by the COVID-19, since January 2021, taxpayers with a total
annual income up to ALL14 million (approx. EUR 115 000) are subject to a 0 % rate on profit
tax, while those whose total annual income exceeds the threshold are subject to a 15 % rate.
Albania has a partially aligned framework with the Merger Directive. Anti-corruption measures
continue to have a limited impact in tax administraion, which remains a particularly vulnerable
area in this respect.
On administrative cooperation and mutual assistance, Albania is yet to conclude double
taxation agreements with Denmark, Cyprus, Lithuania, Portugal, Slovakia, and Finland. The law
on automatic exchange of information on financial accounts is partially aligned with the relevant
2014 EU Directive. For the first time, in 2021, Albania had reciprocal automatic exchange with
17 jurisdictions.
As regards operational capacity and computerisation, the personnel structure of the tax
administration has been kept stable at 1 450 since March 2020. As of April 2022, the number of
vacancies was further reduced, yet still high, to 155 (10.7 %) as compared to 168 (11.6 %) in last
year’s report. The annual training programme is needs-based and 1 370 employees of the GDT
participated in trainings in 2021, including on the new fiscalisation process. In addition to
electronic invoices for cashless transactions between businesses and government (since January
2021), those between businesses (since July 2021), and between businesses and consumers (since
September 2021) became mandatory in an effort to increase tax compliance and reduce
informality.
Albania does not yet have the technical capacity to facilitate the efficient exchange of
information for tax purposes with the EU countries. The electronic tax administration system is
operational, but there are no deadlines to achieve interconnection and interoperability with EU
systems.
Chapter 17: Economic and monetary policy
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EU rules require the independence of central banks and prohibit them from directly financing
the public sector. EU Member States coordinate their economic policies and are subject to fiscal,
economic and financial surveillance.
Albania is moderately prepared in the area of economic and monetary policy and has made
limited progress on last year’s recommendations to improve government’s policy coordination
and consultation mechanism with non-governmental stakeholders. Although the Bank of
Albania’s governor was re-appointed for his second mandate and monetary policy was
appropriate and effective, no progress was made in fully aligning the Law of the Bank of Albania
with the EU acquis. There was some progress in providing data required for the calculation of
the macroeconomic imbalances procedure (MIP) indicators, in aligning government and national
accounts to ESA2010, and Excessive Deficit Procedures notifications, which Albania regularly
submits on a best-effort basis. However, significant improvements are still needed to achieve full
compliance with ESA 2010.
Albania should therefore:
 align the legislation on the personal independence of the Bank of Albania’s governor and
council members as well as regarding the possible monetary financing of the public sector
with the EU acquis;
 improve the government’s economic policy planning capacity and its coordination and
consultation mechanism with non-governmental stakeholders;
In the area of monetary policy, the central bank’s primary objective, set out in the Law on the
Bank of Albania (BoA), remains to achieve and maintain price stability. The BoA is financially
independent, with sufficient instruments, competence and administrative capacity to function
effectively and to conduct an efficient monetary policy. It has a fully operational supervisory
council, appointed by and accountable to the parliament. Monetary policy is conducted within a
free-floating exchange rate regime using a standard set of instruments: i) open market operations;
ii) standing facilities; and iii) required minimum reserves. The Albanian legislation allows the
BoA to provide limited financing to the government under certain conditions, which is not in line
with the EU acquis.
In view of increased inflationary pressures due to global price increases, the BoA started the
normalisation of its monetary policy since March 2022 by increasing the main policy rate from
its record low 0.5% (unchanged since March 2020) in steps to 1.75% in August 2022, in addition
to raising the rates for overnight deposit and lending facilities by 0.65pps and 1.85pps
respectively. The BoA continued to provide liquidity to the economy, and to publish quarterly its
interventions in the money market.
The BoA updated and extended its Medium-Term Development Strategy for 2022-2024, which
includes the objective to strengthen the Bank’s independence to conform with the gradual
approximation of the EU legislation. The strategy foresees to enhance the effectiveness and pass-
through of the BoA’s monetary policy by developing the financial market (interbank money
market, forward market, more SWAP instruments, secondary market for government securities).
The BoA also announced to gradually conclude its intermediary activity in buying and managing
the Albanian Government’s securities accounts within 2022 and to further improve its statistics.
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In the area of economic policy, further alignment with the EU acquis on budgetary frameworks
is needed. Albania has a set of fiscal rules, which it complied with since their adoption in 2016,
except in 2020 when the escape clause was activated due to the state of emergency following the
outbreak of COVID-19. A new numerical rule to achieve a neutral or positive primary balance
from 2023 was added to the budget legislation in 2020, which considerably strengthens the fiscal
rules framework. However, in July 2021 the application of this rule was postponed to 2024 and
the other fiscal rules were suspended by a normative act, which accompanied a budget
amendment to increase the fiscal deficit. Albania has no independent fiscal institution to monitor
compliance with its fiscal rules and the quality of its forecast. However, it is obliged by law to
use the IMF’s forecast for nominal GDP as basis for calculating the public debt-to-GDP ratio,
which the debt rule requires to be lowered every year until the prescribed ceiling of 45% is
reached. Albania used normative acts to amend its 2021 budget six times to address the
economic fall-out of the COVID-19 pandemic. The frequency of budget amendments and the use
of normative acts instead of the regular legislative process highlights weaknesses in planning
capacity and compromises the credibility of the budget preparation process.
The presentation and publication of the annual budget includes a medium-term fiscal framework
with a horizon of more than 3 years on a rolling basis, a forecast of government debt and of the
macroeconomic development. This framework is not always updated and published when the
annual budget is amended. The government presents fiscal risk statements and tax expenditure
reports with the support of technical assistance. The budgetary framework needs to be more
comprehensive and would benefit from an improved macro-fiscal analysis, a more detailed and
consistent breakdown of budget headings and the addition of long-term fiscal sustainability
indicators. Albania regularly submits most of the Excessive Deficit Procedure notification tables
to Eurostat on a best-effort basis, but the data are not yet fully in line with the European System
of National and Regional Accounts (ESA2010) requirements, and the questionnaires are not
complete. Work on the delineation of the public sector in line with ESA2010 and data on extra-
budgetary units is in progress, but not yet complete. The budget preparation involves all
governmental units, but the expenditure plans of local governments are not detailed in the
framework.
The budget planning is not based on estimates of last year’s actual fiscal outcome but on the
previous year’s budget plan, which requires a first budget revision shortly after parliamentary
budget approval, when the fiscal implementation and debt data become available. Albania
submitted its Economic Reform Programme (ERP) 2022-2024 on time but its fiscal framework
was not based on up-to-date budget figures, and it did not include any proceeds from
consultations with non-governmental stakeholders, because these are not using the new online
public consultation platform to which the consultation of the ERP was restricted. Albania
remains in need of effective stakeholder consultation processes as well as of strengthening its
inter-institutional coordination mechanism for comprehensive strategic policy planning and its
capacities to ensure the efficient implementation of reforms.
Chapter 19: Social policy and employment
EU rules in the social field include minimum standards for labour law, equality, health and
safety at work and non-discrimination. They also promote social dialogue at European level.
Albania has some level of preparation on social policy and employment. Some progress was
made in implementing recommendations of the previous report, especially by strengthening the
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quality and effectiveness of labour market institutions and providing employment services to the
most vulnerable groups. During 2021, Albania continued restructuring its employment
governance. The social care reform is progressing, but financial and administrative efforts need
to be stepped up to strengthen the local level capacities for service delivery and the links to
active labour market measures. Albania needs to address the coverage and financial allocation of
the Social Fund, ensure implementation of legislation on public procurement of social services
and of the management information system for social care. The triple shock stemming from the
2019 earthquake, the COVID-19 pandemic, and the consequences of the war against Ukraine has
negatively impacted the most vulnerable categories, which needs to be assessed and mitigated.
In the coming year, Albania should:
 adopt the 2023-2030 strategy for employment and skills, incorporating the objectives of the
decent work agenda, the Youth Guarantee scheme, as well as green and digital transition and
provide adequate human and financial resources for its implementation;
 increase budget allocation for the Social Fund to finance social care services and improve
operational modalities for distribution and implement the legal framework on procurement of
social care services;
 adopt the action plan and the costing of the Youth Guarantee scheme in line with the EU
model and guidance, incorporating its objectives in the new strategy on Employment and
Skills.
Regarding the labour law, the implementation of the amended Labour Code is under way.
Twenty-five (25) EU regulations in the field of occupational safety and health have been
transposed as well, covering areas such as: safety at work, equal treatment between women and
men etc.
After the significant slowdown of inspection activities during the COVID-19 pandemic, the
number of inspections has significantly increased in 2021 (from 5 994 in 2020 to 7 039 in 2021,
and over 184 000 jobs verified). Progress was made on the promotion on the e-inspection
platform. In 2021, the restructuring of the State Labour Inspectorate and Social Services (SLISS)
entered into force both centrally and at local level, with 165 positions overall (+11 compared to
the previous year), but further steps are needed to strengthen its capacities on human resources,
regular training and adequate means to perform duties. In particular, it is essential to enhance the
tripartite collaboration among SLSSI, trade unions and business organisations in designing and
conducting the company visits and in addressing issues impacting the observance of the labour
relations and working conditions in companies and institutions.
On child labour, the system for monitoring child labour and other forms of exploitation, as well
as the coordination of law enforcement between the Agency for the Protection of Children’s
Rights and the Labour Inspectorate still need to be strengthened.
On health and safety at work (OSH), a new policy framework has to be adopted based on a gap
analysis and in line with the new EU OSH strategic priorities, with a focus on strengthening
institutional capacity to effectively enforce compliance with the legislation.
On bipartite social dialogue, some progress was made with the ratification of the ILO
Convention 190 on “Violence and Harassment in the World of Work”. It is important that the
government undertake concrete measures and revise the legislation in alignment with the ILO
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convention. Regarding tripartite social dialogue, good progress was made to strengthen the
capacities of the newly assigned staff of the National Labour Council (NLC) Secretariat. The
NLC met only once during 2021. The mandate of the former NCL ended in 2021 and the new
NCL needs to be established and convened. There is currently no meaningful dialogue at any
level.
On employment policy, Albania is implementing the last year of the National Employment and
Skills Strategy (NESS) 2014-2022 and already started the preparation of the new policy
framework 2023-2030.
Labour force participation for the 15-64 year olds reached 69.3 % in 2021, a 0.2 percentage
point higher compared to the same period in 2020 and reflects the ongoing slow recovery from
the COVID-19 pandemic and other external shocks. The female labour force participation rate
reached 63.2 % at the end of the year, whereas for men this indicator is 77.7 %. The male labour
force participation rate is 15.9 percentage points higher than women, showing a systemic gender
gap that should be structurally addressed.
Major losses were registered in the agriculture sector, with a decrease in employment by 5.3 %.
The unemployment rate (15–64 years) is 11.5%, decreasing by 0.2 percentage points compared
to 2020. The rate was 11.3 % for males and 11.8 % for females, showing that there is still a gap
between the two groups. Due to the effects of the prolonged pandemic and the fragile economic
system, unemployment increased more among vulnerable groups including women, young
people, Roma and Egyptians, and people with disabilities.
In 2021, job creation remained one of the major cross-sectoral priorities of the government,
along with structural measures aimed at expanding social protection and preserving jobs in the
context of recovery from the COVID-19 pandemic and under the pressure of increased
commodity prices and inflation.
In 2021, 24,158 registered unemployed jobseekers found a job through labour offices compared
to 17 934 in the previous year, reflecting the labour market conditions still affected by the
challenges resulting from the COVID-19 pandemic and the impact of external shocks over the
Albanian economy.
The employment rate for the population aged 15-64 years old is 60.9 % in 2021, slighting
improving by 0.2 % of points compare to 2020. The employment rate for females is 53.8 % and
for males 68.2 %. The gender gap in employment for this age-group is 14.4 percentage points.
The major improvement is registered in the industrial sector (+7.5 %), followed by services
(+7.2 %). The major losses were registered in agriculture, with a decrease in employment by -
5.3 %. The long-term effects of the COVID-19 pandemic, increase of commodity prices in
international markets and higher overall imported inflation, risk to moderate the pace of recovery
and impact the employment rate, especially of informal workers and the most vulnerable groups.
The capacity and staffing of the National Agency for Employment and Skills (NAES), still needs
to be increased.
Public employment services made further progress in establishing and following performance
indicators and procedures, improved visibility and outreach services for vulnerable groups.
In 2021, Albania continued the implementation of the reformed Employment Promotion
Programmes (EPPs) packages in all regions with a focus on the most vulnerable ones. A total of
4835 jobseekers benefited from the EPPs during 2021 (60.2 % women and 39.8 % men).
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During 2021, 326 former beneficiaries of social assistance benefited from the employment
promotional programmes. Close monitoring of this programme alongside with the employment
promotional measures will be crucial to ensure a long-term solution for beneficiaries of the
economic aid scheme.
According to the Labour Force Survey of 2021, the percentage of young people neither in
employment, nor in education or training (NEET) in 2021 is 26.1 %. In February 2022, the
government established an inter-ministerial working group responsible for providing guidance
and overseeing the process of implementation of the Youth Guarantee scheme in Albania. As a
starting point, Albania has drafted an action plan for the implementation of the Youth Guarantee
and steps need to be taken for its costing and adoption by the Government. The plan will become
part of the new strategy on Employment and Skills (2013-2030). It is critical that Albania
prepares the adequate institutional framework and allocates human and financial resources to
ensure the implementation of this plan.
Long-term unemployment remains a challenge that Albania should address through more
flexible, tailored and integrated policy interventions.
There were no developments as regards preparations for the European Social Fund. (See
Chapter 22 - Regional policy and coordination of structural instruments).
On social protection and inclusion, there is some positive progress on the implementation of
the strategy on social protection, in particular regarding the roll-out of the reform on the bio-
psychosocial assessment of people with disabilities and outreaching more beneficiaries through
social care services. Another positive step during 2021 was made on the establishment of the
legal framework for the Order of Social Workers, which will help speed up efforts to strengthen
social care and social protection workforce. However, public spending on social care services
programmes for Albania continues to be modest and there is yet no mechanism for monitoring
the situation of those who are vulnerable and with no access to such services.
According to SILC 2020, published by INSTAT (Institute of Statistics) in December 2021, the
ratio of population at-risk of poverty rate in Albania, in 2020, is 21.8 % compared with 20.6 %
2019, This remains below the EU 27 average. Changes in the Law on Social Assistance, adopted
in in December 2021 aim to increase the targeting of poor families and children by increasing the
amount of cash assistance. Cash transfers continue to constitute about 95 % of the social
protection sector’s overall budget. There has been an expansion in service delivery with eleven
new municipalities during 2021 providing - for the first-time social care services, bringing the
total of 16 social care services funded through the Social Fund. However, there are still 2
municipalities which do not provide any social care services.
The Ministry of Health and Social Protection and Ministry of Finance and Economy signed a
joint order to establish coordination and a referral mechanism with a view to integrate in the
labour market the beneficiaries of the economic aid of active working age. Furthermore, a
protocol for integrated case management between employment offices and local social care
services is established and started its implementation in Elbasan municipality.
60 municipalities out of 61 have adopted social care plans with the support of donors and civil
society organisations.
Monitoring of implementation of the local social plans, budget allocation to social services from
the local government and guidance to local government are crucial. The social care services
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National Electronic Register (NERSCS) is not yet fully operational and the procurement
processes associated with installing the register have been delayed.
The total fund disbursed for the local government by the Social Fund during 2021 is EUR 1.5
million allocated to 16 municipalities for 16 new and ongoing social care services. During 2021,
there are 339 social care services provided compared to 229 in 2019. In spite of positive
progress, the government needs to step up efforts in further consolidating the mechanism of the
Social Fund ensuring adequacy, equity and transparency of the implementation of the fund,
alongside the increased budgeting of the social fund in the midterm budget in order to ensure
sustainability of services.
Regarding people with disabilities, the accessibility and availability of public services, such as,
socio-health, employment and vocational education and in particular of specialised services in
the area of disability, is still limited.
On non-discrimination in employment and social policy, in February 2022 the Albanian
Parliament ratified the ILO Convention 190, “On Violence and Harassment”. However, the
implementation requires revising legislation in line with the convention.
As regards equality between women and men in employment and social policy, according to
2021 there is a gender employment gap of 14.4 percentage points. According to INSTAT’s
women’s labour force participation for the group age 15-64 years old, according to the LFS
(2021) continues to be lower by 15.9 percentage points compare to males. The gender pay gap in
2021 is 4.5 percentage decreasing by 2.0 percentage points, compared to 6.6 percent in 2021.
According to the 2022 World Economic Forum’s gender gap index report, Albania ranked 18
out of 146 countries (compared to 25 out of 153 countries for 2021), reflecting the continuous
consequences created by the earthquake and the COVID-19 pandemic. The changes to the
Labour Code introduced more measures to support gender equality in the labour market;
however, there is no monitoring of the implementation of these changes in practice.
Furthermore, there is still a need to harmonise legislation with the EU work-life balance
directive.
Chapter 20: Enterprise and industrial policy
EU industrial policy strengthens competitiveness, facilitates structural change and encourages a
business-friendly environment that stimulates small and medium-sized enterprises (SMEs).
Albania is moderately prepared in the area of enterprise and industrial policy. Some progress
was made by the adoption of the Law on micro, small and medium enterprises, the adoption of
the Law on start-ups and establishment of the Start-Up Council, and continuation of the
assistance programmes to provide business support services and access to finance in line with the
business and investment development strategy (BIDS), adopted in July 2021. The measures to
reduce informal business activities and corruption continued to yield results although with
limited impact on the business environment.
In the coming year, Albania should, in particular:
 address the main challenges to the business environment, by reducing the regulatory burden,
enhancing the participation in the available funding programmes for businesses strengthening
the efforts to tackle informality and corruption, increase business support services, and
implement the Law on start-ups;
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 accelerate the full alignment of national legislation with the EU acquis on late payments;
 adopt the unified investment Law and address the challenges to competitiveness and growth
as stressed in the joint recommendations of the Economic Reform Programmes of 2022-
2024.
Albania finalised and adopted its 2021-2027 business and investment development strategy
(BIDS) in July 2021. The BIDS sets the strategic framework for Albania’s enterprise and
industrial policy, covering SME skills development, innovation, sustainable growth, and
conditions for attracting foreign investment. It also adopted a 2020-2024 programme for
inclusive and sustainable industrial development (ISID), with three main pillars: industrial
competitiveness and market access; productive employment and entrepreneurship development;
and sustainable energy for productive uses and environmental management.
Albania is implementing its 2017 national Strategy on Innovation and Technology. A
programme on Urban Partnership Acceleration was also adopted to connect Albanian innovation
organisations, including universities, industries and start-ups that are committed to solving urban
challenges. After several delays, Albania adopted the Law on start-ups in March 2022 and in
April 2022 a Law on micro, small and medium enterprises (MSMEs), followed by the adoption
of a grant scheme for start-ups in July.
Albania follows the implementation of the Small Business Act and has reflected upon its
recommendations on policy formulation as regards the BIDS, the Law on start-ups and the Law
on MSMEs. SMEs identify their main challenges as the informal economy (particularly in
tourism), corruption and lack of transparency in public procurement (especially as regards Public
Private Partnerships (PPPs)), the need for stable state institutions, unclear ownership of property
titles, and the need to enforce the rule of law. Despite some improvements in the business
environment, the COVID-19 pandemic highlighted structural challenges, and the global price
increase due to ongoing Russian military-aggression on Ukraine is revealing weak export
diversification and a high dependency on imports. Enhancing good governance and the quality of
institutions and product diversification, while maintaining macro-economic stability, are crucial
to supporting economic growth. However, businesses also face obstacles related to a lack of
workforce skills and financial resources, as well as challenges to adjust to modernisation,
digitisation, and e-commerce. Albania is focused on combatting the informal economy by
expanding the taxpayer base, enforcing compliance and working to create a level-playing field
for economic operators, including in the tourism sector and the re-construction programme, yet
without considering the administrative burden and formalisation incentives. Sectors identified
with the highest exposure to informal employment are trade and tourism (almost 50 % of total
identified cases) followed by manufacturing (20 %) and construction (18 %).
Albania continued to privatise state assets, partly through privatisation vouchers. The validity of
privatisation vouchers, due to expire in December 2021, was extended until December 2023. A
law on the establishment and operation of economic zones exists, though none has been
established. A Technological Economic Development Area (TEDA) with an industrial
processing plant is still in its development phase. The 2015 Strategic Investments Law was
extended until the end of 2023 due to delays in the adoption of the unified investment law. Since
its adoption, 22 investment projects have been adopted (10 during the reporting period),
dominated by domestic investors that received 'strategic investment' status, mostly in the
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tourism, agriculture and energy sectors. In spite of a noteworthy overall FDI inflow, cluster-like
linkages and trade in high technology remain weak relative to peers.
In the area of enterprise and industry policy instruments, the Albanian Investment
Development Agency (AIDA) launched an online access to finance platform to enable
businesses to access information on available financing opportunities. Access to finance remains
a serious challenge for Albanian businesses. No state funds were distributed by AIDA during
2020-2021, as they were re-oriented to measures to alleviate the impact of COVID-19 on
businesses. An advisory instrument that provides training and advisory services to MSMEs has
been available since February 2021, providing opportunities for small grants to help businesses
to adapt to the impact of COVID-19. Extraction industry companies were given a three-year
royalty tax exclusion to boost pre-export mineral processing. The Albanian information society
agency offers “TechSpace”, a creative environment for start-ups for training on technology,
innovation and entrepreneurship activities. The “Roadmap to Silicon Valley” pilot programme
for start-ups offers an incubation phase at TechSpace, in cooperation with public universities,
and public and private vocational high schools.
The Albanian legislation on late payments was further aligned with the EU acquis in May 2021 -
full alignment should be ensured as soon as possible, including issues related to title retention,
and recovery procedures for unchallenged claims. Albania’s SMEs definition is partly aligned
with the EU definition as regards the number of employees, however, national capacity in the
field of SME policies and support remains very limited. Formal negotiations on an Association
Agreement with Albania to participate in the EU Single Market Programme (SMP) started in
June 2022.
On sectoral policies, Albania continues to implement the 2019-2023 national strategy and action
plan for sustainable development and tourism. In March 2022, the government adopted a
resilience package to help cope with the consequences of the Russian military-aggression against
Ukraine, which includes support packages for economic operators in the transport and
agriculture sectors. Albania continued to implement incentives for agro-processing industry,
however the demand in this sector seems to be for more budget support and subsidies. Work
continued on drafting the Smart Specialisation Strategy (S3), completing both the qualitative and
quantitative analysis phases, but the Entrepreneurial Discovery Process remains to be launched.
A cross-sectoral strategy and Action Plan 2022 – 2026 on “Digital Agenda of Albania” was
adopted in June 2022.
Chapter 25: Science and research
The EU provides significant support for research and innovation. All EU Member States can
benefit from the EU’s research programmes, especially where there is scientific excellence and
solid investment in research.
Albania has some level of preparation in the area of science and research. Some progress was
made over the reporting period, with the establishment of the Inter-Institutional Working Group
for monitoring the implementation of the 2017–2022 National Strategy for Scientific Research,
Technology and Innovation. Last year’s recommendations have not been fully addressed and
therefore remain valid.
In the coming year, Albania should in particular:
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 increase investment in research, in line with its own commitments and the new European
Research Area priorities;
 complete the Smart Specialisation Strategy and adopt the law on scientific research;
 produce statistics and reliable data on science and technology, including the indicator on
gross domestic expenditure on Research and Innovation
On research and innovation policy, an inter-institutional working group was established in
2021, to monitor the implementation of the National Strategy for Scientific Research,
Technology and Innovation 2017–2022. The new strategy on Research has to be developed and
adopted.
As for scientific research funds, various estimates indicate that Albania allocated 0.2 %-0.4 % of
GDP to research and development for 2021, which is far below the targeted 1 % of GDP by 2022
(state budget funds for the Ministry of Education and Science (MoES) for research were in the
amount of 0.05 % - 0.06 % of GDP).
Albania needs to step up investments in scientific research and associated measures to strengthen
research and innovation capacity at national level, also given the relevance of innovation to the
Economic and Investment Plan for the Western Balkans and its direct relevance for the country’s
economic recovery, while helping address the issue of brain drain of researchers and young
people.
The methodology to establish funding for research and science remains to be developed. In 2021,
the National Statistical Institute of Albania conducted surveys in four sectors (private businesses,
non-profit organizations, government institutions and higher education institutions) to collect
administrative data on the budget funds allocated for R&D, but data collection was
unsatisfactory as both public and private entities did not report data, or values were not
representative.
Efforts are still needed in the development of innovative policies aimed at promoting better links
between academia, industry and government, and in the fields of open access and open data.
Both qualitative and quantitative analysis phases were completed on the development of a Smart
Specialisation Strategy (S3) but the Entrepreneurial Discovery Process remains to be finalised.
As regards EU framework programmes, Albania is fully associated to Horizon Europe. Its
participation in the programme in 2021 has been the best ever since Albania has been
participating in the EU’s Framework Programmes for Research and Innovation (9 projects with a
total funding of EUR 1.9 million). Private sector participation in the programme continues to
remain low. A positive trend is the new national support measure facilitating academia-business
cooperation. Albania should continue its efforts to raise the awareness on participation in the
new Horizon Europe programme.
On integration into the European Research Area, Albania should improve its linkage with
European partners to engage in international cooperative research. There is already active
engagement in European Cooperation in Science and Technology with impressive increases over
the past two years. However, we are still to see the results of Albania’s recent participation in
EUREKA.
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Albania needs to continue to make further efforts to produce statistics and reliable data on
science and technology, including the indicator on gross domestic expenditure on Research and
Innovation. Its inclusion in the European Innovation Scoreboard (in 2022 for the first time) is
already a tangible outcome of these efforts.
Chapter 26: Education and culture
The EU supports cooperation in education and culture by funding programmes and the
coordination of Member State policy through the open method of coordination. The EU and the
EU Member States must also prevent discrimination and ensure quality education for children of
migrant workers, including those from disadvantaged backgrounds.
Albania is moderately prepared in the field of education and culture. Some progress was made
with the adoption of the 2021-2026 National Strategy for Education and the related action plan;
the strengthening of the new National Agency for Employment and Skills; the continued
restructuring of the National Agency for Education, Vocational Training and Qualifications; and
the implementation of the Albanian Qualification Framework and the Vocational Education and
Training Law. Further efforts are required to strengthen quality and inclusiveness of education,
with a special focus on the proper implementation of the competence-based approach and
digitalisation. Appropriate resources should also be allocated to ensure the implementation of the
new policy reform. Further efforts are required to finalise the implementing legislation of the
Law on Cultural Heritage and Museums.
In the coming year, Albania should in particular:
 ensure the optimisation of the VET system to develop services and competences in line with
the needs of the labour market;
 improve professional development and training of teachers and trainers, with a specific focus
on pedagogical skills related to the implementation of the competence-based inclusive
approach and digitalisation from pre-primary to university level, including VET education;
 adopt the 2022-2029 National Youth Strategy.
On education and training, 2021 was a year of adjustment and planning after the shocks due to
the 2019 earthquake which damaged 24 % of educational facilities and the impact of the
COVID-19 pandemic. As a consequence of the earthquake, 21 000 children in 11 municipalities
were moved to host schools and attended classes in shifts, straining resources and affecting the
quality of teaching. At the end of 2021, 87 schools damaged by the quake reverted to normal.
As last year report notes, both the consequences of the earthquake and the prolonged COVID-19
had an impact on the educational system, which was not equipped with adequate teachers’
training and teaching practices to ensure effective blended education. The results of the skills
gaps analysis conducted in 2021 show that 60 % of the teachers still lack the necessary IT skills
to ensure meaningful digitalisation. Albania started training 2 362 teachers in 2021 out of
30 000, but more efforts are needed to increase the level of investment in teachers’ ICT
education. In terms of equipment, on average, Albania provides one computer for 26 pupils
according to UNICEF, which is inadequate to ensure digitalisation and remains much lower than
the EU average of five pupils on one computer.
With regard to quality in education, progress was made with the adoption of the new National
Strategy of Education and Action Plan 2021-2026 with clear pillars on quality, inclusiveness and
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equity in education, and covering all levels, from primary education to university. Despite these
objectives, Albania’s budget allocation to education in 2021 remains low, estimated at 3.6 % of
GDP, only 0.9 pps. higher than in 2020. Overall, more resources are needed to modernise the
educational system and ensure quality, equity and inclusiveness in education for all pupils. The
school financial autonomy has not progressed in 2021, as the sublegal acts and provisions for
providing actual financial autonomy in the school were not developed, despite legislation exists
since 2018. Anti-corruption measures continue to have a limited impact in education, which
remains a particularly vulnerable sector in this respect.
Albania has adopted a new competence-based curriculum and developed a set of textbooks from
grade 1 to 12 in pre-university education system to match the new content and methodology,
which were successfully implemented in 2021. The number of students benefiting from free
textbooks increased during the year to 260 953, including vulnerable children.
On inclusive education, the 2020 guidelines on assistant teachers decreasing the ration
teacher/pupil with disabilities to 1 for 2 to 3 pupils, at national level is under implementation but
there is still an insufficient number of teaching assistants in regions where the number of pupils
with disabilities per teacher is higher, such as Tirana, Tirana District, Durrës and Kamëz.
Meanwhile, additional efforts are also needed to shift from a system with dual education towards
a system where children with disabilities are integrated into inclusive mainstream schools.
No progress was registered for the implementation of preschool reform. Resources remain
inadequate with only 0.5 % of GDP allocated for pre-primary education in 2021. ICT standards
for teachers were quickly developed and over 600 teachers benefitted from ICT training in 2021.
Furthermore, partnership with local authorities is essential, to avoid school disruption and ensure
useful cooperation in education.
Enrolment rates in the pre-university education system decreased to 72.9 %, with a notable
decrease of 9 % in the preparatory/pre-school education for five to six years old, most probably
due to the persistent impact of the COVID-19 crisis. 286 486 pupils are currently enrolled in
basic education 158 528 in primary education, and 127 958 in lower secondary education.
Attendance in basic education dropped by 2.5 % compared to the previous academic year.
Although already very low, the participation rates of Roma and Egyptian children declined in
both pre-university (13 086 against 14 515 in 2019-2020) and early childhood education 2 514
against 2 996 in the year 2019-2020) and care. The gap in access to education between Roma and
Egyptian children and other children living in the same areas remains very large. The situation
has worsened due during the COVID-19 crisis and the lack of possibilities to follow online
classes. The measures planned to facilitate access to universities (a quota system and university
fee waivers) are in general not implemented.
Implementing legislation on establishing sectoral skills committees is in place and an ICT skills
committee was initiated. The first meeting took place in April 2022. Albania has also prepared
the referencing of its National Qualifications Framework to the European Qualifications
Framework. This is a step forward on aligning the Albanian Qualification System with the
European Qualification System. In May 2021, the National Catalogue of the Professional
Qualifications was approved for the levels 2-5 of the AQF, including 122 professional
qualifications. Validation of non-formal and informal learning has so far been confined to pilot
projects.
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Regarding Vocational Education and Training (VET), the legislation implementing the 2017
VET Law is still not yet fully adopted, and the legislation on financial autonomy of VET
providers still needs to be adopted. The government consolidated the VET institutional
framework, by further reinforcing the National Agency for Employment and Skills, keeping
restructuring the National Agency for VET and Qualifications, including through provision of
additional human resources to cover the function of continued professional development.
Nevertheless, further efforts are needed to finalise the VET related staffing of both agencies, to
reinforce the quality assurance framework and to strengthen planning, monitoring and evaluation
functions at central level.
The Optimisation Plan of VET providers, endorsed in 2020, is not yet implemented. Albania has
to adopt the implementing legislation on organisation, functions and activities of VET providers
as well as on their financial autonomy, and fully implement this Plan by 2023 to ensure the
rationalisation and modernisation of the VET offer. In 2021, 66 VET teachers received “basic
didactics” training, covering pedagogical, assessment, soft and digital skills, from 22 teachers in
2020. Further training is required in 2022 and 2023 to ensure the implementation of digital
education and ensure digital competences for online teaching in VET. Despite promotional
activities and support to students from rural areas in following VET education, participation in
VET is low with only 17.7 % of upper secondary students enrolled in vocational schools in 2021
(18 279 students out of 103 467), 0.5 pp less than the previous year.
Albania benefits from the international dimension of the Erasmus+ programme. The ring-fenced
support for the four Western Balkan countries non-associated to the programme provided by the
Instrument for Pre-Accession assistance III (IPA) amounts to EUR 374 million for 2021-2027
programme period.
Albania continued to participate actively in EU programmes, in particular Erasmus+ and the
European Solidarity Corps.
Regarding the culture sector, the national strategy 2019-2025 is under implementation, focused
on cultural education for child and youth; creative industry in music and dramaturgy; and
international cooperation. During 2021, the ministry adopted implementing legislation regarding
the creation and administration of the database of stolen cultural assets, rules of monitoring and
evaluation of entities that have cultural assets under administration. From June to December
2021, 108 internal projects were carried out, while for 2022, 185 projects are approved.
In March 2022, Albania ratified the agreement to participate in the new EU Creative Europe
programme 2021-2027, for which the Ministry of Culture has established the adequate
administrative structures.
The remaining bylaws were approved for the implementation of the law on youth but further
efforts should be made for the establishment of relevant youth structures. No new youth centres
have been established during 2021.
The Ministry of Education, Sports and Youth has to finalise and adopt the National Youth
Strategy for the period 2022-2029 and the action plan.
Chapter 29: Customs union
All EU Member States are part of the EU customs union and follow the same customs rules and
procedures. This requires legislative alignment, adequate implementing and enforcement
capacity, and access to the common computerised customs systems.
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Albania is moderately prepared in the area of the customs union. Limited progress was made,
notably by applying the transitional rules of origin in the pan-Euro-Mediterranean area and by
strengthening capacities and improving cooperation among bodies involved in the fight against
smuggling and import of counterfeit goods, Authorised Economic Operators obtaining validation
by CEFTA, and digitalising of services. Some of last year’s recommendations were not fully
addressed and remain valid. In the coming year, the country should in particular:
 approve legal provisions and develop the New Computerised Transit System;
 continue efforts in pursuing the fight against smuggling, corruption and imports of
counterfeit products, including through strengthening administrative capacities and
improving cooperation among the bodies involved;
 accede to the FCTC Protocol to Eliminate Illicit Trade in Tobacco Products.
As regards customs legislation, Albania’s customs code is broadly aligned with the EU acquis.
However, the levying of “scanning fees” per customs declaration continue to contravene the
Stabilisation and Association Agreement which prohibits customs duties or charges having
equivalent effect on trade between the EU and Albania. Preparatory work for the development of
the New Computerised Transit System continued through cooperation with international experts
in this area. Albania is implementing its authorised economic operator (AEO) programme with
the first eight registrations in 2021, and successful validation of safety and security standards in
line with CEFTA Additional Protocol 5. Awareness raising activities regarding the benefits,
procedures and programmes continued.
The Customs Code contains rules of non-preferential origin and Albania applies the Regional
Convention on Pan-Euro-Mediterranean preferential rules of origin. Since September 2021,
Albania has been the first country in the region to apply the new transitional rules of preferential
origin of the PEM Convention for bilateral trade with the EU, as an alternative to existing rules.
The customs code's provisions on valuation are aligned with EU rules. The risk management
system is automated and compares import, export and transit data against active risk profiles.
The legislation on customs enforcement of intellectual property rights (IPRs) is harmonised with
the EU acquis. Cross-border smuggling of tobacco products and other illicit activities in the
border regions continue to be an important area, where further improvements in cooperation and
antifraud tools are needed. As part of the antifraud effort, the accession to the WHO Framework
Convention on Tobacco Control (WHO FCTC) Protocol to Eliminate Illicit Trade in Tobacco
Products is recommended. The national rules on cash and goods transported in travellers’
baggage still differ from the EU acquis as regards amounts to be declared and the declaration
form. ACA can impose sanctions for non- or mis-declarations of cash at the border.
On administrative and operational capacity, five officials of the Customs authority were
certified by EUROPOL as users and trainers for the SIENA platform, following the completed
optical fibre connection with the police for access to SIENA for exchange of information. The
launch of a national customs enforcement network (nCEN) database resulted in an increased
registration of seizures in the system and is supporting analyses and reporting. In November
2021, the INES+ system became operational for managing cases of infringement of intellectual
property rights with a view to stepping up fight against imports of counterfeit products. By end
2021, 34 out of 41 customs services were accessible online through the e-Albania portal. A new
customs organisational structure entered into force in May 2022 to address observed challenges,
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such as reporting lines of the anti-corruption coordinator. In an effort to improve transparency,
Customs published in April for the first time a “green book” reporting on progress in 2021, and
highlighting priorities for the following year.
CLUSTER 4: THE GREEN AGENDA AND SUSTAINABLE CONNECTIVITY
This cluster covers: transport policy (Chapter 14); energy (Chapter 15); trans-European networks
(Chapter 21); and environment and climate change (Chapter 27). Albania is moderately prepared
on energy and environment and climate change. It has some level of preparation in the areas of
transport and of trans-European networks. The country has made limited progress in these areas
and ongoing efforts to address issues with Flag State Control and to align legislation need to
continue, while nature protection requires attention.
Addressing the issues of climate change by strengthening green transition policies, pursuing
efforts in sustainable hydropower generation and ensuring sustainable connectivity, constitute
fundamental priorities for economic integration within the region and with the European Union.
This cluster and the reforms concerned have significant links to Albania’s Economic Reform
Programme, the Commission’s Economic and Investment Plan and the Green Agenda for the
Western Balkans.
Chapter 14: Transport
The EU has common rules for technical and safety standards, security, social standards, State
aid and market liberalisation in road transport, railways, inland waterways, combined transport,
aviation and maritime transport.
Albania has some level of preparation in the area of transport policy, with limited progress
achieved in the past year. The recommendations from last year have been partly addressed with
implementing legislation in the rail sector and with further measures to improve the quality and
performance of the vessels under the Albanian flag. Efforts to further align the legislation and to
move the Albanian flagged fleet out of the black list of the Paris Memorandum of Understanding
on port state control need to continue. The recommendations of last year remain partly valid.
In the coming year, Albania should in particular:
 adopt the new National Transport Strategy 2021-2025 and prepare and adopt the new Road
Safety Strategy in compliance with the Transport Community Road Safety Action Plan;
 implement legislation on the railway sector reform in compliance with the Transport
Community Rail Action Plan and ensure full operability of the network;
 accelerate concrete measures to improve the performance of maritime transport vessels under
the Albanian flag.
As regards the general transport acquis, the new National Transport Strategy and its Action
Plan for 2021-2025 still needs to be adopted. The strategy is expected to be finalised by the end
of 2022 and should be reflected in the mid-term budget programme 2022-2024. During the
reporting period, there was no progress on alignment of the transport policy with public-service
obligations and the acquis on public-service contracts. Continued efforts are required to fully
implement the intelligent transport systems (ITS) directive, foster multimodality and implement
relevant national laws in compliance with the Transport Community Action Plans. Albania has
started the preparation of a national ITS strategy for rail and maritime modes. On combined
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transport, Albania has yet to provide references to national legislation alignment with the EU
acquis.
Administrative capacity needs strengthening throughout the transport sector, particularly in the
rail sector. Several capacity-building initiatives took place on transport of dangerous goods,
railway and asset management plans. Legislative updates are required to complement the reform
of the Albanian Road Authority. The law on the establishment, organisation and functioning of
the National Investigation Authority for Rail and Maritime Accidents and Incidents was adopted
on 1 July 2021. The Authority was set up but is not yet operational. Available funds for road and
railway infrastructure maintenance remain insufficient, resulting in continued deterioration of
infrastructure conditions. Among cases reported in 2021 by the State Supreme Audit Institution
to the prosecution, one case involved a former director of the Port of Dürres. Continued efforts
are required to support the 2018-2022 rail maintenance plans.
Albania made further progress in aligning its national legislation on road transport by adopting
a piece of implementing legislation on technical inspection of motor vehicles in November 2021.
This piece of legislation is designed to fully align with the EU acquis. In April 2022, an
agreement was signed with Germany on the mutual recognition of driving licenses. The Road
Code was amended in December 2021 to improve the procedures for obtaining a driving license
after rehabilitating from alcohol or psychotropic substances. The rules on electric scooter and
bicycle traffic were unified to strengthen road safety of such new category of vehicles on the
road. Further efforts are needed to align with the EU acquis on electronic road toll systems and
on road fee enforcement. Road Safety remains a serious concern. Although the number of
fatalities fell between 2019 and 2021, work is needed to tackle the discrepancy between the
national statistics and the significantly higher WHO estimate. During 2021, the fatalities per
100 000 inhabitants increased by 8.8% compared to 2020. Albania should intensify efforts to
improve its road safety through effective policies and measures. Albanian authorities have yet to
prepare and adopt a new Road Safety Strategy and its Action Plan 2021-2030, in compliance
with the Transport Community Road Safety Regional Action Plan for the Western Balkans.
Albania completed the alignment of its legislation on periodic roadworthiness tests, but still has
to further strengthen its inspection capacity. Some efforts were made regarding road safety
education. Some road safety interventions have been implemented to improve safety on road
intersections. On the implementation of the law on dangerous goods, Albania has adopted two
pieces of implementation on drivers certificates and safety advisers certificates.
As regards railway transport, the National Accidents Investigation body for Rail and Maritime
was established. Albania needs to ensure full operability of the rail network and complete the
institutional framework of the four new rail companies (infrastructure manager, passenger
transport operations, freight transport operations and maintenance) based on the law adopted in
July 2021. In this respect, Albania needs to finalise and adopt the strategic framework for
implementing ITSs on the core rail network. No progress was reported on passenger rights.
Albania has published its Network Statement in 2022 both in Albanian and in English. Albania
needs to complete the establishment of the Electronic Register of Vehicles and the Rail
Infrastructure Asset Management System (RIAMS) needs to be established. Some progress was
achieved on regional cooperation with the signature of a memorandum of understanding by
Western Balkans infrastructure managers and with a Declaration on Rail at ministerial level.
On maritime transport, Albania approved a regulation on the organisation and functioning of
the flag state control, which is designed to be fully aligned with the acquis on flag state
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requirements and flag state control of the 2006 Maritime Labour Convention. Continued efforts
are required to substantially reduce the detention rate of Albanian-flagged vessels in order to
leave the current “Black List” of poor flag performance, considered at high risk, and to resume
the country’s application for membership of the Paris Memorandum of Understanding on port
state control. Ful alignment with the acquis on EU vessel-traffic monitoring and information
system (VTMIS), based on the strategic framework for implementing ITSs on the core maritime
network still needs to be ensured. Alignment with the acquis on ports and enaction of legislation
based on the EU Port Services Regulation still needs to be put in place. There were no new
developments regarding inland waterway transport, which is limited to two lakes shared with
neighbouring countries, and regulated by bilateral agreements.
On aviation, Albania needs to address the findings raised by the European Union Aviation
Safety Agency (EASA) during the standardisation inspection in 2022 in the domain of air traffic
management (ATM) and air navigation services (ANS), in order to comply with the requirements
for the first transitional phase under the European Common Aviation Area Agreement (ECAA),
It should take immediate actions to reinforce the regulatory capacities of the Civil Aviation
Authority (CAA) of Albania – including on the availability of competent staff - to ensure
effective oversight of the air navigation service provider (Albcontrol). The transposition of EU
ATM/ANS acquis is not completed. The new management of CAA Albania appointed in late
2021 is expected to address these issues. The government adopted a decision on the investigation
and prevention of accidents and incidents in civil aviation, designed to fully align with relevant
EU regulation. In addition, the government adopted in May 2022 an order on civil aviation
incident reporting, which is partially aligned with the EU acquis.
On combined transport, there is a slight improvement of legislation in this area. The definition
of multimodal transport in the 2016 Railway Code is partly in line with the EU acquis and the
National Transport Strategy 2021-2025, which contains parts of combined transport, is yet to be
adopted.
Albania should increase efforts to align with and implement EU passenger rights legislation in
all modes of transport. Further progress is needed on adopting relevant legislation and setting up
systems for electronic freight transport information exchange.
Chapter 15: Energy
EU energy policy covers energy supply, infrastructure, the internal energy market, consumers,
renewable energy, energy efficiency, nuclear energy and nuclear safety, and radiation
protection.
Albania is moderately prepared in this area. There was limited progress on the reform of the
electricity market and connectivity measures in the renewables and gas sectors and on regional
interconnection lines, as well as in diversifying from hydropower generation to other renewable
energy sources. In the context of the global energy crisis, such efforts, as well as energy
efficiency measures, should be accelerated taking into account Albania’s commitments under the
Paris Agreement and the need to engage in the clean energy transition, in line with the Green
Agenda for the Western Balkans. Albania made some progress on the legal framework for
energy efficiency (EE) but still needs to adopt all missing bylaws. No new energy efficiency
funding mechanisms have been put in place. The energy efficiency agency’s role, capacities, and
operations need further improvement. Albania has adopted its National Energy and Climate Plan
2030, to be implemented in 2022.
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Last year’s recommendations have not been completely addressed and remain valid. In the
coming year Albania should in particular:
 ensure the Power Exchange (ALPEX) and day-ahead electricity market are fully operational
and continue strengthening the electricity transmission network;
 complete the functional unbundling of energy operators and ensure full access to the
liberalised market for all customers connected to 20kV in 2022, as well as the progressive
extension of this access to all customers;
 implement the updated National Energy and Climate Plan (NECP) 2020-2030, including
renewable energy and energy efficiency action plans, ensure all enabling institutional and
legislative as well as funding and certification and audit measures are in place, including by
shifting renewable electricity production away from hydropower, taking into account the
energy crisis.
 Utilize benefits in the Energy Community guarantees of origin and sign direct agreement
with the service provider to use national electronic register for issuance, cancellation and
trade of guarantees of origin, in line with the EU standards.
On security of supply, Albania is still moderately prepared but its oil stock legislation is not in
line with the EU acquis. Progress is needed to create a central stockholding body for oil. Albania
should align with the acquis on minimum oil stocks of crude oil and petroleum products required
for security of supply. Furthermore, Albania’s emergency oil stock model has not yet been
amended.
Albania’s electricity system has been connected with systems in Greece and Montenegro since
2014. The Power Exchange (ALPEX) is established and is expected to be fully operational in
2022. The construction works of the interconnector with North Macedonia are expected to start
at the end of 2022 . In 2021, Albania’s electricity distribution losses in the power grid remained
at 20 %, the same level as in 2020
Albania intends to connect the Vlora thermal power plant with the Trans-Adriatic Pipeline (TAP)
through a natural gas pipeline, as well as through an LNG terminal to enhance the country and
the regional energy security. The decision for licencing Albpetrol as a gas supplier was approved
by the Energy Regulatory Authority (ERE) in August 2021, while Albgas is expected to fulfil all
conditions on ownership unbundling to be certified as Transmission System Operator at the end
of 2022 (partly fulfilled by ERE decision of January 2022).) (see also Chapter 21 – Trans-
European networks).
On the internal energy market, the complete unbundling of the distribution system operator
OSHEE SA is still pending.
Electricity prices are not fully liberalised. Since 1 January 2021, all distribution customers
connected to 35kV benefit from an unregulated market. The next step of de-regulating supply at
all voltage levels, except the 0.4 kV level, remains to be completed. The electricity market is
dominated by the regulated wholesale contract between state-owned generation company KESH
and OSHEE companies (distribution and supply). This contract is to end after ALPEX becomes
operational in 2022. Given the global energy crisis, a transitionary mechanism has been put in
place to allow Kesh to purchase electricity abroad and a price cap on electricity for domestic
customers has been introduced from Autumn 2021.
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The Energy Regulatory Authority (ERE) legal framework is in line with the EU acquis, except
for the regulator’s right to impose measures to promote competition, to require transmission and
distribution system operators to change their terms and conditions, and to raise the level of the
penalties that ERE can impose. ERE still needs to develop its capacity to address shortcomings
in the energy markets. The approval in 2021 of REMIT rules is a necessary but insufficient step
forward.
Albania’s legislation is partly aligned with the hydrocarbons licensing directive. It has not
harmonised with the directive on the safety of off-shore oil and gas installations.
On renewable energy, Albania adopted amendments to the 2017 law in January 2021. The feed
in tariff (FIT) support scheme has been transformed into a contract for difference (CfD), while a
renewable energy operator (REO) should be established. The CfD support scheme
implementation regulation and the REO are expected to be in place by the end of 2022. A pricing
methodology for consumers with installed capacity up to 500kW was adopted in 2021 and
should be implemented by the end of 2022. The establishment of an agency responsible for
renewable energy has not yet been accomplished. The National Agency of Natural Resources
was appointed to perform this role for the time being.
The target of the National Consolidated Renewable Energy Action Plan (NCREAP) for 2019-
2020, extended to 2021, of a 38 % renewable energy sources share in total consumption
throughout 2020 was not reached. Two contracts for solar photovoltaic farms were signed, which
will become operational in 2023, and an auction on wind farms has been launched in 2021, while
an auction is planned for Hybrid Photovoltaic To accelerate renewable electricity production and
facilitate the transition from hydropower to other renewables, more auctions should be
conducted. Financing agreements for two renewable energy flagship projects under the EU
Economic Investment Plan for the Western Balkans have been signed in 2021 and Albania could
therefore accelerate the development of renewable energy projects.
Albania depends almost exclusively on hydropower for electricity generation, making it
vulnerable to climate impacts. It is a net importer of electricity at a rate of 30 % per year, as
hydroelectricity is not sufficient to cover its needs. Progress in power interconnection with
neighbouring countries and setting up an integrated regional energy market is needed to
strengthen the security of supply and create opportunities for green energy development and
trading. The deployment of its vast solar and wind resources would significantly improve
Albania’s energy security and reduce its energy system vulnerability to climate impacts. Albania
plans to use more photovoltaic and renewable energy from wind and this trend should be pushed
forward given the NECP 2030 targets and the energy crisis.
The concession contracts for hydroelectric power plants (HPP) are not sustainable for Albania.
The small HPPs have a significant impact on the biodiversity and local communities, notably in
protected areas where around 100 concessions are located or planned. Plans for hydroelectric
power plants have been challenged, questioning the regularity of concession processes and the
validity of environmental impact assessments (EIAs). Moreover, no strategic environmental
assessments (SEAs) have been conducted. Two large HPPs on the Vjosa River and the Drin
River have generated opposition from communities. Such investments require full compliance
with the national legislation and the environmental and Energy Community acquis, notably with
regards to public consultations and the quality of EIAs and SEAs. Further efforts are needed on
framing HPP developments and on strictly enforcing environmental legislation.
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The implementation of the national energy efficiency action plan (NEEAP) 2017-2020,
extended to 2021, has not met its targets in terms of 6.8% energy saving by 2021. The Energy
Efficiency Agency, operational since 2018, is still not fully operational. No EE incentives are in
place and EE financing mechanisms still need to be promoted. Nevertheless, some progress has
been made towards compliance with the Energy Community acquis by amending the energy
efficiency law in March 2021 to align with the Energy Efficiency Directive, and several
procedural and legal acts have been adopted in the area of energy performance of buildings.
Pending implementing legislation related to the Energy Efficiency and Energy Performance of
Buildings Directives should be adopted in 2022, the certification of energy auditors and
managers should be continued, and financing incentives and mechanisms for energy efficiency
should be put in place. Energy efficiency projects should also be accelerated, given the targets
and the ongoing energy crisis.
Albania has adopted in December 2021 its National Energy and Climate Plan (NECP) 2020-
2030. This Plan complements the Energy Strategy 2018-2030 and is to replace the National
Energy Efficiency Action Plan (NEEAP) and Regional Energy Efficiency Action Plan (REEAP),
setting new short and medium-term EE and RE targets and measures. Therefore, Albania needs
to ensure that implementable RE and EE action plans are adopted within the scope of the
NECP2030. Albania still needs to make sure that a fully operational energy agency is in place in
2022, to implement promptly the measures of the plan.
Albania has made no further progress on nuclear energy, nuclear safety and radiation
protection.
Chapter 21: Trans-European networks
The EU promotes trans-European networks (TENs) in the areas of transport,
telecommunications and energy to strengthen the internal market and contribute to growth and
employment.
Albania has some level of preparation in the area of trans-European networks. Some progress
was made in developing transport and energy networks. Albania needs to make further efforts to
address the recommendations of last year which remain valid.
In the coming year, Albania should in particular:
 continue developing the core transport and energy networks in line with: (i) the national
strategies for transport and energy; (ii) the infrastructure investment prioritisation under the
single project pipeline; and (iii) the Economic and Investment Plan for the Western Balkans
while contributing to the Green Agenda;
 continue to harmonise the legal framework with EU acquis and the regulations on TEN-T
(trans-European transport networks) and TEN-E (trans-European energy networks),
including full harmonisation of guidelines for trans-European energy infrastructure
andcontinue implementing Transport Community Treaty action plans on road, road safety,
rail and transport facilitation and strengthen the institutional framework and administrative
capacity to develop and monitor TENs.
Albania has made some progress on its strategic framework for transport networks. It
continued to harmonise its legal and institutional framework with the EU trans-European
transport networks (TEN-T) regulation and the Transport Community Treaty (TCT). The
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Albanian authorities are encouraged to strengthen their close cooperation in the framework of the
TCT and to progress with implementing the action plans on road, road safety, rail and transport
facilitation. Albania has continued its active involvement in the EU strategy for the Adriatic and
Ionian region (EUSAIR) and has chaired its Governing Board since 1 June 2021.
The National Transport Strategy for 2021-2025 and its Action Plan have been prepared by the
Ministry of Infrastructure and Energy and need to be adopted (See Chapter 14 - Transport).
Albania has further aligned the national legal framework with TEN-T Regulation through an
additional implementing decision.
Albania has made progress in repairing and maintaining its core road infrastructure as road
maintenance practices have been implemented throughout the country’s national roads network.
Work for the preparation of road, rail and port infrastructure projects, especially along the
Adriatic-Ionian Corridor and Corridor VIII (Varna–Durrës) has shown progress. The Vlora
bypass has been permanently open for traffic in July 2022. Concerning rail, works for the
rehabilitation of the Durrës-Tirana rail line and for the construction of a new line to the
international airport started in October 2021. The design study for the segment Durrës-
Rrogozhine, in Rail Corridor VIII, was completed in October 2021.
The government decided to relocate the cargo activities of the ports of Durrës and Vlora. In the
context of a 10-year agreement on economic cooperation with a third country (See also Chapter
5 – Public Procurement), in June 2021, the Council of Ministers decided to change the
designation of Porto Romano, transforming it from a MBM (multi-buoy mooring) port to an
open port for international cargo traffic. In December 2021, the Port of Durrës Authority signed
a service contract to prepare the detailed design for cargo activities in another location at Porto
Romano, transferred from Durrës Port.
The Kukës airport in the north of Albania started normal operations in July 2021, focusing on
low-cost airlines. After an interruption, flights resumed in February 2022. In November 2021,
the government inaugurated the works for the construction of a commercial airport within the
Vjosa-Narta protected landscape, which raises important concerns due to threats to the
environment, the habitat, migratory birds and other living species.
Albania is partially aligned with the acquis on a single European railway area, railway system
interoperability and rail freight corridors for competitive freight. Progress has been made for
adopting the roads ITS strategy. Nevertheless, further efforts are needed to align the country with
the ITS directive, develop a national strategy on the deployment of ITS and prepare for its
implementation.
Albania should ensure that its transport network projects are aligned with the TEN-T regulatory
framework and the TCT action plans, while contributing to the Green Agenda for the Western
Balkans. Investments need to be implemented in accordance with cost/benefit analyses carried
out in line with EU best practice. Projects are channelled through a single project pipeline,
confirming the country’s strategic orientation towards TENs. Serious measures on road safety
should be taken, particularly to eliminate ‘blackspots’ identified on stretches with high accident
rates, which lead to fatalities and injuries. The road core network is now covered by 5 year
maintenance programmes. Adoption of the multiannual maintenance plans for rail core network
remains a challenge taking into consideration the state of rail infrastructure.
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On energy networks, further efforts are still necessary to adopt the strategic environmental
assessment (SEA) and project identification plan under the gas master plan. This will help the
development of TEN-E projects. The agreement signed in July 2021 for the construction of the
TAP Fier exit point is key for the implementation of the above pipelines, as well as for the
development of a gas market in Albania. The planned development, and interconnections of a
LNG terminal in Vlora to regional gas pipelines (Trans-Adriatic Pipeline TAP, Ionian Adriatic
Pipeline IAP, Kosovo gas interconnector pipeline ALKOGAP would increase regional energy
security.
Progress was made on the improvement of the infrastructure for electrical power transmission.
Kosovo entities joined the Kosovo-Albania control block and participate in the Albanian Energy
Exchange (ALPEX). This should become operational by November 2022, further to the
successful tendering of the platform operator.
Concerning the construction of a 400kV interconnection line between Fier in Albania and the
North Macedonia border, works are expected to start in the second half of 2022, with completion
scheduled in third quarter of 2023.
Albania’s participation in the EU Strategy for the Adriatic-Ionian Region (EUSAIR), remains a
priority for both transport and energy networks. It contributes to strengthening ties through its
action plan composed of four pillars: blue growth, connecting the region, environmental quality
and sustainable tourism.
Chapter 27: Environment and climate change
The EU promotes strong climate action, sustainable development and protection of the
environment. EU law contains provisions addressing climate change, water and air quality,
waste management, nature protection, industrial pollution, chemicals, noise and civil protection.
Albania shows some level of preparation in this area. Limited progress was made in further
aligning the policies and legislation with the EU acquis, in areas such as water management,
chemicals and environmental crime. Albania made progress in the area of civil protection and is
ready to join the Union Civil Protection Mechanism. Albania needs nevertheless to continue
working on further improving its civil protection system. Significant efforts are needed on
implementation and enforcement, especially on waste management, water and air quality and
climate change.
The 2021 recommendations remain valid and in the coming year, in addition to addressing the
shortcomings set out below, Albania should in particular:
 adopt the new law on water services and the new strategy for water supply and sewerage
2021-2030, and approve a national road map on utilities aggregation; substantially increase
the budgetary resources and implementation capacity of its key national water agencies;
finalise and adopt the River Basin Management Plans (RBMP) for the Ishem, Erzen and Mati
rivers and complete the initial stage for Vjosa River;
 take immediate measures to review and improve environmental and strategic impact
assessments on existing and planned projects, plans and programmes, especially in the
hydropower, construction, tourism, transport and mining sectors; take immediate measures to
fight environmental crime and increase policy and law enforcement for nature and
biodiversity protection, especially in the protected areas;
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 adopt a new national disaster risk reduction strategy and action plan, and set up flood
vigilance mechanisms and risk management plans in all river basins; implement the National
Strategy on Climate change and related Action Plans on mitigation and adaptation, adopt the
relevant legislation and implement its integrated National Energy and Climate Plan in line
with Energy Community obligations.
Environment horizontal issues
Albania needs to step up efforts to achieve full alignment and implementation in most areas. The
implementation of the Environmental Impact Assessment (EIA) and Strategic Environmental
Assessment (SEA) Directives needs to be significantly improved with regard to concrete projects
before construction and operation, in particular for HPPs. The EIA quality and processes have to
improve. Recommendations from EIAs are rarely implemented, and should be enforced and
monitored. The EIA for Vlora Airport was widely criticised by civil society and other
stakeholders inter alia for not considering the protected area status of the selected site. In some
cases, the EIA was approved after the contruction was already underway. Public participation
and consultation in decision-making need to be improved, particularly at local level.
Implementation of the EU directive on protection of the environment through criminal law has
to be improved, although environmental crimes convictions increased to 65 from 45 in 2020.
These crimes relate in particular to deforestation, illegal logging, arson, hunting and sale of
wildlife and protected species, gravel extraction from riverbeds, and dumping of waste in rivers.
The implementation of the polluter-pays principle in implementing legislation is weak. Further
progress is needed to achieve full alignment with the directive on environmental liability.
Inspections and enforcement capacities should be rapidly strengthened, especially to address
environmental crimes more effectively. The state budget for environment and climate change
remains very limited in 2022, and not sufficient to implement the EU acquis. Frequent staff
turnover and hiring of staff without necessary expertise has further eroded the capacity of the
central administration in this area. The Specialised Anti-Corruption Structure (SPAK) arrested in
mid-December 2021 the former Minister of Environment, on corruption charges during the
award procedures for the construction concession of the incinerator in Elbasan. SPAK has also
requested the arrest of two directors of concession companies. It arrested, in April 2022, the
former Secretary General of the Ministry of the Environment on charges of corruption during the
award procedures for the Fier waste incinerator.
More efforts are needed to align with the air quality acquis, including on extending and
improving the air monitoring system. The implementation of the 2014 national air quality
strategy is still pending and the 2019 national plan on air quality management does not provide a
functional monitoring system. It focuses mostly on transport measures, while air monitoring
continues to be not in line with the EU standards on air quality. The implementation of the action
plan for air quality and of Directive (EU) 2016/802 on sulphur content in certain liquid fuels are
ongoing, while the implementation of Directives 94/63/EC on the control of volatile organic
compound (VOC) emissions and 2009/126/EU on stage II petrol vapour needs to start.
The legal framework for waste management is partially aligned and substantial efforts to
achieve alignment are needed. Closing of non-compliant landfills and dumpsites, as well as
littering, remain a significant challenge. Separate collection of waste streams and economic
instruments to promote recycling, reuse and to prevent waste generation are still insufficient. The
construction of a new incinerator in Tirana poses growing concerns in terms of compliance with
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the EU waste acquis, including on the waste hierarchy and recycling targets. Moreover, the
waste management policies do not aim to reach EU 2030 recycling targets. Albania should
promote circular economy and should incentivise preventing, reducing and recycling waste,
especially composting, to cut down landfilling. The implementation of the waste streams
legislation should be speeded up. The enforcement and compliance-checking role of the
institutions should be clarified and strengthened, with appropriate staffing and budget. In March
2022, Albania adopted a legislation that bans the use of certain categories of plastic bags, and has
partially aligned with the directive on single-use plastics. Further alignement with this directive
is needed, by banning the other single-use plastic items.
On water quality, the level of alignment remains incomplete and two laws on water resources
and marine waters should be adopted in 2022. Directive specific implementation plans for the
Drinking Water Directive and Urban Wastewater Treatment Directive, where major investments
are required for compliance, are under preparation. Following the 2020 adoption of the Drini-
Buna and Semani River Basin Management Plans, Albania should proceed with the completion
and adoption of the remaining five RBMPs: the Ishem, Erzen, Mati, Shkumbini and Vjosa. In
line with the Green Agenda for the Western Balkans, Albania should increase efforts in
strengthening transboundary basin management with neighbouring countries, which concern to
Drini-Buna and Vjosa river basins. A transboundary approach with Greece is encouraged during
the future development of the Vjosa RBMP, aknowledging the high ecological value and eco-
tourism potential of the river, rin 2021 through a natural river park status.
To ensure progress with regards to the EU water acquis as outlined above, Albania needs to
substantially increase the budgetary resources and implementation capacity of the key national
water agenciesand adopt a capacity development plan. In addition, the water quality and quantity
monitoring is insufficient compared to the current compliance, management and protection
needs. The Water Resources Management Agency (AMBU), together with the Nationa
Environment Agency (NEA) and other water monitoring agencies, should urgently programme
and implement a national water monitoring programme with sufficient resources.
The performance of the water supply and sewerage services sub-sector remains globally low.
Albania should amplify and accelerate further the water reform measures. The new law on water
supply and sewerage, the new national strategy for water supply and sewerage 2030, and the
revised water code should be adopted and implemented in 2022, and Albania should approve a
road map on aggregation. There is also a need to ensure full alignment with the urban wastewater
treatment directive, extend sewerage networks, license and apply adequate tariffs for all waste-
water treatment plants and build new ones, in particular in urban and coastal areas with high
tourism development. The AKUM strategic institutional development plan, needs to be adopted
and implemented to drive and support the implementation of the water reform and new strategy
2030.
Alignment with the acquis in the field of nature protection, in particular the Habitats and Birds
Directives, is advanced. The legislation on strategic investment raises concerns for the protection
of biodiversity, as it may lead to large tourism and industrial investments in protected areas.
Construction works for the new Vlora Airport within the Vjosa-Narta Protected Area started in
December 2021, in contradiction with national laws and international biodiversity protection
conventions that have already been ratified. The government declared in December 2021 the
status of Vjosa River as a Protected Area of protection, as one of Europe’s last wild rivers
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(excluding however its tributaries). Good progress was made with the adoption of the set of rules
for the management of revenues generated by fees paid in Protected Areas, and the establishment
of the Special Fund for Protected Areas. An acceleration in the implementation of the set of rules
should be considered. In January 2022, the government of Albania approved the revised
delimitation of 34 protected areas. Although the total of the area under protection has increased
to 21 % of the territory, this increase has happened in the interior of the country, while the
coastal area under protection has shrank. Albania does not adequately ensure enforcement of the
forest and logging laws, and prosecuted records of offenders and arsonists are little, considering
the high number of intentional and unintentional fires in 2021 and 2022. No convictions on these
cases have been reported. The moratorium on hunting was extended by an additional 5 years but,
for conservation purposes, a law and plan enforcing the moratorium should also be adopted.
Capacity for prevention and inspection of wildlife crimes should be ensured.
The Skavica hydropower plant project under preparation is expected to have a large
environmental and socio-economic impact on the area, and impact the Balkan lynx populations
that use this corridor for migration between Albania and North Macedonia. Therefore, adequate
attention should be brought to the project design and EIA quality to minimise these impacts.
Investments in the road sector rarely implement the obligatory planting and restoration of road
slopes, and no wildlife crossing has so far been planned and implemented in Albania.
Albania joined in February 2022 the High Ambition Coalition for Nature and People, pledging to
protect at least 30 % of land and seas and promote nature-based solutions within the UN
framework convention on climate change.
Alignment with the EU legislation on industrial pollution and risk management is still at an
early stage. Capacity and financial constraints are hampering progress in implementing
legislation on the prevention of major accidents involving dangerous chemicals.
On chemicals, Albania has a legislative basis for alignment with the EU regulation on the
registration, evaluation, authorisation and restriction of chemicals (REACH), the implementing
legislation remains to be adopted and adequate administrative structures to be established.
Albania performed urban noise monitoring in several cities and municipalities in line with the
national monitoring programme and according to WHO and national standards. It should
strengthen its administrative capacity for preparing strategic noise maps and action plans.
On civil protection, Albania made progress in building its civil protection capabilities and has
undergone a comprehensive reorganisation of its national civil protection system. In June 2022,
the Prime Minister submitted to the European Commission the government’s expression of
interest to join the UCPM, demonstrating its commitment for contribution to the Mechanism and
further progress on civil protection. The country should nevertheless work on further improving
its civil protection system. considering the multiplication of national disasters in the last decade
and the increased impacts of climate change, Albania should adopt a new national strategy and
national plan, review the emergency plans, and substantially enhance operational capacities,
infrastructure and systems for early warning, prevention, preparedness and response. Albania
needs to build efficient civil protection and disaster risk reduction (DRR) systems in order to
increase the country’s resilience to natural disasters and crisis. The country should improve the
management of flood risks in accordance with the EU floods directive, and towards formulating
new measures for the reduction in damage caused by flooding. The country should boost
implementation by developing and adopting flood risk management plans in all basins. It should
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further enhance flood forecast and sustainability of national monitoring stations network, and
urgently regulate its early warning and hydrometric-meteorological services. Albania is also
encouraged to develop river basin droughts management plans, and forest fires risk assessments
and management plans. Albania should also proceed with establishing secure trans-European
services for telematics between administrations (TESTA).
Climate change
Albania has some level of preparation for tackling climate change, but alignment with the EU
acquis still remains limited. Albania pledged climate neutrality by 2050 at COP26 in November
2021, in line with the EU ambition. It also joined the Global Methane Pledge. Good progress was
done by adopting a revised National Determined Contribution (NDC) in October 2021,
increasing the ambition from 11.5 % to 20.9 % of emissions reduction for the period 2021-2030,
and by adopting a National Energy and Climate Plan (NECP) in December 2021. However, the
emission reductions foreseen for 2021-2030 in the NECP go up to 18.7%, lower than the pledge
in the revised NDC. The plan relies significantly on sequestration of CO2 by forests, however
there are very limited financial means and capacities allocated to the protection of forests and to
forest management including reforestation and forest fires risks management measures. This
should be urgently tackled. An overall lack of a specific administrative structure for handling
climate change issues remains a matter of serious concern. Significant efforts are also needed to
green the transport sector.
The National Strategy on Climate Change will require updating to take into account the new
climate targets set out in the revised NDC and, closer to accession, the new climate targets set by
the EU. The implementation of the 2020 Climate Law requires further implementing measures to
be initiated under the Minister in charge of environment. Capacities in the public administration
to understand the climate change impacts on Albania and to mainstream climate change in
sectoral strategies and plans remain very limited, and capacity building is very much needed in
this regard. No emissions register is in place.
Substantial investments and efforts are needed for climate adaptation, as Albania is highly
exposed to the consequences of climate change. Sea level rise as well as floods/droughts is
expected to increasingly affect people substantially, public infrastructures and economic
activities. Climate risks management plans need therefore to be adopted at all levels and large
and vital infrastructures to be climate-proofed in order to increase the country’s resilience to
climate change impacts.
CLUSTER 5: RESOURCES, AGRICULTURE AND COHESION
This cluster covers: agriculture and rural development (Chapter 11); food safety, veterinary and
phystosanitary policy (Chapter 12); fisheries (Chapter 13); regional policy and coordination of
structural instruments (Chapter 22); and financial and budgetary provisions (Chapter 33).
Albania has some level of preparation in most areas linked to resources, agriculture and
cohesion, namely agriculture and rural development, veterinary and phytosanitary policy,
fisheries and financial and budgetary provisions. It is moderately prepared as regards regional
policy and coordination of structural instruments. Albania has made good progress in agriculture
and rural development, notably with the establishment of a farm register and better
administrative capacity for rural development. Good progress was also observed on fisheries,
with the operationalisation of the Vessel Monitoring System (VMS) and allocation of human
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resources to monitor and report on the activities of fishing vessels. Progress was however limited
on food safety, veterinary and phytosanitary policy, on regional policy and coordination of
structural instruments while some progress was made on financial and budgetary provisions.
This cluster comprises policies linked to sustainable and inclusive territorial development as well
as the EU’s funding system, requiring particular preparation for developing the capacities to
assume responsibilities of a future Member State.
Chapter 11: Agriculture and rural development
The common agricultural policy (CAP) supports farmers and rural development. This requires
strong management and control systems. There are also common EU rules for quality policy and
organic farming.
Albania has some level of preparation in agriculture and rural development. Some progress
was achieved with regard to the establishment of a farm register and the development of
administrative capacities for the preparation of the instrument for pre-accession assistance for
rural development programme (IPARD III). Some of the Commission’s recommendations from
2021 were not fully implemented and remain valid.
In the coming year, Albania should in particular:
 complete the farm register and adopt an implementation plan for the establishment of the
farm accountancy data network (FADN) to provide validated data for policy-making;
 Ensure the administrative capacity required to submit for entrustment relevant measures
available under IPARD III programme;
 complete the legal frameworks on wine quality schemes and organic production; ensure the
institutional and administrative capacity for their implementation.
As regards horizontal issues, continuous capacity building of the IPARD authorities is required
to receive entrustment for implementation of new measures under the IPARD programme.
The strategy for agriculture and rural development 2021-2027 was adopted providing strategic
background for implementation of national policy and IPARD III.
A farm register is being put in place. Registration of farms is required and performed both under
national schemes and under relevant IPARD measures and is performed by the advisory services.
The farm register is an important first element of the future integrated administration and control
system (IACS) and it will support the implementation of the IPARD III programme. There was
no progress in establishing a land parcel identification system (LPIS). For the establishment of
the FADN an implementation plan with a concrete timeline and resource allocation remains to be
adopted.
Direct payments under national schemes remain coupled to production and not subject to cross-
compliance rules. The national agriculture budget continues to be low, and IPARD should not be
used as a substitute to national support. A strategic Action Plan was adopted to implement the
reform of the advisory system.
There was no progress on the establishment of a common market organisation (CMO).
Legislation on wine remains to be adopted. Institutional capacity is still at a low level.
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On rural development, IPARD implementation continued in a satisfactory manner in terms of
contracting targets. It implemented a 4th
call for applications under IPARD II. However, efforts
are needed to avoid de-commitments in 2022 and in 2023, due to delays in project
implementation.
Legislation on quality policy, is partly aligned with the EU acquis. On organic farming,
additional effort is needed to bring the legislation on organic production in line with the recent
reform of the EU organic legislation. Albania continued the national support for organic farming.
Chapter 12: Food safety, veterinary and phytosanitary policy
EU hygiene rules for foodstuff production ensure a high level of food safety. Animal health and
welfare and the safety of food of animal origin are safeguarded together with quality of seeds, plant
protection material, protection against harmful organisms and animal nutrition.
Albania has some level of preparation in the area of food safety, veterinary and phytosanitary
policy and made limited progress. Albania has not made significant steps to design and adopt a
coherent sector policy. Albania has initiated the alignment with the EU acquis on official
controls, animal health and plant health but the progress is modest so far.
Some of the Commission’s recommendations from 2021 were not fully implemented and remain
valid, as more progress is needed.
In the coming year, Albania should in particular:
 adopt a consolidated national food safety policy and align relevant laws on official controls,
animal health and plant health under this framework;
 complete the staffing of the veterinary service to make the service fully operational in line
with tasks and functions defined by relevant regulations; establish an effective surveillance
capacity on main infectious animal diseases including rabies;
 continue to efficiently implement the rabies vaccination programme covering 2023.
On general food safety, the National Food Authority has carried out regular official controls in
accordance with the annual risk-based plan. There is some progress regarding the preparation of
an improved risk assessment methodology. Albania needs to enhance official controls by
adopting the upgraded methodology and train sufficient staff to implement the annual inspection
plans. The National Authority has yet to improve the quality of the inspection statistics, not
limiting it to the number of inspections or measures taken on infringements. Data management
needs to be improved to increase efficiency, and reduce the administrative burden for planning
and reporting on risk based official controls and ensure transparency of national data.
There was some progress on convening the Board for National Food Authority and establishment
of the Scientific Panel from June 2022. As regards the veterinary policy, there was progress by
National Veterinary and Plant Protection Authority (NVPPA) on recruitment of veterinarians.
The reform of the veterinary sector should be completed by filling all vacancies and by
establishing the necessary capacities on passive and active surveillance including reliable
assessments of the prevalence of diseases, thorough data analysis and appropriate design,
planning and implementation of effective systems for disease prevention and/or eradication.
The Government approved in May 2022 the re-organisation of the Ministry of Agriculture and
Rural Development by establishing directorates dealing with food safety, veterinary and
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phytosanitary. Albania needs to ensure the establishment of a structure coherent with the EU
acquis, with a clear chain of command, line of communication and reporting.
The programmes for the monitoring of brucellosis and tuberculosis in cattle herds with more than
10 heads, anthrax, lumpy skin disease in bovine have continued. During 2021, vaccinations
campaigns against rabies for the period 2020-2022 were completed including post monitoring of
vaccination. Albania should take full ownership of these vaccination campaigns and transition to
using its own means for such future vaccination campaigns, in line with obligations to harmonise
with the relevant EU acquis. Countrywide verification and registration of the number of animals
in Albania has continued. From October 2021, official controls have been implemented, by the
National Veterinary and plant Protection Authority, in live animal markets and slaughterhouses,
thus improving reporting animal disease and animal movement. The animal register needs to
include more information on other animals, such as swine, equine, poultry and other animals as
referred to in the EU acquis, to ensure that solid traceability systems are established for food of
animal origin.
With regard to the placing on the market of food, feed and animal by-products, the National
Residue Monitoring Plan including veterinary medical products, pesticide residues, heavy metals
and mycotoxins in live animals and products of animal origin has been launched. Nevertheless,
Albania should implement in full the National Residue Monitoring Plan by using validated
screening methods to ensure the reliability of results for the relevant species and commodities.
The laboratory network of Albania should be improved including management, capacities,
accreditation and validation of methods within a consolidated framework.
As regards animal by-products legal basis there was no progress.
Concerning food safety rules, Albania has continued to align with the EU acquis on
microbiological criteria of food products; specific hygiene requirements for meat and meat
products; establishment of detailed rules concerning the market standard and trade in eggs;
maximum level of pesticide residues in fruits, vegetables, fresh and/or processed seeds; on food
additives.
On the phytosanitary policy, the Ministry of Agriculture and Rural Development has continued
approving active substances of plant protection products in line with the EU acquis. The
National Veterinary and Plant Protection Authority (NVPPA) has performed the monitoring and
verification of the phytosanitary condition for any plant pests in the country, supervising the use
of hazardous plant protection on products posing high risks to human health and environment,
and issuing phytosanitary certificates for export. National Food Authority has also performed
inspections on plant protection and agriculture inputs.
With regard to legislation on feed or genetically modified organisms, there is no progress. The
legislation on genetically modified organisms (GMOs) needs to be adopted.
Chapter 13: Fisheries
The common fisheries policy lays down rules on fisheries management, protects living resources of
the sea and limits the environmental impact of fisheries. This includes setting catch quotas,
managing fleet capacity, rules on markets and aquaculture and support for fisheries and coastal
communities.
Albania has some level of preparation/is moderately prepared in fisheries. Albania made
good progress, specifically on maintaining operational the Vessel Monitoring System (VMS)
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and allocating human resources to monitor and report on the activity of fishing vessels. There
was progress on recruitment of inspectors; but the administrative capacities of the inspectorate
and central administration should be further enhanced. Albania as a contracting party of the
General Fisheries Commission for the Mediterranean (GFCM) is fully implementing its
recommendations to control the fishing effort. The Commission’s recommendations from 2021
were adapted to reflect new specific priorities.
In the coming year Albania should in particular:
 build up the necessary administrative capacity of the fishery sector, notably by completing
the staffing, strengthening data collection and scientific advice, implement national policies
in line with EU Common Fisheries Policy (CFP) and international agreements;
 take concrete steps for implementing the Regional Plan of Action for small-scale fisheries;
 participate actively in the GFCM inspection scheme in the Adriatic Sea.
Regarding resource and fleet management and structural actions, the vessel register and
fishery production data are regularly maintained and updated. A number of legal acts were issued
to regulate the management of commercial fishing capacities. The agreement between Albania
and North Macedonia for joint fisheries management in Lake Ohrid and Lake Prespa is in force.
Ministerial orders have been issued in line with the recommendations of GFCM for sustainable
exploitations of fish stocks. With regard to small-scale fisheries, no significant step has been
taken since the amendments to the Fishery Law in 2019. The government has introduced new
financial supporting measures to fishery sector as part of national funding programme for
agriculture and rural development 2022.
Inspection and control capacity has improved. The vessel monitoring system (VMS) is fully
functional as of May 2021. In addition, tests on a pilot electronic reporting system (ERS) started.
The legal basis on the establishment of the full ERS system remains to be prepared. The Ministry
of Agriculture has recruited six system operators who monitor and report on the activity of
fishing vessels in addition to the Fishery Monitoring Centre (IMOC). Progress took place on
recruitment procedures of the new fishery inspectors. The total number of inspectors increased
from 21 to 28 into four ports offering the service 24/7.
As part of the May 2022 re-organisation of the Ministry of Agriculture and Rural Development,
adequate human resources in the Directorate of Fisheries and Aquaculture Policies and
Programmes has to be ensured. The capacity to interpret and implement the national legislation
or the EU Common Fisheries Policy (CFP) remains weak and has consequences on data
collection, which needs further strengthening, in particular in terms of scientific capacity and
data management.
The government approved the first plan of allocated zones for aquaculture (AZA) in Saranda
region. The Government needs to adopt such plans also for the remaining Shengjin, Durrës and
Vlora AZAs. Efforts on preparation of AZA for inland waters have started.
On market policy, a wholesale market for the fishery products in Shengjin fishing port has been
completed. The legal basis for the transfer of market management has been drafted. The
construction of the wholesale fish market in Vlora was completed. On State aid, support is made
available for replacement of fishing vessels and equipment (50 % co-funding).
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Regarding international agreements for fisheries management, a cooperation agreement
between Albania and North Macedonia is in force. Albania is a contracting party of GFCM and
has fully implemented its recommendations to control the fishing effort. Albania should continue
to actively participate and implement actions and recommendations of GFCM, notably the
implementation of the multi-annual management plans for the conservation and sustainable
exploitation of small pelagic and demersal fishing activities in the Adriatic Sea and by increasing
activities to implement the regional plan of action for small-scale fisheries in the Mediterranean
and the Black Sea (RPOA-SSF).
Chapter 22: Regional policy and coordination of structural instruments
Regional policy is the EU’s main tool for investing in sustainable and inclusive economic
growth. EU Member States are responsible for its implementation, which requires adequate
administrative capacity and sound financial management of project design and execution.
Albania is moderately prepared in the area of regional policy and coordination of structural
instruments. Limited progress was made over the reporting period, particularly with the
adoption of the implementing legislation to the Law on Regional Development and Cohesion.
The recommendations for 2021 remain partly valid. In the coming year, the country should in
particular:
 prepare for effective implementation of the EU acquis under chapter 22 and factor the
requirements of the future structural/cohesion funds in the institutional set-up, the financial
management and control systems, and the administrative capacity, ensuring that all its
instruments and funds are gradually made compliant with EU requirements in terms of
programming and partnership principles;
 proceed with the national strategy and plan for regional development and cohesion (2021-
2027) and complete the regional development plans (2021-2024) which should foster the
development potential through decentralised interventions based on local and/or regional
integrated plans and strategies; finalise and approve the National Strategy for Development
and Integration 2020-2030;
 clarify responsibilities between central and local authorities in line with the progress
achieved on decentralisation, and further strengthen the administrative capacity of central,
regional and local bodies, especially at central level, in particular by ensuring adequate
staffing and revising the local government salary structure and keeping fiscal
decentralisation high on the agenda.
As regards the legislative framework for regional policy, following the approval of the Law on
Regional Development and Cohesion in September 2020 and 26 consultative meetings, five
implementing acts were developed, including on defining development regions in Albania and
their prerogatives. The other acts, still pending approval, are to establish the policy for regional
development and cohesion, the national committee as well as the regional boards, and the
procedures for drafting the national and regional plans. The drafting of by-laws for the managing
authority and for the establishment of the database and monitoring system for regional
development and cohesion is ongoing.
On the institutional framework, relevant by-laws on establishing a comprehensive regional
development system need to reflect the role and responsibilities of each of the actors involved. In
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terms of indirect management of EU funds, decisions on the appointment of institutions and
bodies that will implement the EU’s Instrument for Pre-accession Assistance (IPA III) should be
made taking into account their future role in cohesion policy. (See above under Political Criteria
- Governance).
Albania also needs to address issues with strategic planning, implementation and monitoring
capacity of infrastructure projects financed under the Economic and Investment Plan.
On administrative capacity, the staff of the structures involved in indirect management
continued to receive training and this should remain a focus. The administrative capacity for
coordinating and monitoring sectoral reform through the integrated policy management groups
and sectoral steering committees has slightly improved. The involvement of development
partners, local governments and civil society organisations in sectoral dialogue still needs some
improvement.
As regards programming, efforts are needed to develop autonomous programming capacity in
the period ahead (2023-2027). The national project pipeline of investments, including those for
regional development, is not yet fully aligned with the medium-term budget programme and the
planning and management of nationwide public investment. A key element for the success of the
regional development process will be to build ownership of public and private actors at national
and sub-national levels.
Albania continues to gain experience in programming and implementation of regional policy
territorial cooperation through the participation in cross border cooperation and transnational
and interregional cooperation programmes. Albania participates in the EU Strategy for the
Adriatic Ionian Region (EUSAIR) which promotes cooperation and synergies among the
participating EU and non-EU countries.
On monitoring and evaluation, the sectoral monitoring committee issued operational
recommendations for all IPA sectors, however SASPAC should ensure adequate monitoring of
all programme activities on a daily basis. The support offices of the National Authorising Officer
and the National IPA Coordinator has yet to establish a list of key performance operators to
evaluate the performance.
On financial management, control and audit, an evaluation of IMBC under IPAII found that
the law on the audit authority needs to be amended to ensure that management powers remain
with the General Director, and are not subordinated to the Supervisory Council. The National
Authorising Officer needs to ensure that its management declaration adequately reflects the
results of its supervision and monitoring of management and control systems. The Officer’s
support office has yet to establish procedures to ensure immediate dissemination, and the
implementation throughout the institutions, regarding internal control by the Commission.
Irregularities are still to be registered completely and without delay in the irregularity
management system, and internal control weaknesses and non-compliance events should be
systematically reported in a dedicated registry.
Chapter 33: Financial and budgetary provisions
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This chapter covers the rules governing the funding of the EU budget (‘own resources’). These
resources mainly consist of: (i) contributions based on the gross national income of each
Member State; (ii) customs duties; (iii) the non-recycled plastic resource and (iv) a resource
based on value-added tax. EU Member States must have the appropriate administrative capacity
to adequately coordinate and ensure the correct calculation, collection, payment and control of
own resources.
Albania has some level of preparation in the area of Financial and budgetary provisions. Some
progress was made in aligning with the EU acquis in the underlying policy fields that affect the
functioning of the EU funding system. Albania continued to regularly publish the Gross
Domestic Product and Gross National Income Indicators following ESA 2010 methodology and
methodological improvements continued as regards the alignment with ESA 2010 standards,
however last year’s recommendations remain valid as more progress is needed. In the coming
year, the country should in particular:
 continue aligning data on National Accounts to ESA 2010 (European System of Accounts),
and improving the comprehensiveness of data transmission to Eurostat including on
Excessive Deficit Procedure (EDP);
 align its legislation with the EU provisions on VAT and customs duties and strengthen the
efforts to tackle fiscal evasion.
 enhance the administrative capacities and co-ordination mechanisms among key
stakeholders in the own resources system.
There was some progress in the underlying policy areas indirectly affecting the own resources
system (for progress in these areas, see Chapters 16 – Taxation, 18 – Statistics, 29 – Customs
union, and 32 – Financial control).
With regard to traditional own resources, Albania has structures in place for levying customs
duties at the point of import. It operates a national VAT system. However, the mid-term revenue
strategy (MTRS) that was planned to be adopted in 2020 still needs to be finalised.
As regards the Gross National Income (GNI) resource, Albania continued its efforts to align its
legislation with ESA 2010 standards and in publishing the inventory of resources and methods
used in the national accounts. However, further efforts are needed to improve compliance with
ESA 2010 and to start the work on establishment of the GNI Inventory in full alignment with
Eurostat recommendations. Due to the COVID-19 pandemic, the benchmark revision of national
accounts planned to be adopted in 2020 was postponed to 2024. INSTAT has continued its work
in improving the EDP data, following the ESA 2010 and the manual on government deficit and
debt, and pilot estimations were transmitted to Eurostat. In May, INSTAT released the
publication on Generation of Income Accounts by Institutional Sectors for the year 2019, while
data series for the period 2013 – 2019 are transmitted based on ESA 2010 Transmission
program.
Albania continued its preparations for improving the estimation of its non-observed economy. A
pilot project to improve the exhaustiveness adjustments of GDP/GNI estimates, designed in
particular to develop new experimental estimates on illegal activities and fiscal audit, was
implemented. Efforts to improve the exhaustiveness of national accounts estimates are being
undertaken. The general tax directorate and the general customs directorate have continued their
work on identification of fiscal evasion and fraud. Staff continued to receive training through the
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Fiscal Academy, including on fiscalisation process, and since January 2022 a special Anti-
Informality Unit is established in the Ministry of Finance and Economy. However, continued
efforts are needed to ensure formalisation of the informal economy, improve the exhaustiveness
of the national accounts and GDP/GNI calculations and combat fiscal evasion and customs duty
fraud.
On administrative infrastructure, the Ministry of Finance and Economy has overall
responsibility for financial and budgetary issues. Albania will need to continue to work on
establishing the relevant institutions involved in the own resources system, an own resource
coordination body and implementing rules. These are needed to ensure that, upon accession, it
will be able to calculate, forecast, account for, collect, pay, control, and report to the EU, on own
resources in line with the EU acquis.
CLUSTER 6: EXTERNAL RELATIONS
There are two chapters in this cluster: external relations (Chapter 30); foreign, security &
defence policy (Chapter 31). Albania has a good level of preparation in both. A regards the latter
chapter, Albania made good progress, maintaining full alignment with all relevant EU decisions
and declarations of the EU’s Common Foreign and Security Policy, including with the EU
restrictive measures following Russia’s unprovoked aggression against Ukraine. As a non-
permanent member since January 2022, Albania has been actively engaged in the UN Security
Council in promoting and defending the rules-based international order.
For the external relations chapter, which covers the EU’s common trade and commercial policy
towards third countries as well as its humanitarian aid and its development policy, Albania made
some progress and reached a good level of preparation. Albania has in particular continued
alignment of legislation in the field of dual use goods and to implement CEFTA additional
protocols.
Chapter 30: External relations
The EU has a common trade and commercial policy towards third countries, based on
multilateral and bilateral agreements and autonomous measures. There are also EU rules in the
field of humanitarian aid and development policy.
Concerning the acquis on external relations, Albania has a good level of preparation. Some
progress was made during the reporting period, particularly as regards continuation of alignment
of the legislation in the field of dual use goods with the relevant EU acquis.
Last year`s recommendations were not fully implemented and remain largely valid:
 align the relevant legislation with the EU acquis on trade in certain goods that could be used
for capital punishment, torture or other cruel, inhuman or degrading treatment or
punishment;
 establish a legal framework covering international cooperatin and development policy as
well as humanitarian aid towards non-EU countries in line with EU policies and principles ;
 further implement CEFTA Protocol 6 on trade in services, and conclude and adopt CEFTA
Protocol 7 on dispute settlement.
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On the common commercial policy, Albania continued to coordinate its positions and align its
policies closely with those of the EU, including within the World Trade Organization (WTO) as
regards the dispute settlement understanding (DSU), proposed mechanisms of the DSU and the
Joint statement on Services Domestic Regulation. With regards to the later, in November 2021
Albania notified the WTO on the revised schedule of specific commitments. The order on
prohibition of export of medicines and medical equipment linked to the COVID-19 pandemic
were lifted in July 2021.
In November 2021, Albania amended its national control list of dual-use goods in line with the
EU regulation on control of exports, transfer, brokering, and transit of dual-use goods and
technologies. A specific unit dealing with dangerous goods, dual use and illegal trafficking was
set up in the anti-trafficking directorate of the General Directorate of customs. During the
reporting period the export control authority carried out verification procedures together with
customs authority and issued fines for 10 companies for non-compliance with the legislation on
dual use goods. Albania has yet to align its legislation with the EU acquis on trade in certain
goods that could be used for capital punishment, torture or other cruel, inhuman or degrading
treatment or punishment.
There is no progress in the area of export credit guarantee while the second tier banks do
provide guarantees such as payment guarantee, performance/contract guarantee and bid
guarantee. There is no state-supported export credit insurance provider.
As regards bilateral agreements with third countries, Albania is negotiating with China a
memorandum of understanding concerning investment cooperation in the digital economy and
with India an agreement on establishing the inter-governmental Commission on economic
cooperation.
Albania continued to implement CEFTA commitments related to additional protocols (AP) 5 and
6. Albania continued its awareness campaign with private sector representatives as regards the
Authorised Economic Operators (AEOs) application procedures and benefits, and has registered
16 applications from local businesses. The first eight authorised economic operators were
certified by the General Directorate of Customs and were positively assessed by the CEFTA
validation committee. Albania continued to participate in the negotiations on CEFTA AP 7 on
dispute settlement.
Albania has no development policy framework for cooperation/aid or agency for development
cooperation. The country is encouraged to establish a legal framework covering international
cooperation and development policy as well as humanitarian aid towards non-EU countries, in
accordance with EU policies and principles.
The 2001 Law on Non-Profit Organisations recognises the potential activities of such
organisations in the field of humanitarian aid, and allows them to carry out development and
humanitarian aid activities in Albania and elsewhere. Two decisions of Council of Ministers
were adopted in Marcha and June 2022 to address humanitarian aid issues for Ukrainans coming
to Albania due to the Russia`s agression on Ukraine, and on the financial aid to be provided to
the Ukrainian government for country’s reconstrution.
Chapter 31: Foreign, security and defence policy
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EU Member States must be able to conduct political dialogue under the EU foreign, security and
defence policy, align with EU statements, take part in EU actions, and apply agreed sanctions
and restrictive measures.
Albania has a good level of preparation in the field of foreign, security and defence policy.
Good progress was made as the country continued its track-record of full alignment with the
EU’s common foreign and security policy, including with the EU restrictive measures following
Russia’s unprovoked aggression against Ukraine. Furthermore, as a non-permanent member
since January 2022, Albania has been actively engaged in the UN Security Council in promoting
and defending the rules-based international order, in particular in the context of Russia’s war of
aggression against Ukraine. Some progress was made on implementing the national strategy on
small arms and light weapons, and on aligning with the EU acquis in this field, but Albania
remains both a destination and a transit country for light firearms.
In the coming year, Albania should in particular:
 maintain its full alignment with the EU foreign, security and defence policy;
 continue to implement the national strategy on small arms and light weapons as well as the
corresponding action plan, and step up the investigation and prosecution of firearms
trafficking.
The political dialogue between the EU and Albania on foreign and security policy issues
continued, including through Albania’s active engagement in the EU-Western Balkans CFSP
dialogue at political directors’ level. Albania has expressed its support for the EU Strategic
Compass for Security and Defence.
Albania’s Ministry for Europe and Foreign Affairs has appropriate structures to participate in the
common foreign and security policy (CFSP) while the Ministry of Defence deals more
specifically with the common security and defence policy. When invited, Albania aligned with
all relevant Council Decisions and High-Representative declarations on behalf of the EU,
including on restrictive measures, despite increasing pressure from third parties. Albania
continues to align 100 % with the EU foreign and security policy. This is a strong signal of the
country’s strategic commitment to its EU path. Albania notably aligned with the EU position in
the UN General Assembly (UNGA) when co-sponsoring or voting on resolutions regarding
Russia’s aggression against Ukraine and its humanitarian impact. Albania also voted for the
suspension of the Russian Federation in the UN Human Rights Council.
On restrictive measures, Albania implements EU sanctions. The authorities have cooperated
with the EU in strengthening their capacity to implement and enforce international sanctions.
Albania’s priorities as a non-permanent member of the UN Security Council in 2022-2023 are in
line with important EU priorities, including women, peace and security, human rights and
international law, countering violent extremism, and climate and security. It has closely
cooperated and coordinated with the EU, respectively EU Member States in the UN Security
Council, including on the international response to Russia’s aggression against Ukraine.
Albania maintains a bilateral immunity agreement with the United States, granting US citizens
exemptions from the jurisdiction of the International Criminal Court. In doing so, it does not
comply with the EU common positions on the integrity of the Rome Statute or with the related
EU guiding principles on bilateral immunity agreements. Alignment with the EU position is
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therefore needed.
Concerning non-proliferation, Albania continued to implement its national strategy on small
arms and light weapons (SALW) adopted in February 2019. A new action plan to implement the
strategy in 2022-2024 was adopted in December 2021. The action plan’s implementation has
begun. Albania also remained actively engaged in the implementation of the 2018 regional
roadmap and other regional forms of cooperation, such as the European multidisciplinary
platform against criminal threats (EMPACT) on firearms.
Albania continued to participate in some, but not all, international export control arrangements
and non-proliferation instruments. It started procedures to join the Wassenaar Arrangement in
September 2020 and should conclude the process rapidly. Albania continued to implement the
national strategy against proliferation of weapons of mass destruction and its action plan,
adopted in January 2020. In May 2022, Albania initiated its membership of the Organisation for
the Prohibition of Chemical Weapons (OPCW) Executive Council (2022-2024), actively
contributing to the effective implementation of the Chemical Weapons Convention.
Albania continued active cooperation with international organisations and maintained a
robust presence in a number of NATO missions, including some of strategic importance to the
EU, and contributed to the United Nations Mission in South Sudan.
In terms of security measures, a by-law on the selection and installation of equipment that
processes classified information was adopted by the Council of Ministers in April 2022. Albania
continued to participate in EU crisis management missions and operations under the common
security and defence policy (CSDP), notably EUFOR Althea in Bosnia and Herzegovina. The
country pledged to contribute to the EU battle groups in 2024.
Regarding hybrid threats, Albania completed the EU’s hybrid risk survey with the objective of
identifying systemic vulnerabilities which should be addressed. In July 2022, a large-scale
cyberattack took place in Albania, which led to the disruption of most public online services and
government e-mail systems. In September 2022, the Albanian government attributed the attack to
Iran and, consequently, decided to sever its diplomatic ties with that country.
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ANNEX I – RELATIONS BETWEEN THE EU AND ALBANIA
The Stabilisation and Association Agreement (SAA) between Albania and the EU came into
force in April 2009. The transitional period of the SAA ended on 31 March 2019 and that since 1
April 2019, Albania is thus fully associated with the EU. In the reporting period, Albania
continued to implement its commitments under the SAA. Regular political and economic
dialogue has continued through the relevant joint bodies under the SAA. The Stabilisation and
Association Parliamentary Committee met on 23-24 February 2022. The Stabilisation and
Association Committee took place on 15 February 2020. Discussions focused on progress in
SAA implementation as well as of the most important reforms developments. The Stabilisation
and Association Council did not meet during the reporting period.
The SAA and its Interim Agreement, applied since 2006, have allowed progressive trade
liberalisation and mutual duty-free access for most goods. Since 2000 Albania has also been
benefiting from the ‘Autonomous Trade Measures’. Albania is a WTO member since 2000, and
joined the Central European Free Trade Agreement (CEFTA) in 2007. The EU is the main
trading partner of Albania, followed by CEFTA countries. Trade integration with the EU is high.
In 2021 the EU remained the main trading partner of Albania, accounting for 60% of Albania’s
total trade in goods (72% of total exports and 54% of total imports). EU-Albania trade rose by
27.3% in 2021, demonstrating a recovery from the impacts of the COVID-19 pandemic.
Albania’s total trade in 2021 was worth €10 billion. The country’s trade deficit with the EU
amounted to EUR 1.6 billion in 2021. In comparison, Albania’s trade with CEFTA represented
aound 10.1% of total trade, a similar level to 2020, which demonstrates ongoing regional
integration.
Albania is a candidate country since 2014. In 2018, the Commission issued an unconditional
recommendation to open accession negotiations. On 26 March 2020, the European Council
endorsed the Council’s decision to open accession negotiations with Albania. On 12 May 2021,
the Commission informed the Council that all conditions to be fulfilled prior to the holding of the
first Inter-Governmental Conference of accession negotiations were met, since the Constitutional
Court regained functionality in December 2020. On 19 July, the Intergovernmental
Conference on accession negotiations took place with Albania. The Commission launched the
screening process on the same day.
Visa liberalisation for citizens of Albania travelling to the Schengen area has been in force since
December 2010. A readmission agreement between the EU and Albania has been in force since
2006. The Commission’s August 2021 fourth report under the visa suspension mechanism25
concluded that Albania continues to meet the visa liberalisation requirements.
Albania is the only country from the region that has signed cooperation agreements with all
justice and home affairs agencies of the EU. A Europol liaison officer was deployed in Tirana
until February 2022. This further intensified the cooperation with Europol. A liaison prosecutor
was deployed to Eurojust in the Hague in January 2021. The first Frontex joint operation outside
the EU deployed at the Greek-Albanian border in May 2019 was supplemented in March 2021
with a sea border joint operation deployed near Durres. In March 2021 a new working
arrangement was signed with FRONTEX. A second FRONTEX liaison officer to the Western
Balkans with a mandate covering Albania, Kosovo, and North Macedonia was deployed in
25
COM(2021)602 final and SWD(2021)206 final
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Tirana in January 2021. Albania continues to cooperate with EMCDDA under the working
arrangement signed in March 2019 on drug related issues. Albania was granted Observer Status
to EU Fundamental Rights Agency by decision of the EU-Albania Stabilisation and Association
Council in November 2019. Albania appointed an Observer to the Agency in 2020 and a positive
engagement with Albanian stakeholders started.
Albania has continued to fully align with all EU common foreign and security policy positions
and declarations. Albania continued to actively participate in EU crisis management missions
and operations under the common security and defence policy, notably EUFOR Althea in Bosnia
and Herzegovina.
Under the Instrument for Pre-accession Assistance 2021 – 2027 (IPA III), a first financing
decision of EUR 64.9 million was adopted at the end of 2021, providing support for EU
accession and post-country’s COVID recovery and enhancing the country’s reforms in the areas
of rule of law, nature protection, green growth and innovation. This first set of programmes
complemented by a significant package of multi-country programmes and the rural development
programme IPARD II, provide a significant contribution to kick-start the implementation of the
Economic and Investment Plan for the Western Balkans and the Green Agenda. Albania
participates also in cross-border cooperation programmes, transnational cooperation programmes
and Union programmes.
The new activities will complement the on-going programmes under IPA II (2014-2020), which
are still providing significant support for the social and economic development of the country
and contribute to key reforms. On the fundamentals, progress was made with the implementation
of the justice reform, capacities of the justice and law enforcement agencies in the fight against
corruption, organised crime and money laundering. EU programmes have supported public
administration reform, public finance, decentralisation and service provision to the citizens. In
addition, civil society has been a strong partner in advancing the priority areas of the
fundamentals agenda. Significant EU financial assistance has been allocated to Albania for
protecting the environment and boosting the connectivity with the EU transport systems.
In response to the COVID-19 outbreak, EUR 50.65 million was reprogrammed from the IPA
2019 and 2020 envelopes, to allow provision of urgent medical supplies and support for the
mitigation of socioeconomic impact of the crisis. Other programmes were also reoriented to help
reduce the impact of the pandemic and Albania signed a loan of EUR 180 million in Macro
Financial Assistance, of which the 1st
tranche of 90 million were disbursed on 31 March 2021
and the balance in November 2022.
The Commission set aside 70 MEUR in grants from IPA II for the Western Balkan partners to
reimburse the Member States for the resale of doses they obtained under the EU Advance
Purchase Agreements with COVID-19 vaccine producers or bilateral orders of EMA authorised
vaccines, of which Albania received EUR 11.2 million. Albania has received just over 1 million
doses via the use of the IPA grant, including over 188 000 via COVAX initiative, which is
significantly supported by the EU. COVAX also delivered a further over 143 000 doses to
Albania by the same date.
Following the November 2019 earthquake, the EU pledged EUR 115 million, which have been
translated into two programmes.
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While the recent focus has been on mobilising and delivering support to Albania in response to
the triple shock of the 2019 earthquake26
, the COVID-19 pandemic, and the consequences of the
aggression against Ukraine, IPA has also continued to help the country to deliver on key reforms
such as the justice reform, for instance in the process of reevaluation of judges and prosecutors
(“vetting”), and in supporting the specialised structures against corruption and organised crime.
Furthermore, Albania benefits from the IPA multi-country and regional programmes and
participates in five cross-border cooperation programmes, as well as in transnational cooperation
programmes. Albania participates with IPA support in the EU programmes Erasmus+, Creative
Europe (Culture and Media strands), Employment and Social Innovation, Horizon 2020,
Customs 2020, Fiscalis 2020, Competitiveness of Enterprises and Small and Medium-Sized
Enterprises Programme (COSME), Justice, Europe for Citizens and EU Fundamental Rights
Agency (FRA) (observer).
26
The EU4Schools programme supports reconstructing and rehabilitating education facilities damaged by the
earthquake. The EU4Culture supports the rehabilitation of the cultural heritage sites gravely damaged by the
earthquake, as well as related economic activities to support the tourism related to these sites
STATISTICAL DATA (as of 01.09.2022)
Albania
Basic data Note 2009 2016 2017 2018 2019 2020
Population (thousand) 2 936 s 2 876 s 2 877 s 2 870 s 2 862 s 2 846 s
Total area of the country (km²) 28 750 w 28 748 w 28 748 w 28 748 w 28 748 w 28 748 w
National accounts Note 2009 2016 2017 2018 2019 2020
Gross domestic product (GDP) (million national currency) 1 143 937 1 472 479 1 550 646 1 636 731 1 691 903 1 644 077 p
Gross domestic product (GDP) (million euro) 8 662 10 720 11 559 12 828 13 754 13 283 p
GDP (euro per capita) 2 960 3 730 4 020 4 480 4 820 4 680 p
GDP per capita (in purchasing power standards (PPS)) 6 654 8 387 8 770 9 155 9 524 9 109 p
GDP per capita (in PPS), relative to the EU average (EU-27 = 100) 27.7 29.7 29.9 30.2 30.4 30.4
Real GDP growth rate: change on previous year of GDP volume (%) 3.4 d 3.3 3.8 4.0 2.1 - 3.5 p
Employment growth (national accounts data), relative to the previous year (%) : : : : : :
Labour productivity growth: growth in GDP (in volume) per person employed, relative to the
previous year (%)
: : : : : :
Unit labour cost growth, relative to the previous year (%) : : : : : :
**3 year change (T/T-3) in the nominal unit labour cost growth index (2015 = 100) : : : : : :
Labour productivity per person employed: GDP (in PPS) per person employed relative to EU
average (EU-27 = 100)
: : : : : :
Gross value added by main sectors
Agriculture, forestry and fisheries (%) 19.4 22.6 21.8 21.1 21.0 22.0 p
Industry (%) 10.9 14.0 12.8 14.1 13.8 12.6 p
Construction (%) 17.3 10.2 10.5 10.3 9.8 10.3 p
Services (%) 52.4 s 53.2 s 54.9 s 54.6 s 55.4 s 55.2 ps
Final consumption expenditure, as a share of GDP (%) 91.9 92.2 91.1 90.4 91.3 92.4 p
Gross fixed capital formation, as a share of GDP (%) 32.7 24.4 24.6 23.9 22.3 22.8 p
Changes in inventories, as a share of GDP (%) 1.8 0.9 0.5 0.0 0.7 0.4 p
Exports of goods and services, relative to GDP (%) 25.2 29.0 31.6 31.6 31.3 22.7 p
Imports of goods and services, relative to GDP (%) 49.9 45.8 46.6 45.2 45.0 37.2 p
Gross fixed capital formation by the general government sector, as a percentage of GDP (%) : : : : : :
Business Note 2009 2016 2017 2018 2019 2020
Industrial production volume index (2015 = 100) 1) 41.8 w 82.0 w 81.4 w 96.6 w 95.5 w 89.5 w
Number of active enterprises (number) 2) 3) 70 890 w 98 262 w 97 352 w 97 272 w 93 563 w :
Birth rate: number of enterprise births in the reference period (t) divided by the number of
enterprises active in t (%)
4) 13.8 w 19.5 w 15.3 w 12.5 w 10.8 w 10.4 w
Death rate: number of enterprise deaths in the reference period (t) divided by the number of
enterprises active in t (%)
: : : : : :
People employed in SMEs as a share of all persons employed (within the non-financial
business economy) (%)
2) 3) 82.7 sw 81.4 sw 80.5 sw 80.2 sw 81.2 sw :
Value added by SMEs (in the non-financial business economy) (EUR million) 2) 3) 1 383 sw 2 276 sw 2 520 sw 2 881 sw 3 263 sw :
Total value added (in the non-financial business economy) (EUR million) 2) 3) 1 994 w 3 388 w 3 687 w 4 187 w 4 511 w :
Inflation rate and house prices Note 2009 2016 2017 2018 2019 2020
Consumer price index (CPI), change relative to the previous year (%) : 1.5 w 3.2 w 1.8 w 1.7 w 2.2 w
**Annual change in the deflated house price index (2015 = 100) : : : : : :
Balance of payments Note 2009 2016 2017 2018 2019 2020
Balance of payments: current account total (million euro) : - 811.5 - 870.6 - 865.7 - 1 089.2 - 1 153.3
Balance of payments current account: trade balance (million euro) : - 2 602.5 - 2 823.1 - 2 869.7 - 3 144.1 - 2 982.1
Balance of payments current account: net services (million euro) : 796.5 1 086.8 1 110.3 1 263.8 1 056.2
Balance of payments current account: net balance for primary income (million euro) : 174.0 18.3 - 13.6 - 180.3 - 227.6
Balance of payments current account: net balance for secondary income (million euro) : 820.4 847.5 907.2 971.3 997.1
Net balance for primary and secondary income: of which government transfers (million euro) : 47.8 69.6 67.1 67.1 58.2
**3 year backward moving average of the current account balance relative to GDP (%) : : - 7.9 - 7.3 - 7.4 - 7.8
**Five year change in share of world exports of goods and services (%) : : : : : :
Net balance (inward - outward) of foreign direct investment (FDI) (million euro) 688.7 w 935.4 s 992.4 s 1 023.6 s 1 037.1 s 893.6 w
Foreign direct investment (FDI) abroad (million euro) 28.2 w 58.0 23.4 69.1 114.2 76.6 w
of which FDI of the reporting economy in the EU-27 countries (million euro) : 9.9 w 14.6 w 32.4 w 39.1 28.6 w
Foreign direct investment (FDI) in the reporting economy (million euro) 716.9 w 994.4 w 1 017.0 w 1 092.1 w 1 150.5 w 970.2 w
of which FDI of the EU-27 countries in the reporting economy (million euro) : 163.0 w 404.7 w 248.0 w 649.4 535.6 w
**Net international investment position, relative to GDP (%) : - 44.3 w - 47.1 w - 49.4 w - 50.1 w - 55.0 w
Year on year rate of change in gross inflow of remittances (in national currency) from migrant
workers (%)
9.1 sw 5.7 s 5.5 s 5.2 s 5.1 s 5.1 ps
Public finance Note 2009 2016 2017 2018 2019 2020
General government deficit / surplus, relative to GDP (%) - 7.1 w - 1.8 w - 2.0 w - 1.6 w - 1.9 w - 6.8 w
General government gross debt relative to GDP (%) 55.7 w 68.7 w 66.9 w 64.9 w 63.3 w 72.7 w
Total government revenues, as a percentage of GDP (%) 26.1 w 27.6 w 27.8 w 27.5 w 27.2 w 26.3 w
Total government expenditure, as a percentage of GDP (%) 33.2 w 29.5 w 29.8 w 29.1 w 29.1 w 33.2 w
Financial indicators Note 2009 2016 2017 2018 2019 2020
Gross external debt of the whole economy, relative to GDP (%) 41.5 sw 73.5 s 68.8 s 65.1 s 59.9 s 64.3 ps
Gross external debt of the whole economy, relative to total exports (%) 164.4 w 253.5 w 217.6 w 205.8 w 191.3 w 283.8 w
Money supply: M1 (banknotes, coins, overnight deposits, million euro) 2 154.4 w 3 170.1 w 3 440.8 w 3 752.1 w 4 259.5 w 5 149.2 w
Money supply: M2 (M1 plus deposits with maturity up to two years, million euro) 4 378.2 w 5 365.1 w 5 508.2 w 5 732.2 w 6 160.4 w 6 967.3 w
Money supply: M3 (M2 plus marketable instruments, million euro) 6 599.0 w 9 198.2 w 9 444.2 w 9 906.4 w 10 717.6 w 11 771.8 w
Total credit by monetary financial institutions to residents (consolidated) (million euro) 3 192.2 w 4 046.4 w 4 086.0 w 4 223.7 w 4 514.3 w 4 760.5 w
**Annual change in financial sector liabilities (%) : : : : : :
**Private credit flow, consolidated, relative to GDP (%) : : : : : :
**Private debt, consolidated, relative to GDP (%) : : : : : :
Interest rates: day-to-day money rate, per annum (%) 5) 5.51 w 1.49 w 1.34 w 1.24 w 1.10 w 0.73 w
Lending interest rate (one year), per annum (%) 6) 12.46 w 5.89 w 5.98 w 5.66 w 6.27 w 6.10 w
Deposit interest rate (one year), per annum (%) 7) 6.78 w 0.80 w 0.75 w 0.73 w 0.49 w 0.40 w
Euro exchange rates: average of period (1 euro = … national currency) 132.060 137.360 134.150 127.590 123.010 123.770
Trade-weighted effective exchange rate index, 42 countries (2015 = 100) : : : : : :
**3 year change (T/T-3) in the trade-weighted effective exchange rate index, 42 countries
(2015 = 100)
: : : : : :
Value of reserve assets (including gold) (million euro) 1 646.2 w 2 945.0 w 2 995.9 w 3 399.0 w 3 359.6 w 3 942.4 w
External trade in goods Note 2009 2016 2017 2018 2019 2020
Value of imports: all goods, all partners (million euro) 3 259 4 169 4 648 5 026 5 269 4 860
Value of exports: all goods, all partners (million euro) 780 1 771 2 026 2 431 2 426 2 190
Trade balance: all goods, all partners (million euro) - 2 479 - 2 399 - 2 622 - 2 596 - 2 843 - 2 670
Terms of trade (export price index / import price index * 100) (number) 102.3 sw 96.9 sw 99.8 sw 103.6 sw 99.2 sw 104.1 sw
Share of exports to EU-27 countries in value of total exports (%) 79.2 s 77.7 s 77.0 s 75.9 s 76.4 s 74.7 s
Share of imports from EU-27 countries in value of total imports (%) 64.0 s 62.4 s 60.8 s 60.0 s 57.7 s 57.9 s
Demography Note 2009 2016 2017 2018 2019 2020
Crude rate of natural change of population (natural growth rate): number of births minus
deaths (per thousand inhabitants)
4.7 3.6 3.0 2.5 2.3 0.2
Infant mortality rate deaths of children under one year of age (per thousand live births) 10.3 8.7 8.0 8.9 10.3 10.0
Life expectancy at birth: male (years) : 77.1 77.1 77.4 77.6 75.2
Life expectancy at birth: female (years) : 80.1 80.1 80.5 80.7 79.6
Labour market Note 2009 2016 2017 2018 2019 2020
Economic activity rate for persons aged 20–64: proportion of the population aged 20–64 that
is economically active (%)
69.6 ew 73.3 ew 73.9 w 74.8 ew 75.9 ew 75.3 ew
*Employment rate for persons aged 20–64: proportion of the population aged 20–64 that are
in employment (%)
60.4 ew 62.1 ew 63.9 w 65.6 ew 67.1 ew 66.3 ew
Male employment rate for persons aged 20–64 (%) 73.2 ew 69.4 ew 72.1 w 73.9 ew 74.7 ew 74.0 ew
Female employment rate for persons aged 20–64 (%) 48.9 ew 55.0 ew 55.6 w 57.4 ew 59.7 ew 58.8 ew
Employment rate for persons aged 55–64: proportion of the population aged 55–64 that are
in employment (%)
48.9 ew 54.8 ew 55.5 ew 58.2 ew 60.4 ew 60.3 ew
Employment by main sectors
Agriculture, forestry and fisheries (%) : 40.2 ew 38.2 ew 37.4 ew 36.4 ew 36.1 ew
Industry (%) : 12.8 ew 12.5 ew 12.7 ew 13.1 ew 13.4 ew
Construction (%) : 6.5 ew 6.9 ew 7.0 ew 7.0 ew 7.0 ew
Services (%) : 40.5 ew 42.4 ew 42.9 ew 43.5 ew 43.5 ew
People employed in the public sector as a share of total employment, persons aged 20–64
(%)
: 15.6 ew 16.4 ew 15.9 ew 15.3 ew 15.5 ew
People employed in the private sector as a share of total employment, persons aged 20–64
(%)
: 84.4 ew 83.6 ew 84.1 ew 84.7 ew 84.5 ew
Unemployment rate: proportion of the labour force that is unemployed (%) 13.8 ew 15.2 ew 13.7 ew 12.3 ew 11.5 ew 11.8 ew
Male unemployment rate (%) 12.2 ew 15.9 ew 14.6 ew 12.7 ew 11.6 ew 11.6 ew
Female unemployment rate (%) 15.9 ew 14.4 ew 12.6 ew 11.9 ew 11.4 ew 12.0 ew
Youth unemployment rate: proportion of the labour force aged 15–24 that is unemployed (%) 27.2 ew 36.5 ew 31.9 ew 28.3 ew 27.2 ew 26.5 ew
Long-term unemployment rate: proportion of the labour force that has been unemployed for
12 months or more (%)
9.1 ew 10.1 ew 8.9 ew 8.3 ew 7.3 ew 7.0 ew
Unemployment rate for persons (aged 25–64) having completed at most lower secondary
education (ISCED levels 0-2) (%)
10.3 ew 11.8 ew 11.2 ew 9.2 ew 8.6 ew 9.6 ew
Unemployment rate for persons (aged 25–64) having completed tertiary education (ISCED
levels 5-8) (%)
: 13.3 ew 11.7 ew 11.5 ew 9.7 ew 10.0 ew
Social cohesion Note 2009 2016 2017 2018 2019 2020
Average nominal monthly wages and salaries (national currency) 8) 9) 40 874 ew 47 522 ew 48 967 ew 50 589 ew 52 380 ew 53 662 ew
Index of real wages and salaries (index of nominal wages and salaries divided by the
inflation index) (2016 = 100)
9) : 100 ew 101 ew 102 ew 105 ew 105 ew
GINI coefficient : : 37 35 34 33
Poverty gap : : 33.4 32.4 28.6 26.0
*Early leavers from education and training: proportion of the population aged 18–24 with at
most lower secondary education who are not in further education or training (%)
35.5 ew 19.6 ew 19.6 w 17.4 w 16.3 w 15.6 w
Standard of living Note 2009 2016 2017 2018 2019 2020
Number of passenger cars relative to population size (number per thousand population) 95.8 sw 152.0 147.0 161.0 176.0 191.0
Number of mobile phone subscriptions relative to population size (number per thousand
population)
10) 1 444.0 ew 1 836.2 w 1 934.4 w 1 445.6 w 1 183.8 w 1 176.2 w
Mobile broadband penetration (per 100 inhabitants) 10) : : : : 62.7 w 70.4 w
Fixed broadband penetration (per 100 inhabitants) 10) : 9 w 11 w 13 w 15 w 17 w
Infrastructure Note 2009 2016 2017 2018 2019 2020
Density of railway network (lines in operation per thousand km²) 13.9 sw 11.6 sw 11.6 sw 11.6 sw 5.9 sw 7.8 sw
Length of motorways (kilometres) : : : : : 22
Innovation and research Note 2009 2016 2017 2018 2019 2020
Public expenditure on education relative to GDP (%) 3.3 sw 3.1 sw 3.1 sw 3.2 psw 3.3 psw 3.3 sw
*Gross domestic expenditure on R&D relative to GDP (%) : : : : : :
Government budget appropriations or outlays on R&D (GBAORD), as a percentage of GDP
(%)
: : : : : :
Percentage of households who have internet access at home (%) : : : 84.0 85.0 87.0
Environment Note 2009 2016 2017 2018 2019 2020
*Index of greenhouse gas emissions, CO2 equivalent (1990 = 100) 90.0 w : : : : :
Energy intensity of the economy (kg of oil equivalent per 1 000 euro GDP at 2015 constant
prices)
239.7 217.4 219.2 209.4 204.2 196.3
Electricity generated from renewable sources relative to gross electricity consumption (%) 70.7 82.1 91.0 92.5 93.0 100.0
Road share of inland freight transport (based on tonne-km) (%) : : : : : :
Energy Note 2009 2016 2017 2018 2019 2020
Primary production of all energy products (thousand TOE) 1 251 1 961 1 642 2 015 1 736 1 494
Primary production of crude oil (thousand TOE) 577 1 056 959 911 1 005 758
Primary production of solid fuels (thousand TOE) 2 2 76 161 52 69
Primary production of gas (thousand TOE) 7 35 37 32 58 41
Net imports of all energy products (thousand TOE) 1 007 s 464 s 920 s 503 s 753 s 793 s
Gross inland energy consumption (thousand TOE) 2 171 2 271 2 375 2 366 2 355 2 183
Gross electricity generation (GWh) 5 202 7 782 4 526 8 553 5 206 5 313
Agriculture Note 2009 2016 2017 2018 2019 2020
Agricultural production volume index of goods and services (at producer prices) (2010 = 100) : : : : : :
Utilised agricultural area (thousand hectares) 1 200.9 1 181.7 1 174.1 1 174.0 1 174.1 1 165.7
Livestock numbers: live bovine animals (thousand heads, end of period) : 497.0 p 475.2 467.3 415.6 362.6
Livestock numbers: live swine (thousand heads, end of period) : 183.6 p 180.1 184.1 183.9 158.4
Livestock numbers: live sheep and live goats (thousand heads, end of period) : 2 912.7 ps 2 858.6 s 2 781.0 s 2 621.2 s 2 332.2 s
Raw milk available on farms (thousand tonnes) : : : : : :
Harvested crop production: cereals (including rice) (thousand tonnes) 629.9 698.4 : 678.2 666.1 684.0
Harvested crop production: sugar beet (thousand tonnes) : 29.6 0.0 27.5 30.7 27.0
Harvested crop production: vegetables (thousand tonnes) : 1 129.0 w 1 157.1 w 1 166.3 w 1 258.0 w :
Source: Eurostat and the statistical authorities in Albania
: = not available
d = definition differs
e = estimated value
p = provisional
s = Eurostat estimate
w= data supplied by and under the responsibility of the national statistical authority and published on an "as is" basis and without any assurance as regards their quality
and adherence to EU statistical methodology
* = Europe 2020 indicator
** = Macroeconomic Imbalance Procedure (MIP) indicator
Footnotes:
1) Activity B_D
2) Based on NACE Rev. 1.1. Coverage is Divisions 10 to 74.
3) Based on NACE Rev. 2. Coverage is Divisions 05 to 82 and 95.
4) A Directive made some farmers part of the SBR. Reform by the Albania Government to reduce the informal economy as well as the registration of farmers resulted in the
SBR keeping just enterprises registered within the year and not newly created enterprises. As a result the birth rate can not be calculated from these data.
5) Annual average of the Tribor rate – interbank rate for overnight loans.
6) Average weighted rate applied to new 12-month loans over the respective month, on 12-month maturity.
7) Deposit interest rate represents the average weighted rate for newly accepted deposits over the respective month, on 12-month maturity.
8) Public sector only.
9) Source of information: General Directorate of Taxation, social insurance contributors; INSTAT's calculation
10) The data are updated with the average population data for 2020.