COMMISSION STAFF WORKING DOCUMENT ALBANIA 2015 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 EU Enlargement Strategy
Date: 2015-11-10
Institutions: Directorate-General for Neighbourhood and Enlargement Negotiations, European Commission
Subjects: Albania, accession criteria, accession negotiations, pre-accession strategy

EUROPEAN 
COMMISSION 

Brussels, 10.11.2015  
SWD(2015) 213 final 

COMMISSION STAFF WORKING DOCUMENT 

ALBANIA 
2015 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 

EU Enlargement Strategy 

{COM(2015) 611 final} 
{SWD(2015) 210 final} 
{SWD(2015) 211 final} 
{SWD(2015) 212 final} 
{SWD(2015) 214 final} 
{SWD(2015) 215 final} 
{SWD(2015) 216 final} 

EN 

   EN 

 
 
 
 
  
 
 
 
Table of Contents 

1.  

INTRODUCTION....................................................................................................... 4 

1.1.  Context .............................................................................................................. 4 
1.2.  Summary of the report....................................................................................... 4 

2.   POLITICAL CRITERIA............................................................................................. 6 

2.1.  Democracy ........................................................................................................ 6 
2.2.   Public administration reform............................................................................. 9 
2.3.  Rule of law ...................................................................................................... 12 
2.4.  Human rights and the protection of minorities................................................ 20 
2.5.  Regional issues and international obligations ................................................. 22 

3.  ECONOMIC CRITERIA .......................................................................................... 23 

3.1.  The existence of a functioning market economy............................................. 24 
3.2.  The  capacity  to  cope  with  competitive  pressure  and  market  forces  within 

the Union ......................................................................................................... 29 

4.  ABILITY TO ASSUME THE OBLIGATIONS OF MEMBERSHIP...................... 31 

4.1.  Chapter 1: Free movement of goods ............................................................... 31 
4.2.  Chapter 2: Freedom of movement for workers ............................................... 32 
4.3.  Chapter 3: Right of establishment and freedom to provide services............... 32 
4.4  Chapter 4: Free movement of capital .............................................................. 33 
4.5.  Chapter 5: Public procurement........................................................................ 34 
4.6.  Chapter 6: Company law................................................................................. 36 
4.7.  Chapter 7: Intellectual property law................................................................ 36 
4.8.  Chapter 8: Competition policy ........................................................................ 37 
4.9.  Chapter 9: Financial services .......................................................................... 38 
4.10.  Chapter 10: Information society and media .................................................... 38 
4.11.  Chapter 11: Agriculture and rural development.............................................. 39 
4.12.  Chapter 12: Food safety, veterinary and phytosanitary policy........................ 40 
4.13.  Chapter 13: Fisheries....................................................................................... 41 
4.14.  Chapter 14: Transport policy........................................................................... 42 
4.15.  Chapter 15: Energy.......................................................................................... 43 
4.16.  Chapter 16: Taxation....................................................................................... 44 
4.17.  Chapter 17: Economic and monetary policy ................................................... 45 
4.18.  Chapter 18: Statistics....................................................................................... 46 
4.19.  Chapter 19: Social policy and employment .................................................... 47 
4.20.  Chapter 20: Enterprise and industrial policy................................................... 49 
4.21.  Chapter 21: Trans-European networks............................................................ 49 
4.22.  Chapter 22: Regional policy and coordination of structural instruments........ 50 
4.23.  Chapter 23: Judiciary and fundamental rights................................................. 51 
4.24.  Chapter 24: Justice, freedom and security ...................................................... 61 
4.25.  Chapter 25: Science and research.................................................................... 65 

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4.26.  Chapter 26: Education and culture .................................................................. 66 
4.27.  Chapter 27: Environment and climate change ................................................ 67 
4.28.  Chapter 28: Consumer and health protection .................................................. 68 
4.29.  Chapter 29: Customs union ............................................................................. 70 
4.30.  Chapter 30: External relations......................................................................... 70 
4.31.  Chapter 31: Foreign, security and defence policy........................................... 71 
4.32.  Chapter 32: Financial control .......................................................................... 72 
4.33.  Chapter 33: Financial and budgetary provisions............................................. 74 
Annex I – Relations between the EU and Albania.................................................... 75 
Annex II – Statistical Annex ..................................................................................... 77 

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1.  

INTRODUCTION

1

1.1.  Context 

In  June  2014,  the  European  Council  granted  Albania  candidate  status.  In  the  past  year, 
Albania  has  implemented  smoothly  its  obligations  under  the  Stabilisation  and  Association 
Agreement (SAA). Regular political and economic dialogue between the EU and Albania has 
continued  through  the  relevant  structures  under  the  SAA.  The  government  engaged  in  EU-
related reforms and in addressing the five key priorities identified for the opening of accession 
negotiations.2  Albania  continued  to  actively  participate  in  high  level  dialogue  meetings,  as 
well as in the related joint working groups on the five key priorities.  

1.2. 

Summary of the report  

As  regards  the  political  criteria,  the  local  elections  in  June  2015  were  conducted  without 
major  incidents.  Concerns  about  the  impartiality  and  professionalism  of  the  electoral 
authorities and the overall politicisation of the electoral process have yet to be addressed. In 
December 2014, the parliament adopted a resolution outlining the basis for the ruling majority 
and the main opposition party to engage in a continuous constructive political dialogue. This 
ended a six-month parliamentary boycott by the main opposition party. However, more needs 
to be done to address the divisive political culture and ensure a more constructive cross-party 
dialogue.  

As  concerns  public  administration  reform,  Albania  is  moderately  prepared.  Comprehensive 
reform  strategies  and  the  new  Code  of  Administrative  Procedures  were  adopted.  However, 
efforts  are  needed  to  achieve  the  objective  of  a  professional  and  depoliticised  public 
administration, to increase the financial and administrative capacity of local government units 
and to ensure effective implementation of the civil service law at local level. 

Albania's judicial system is at an early stage of preparation. Substantial shortcomings in the 
judicial system remain regarding independence and accountability of judges and prosecutors, 
enforcement  of  decisions,  inter-institutional  cooperation,  and  the  administration  of  justice 
which  remains  slow.  An  ad  hoc  parliamentary  committee  was  established  to  conduct  a 
comprehensive  and  inclusive  justice  reform.  The  next  crucial  steps  are  the  adoption  of  the 
judicial  reform  strategy  and  action  plan  followed  by  the  adoption  of  the  necessary 
institutional, legislative and procedural measures. 

Albania  has  reached  some  level  of  preparation  in  the  fight  against  corruption.  A  new  anti-
corruption  strategy  and  action  plan  were  adopted.  However,  corruption  is  widespread  and 
more efforts are needed to make progress with a view to establishing a solid track record of 
investigations, prosecutions and convictions at all levels. Proactive investigations, systematic 
risk assessments and inter-institutional cooperation need to be improved. The independence of 
institutions  involved  in  the  fight  against  corruption  needs  to  be  enhanced,  as  they  remain 
vulnerable to political pressure and other undue influence.  

The  country  has  reached  some  level  of  preparation  as  regards  the  fight  against  organised 
crime. Albania conducted a number of law enforcement operations leading to the destruction 

1  This  report  covers  the  period  from  October  2014  to  September  2015.  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. As a rule, legislation or 
measures which are under preparation or awaiting parliamentary approval have not been taken into account.  
2 See Enlargement Strategy and Main Challenges 2013-2014. 

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of vast cultivations of cannabis. However, the number of final convictions effectively leading 
to dismantling criminal organisations remains negligible compared to the estimated value of 
the  regional  and  domestic  criminal  market.  Financial  investigations,  anti-money  laundering 
measures and asset confiscation remain underused. Albania needs to establish a track record 
of  proactive  investigations,  prosecutions  and  final  convictions  in  organised  crime  cases, 
including money laundering, and effectively dismantle criminal networks. 

The  legal  framework  for  the  protection  of  human  rights  is  broadly  in  line  with  European 
standards. However, effective implementation of relevant legislation and strategies is limited 
and the enforcement of human rights protection mechanisms remains insufficient. As regards 
freedom  of  expression,  Albania  has  reached  some  level  of  preparation.  The  overall 
environment is generally conducive to the freedom of expression, but better implementation 
of  the  legislation  is  needed.  The  independence  of  the  regulatory  authority  and  public 
broadcaster  must  be  further  strengthened.  Enforcement  of  property  rights  remains  to  be 
ensured,  and  the  processes  of  property  registration,  restitution  and  compensation  are  not 
completed.  Roma  and  Egyptians  face  very  difficult  living  conditions  and  frequent  social 
exclusion  and  discrimination.  In  the  area  of  anti-discrimination,  the  case-law  needs  to  be 
further developed. Institutional mechanisms to protect the rights of the child remain poor. The 
juvenile justice system fails to comply with international standards.  

Albania  has  continued  to  participate  actively  in  regional  cooperation  and  maintain  good 
neighbourly  relations  in  line  with  its  commitments  under  the  Stabilisation  and  Association 
Agreement. 

As regards the economic criteria, Albania is moderately prepared in developing a functioning 
market economy. Some progress was made in improving macroeconomic stability and growth 
prospects improved. Inflation remained low. However, significant challenges remain. Further 
efforts  are  needed  to  sustain  fiscal  consolidation,  improve  the  business  environment  and 
tackle  the  informal  economy.  Albania  should  also  improve  the  budget  management 
framework and address the high level of non-performing loans. The levels of unemployment 
(17.5%) and informal employment remain high. 

Concerning  the  capacity  to  cope  with  competitive  pressure  and  market  forces  within  the 
Union, Albania has some level of preparation. Some progress was made as regards education, 
transport  and  energy  infrastructure.  However,  significant  investment  in  human  and  physical 
capital is necessary to improve Albania's competitiveness. Albania should improve the quality 
of  higher  education  and  continue  restructuring  the  vocational  education  and  training,  adopt 
and  implement  the  national  transport  and  energy  strategies  and  lower  non-tariff  barriers  to 
trade such as shortcomings in food safety.  

Albania continued aligning its legislation to the requirements of the EU in a number of areas, 
enhancing its ability to take on the obligations of membership. In many areas, the country 
is  moderately  prepared,  such  as  in  financial  control,  or  has  some  level  of  preparation, 
including  in  the  areas  of  public  procurement  and  statistics.  However,  Albania  will  need  to 
make  substantial  efforts  to  upgrade  its  preparations  for  implementing  the  acquis.  It  should 
continue  work  on  the  development  of  the  transport  and  energy  network.  The  administrative 
capacity and professional standards of bodies charged with the implementation of the acquis 
needs to be strengthened and the independence of regulatory bodies safeguarded. Enhancing 
transparency and accountability, in particular ensuring the effective, efficient and transparent 
functioning  of  the  public  procurement  system  and  public  finance  management,  remains 
essential. 

Albanian  authorities  are  expected  to  pursue  their  efforts  to  tackle  the  increasing  number  of 
manifestly  unfounded  asylum  applications  lodged  by  its  citizens  to  EU  Member  States  and 

5 

 
Schengen-associated  countries.  All  activities  to  counter  this  negative  phenomenon  shall  be 
intensified via the post-visa liberalisation monitoring mechanism, particularly after the recent 
increase over the summer.   

2.  

POLITICAL CRITERIA 

2.1.  Democracy 

Elections 

The local elections in June 2015 were conducted without major incidents. Concerns about the 
impartiality  and  professionalism  of  the  electoral  authorities  and  the  overall  politicisation  of 
the electoral process have yet to be addressed. 

While  no  major  incidents  occurred  in  the  June  local  elections,  a  number  of  shortcomings 
affected the process. Many cases of group voting and procedural irregularities were noted by 
international  observers.  The  OSCE’s  Office  for  Democratic  Institutions  and  Human  Rights 
(OSCE/ODIHR)  raised  concerns  about  the  impartiality  and  professionalism  of  the  electoral 
authorities and the overall politicisation of the electoral process. Local elections were based 
on the new territorial administrative division, which provided for 61 municipalities. In April, 
amendments  were  made  to  the  Electoral  Code  to  reflect  the  new  boundaries.  They  also 
strengthen  the  gender  quota  provisions  for  local  elections,  requiring  50 %  representation  of 
each  sex  on  lists  of  candidates,  in  line  with  OSCE/ODIHR  and  Venice  Commission 
recommendations. Other OSCE/ODIHR recommendations have not been addressed, including 
those on enhancing the impartiality of electoral commissions, transparent campaign financing 
and effective resolution of electoral disputes. 

The  Central  Election  Commission  (CEC)  has  been  at  full  capacity  since  January,  when 
parliament appointed three members whose appointment had been pending since April 2013. 
The overall impartiality and professionalism of the electoral administration remain a concern. 

Parliament 

Some progress has been made in the functioning of parliament, in particular by improving the 
transparency of law-making. A more constructive cross-party dialogue remains to be ensured. 
Initial  steps  were  taken  to  prepare  legislation  for  the  exclusion  of  criminal  offenders  from 
public offices.  

In  December,  a  six-month  parliamentary  boycott  by  the  main  opposition  party  ended  when 
parliament  adopted  a  resolution  whereby  the  ruling  majority  and  the  main  opposition  party 
pledged to engage in constructive political dialogue.  They also agreed to revise the rules of 
procedure on parliamentary committees, and to work on drafting legislation for the exclusion 
of criminal offenders from public offices. The implementation of this agreement started with 
the  establishment  of  two  parliamentary  committees  of  inquiry  and  an  ad  hoc  committee  to 
work on the exclusion of criminal offenders from public offices. The adoption of the related 
legislation would enhance the citizens' trust in political representatives and public institutions. 
The work of the committees remains affected by political polarisation. In July, the parliament 
approved the new composition of the ad hoc committee on judicial reform based on parity of 
members  of  the  ruling  majority  and  the  opposition.  In  November,  parliament  amended  its 
rules of procedure, granting the main opposition party the same amount of speaking time as 
the Prime Minister. Constructive dialogue in parliament and its technical bodies needs to be 
ensured. 

6 

 
 
Parliament lifted the immunity of three MPs from the ruling majority, and rejected seven of 
the President’s nominations to the High Court. 

In March, parliament enacted a new law on its role in the EU integration process, providing 
for more inclusiveness, oversight and exchange of information. This was followed in May by 
the  establishment  of  the  National  Council  for  European  Integration  to  make  the  EU-related 
reform  process  more  inclusive.  Parliament’s  capacity  to  monitor  the  implementation  and 
compliance of new legislation with EU law remains limited. Coordination with the executive 
branch  needs  to  be  enhanced.  Other  oversight  mechanisms,  such  as  question  and  answer 
sessions, remain underused.   

Parliament  continued  to  monitor  the  work  of  independent  institutions  and  discussed  their 
reports  more  promptly  and  thoroughly.  However,  appropriate  follow-up  to  their  findings 
needs to be ensured.  

Transparency  and  inclusiveness  in  the  legislative  process  have  improved.  Parliamentary 
committees  have  generally  been  proactive  in  holding  consultations  with  civil  society  and 
interest  groups.  A  resolution  on  the  role  of  civil  society  in  the  country’s  democratic 
in  December.  Parliament’s  organisational  structure  and 
development  was  adopted 
administrative and expert capacity need to be further improved, which requires the allocation 
of sufficient funds to recruit and train staff, especially in relation to research and analysis. 

Governance 

The government has maintained its focus on addressing the key priorities for the opening of 
accession negotiations, pursuing a set of reforms necessary to advance in the EU integration 
path. Some progress has been made at local government level with the start of implementation 
of  the  territorial  administrative  reform  and  the  adoption  of  the  decentralisation  strategy. 
However,  substantial  efforts  are  needed  to  clarify  the  functions  and  responsibilities  of  the 
newly  created  local  government  units  and  to  increase  their  financial  and  administrative 
capacity. 

Some  steps  have  been  taken  to  improve  inter-institutional  coordination.  Working  groups  in 
specific sectors have been reorganised to improve monitoring of policy developments and to 
provide strategic advice more effectively. 

The Constitutional Court has ruled on 12 cases related to the functioning of state institutions. 
Swift implementation of Constitutional Court rulings is essential, and when they require the 
adoption  of  legislation  or  change  of  work  practices  the  government  and  parliament  should 
ensure implementation. 

Further  efforts  are  needed  to  ensure  the  professionalism  and  depoliticisation  of  independent 
institutions.  Albania  should  examine  the  possibilities  for  introducing  harmonised  provisions 
on  the  appointment  and  dismissal  of  heads  of  independent  institutions,  a  merit-based  and 
transparent selection process of both their heads and members of boards, budgetary autonomy 
and autonomy to set up their internal structures. 

Regarding local self-government, in January, the government established the National Agency 
for  Implementation  of  the  Territorial  Reform.  Instructions  on  amalgamation  of  local 
government units as a result of the territorial administrative reform were adopted and a EUR 
13.2  million  transitory  fund  for  the  implementation  of  the  reform  was  distributed  to  the  61 
newly established municipalities. In line with the newly adopted decentralisation strategy for 
2015-2020,  a  new  law  fully  clarifying  the  functions  and  responsibilities  of  the  local 
government  units  is  needed.  Local  government  associations  were  more  actively  involved  in 
the  drafting  of  the  strategy  and  legal  acts.  However,  recent  legal  provisions  for  increased 

7 

 
inter-institutional  cooperation  between  central  and  local  governments  have  yet  to  be 
implemented. 

The  amendments  to  the  law  on  territorial  planning,  clarifying  some  aspects  of  the 
development of local plans, entered into force in October 2014, and implementing legislation 
is  in  place  since  July.  However,  local  governments  continued  to  face  difficulties  in 
implementing their urban planning responsibilities. 

The National Urban Construction Inspectorate continued to demolish illegal buildings, while 
the  process  of  legalising  others  through  the  Agency  for  Legalisation  of  Illegal  Buildings 
continued.  The  inspectorate  referred  several  mayors  to  the  prosecution  service  for  alleged 
abuse  of  office  and  issuing  illegal  building  permits.  This  resulted  in  a  number  of  ongoing 
prosecutions and first-instance court decisions. The decision-making process in the National 
Territorial  Council  (NTC),  the  inspectorate  and  local  government  bodies  needs  to  be  made 
more transparent.  

As regards fiscal decentralisation, local government expenditure in 2014 was 2.3 % of GDP, 
an  increase  on  the  previous  year  while  remaining  below  the  annual  target.  Albania  should 
strengthen  public  finance  management  at  local  level  under  the  strategy  on  public  finance 
management adopted in December. Efforts to make the distribution of central funds to local 
units  more  transparent  should  be  further  supported.  Albania  needs  to  ensure  the 
decentralisation  strategy's  sustainability  as  part  of  the  2016-2018  medium-term  budget 
programme.  

Local government units need substantially greater capacity to deliver services to the public, 
including  one-stop-shops  for  all  public  services.  More  efforts  are  needed  to  develop  the 
capacity  to  design  and  implement  local  development  plans.  Substantial  efforts  are  needed 
from  both  central  and  local  government  units  to  develop  and  implement  a  comprehensive 
training plan for the staff of the new local government units. 

The Ombudsman's cooperation with civil society remained very good and a number of joint 
trainings  were  delivered.  In  March,  the  Ombudsman’s  Office  was  awarded  an  ‘A’  status 
certificate  by  the  International  Coordinating  Committee  of  National  Human  Rights 
Institutions for complying with the Paris Principles, granting it the right to speak at the United 
Nations  Human  Rights  Council.  In  November,  the  Law  on  the  Ombudsman  was  amended, 
extending  its  remit  on  human  rights  promotion  and  providing  for  a  more  transparent  and 
inclusive  selection  of  candidate  commissioners,  and  creating  two  additional  commissioner 
posts:  the  Children’s  Commissioner  and  the  Commissioner  for  the  national  mechanism  for 
prevention  of  torture.  However,  these  were  not  reflected  in  additional  budget  allocations, 
which  remain  insufficient.  The  seven  regional  Ombudsman  offices  are  dependent  on 
volunteers  and  donor  support.  The  authority,  autonomy  and  resources  of  the  Ombudsman’s 
Office need to be enhanced, and he should always be properly consulted on draft legislation 
and reforms affecting his areas of competence. 

Civil society 

Good progress has been made towards establishing an institutional framework for cooperation 
with and consultation of civil society. Now it is important that existing mechanisms are fully 
implemented in practice. 

Cooperation between state institutions and civil society organisations (CSOs) has improved. 
In  October,  parliament  approved  a  regulation  on  public  consultations,  and  in  December  it 
passed a resolution which ratifies the charter on civil society, recognising the importance of 
civil society in the country’s democratic development. Following a wide consultation process, 
in  May  the  government  adopted  a  roadmap  setting  out  its  policy  towards  a  more  enabling 

8 

 
environment  for  civil  society.  Civil  society  representatives  participated  in  meetings  of  the 
National Council on European Integration, but are yet to take an active role. The law setting 
up  the  National  Council  for  Civil  Society,  a  consultative  body  to  enable  regular  dialogue 
between  the  government  and  CSOs  on  civil  society  development,  was  adopted  by  the 
government,  but  is  yet  to  be  enacted  by  the  parliament.  At  local  level,  cooperation  remains 
weak. 

While  the  new  law  on  VAT  provides  CSOs  with  the  possibility  to  obtain  value  added  tax 
reimbursement on Instrument for Pre-Accession (IPA) funded grants, no such reimbursement 
has taken place so far. The new online tax system requires monthly declarations on all CSOs, 
even  when  no  activities  are  ongoing,  which  creates  an  additional  administrative  burden, 
particularly  for  small  organisations.  Public  funding  for  CSOs  is  limited  and  procedures  for 
fund  allocations  need  to  be  clarified  and  unified  throughout  the  public  administration.  Tax 
rules  and  other  regulations  are  not  conducive  to  private  donations  to  CSOs.  Civil  society 
remains fragmented overall and overly dependent on donor funding. 

2.2.   Public administration reform 

Albania is moderately prepared with the reform of its public administration. Good progress 
has  been  made  in  areas  falling  under  the  key  priority  on  public  administration  reform, 
especially  with  the  adoption  of  a  comprehensive  reform  strategy  and  a  new  Code  of 
Administrative Procedures. However, further efforts are needed also in the areas outside the 
scope of this key priority, especially on improving policy development and coordination, and 
the capacity of administrative courts.  

In order to fulfil the key priority on public administration reform, in the coming year, Albania 
should in particular: 

→  continue  to  demonstrate  transparent  and  merit-based  recruitment  and  dismissal  of  civil 
servants  in  all  state  institutions  in  order  to  achieve  the  objective  of  a  professional  and 
depoliticised public administration; 

→  make  accurate  information  on  public  service  available  through  the  Human  Resources 
Management Information System, and connect it to the treasury system;  

→ prepare for the implementation of the new Code of Administrative Procedures, and carry 
out a parallel review and alignment of other relevant legislation. 

Public service and human resources management 

The 2013 Law  on  Civil  Servants is in line with the principles of public  administration. The 
law provides for merit-based recruitment, promotion and dismissal in the public service. 
Several open ‘pool’ recruitments were carried out in 2014 and 2015 for entry-level positions. 
An open competition for the senior civil servants was held and led to the creation of the top 
level  management  corps.  An  in-depth  training  programme  for  all  new  top-level  managers 
shall now be carried out. 

The  amendments  to  the  law,  adopted  in  December,  however,  open  the  possibility  of 
recruitment for lower and middle management posts from outside the civil service, and render 
dismissals more flexible. Following the amendments, the secondary legislation should ensure 
that  fair  and  rigorous  recruitment  and  dismissal  procedures  are  maintained.  The  quality  of 
recruitment  procedures  needs  to  be  significantly  improved,  especially  in  the  independent 
institutions. The legal framework excludes certain institutions and positions from the scope of 
the Law on Civil Servants. Albania should ensure a homogenous employment regime among 
public administration institutions.  

9 

 
Management  of  human  resources  across  the  public  administration  has  improved.  The 
Department for Public Administration increased its staff in 2014 to ensure better coordination, 
but it still needs to improve capacity. Preparations have started to make the human resources 
management information system operational and extend it to all institutions.  Implementation 
of the Law on Civil Servants at local level remains a challenge. The high number of appeals 
in  the  administrative  courts  raises  concern  about  the  use  of  termination,  downgrading, 
restructuring and disciplinary procedures to demote and dismiss public servants.  

The Commissioner for oversight of the civil service was appointed by parliament at the end of 
2014 as an independent monitor of the management of civil service. In March, she presented 
her  first  report  to  the  parliament.  Effective  follow-up  of  the  Commissioner’s  findings  and 
recommendations should be ensured. 

The  remuneration  system  is  based  on  job  classification  and  is  in  principle  transparent. 
However, in June, the government adopted a new system of salary bonuses for civil servants 
working on EU integration and legal drafting. The proposed system needs to be reviewed to 
ensure it is in line with the Law on Civil Servants. The authorities need to take the necessary 
steps to ensure fair and transparent remuneration with equal pay for equal work, and to avoid 
weakening the career-based civil service system.  

Professional  development  is  provided  for  in  the  law.  The  Albanian  School  of  Public 
Administration (ASPA) is responsible for civil servants training. The quality and quantity of 
training  has  increased,  but  ASPA's  budget  is  insufficient  for  the  increased  number  of  civil 
servants in need of training. The new performance appraisal system is not yet used widely.  

The  perception  of  corruption  is  high  in  Albania.  Both  the  public  administration  reform 
strategy and the anti-corruption strategy include measures to prevent corruption and promote 
integrity in public service, but they still need to be implemented effectively. 

Policy development and coordination 

Albania has the legal framework and institutional structures in place to ensure a good policy-
making system, but there are some weaknesses in implementation. The European integration 
coordination system has been set up but needs to be made fully functional and equipped with 
the  necessary  staff  capacity.  Planning  as  well  as  monitoring  and  reporting  on  the 
implementation of the national plan for European integration should be improved. There are 
weaknesses  with  regard  to  the  implementation  of  the  government’s  work  programme, 
coordination  of  the  policy  proposals  and  costing  of  strategies.  The  links  between  policy 
planning and medium-term budget planning need to be therefore substantially strengthened.  

Policy  and  legislation  development  is  not  yet  sufficiently  inclusive  and  evidence-based.  In 
March 2015, tables of concordance based on European standards were made compulsory for 
all legislation aiming at alignment with the acquis. However, ministries do not have in place 
clear internal rules which regulate procedures for policy development and legal drafting. The 
Law on Public Notification and Consultation came into force in May, setting out procedures 
for stakeholder consultation. Impact assessments are not carried out systematically and their 
quality varies between institutions. Financial impact  assessments generally  accompany draft 
legislative proposals, but their quality also varies greatly.  

The  system  for  monitoring  government's  performance  should  be  streamlined  to  ensure 
efficient  public  scrutiny  over  government  work,  and  the  government  monitoring  reports 
should focus on achievements against policy objectives rather than on outputs. 

Accountability of the administration 

10 

 
The legislative framework for the organisation of the state administration is in place, but the 
lines of accountability between agencies and subordinate bodies are still not fully clear. Also, 
lines of accountability within institutions need to be improved, as managerial accountability is 
not yet a feature of the system. (See Chapter 32 – Financial control) 

The  institutional  set-up  and  resources  to  ensure  the  citizens'  right  to  good  administration 
are generally well established. The degree to which the recommendations of oversight bodies 
such as the Ombudsman and the High State Control are implemented is, however, difficult to 
establish  as  there  is  no  systematic  monitoring.  The  right  to  access  public  information  is 
regulated in the Law on the Right to Information, which was adopted in September 2014. The 
law grants supervisory, monitoring and sanctioning powers to the Commissioner for the Right 
to  Information  and  Protection  of  Personal  Data.  Regular  monitoring  of  the  practical 
application of exemptions from the law should be carried out.  

The right to administrative justice is governed by the Law on Administrative Disputes and 
the Law on Administrative Courts. The overall capacity of the administrative court system to 
deal  with  the  backlog  of  cases  needs  to  be  significantly  improved.  There  are  considerable 
delays  in  enforcement  of  the  final  decisions  of  the  courts,  including  on  cases  of  unlawfully 
dismissed  civil  servants.  The  Constitution  lays  down  the  right  to  seek  compensation  and 
public  authorities’  liability  in  cases  of  wrongdoing  is  regulated  by  a  special  law,  but  in 
practice the number of related court cases is low due to limited public awareness.  

Public financial management 

A public financial management reform strategy for 2014-2020 was adopted in December. 
Implementation has focused on strengthening  the  fiscal framework  with  multi-year  ceilings, 
on a new IT system for the tax administration and on compliance audits. Implementation of 
the arrears prevention and clearance strategy is on track. The credibility of the medium-term 
budget programme needs to be strengthened, and coordination of public investment planning 
and  management  improved.  Strong  coordination  is  needed  to  ensure  synergies  with  public 
administration reform. Efforts to prevent, detect and fight against high-risk fraud, corruption 
and misuse of public funds need to be further stepped up. 

Budget transparency is ensured to some extent. The annual budget proposal does not have 
information  on  baseline  expenditure,  new  policies,  final  outturn  data  for  previous  years  or 
multiannual commitments on capital spending. A ‘citizen’s budget’ is not available. The High 
State Control does not provide an opinion on whether the government's financial reports fairly 
present public finances. 

Service delivery to citizens and businesses 

There  is  a  strong  political  commitment  to  a  user-oriented  administration,  and  the 
government aims to ensure equal access to public services. Progress has been achieved with 
further  extension  of  services  on  the  e-Albania  portal  and  the  establishment  of  an 
interoperability framework for state institutions. Public satisfaction with government services 
is  moderate  and  should  be  enhanced  by  policies  and  mechanisms  promoting  quality 
improvements  in  public  institutions.  The  fragmented  institutional  responsibilities  are  a  key 
challenge to further implementation. Progress on simplifying administrative procedures has 
been achieved in April with the adoption of a new Code of Administrative Procedures, in line 
with European standards. For uniform application of the code upon its entry into force mid-
2016,  the  authorities  need  to  carry  out  a  parallel  review  and  alignment  of  other  relevant 
legislation  and  provide  substantial  training  to  the  civil  servants.  The  special  administrative 
procedures need to be reviewed and either abolished or brought into line with the new law. 

11 

 
 
Strategic framework for public administration reform 

The 2015-2020 public administration reform strategy was adopted in April together with 
an  action  plan  for  2015-2017.  A  comprehensive  monitoring  and  reporting  system  with 
performance  indicators  and  targets  has  been  set  up.  Related  strategies  on  public  financial 
management,  the  ‘digital  agenda’,  anti-corruption  and  decentralisation  have  also  been 
adopted. Political support to the reform process is expected to be ensured by the newly set-
up  Integrated  Policy  Management  Group  for  PAR,  chaired  by  the  Minister  of  State  for 
Innovation and Public Administration. The capacity of the lead institutions needs to be further 
strengthened, particularly  with  regard to public  administration  reform monitoring. Financial 
sustainability  is  a  concern,  as  costs  of  the  overall  public  administration  reform  are  not  fully 
reflected in the medium-term budget programme. 

2.3.  Rule of law 

Functioning of the judiciary 

Albania’s judicial system is at an early stage of preparation. Some progress has been made 
in the past year, notably through the establishment, in November, of an ad hoc Parliamentary 
Committee on Justice Reform to carry out a comprehensive and inclusive reform process. 

Administration  of  justice  is  slow  and  judicial  decisions  are  not  always  enforced.  The 
professional  training  of  judges  is  inadequate  and  their  independence  is  not  fully  ensured. 
There is insufficient accountability of judges and prosecutors and corruption within the justice 
system is widespread. Inter-institutional cooperation is poor and resources are insufficient. 

In  order  to  fulfil  the  key  priority  on  the  reform  of  the  judicial  system,  in  the  coming  year 
Albania should in particular: 

→ adopt a new judicial reform strategy and accompanying action plan, and proceed, through 
an inclusive consultation process, with drafting and adopting the institutional, legislative and 
procedural measures necessary, taking into account European standards and best practices; 

→ fill the vacancies at the High Court and the administrative courts; 

→  extend  the  courts'  unified  electronic  case  management  system  and  ensure  it  is  effective, 
including an appropriate maintenance budget; 

→ publish all court decisions with their respective reasoning within a reasonable deadline. 

Strategic documents 

The 2011-13 justice sector reform strategy has expired and the adoption of a new strategy is 
pending. In April, the 2015-17 medium-term strategy of the Prosecution Office was adopted. 

Management bodies 

The High Council of Justice (HCJ) is the governing body of the judiciary. Its role is limited 
to the appeal and first-instance courts. It is composed of the President of the Republic (chair), 
the Minister of Justice, the President of the High Court, nine judges of all levels elected by the 
National  Judicial  Conference  and  three  jurists  elected  by  parliament  by  a  simple  majority. 
There is no provision ensuring that at least one member designated by parliament is supported 
by an opposition party. The deputy head of the HCJ, who is appointed upon a proposal by the 
President from among the members designated by parliament, plays a crucial role in the work 
of  the  Council.  He  is  the  only  fulltime  member  of  this  body.  The  HCJ  is  in  charge  of  the 
evaluation,  appointment,  promotion,  and  transfer  of  judges  and  handles  disciplinary 

12 

 
 
proceedings initiated by the Minister of Justice. In 2014, new rules on suspension from office 
and dismissal of HCJ members, and on issues relating to conflicts of interest, were introduced. 
However,  the  rules  on  ethics  remain  incomplete.  The  HCJ  publishes  its  decisions  online, 
together with the minutes of its meetings. 

The  Council  of  Prosecutors  is  made  up  of  six  prosecutors  plus  a  representative  of  the 
Ministry of Justice, and may include a representative of the President of the Republic. It is an 
advisory body to the General Prosecutor and not a fully-fledged career management body for 
prosecutors. 

Independence and impartiality 

The independence of the judiciary is enshrined in the Constitution. However, in practice it 
is  jeopardised  by  the  highly  politicised  way  in  which  High  Court  and  Constitutional  Court 
judges  are  appointed,  and  the  wide  margin  of  discretion  enjoyed  by  the  HCJ  in  appointing, 
promoting and transferring judges. In principle, judges and prosecutors decide independently 
on individual cases. In practice, their independence is limited and there are regular reports of 
selective justice and political interference in court cases.  

Not  all  courts  use  the  unified  case  management  system  to  allocate  cases.  Non-transparent 
practices  such  as  assigning  cases  by  drawing  lots  —  occasionally  even  in  the  office  of  the 
head of court — have not been phased out in some courts. Rules on the exclusion of judges 
from cases are set out in the Civil, Criminal and Administrative Procedure Codes. Courts do 
not  keep  a  register  of  cases  from  which  judges  have  been  excluded  or  have  asked  to  be 
excluded.  Individual  requests  to  exclude  judges  from  cases  are  addressed  directly  to  the 
courts.  The  prosecution  service’s  recently  established  case-handling  system  is  not  yet  fully 
operational throughout the country, except for case registration purposes.  

Accountability 

A  code  of  ethics  for  judges  has  existed  since  2000  but  had  no  real  impact  on  their 
accountability. In 2014, a code of conduct was adopted for the prosecution service. There is 
not  enough  monitoring  of  compliance  with  ethical  standards  and  integrity  when  appointing 
judges  and  prosecutors.  There  is  no  counselling  or  mandatory  in-service  training  on  ethics. 
Lawyers have their own code of ethics and professional ethics is one of the subjects covered 
by the initial training programme of the School of Magistrates. 

Judges are held accountable through inspection by both the Ministry of Justice and the HCJ. 
Although there is a memorandum of understanding between these two bodies, there is a risk 
of  overlapping  inspections.  The  legal  framework  for  disciplinary  proceedings  lacks  clarity 
and such proceedings can be used to improperly influence judges. The Minister of Justice has 
sole  power  —  and  discretion  —  to  bring  disciplinary  proceedings  against  judges,  which  is 
contrary to EU standards. The Minister submits disciplinary cases to the HCJ for review and a 
decision on sanctions. 

Judges  and  prosecutors  are  obliged  to  declare  their  assets  on  an  annual  basis.  However, 
despite numerous reported cases of failure to comply with this requirement, no final decisions 
on  sanctions  have  been  issued  to  date.  The  judiciary  is  generally  perceived  as  being  highly 
corrupt.  

Professionalism and competence 

Recruitment, appointment and dismissal are the responsibility of the HCJ, for judges, and 
the General Prosecutor, for prosecutors. The requirement of professionalism and integrity is 
not sufficiently reflected in the existing criteria for judges. Criteria for evaluating prosecutors 
are in place but clear and transparent criteria for evaluating and promoting judges have yet to 

13 

 
be adopted. Decisions related to judges' careers are not fully transparent and are not always 
based  on  merits  and  other  objective  criteria.  An  appeal  against  appointments,  evaluations, 
transfers,  promotion  decisions  and  disciplinary  measures  is  possible.  High  Court  and 
Constitutional Court judges are appointed by the President of the Republic, with the backing 
of a simple majority of parliament. In recent years, the process of appointing Constitutional 
and  High  Court  judges  has  been  marred  by  controversial  hearings  in  parliament’s  Legal 
Affairs  Committee  and  frequent  rejection  by  parliament  of  presidential  nominees.  In  an 
attempt to remedy this situation, the Law on the High Court was amended in 2013 and again 
in  2015,  when  more  specific  criteria  and  procedures  for  the  selection  of  judges  were 
introduced. 

Prosecutors  are  appointed,  promoted,  transferred  and  dismissed  by  the  President  of  the 
Republic upon a proposal from the General Prosecutor. The independence and accountability 
of  the  prosecutorial  system  is  further  weakened  by  the  fact  that  the  General  Prosecutor  is 
appointed  with  the  consent  of  a  simple  majority  of  parliament.  Procedures  for  the 
appointment,  promotion  and  dismissal  of  key  staff  in  the  General  Prosecutor’s  Office  lack 
transparency. 

Quality of justice 

Initial and in-service judicial training is provided by the School of Magistrates, and is being 
partly  financed  by  foreign  donors  due  to  continuing  shortfalls  in  the  budget.  A  training 
programme on the case law of the European Court of Human Rights is in place, but training 
on  EU  acquis  is  limited.  Albania  does  not  yet  participate  in  the  European  Judicial  Training 
Network. 

The National School of Lawyers began its activity in October 2013. Since then, the school has 
prepared  705  lawyers  for  the  bar  examination.  The  school  does  not  yet  provide  in-service 
training for lawyers. 

The Ministry of Justice publishes an annual report of courts’ activities and all courts produce 
their own annual reports, although not all those reports are published. 

The  budget  for  the  overall  justice  sector  in  2015  is  3 %  lower  than  in  2014  at 
EUR 80.1 million, which represents 0.8 % of GDP and 2.4 % of the state budget. It covers the 
Ministry of Justice, the prosecution, the courts, the School of Magistrates, the High Council of 
Justice and the Constitutional Court. Nevertheless, the budget for the courts, the prosecution 
and the State Commission for Legal Aid, which is EUR 27.6 million and represents EUR 9.55 
per inhabitant, has increased.  

Albania has 402 professional judges (13.9 per 100 000 inhabitants), 327 prosecutors (11.4 per 
100 000  inhabitants)  and  916  judicial  administrative  staff  (2.3  employees  per  judge).  There 
are  55  practising  lawyers  for  100 000  inhabitants.  The  planning  and  distribution  of 
administrative and financial resources within the judiciary needs to be improved. 

Major  investments  have  been  made  in  court  infrastructure  but  many  court  premises  require 
further renovation. Some courts do not have enough courtrooms and hearings still take place 
in judges’ offices, which increases the risk of corrupt practices.   

Online access to legislation in a consolidated form is not available. A case law database exists 
but publication of judicial decisions remains inconsistent and there are no effective research 
tools. The High Court has handed down only a few rulings unifying case law. The system for 
notifying parties and witnesses is inadequate. The Law on Mediation provides an alternative 
dispute resolution mechanism, but recourse to mediation is rare.    

14 

 
 
Efficiency 

The overall length of proceedings from initiation to final judgment remains a major concern. 
There  is  no  effective  monitoring  mechanism  and  there  is  an  overall  lack  of  capacity  to 
produce reliable statistical data. Compared with selected European states and the ‘reasonable 
time’  standard  under  Article  6  of  the  European  Convention  on  Human  Rights  (ECHR), 
Albania  has  some  of  the  lengthiest  civil  and  criminal  procedures  in  Europe.  The  excessive 
length  of  proceedings  is  due  to  long  delays  before  appeal  courts.  Unclear  provisions  in  the 
Codes of Civil and Criminal Procedure also reduce the efficiency of the courts. The clearance 
rate, i.e. the ratio of solved cases to new cases filed, has increased in recent years but with 
some differences according to the type of court. In 2014, clearance rates were below 100 % at 
the High Court, in both first-instance and appeal administrative courts, as well as in district 
first-instance and appeal courts as far as criminal cases are concerned. Backlogs remain high, 
in particular in administrative courts and at the High Court (rising from 4 094 cases in 2011 to 
some 12 000 in 2014). In 2014, there was an overall backlog of 30 600 cases in first-instance 
and appeal courts, 7.5 % less than in 2013.  

Fight against corruption 

The  country  has  reached  some  level  of  preparation  in  the  fight  against  corruption.  Some 
progress has been made in the past year, notably through the adoption of a strategy and action 
plan. 

However,  corruption  is  widespread  and  more  efforts  are  needed  to  establish  a  solid  track 
record  of  investigations,  prosecutions  and  convictions  at  all  levels,  in  particular  for  cases 
where high-level state officials are involved. The independence of institutions involved in the 
fight against corruption needs to be enhanced, as they remain vulnerable to political pressure 
and other undue influence.  

In order to fulfil the key priority on the fight against corruption, in the coming year Albania 
should in particular: 

→  demonstrate  further  progress  with  a  view  to  establishing  a  solid  track  record  of 
investigations, prosecutions and convictions in the fight against corruption at all levels; ensure 
follow-up of the high number of cases referred to the prosecution by the High Inspectorate for 
Declaration and Audit of Assets and Prevention of Conflict of Interest; 

→  amend  relevant  legislation  in  the  area  of  interceptions  and  surveillance,  time  limits  for 
investigations,  and  admissibility  of  evidence  before  court  to  enhance  the  efficiency  of 
investigations on corruption cases, in line with European standards and best practices; 

→ step up efforts to ensure direct access to databases for prosecutors and police; extend the 
case management system in prosecution offices and ensure it is effectively used. 

Track record 

The track record of investigations, prosecutions and convictions in corruption cases remains 
limited.  So  far,  there  are  only  very  few  first  instance  convictions  of  corruption  cases 
involving  high-level  state  officials.  One  judge  has  been  convicted  on  corruption  related 
grounds.  The  number  of  final  convictions  involving  junior  or  middle-ranking  officials  has 
increased  steadily  since  2010,  but  remains  low  overall.  A  number  of  high-profile  cases, 
including  some  where  evidence  of  alleged  wrongdoing  by  high-level  state  officials,  judges, 
mayors and former ministers was leaked to the media, have never been seriously investigated. 
Political  authorities  should  ensure  law  enforcement  bodies  are  fully  empowered  to  act 

15 

 
 
effectively and impartially when investigating corruption allegations. Control and inspection 
mechanisms in the public administration need to be strengthened as a matter of urgency. 

Financial investigations are not yet systematically launched in cases of corruption. There are 
very  few  final  cases  of asset confiscation  in  corruption  cases.  Infiltration  of  the  public  and 
private  sectors  by  organised  crime  —  facilitated  by  corruption  —  continues  to  be  a  major 
cause for concern and needs to be urgently addressed. Political influence on law enforcement 
authorities  and  the  judiciary  is  an  issue  of  concern.  Political  actors  frequently  criticise 
ongoing corruption investigations and court rulings. 

The  number  and  frequency  of  checks  on  asset  declarations  increased  in  2014.  However, 
many  referrals  are  not  being  prosecuted.  So  far,  there  have  been  very  few  cases  relating  to 
conflicts of interest violations. A proper follow up of the cases needs to be ensured. Also, a 
sufficient  sample  of  asset  declaration  checks  of  high-state  officials  has  yet  to  be  ensured. 
Regarding  party  financing  and  electoral  campaign  financing,  there  is  no  track  record  of 
effective  control,  or  deterrent  penalties  for  wrongdoing.  Education,  healthcare,  judiciary, 
public  procurement,  construction  and  spatial  planning,  and  local  government  continue  to  be 
particularly vulnerable to corruption. 

The law on access to information, which has been adopted in September 2014, is in line with 
international  standards. It has started  being  implemented, with inspections  being  carried out 
by  the  Commissioner  for  Access  to  Information  and  Data  Protection  Office,  as  well  as 
decisions taken. There is no adequate legal framework for protecting whistleblowers. 

Institutional framework 

There is a National Coordinator against Corruption, but responsibilities for different aspects 
of  policy  are  scattered  among  individual  institutions.  The  High  Inspectorate  for  Declaration 
and  Audit  of  Assets  and  Prevention  of  Conflicts  of  Interest  (HIDAACI)  is  at  high  risk  of 
political influence, and its independence and accountability need to be strengthened in view of 
its  significant  potential  contribution  to  strengthening  the  prevention  of  and  fight  against 
corruption. In addition to the High State Control and HIDAACI, there are two other levels of 
audit.  State  institutions  have  internal  audit  units  as  a  standard  component  of  public  sector 
internal  financial  control,  and  the  Council  of  Ministers’  Unit  for  Internal  Administrative 
Control and Anti-Corruption (UIACA) may also conduct audits in line ministries, institutions 
under the authority of the Prime Minister or ministers, and administrations under the authority 
of  prefects  and  companies  where  the  state  holds  all  or  a  majority  of  the  shares.  UIACA’s 
mission  includes  administrative  checks  in  relation  to  complaints  on  alleged  corruption  or 
abusive and arbitrary administrative practices and awareness rising of public authorities. 

However,  UIACA’s  role  needs  to  be  further  clarified,  and  corruption  prevention  should  be 
streamlined; the institutions involved are fragmented. There is no system of risk assessments 
based  on  suspected  breaches,  or  audits  of  institutions  in  line  with  public  internal  financial 
control  systems.  The  HIDAACI’s  remit  and  capacity  also  need  to  be  strengthened,  its 
cooperation and data exchange with other institutions improved, and an electronic system to 
manage conflict of interest and asset declarations set up. In January, the government launched 
an online portal for complaints of corruption, but its scope and referral mechanisms need to be 
further clarified. 

There  are  no  clear,  enforceable,  public  standards  for  professional  conduct  for  MPs,  and  no 
system  for  case-by-case  notification  of  conflicts  of  interest.  MPs’  asset  declarations  are  not 
made public automatically and are fully audited only every three years. 

As regards law enforcement, important steps have been taken since 2007 to set up specialised 
units to investigate corruption-related offences in the police and prosecution. In 2014, further 

16 

 
steps  were  taken  to  ensure  the  investigation  and  prosecution  of  cases  involving  high  state 
officials.  However,  significant  flaws  remain  in  the  legal  and  institutional  framework. 
Jurisdiction  over  corruption  offences  is  unclear,  human  and  technical  resources  are 
inadequate,  effective  cooperation  and  trust  between  the  police  and  prosecutors  are  lacking, 
and  there  is  not  enough  cooperation  and  exchange  of  information  with  other  institutions. 
Ordinary courts are not specialised enough to deal with complex corruption-related cases and 
training is inadequate. Sanctions imposed in corruption cases tend to be overly lenient. Courts 
have  different  approaches  to  authorising  special  investigative  techniques  and  admitting 
illegally  obtained  evidence  such  as  private  recordings.  Court  decisions  are  often  poorly 
structured and drafted.  

There are no legal barriers to the exchange of information between institutions. However, it is 
not smooth or effective in practice. HIDAACI needs access to relevant databases and sources, 
including the land register and bank information, to check asset declarations. The police and 
prosecution also need direct access to a number of public databases to be able to build cases. 
However, mutual distrust between institutions remains evident and hampers access. 

Legal framework 

Public  sector  corruption,  including  active  and  passive  corruption,  abuse  of  duty,  high-level 
corruption, private sector corruption, illegal benefiting from public office and matters related 
to asset declaration are all defined in the Criminal Code. The anti-corruption legal framework 
is  highly  complex,  and  its  stability  and  legal  certainty  have  been  undermined  by  numerous 
interpretation. 
and  frequent  amendments,  which  are  often  subject 
Government mechanisms for obtaining help, advice or training are limited and the procedures 
for  responding  to  breaches  of  ethics  are  ineffective.  Reforms  implemented  so  far  have  not 
yielded  significant  results  or  altered  the  public’s  perception  of  the  level  of  misconduct  by 
public  officials.  Further  efforts  are  needed  to  improve  the  law  to  make  investigations  more 
efficient, and to clarify the definition of ‘high state official’ and ‘large-scale corruption’. The 
existing regulations mainly focus on restrictions and prohibitions, to the detriment of public 
disclosure and transparency, which limits their effect. Further efforts are needed to improve 
implementation  and  ensure  that  information  of  public  interest  is  disclosed  in  a  timely  and 
efficient manner. 

to  contradictory 

The  country  is  party  to  the  UN  Convention  against  Corruption.  Albania  has  not 
criminalised  illicit  enrichment,  but  has  criminalised  the  refusal  to  declare  assets,  non-
declaration,  the  concealment  of  assets,  and  false  declarations  by  elected  persons,  public 
employees and others who have a legal obligation to declare assets. The country signed and 
ratified  the  relevant  Council  of  Europe  Anti-Corruption  Conventions  and  the  OECD 
Convention  on  Combating  Bribery  of  Foreign  Public  Officials  in  International  Business 
Transactions.  Albania  has  still  to  fully  align  its  legal  framework  with  the  recommendations 
made  in  the  Council  of  Europe’s  Group  of  States  against  Corruption  (GRECO)  evaluation 
rounds (see Chapter 23: Judiciary and fundamental rights). 

Strategic framework 

The  government  defined  the  fight  against  corruption  as  one  of  its  key  priorities.  In  March, 
Albania adopted its national anti-corruption strategy (2015-20) and action plan (2015-17), 
with a budget of EUR 12 million. Relevant stakeholders, including civil society and business 
community,  were  widely  consulted.  Clear  timelines  and  responsibilities  are  set  out,  and 
actions are budgeted individually. Results and impact indicators should  still  be improved in 
the end-of-year review of the action plan. 

17 

 
 
Fight against organised crime 

The  country  has  reached  some  level  of  preparation  in  the  fight  against  organised  crime. 
Some  progress  has  been  made  over  the  past  year  on  enhancing  international  police 
cooperation, in particular in the fight against drug trafficking.                                                                             

However,  cooperation  between  prosecution  and  police  remains  to  be  further  developed. 
Effective  judicial  follow-up  of  organised  crime  cases  and  quality  of  indictments  must  be 
ensured. The number of final convictions remains negligible compared to the estimated value 
of the regional and domestic criminal drug market. Financial investigations remain underused 
and the level of assets confiscated is low.  

In  order  to  fulfil  the  key  priority  on  the  fight  against  organised  crime,  in  the  coming  year 
Albania should in particular:  

→ demonstrate further progress with a view to establishing a solid track record of proactive 
investigations,  prosecutions  and  convictions,  including  dismantling  of  criminal  networks 
involved in all forms of organised crime; 

→  amend  relevant  legislation  in  the  area  of  interceptions  and  surveillance,  time  limits  for 
investigations,  and  admissibility  of  evidence  to  enhance  the  efficiency  of  investigations  on 
organised crime cases, in line with European standards and best practices; 

→  set  up  an  effective  human  resources  policy  and  a  merit-based  promotion  and  transfer 
process  in  the  Albanian  State  Police,  and  allocate  adequate  resources  to  the  police  and 
prosecution services to fight organised crime. 

Track record 

The  number  of  final  convictions  for  organised  crime  is  still  very  low  and  has  only  slightly 
increased  in  recent  years.  There  are  very  few  cases  against  trafficking  in  human  beings, 
despite Albania being a source, transit and destination country for trafficked people. Over the 
past  five  years  fewer  than  35  people  have  been  convicted  for  money  laundering  and  none 
during  the  first  semester  of  2015,  although  123  proceedings  were  registered  and  two  cases 
sent  to  court.  The  circumstantial  evidence  in  cases  of  inexplicable  wealth,  unjustified 
proliferation  of  assets  or  extraordinary  financial  operations 
is  not  used.  Criminal 
investigations  often  have  a  narrow  scope  and  legal  persons  are  very  rarely  investigated. 
Financial  investigations  targeting  suspected  members  of  organised  criminal  groups  are  not 
systematically and efficiently carried out. Precautionary freezing of assets is seldom applied 
during the initial phase of an investigation. Proceeds of crime often disappear, resulting in a 
poor track record of confiscated assets at the time of the final conviction. Less than 50 % of 
organised crime cases led to the confiscation of assets beyond those found upon the arrest of 
the  suspect.  Leaks  to  the  press,  violating  the  secrecy  of  investigations  and  jeopardising  the 
safety of police, are frequent. 

Institutional and operational capacity 

The  Albanian  State  Police  has  9 997  police  officers,  228  per  100 000  inhabitants.  Its 
management of human resources has improved, while its command structures and capacities 
need  to  be  consolidated.  The  high  rates  of  staff  turnover,  in  particular  among  experienced 
police officers often trained with international support, need to be reduced. 

Specialised  units  are  in  place  for  economic  and  financial  crimes,  cybercrime,  counter-
terrorism,  trafficking  in  drugs  and  human  beings,  motor  vehicles,  works  of  art,  arms, 
explosives,  protection  of  witness  and  collaborators  of  justice,  and  international  law 

18 

 
 
enforcement  cooperation.  The  joint  investigation  units  need  to  further  develop  their  human 
resource capacity. The efficiency of investigations is often jeopardised by frequent changes of 
judicial police officers and a lack of personnel specialised in financial and fiscal matters. The 
general level of police equipment and logistics remains an issue of concern.  

Cooperation  between  prosecution  and  police  needs  to  be  further  improved.  The  poor 
capacity  of  judicial  police  and  prosecutors  to  detect  and  investigate  complex  criminal  cases 
means  they  are  limited  to  simple  investigations  ending  in  arrests  in  the  act,  so  there  is  no 
comprehensive approach to investigations and prosecutions. The law enforcement authorities 
are  highly  centralised,  resulting  in  poor  standards  of  investigation  in  remote  areas  of  the 
country.  Capacity  to  use  special  investigative  means  is  limited.  Formal  and  lengthy 
procedures to obtain even basic information during investigations cause significant delays and 
jeopardise  the  secrecy  of  the  process.  The  police  and  prosecution  services  lack  adequate 
resources to fight organised crime. 

Following the conclusion of an operational agreement with Europol, exchange of information 
has  significantly  increased.  Albania  obtained  access  to  the  secure  information  exchange 
network  application  (SIENA).  In  2014,  1 026  messages  were  exchanged  through  SIENA, 
compared with 216 in 2013, which represents an increase of approximately 375 %. 

Police  collect  and  process  crime  statistics  manually,  which  is  cumbersome  and  undermines 
data reliability. The budget of the DNA sector of the Forensic Directorate, despite the recent 
increase,  is  insufficient  to  cover  the  costs  of  DNA  collection,  thus  limiting  DNA  profiling 
capacity. 

Legal framework 

The new Law on the State Police, which came into force in March, is in line with the main 
recommendations  of  the  Council  of  Europe’s  European  Code  of  Police  Ethics.  Criminal 
penalties are not sufficiently dissuasive. A number of shortcomings in the investigation phase 
need to be addressed, including the timeframe for preliminary investigations and procedures 
for  using  special  investigation  means.  The  law  on  the  confiscation  of  criminal  assets  is 
partially  aligned  with  the  acquis.  Alignment  is  still  required  as  regards  third  party 
confiscation,  extended  confiscation  and  precautionary  freezing  of  assets.  Frequent 
amendments  and  contradictory 
legal  certainty.  The 
recommendations of the Financial Action Task Force are reflected in anti-money laundering 
legislation. However, shortcomings need to be addressed, including in implementation and in 
police  access  to  public  databases.  Amendments  to  the  anti-mafia  law  on  assets  seizure  and 
confiscation have yet to be adopted. 

interpretation  have  hindered 

Strategic framework 

A  revised  2013-20  interinstitutional  strategy  and  action  plan  on  fighting  organised  crime, 
countering  terrorism  and  illicit  trafficking  is  in  place.  In  June  Albania  adopted  a  national 
serious and organised crime threat assessment (SOCTA). Albanian police analysts have been 
trained  by  Europol  in  June  thus  establishing  the  necessary  capacity  to  align  the  national 
serious and organised crime threat assessment with the EU SOCTA methodology. However, 
Albania makes little use of Europol’s strategic intelligence products. 

Fight against terrorism 

Albania has been affected by the phenomenon of foreign terrorist fighters and radicalisation. 
Cases  of  hate  speech  need  to  be  addressed  more  forcefully.  The  phenomenon  of  foreign 
terrorist  fighters  needs  a  specific  approach  by  the  intelligence  and  law  enforcement 
community and a coherent judicial policy on offenders. While international cooperation has 

19 

 
greatly  improved  at  both  operational  and  strategic  level,  prevention  mechanisms  involving 
civil society and religious communities are yet to be designed. 

2.4.  Human rights and the protection of minorities 

Overall situation 

The  legal  framework  for  the  protection  of  human  rights  is  broadly  in  line  with  European 
standards.  However,  implementation  is  limited  and  enforcement  of  human  rights  remains 
insufficient.  

Shortcomings particularly affect the following areas: 

•   Enforcement  of  property  rights  remains  to  be  ensured.  The  processes  of  property 
registering, restitution and compensation are not completed. 

•   Roma and Egyptians face very difficult living conditions and frequent social exclusion and 
discrimination  due 
inter-institutional 
ineffective  policy 
cooperation; a solid anti-discrimination case law has yet to be built up;  

implementation  and  poor 

to 

•   Institutional mechanisms to protect the rights of the child remain poor; the juvenile justice 
system fails to comply with international standards; 

In  order  to  fulfil  the  key  priority  on  the  protection  of  human  rights,  in  the  coming  year 
Albania should in particular make further progress with the implementation of the 2012-2020 
strategy  on  property  rights,  and  the  processes  of  property  registration,  restitution  and 
compensation;  improve  the  living  conditions  of  Roma  and  Egyptians;  demonstrate  progress 
towards  developing  the  anti-discrimination  track  record;  and  enhance  efforts  to  bring 
legislation on juvenile justice in line with international standards.  

A  detailed  analysis  of  freedom  of  expression  follows  below.  For  a  detailed  analysis  of 
developments  on  other  human  rights  and  the  protection  of  minorities,  see  Chapter  23  — 
Judiciary and fundamental rights. For developments in the areas of trade union rights, non-
discrimination and equal opportunities, see also Chapter 19 — Social policy and employment. 

Freedom of expression 

The  country  has  some  level  of  preparation  concerning  the  right  to  freedom  of  expression. 
There has been some progress over the past year. 

The  Constitution  and  relevant  legislation  are  in  line  with  international  human  rights  law, 
guaranteeing  individual  liberties.  The  overall  environment  is  generally  conducive  to  the 
exercise of freedom of expression, but better implementation of the legislation is needed. In 
addressing the shortcomings outlined below, in the coming year, Albania should in particular: 

→ enhance transparency of government advertising in the media;   

→  ensure  that  the  existing  legislation  is  implemented  in  a  manner  which  ensures  equality 
before the law; 

→  further  strengthen  the  independence  of  the  regulatory  authority  and  public  broadcaster 
notably  through  the  establishment  of  the  RTSH  steering  committee  and  the  appointment  of 
senior management. 

Intimidation of journalists 

Physical assaults on journalists are rare. One case of a failed attempt on a journalist’s life has 
been  reported,  although  it  has  yet  to  be  confirmed  whether  this  attempt  was  related  to  the 
exercise  of  his  profession.  Another  journalist  has  been  threatened  and  placed  under  police 

20 

 
protection. The police and respective authorities have reacted promptly, and investigations are 
ongoing. Proper judicial follow-up needs to be ensured. There have been  some cases  where 
politicians made hostile statements against journalists. 

Legislative environment 

The  Constitution  and  relevant  legislation  are  in  line  with  international  human  rights  law, 
guaranteeing  individual  liberties,  including  the  right  to  privacy,  freedom  of  expression  and 
sanctions  against  incitement  of  hatred.  Defamation  is  a  criminal  offence,  although  prison 
sentences are not foreseen as sanctions. Journalists are exposed to potentially large fines and 
damages.  The  rules  on  hate  speech  are  in  line  with  international  law.  However,  domestic 
court  rulings  in  hate  speech  matters  are  not  monitored.  The  Commissioner  for  Protection 
against Discrimination has issued a number of decisions and recommendations in cases that 
are  related  to  hate  speech.  The  new  law  on  access  to  information,  approved  in  September 
2014, is in line with  international  standards. Recent proposals to amend the Civil Code and 
the  Law  on  Audiovisual  Media  with  the  aim  of  filtering  offensive  comments  and  removing 
existing audiovisual media ownership limitations could limit freedom of expression. 

Implementation of legislation/institutions 

The 2013 Audiovisual Media Law transformed the National Council on Radio and Television 
into the Audiovisual Media Authority (AMA). The procedure for appointing members of the 
AMA board, based on political support by either the majority or the opposition, does not fully 
guarantee their independence. New AMA members and a chair were appointed in 2014. The 
opposition disputed the election process in court, alleging that the appointments — approved 
with  the  votes  of  the  ruling  majority  only  —  were  invalid  and  in  breach  of  the  law. 
Opposition-nominated AMA members did not attend AMA board meetings, questioning the 
legitimacy of its board. This has made it difficult for the regulator to reach the quorum needed 
for major decisions. Online content and registration of websites are not regulated by law.  

Public service broadcaster 

Regulation of the public service broadcaster RTSH is in line with EU standards. Financing is 
mostly  independent  of  the  government.  RTSH  fee  collection  improved  when  the  collection 
rate of electricity bills, which include the RTSH fee, improved. The election of the RTSH’s 
Steering  Council  has  been  delayed  by  political  deadlock  and  a  lawsuit  brought  by  the 
opposition. The RTSH should now adopt its statute, and other necessary guidelines, and elect 
a new management.  

Economic factors 

Media ownership transparency has improved. At the National Registration Centre's website 
citizens can check the shareholders of any registered company. However, the functioning of 
the  media  market  remains  opaque  with  a  number  of  media  outlets  surviving  in  a  relatively 
small market, with limited resources. Transparency of government advertising in the media 
needs to improve. The media continued to be used as a tool to promote political and private 
interests. 

Professional organisations, professional conditions 

The  capacity  of  the  journalists’  trade  union  remains  weak,  although  it  has  intensified  its 
efforts  to  set  up  branches  covering  many  cities  in  the  country.  Professional  and  ethical 
standards in journalism need to be strengthened. Protection from arbitrary dismissal needs to 
be provided for journalists to prevent self-censorship. Further action is needed to ensure the 
proper  enforcement  of  labour  rights,  especially  the  rights  of  media  staff  to  a  formal 
employment contract and the payment of social contributions.  

21 

 
2.5.  Regional issues and international obligations 

Albania still maintains a 2003 bilateral immunity agreement with the United States, granting 
exemptions  for  US  citizens  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. Albania 
needs to align with the EU position. 

As  regards  regional  cooperation  and  good  neighbourly  relations  Albania  is  active  in 
regional  initiatives  and  plays  a  proactive  role,  and  it  held  a  one-year  chairmanship  of  the 
South-East European Cooperation Process (SEECP). In 2014, Albania concluded its one-year 
US-Adriatic  Charter  (A5)  presidency.  Albania  has  continued  to  participate  in  the 
EUFOR/ALTHEA  mission  in  Bosnia  and  Herzegovina,  and  in  all  events  related  to  the 
implementation of the Trans-Adriatic Pipeline and Ionian Adriatic Pipeline projects. 

A fresh impetus has been given to regional cooperation through the 'Berlin process' and the 
Western  Balkan  6  initiative,  intensifying  cooperation  among  the  Western  Balkan  countries 
and with the EU, notably regarding the connectivity agenda.  In April, the Western Balkan 
Six  countries  reached  an  agreement  on  the  core  transport  network  and  in  June  2015  on 
extending  three  trans-European  transport  networks  core  corridors  to  the  Western  Balkans. 
They also identified the priority projects along sections of these corridors to be implemented 
by 2020. To ensure sustainability and also achieve short term results, the countries agreed to 
implement before the next summit in Paris a number of 'soft' measures such as aligning and 
simplifying border crossing procedures, road safety and maintenance schemes.  

Albania  is  a  constructive  partner  in  the  region,  further  developing  solid  bilateral  relations 
with other countries preparing to join the EU and neighbouring EU Member States. Albania 
started  negotiations  with  Montenegro  and  Serbia  with  regard  to  the  bilateral  convention  on 
regional cooperation, under Article 13 of the Stabilisation and Association Agreement. 

Relations with Bosnia and Herzegovina are good. There are no open bilateral issues. In July, 
Albania  and  Bosnia  Herzegovina  signed  an  agreement  allowing  their  citizens  to  travel 
between the two countries with ID cards only. 

Relations  with  the  former  Yugoslav  Republic  of  Macedonia  are  good,  with  frequent  high-
level official visits. The government reacted to the May events in Kumanovo by calling for 
calm,  transparency  and  full  implementation  of  the  Ohrid  Framework  Agreement.  A 
memorandum  of  understanding  on  defence  was  signed  in  January.  An  agreement  to  jointly 
recognise respective social insurance schemes and a cooperation protocol on culture for 2015-
20 were signed in March. In August, Albania approved a EUR 50 000 grant for humanitarian 
aid to alleviate flood damage in Tetovo. 

Relations  with  Montenegro  are  good.  A  bilateral  agreement  on  economic  cooperation  was 
signed in February. Albania has consistently  expressed its  support for Montenegro’s  NATO 
membership. There were two high level visits during the year. 
Relations  with  Kosovo∗  are  good.  A  joint  customs  procedure  was  established  at  the  Morinë 
border  crossing  point.  In  March,  12  agreements,  memoranda  and  protocols  of  cooperation 
were  signed  at  the  second  joint  governments’  meeting,  on  cooperation  and  security,  border 
control,  education,  agriculture,  trade  and  rural  development.  Albania  has  strongly  supported 
Kosovo’s  integration  process  and  its  membership  of  regional  initiatives  and  international 

∗ This designation is without prejudice to positions on status, and is in line with UNSCR 1244/99 and the ICJ 
Opinion on the Kosovo declaration of independence. 

22 

 
                                                            
 
organisations. Albania supports the ongoing dialogue between Kosovo and Serbia facilitated 
by the EU.   

Relations  with  Serbia  have  intensified  and  are  constructive  overall.  In  October,  an  incident 
during a football match played by both national teams in Belgrade strained bilateral relations. 
The Albanian Prime Minister’s subsequent visit to Belgrade — the first in 68 years — marked 
an  important  step  forward  in  the  normalisation  of  relations,  and  was  followed  by  a  visit  of 
Serbian  Prime  Minister  Vučić  in  May.  Albania  and  Serbia  presented  a  joint  proposal  on 
concrete connectivity projects at the April Western Balkans Summit in Brussels. The Serbian 
and  Albanian  Ministers  of  Foreign  Affairs  took  part  in  a  first  trilateral  meeting  with  their 
Italian counterpart in Rome. 

Albania maintains close relations with Turkey. In May, a strategic partnership was signed on 
mutual  assistance  and  cooperation  in  the  fight  against  organised  crime  and  the  fight  against 
terrorism. Frequent high-level visits took place, including Turkish President Erdoğan in May. 

Relations with Greece have been positive overall, and have become closer in relation to the 
rule  of  law,  with  joint  meetings  between  representatives  of  the  ministries  of  the  interior  to 
build  cooperation  on  migration  issues.  Talks  on  several  bilateral  issues,  including  the 
agreement  on  the  delimitation  of  Greek-Albanian  continental  shelf  and  maritime  zones, 
continue. 

Relations with Italy remain very strong, particularly in the trade sector. Diplomatic relations 
are  very  good.  In  December,  a  bilateral  cooperation  protocol  was  signed  for  2014-2016, 
focusing on private sector development, agriculture, and rural and social development. 

3. 

ECONOMIC CRITERIA 

Key economic figures 

2013 

2014 

Gross  domestic  product  per  capita  (%  of  EU28  in 
PPS) 

GDP growth (%) 

28 

1.1 

29 

2.1 

Unemployment rate (female; male) (%) 

15.9 (13.5; 17.8) 

17.5 (15.2; 19.2) 

Economic  activity  rate  for  persons  aged  20–64: 
proportion  of  the  population  aged  20–64  that  is 
economically active (female; male) (%) 

67.6 (57.6; 79.2) 

68.6 (57.3; 80.5) 

Current account balance (% of GDP) 

Foreign direct investment (FDI) (% of GDP) 

-10.8 

9.6 

-13.1 

8.1 

Source: Eurostat 

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. 

The  monitoring  of  these  economic  criteria  should  be  seen  in  the  context  of  the  increased 
importance  of  economic  governance  in  the  enlargement  process.  In  order  to  improve  their 
economic  governance,  in  2015  the  enlargement  countries  were  asked  to  prepare  Economic 
Reform  Programmes  (ERPs),  which  set  out  a  medium-term  macro-fiscal  policy  framework 

23 

 
 
together  with  key  structural  reforms  aimed  at  supporting  the  framework  and  boosting 
competitiveness.  The  ERPs  were  the  basis  for  country-specific  recommendations  jointly 
adopted  by  the  EU  and  the  Western  Balkans  and  Turkey  in  the  Economic  and  Financial 
Dialogue meeting on 12 May 2015. 

3.1.  The existence of a functioning market economy 

Albania  is  moderately  prepared  in  developing  a  functioning  market  economy.  Some 
progress was made, in particular in improving macroeconomic stability. However, significant 
challenges remain, in particular the need to lower the public debt burden. Growth prospects 
have been improving, but they are still vulnerable to constrained bank lending. With a narrow 
export and production base, the competitiveness of Albania’s economy is weak. The private 
sector is held back by significant shortcomings in the regulatory environment and the rule of 
law. The level of unemployment and informal employment remains high. 

In  line  with  the  ERP  recommendations  and  in  order  to  support  long-term  growth,  in  the 
coming year Albania should pay particular attention to: 

→ sustaining fiscal consolidation and strengthening the budget management framework; 

→ tackling the high level of non-performing loans; 

→ improving the business environment by implementing regulatory reforms and adopting the 
new bankruptcy law. 

Economic policy essentials 

The government demonstrated strong commitment to reform and implemented stability-
oriented  macroeconomic  policies  in  a  challenging  political  environment.  Albania 
submitted  its  Economic  Reform  Programme,  covering  the  period  2015-17,  in  January  2015. 
The objectives of the programme are to achieve macroeconomic stability, remove obstacles to 
growth  and  improve  competitiveness.  The  ERP’s  medium-term  macroeconomic  projections 
assume  a  further  acceleration  of  growth  and  continued  fiscal  consolidation  on  the  basis  of 
stability-oriented  policies.  Albania  needs  to  follow  up  on  its  commitments  and  take  further 
steps  to  implement  the  ERP  recommendations,  which  are  set  out  below.  The  three-year 
financing  arrangement  with  the  International  Monetary  Fund  agreed  in  February  2014 
supports strengthened macroeconomic stability and growth-boosting reforms. 

Macroeconomic stability 

Economic  activity  picked  up  in  2014 
because  of  improved  private  domestic 
demand.  The  growth  rate  reached  its 
lowest  level  in  15  years  in  2013,  at  only 
1.1 %. 
In  2014,  however,  growth 
rebounded  to  an  estimated  2.1 %  as 
interest  rate  cuts  by  the  central  bank 
improved  financing  conditions,  rising 
remittances  and  low  inflation  boosted 
household spending, and the clearance of 
a 
large  part  of  government  arrears 
improved firms’ liquidity and confidence. 
Annual  economic  growth  reached  2.8 % 
in the first quarter of 2015, partly thanks to a strong increase in investment. Per capita GDP in 
purchasing  power  standards  stood  at  only  29 %  of  the  EU-28  average  in  2014  (unchanged 

24 

 
 
since  2009),  pointing  to  the  need  to  generate  higher  growth  rates  to  converge  towards  EU 
living standards. 

current 

account  deficit 

The 
is 
structurally  high,  but  its  financing  is 
healthy,  relying  mainly  on  non-debt-
creating  flows.  Overall, 
the  current 
account  deficit  increased  to  13.1 %  of 
GDP  in  2014  from  10.8 %  in  2013.  The 
trade  deficit  increased  to  18.8 %  of  GDP 
in  2014  after  narrowing  in  2012  and 
2013.  This  was  the  result  of  higher 
imports  due 
recovering  domestic 
demand,  though  exports,  especially  of 
clothing  and  footwear,  also  rose.  The 
investment 
growing  stock  of  foreign 
repatriation  of 
resulted 
investment earnings. The long-standing decline in migrant remittances was reversed in 2014, 
but in proportion to GDP they remain much below the level reached in the years leading up to 
the 2008 global crisis. 

in  higher 

to 

In the 2009-2014 period, around two thirds of net financial inflows to the economy consisted 
of foreign direct investment (FDI). External debt amounted to around 68 % of GDP at the end 
of 2014, with long-term debt making up more than 80 % of the total, mostly in the form of 
concessional  government  borrowing  and  inter-company  lending.  This  debt  profile  does  not 
give  rise  to  concerns  about  refinancing  prospects.  Moreover,  the  official  foreign  exchange 
reserves, covering around 5.3 months of imports and amounting to almost double the stock of 
short-term  external  debt  in  the  first  quarter  of  2015,  provide  an  adequate  safeguard  against 
adverse shocks. To address the persistent current account deficit, Albania needs to diversify 
its  economy  and  improve  productivity  by  attracting  foreign  capital  into  tradable  sectors 
among other things. 

Unemployment  remained  high  despite  an  increase  in  employment.  Employment,  in  line 
with  the  economic  recovery,  grew  by  1.6 %,  but  due  to  a  rise  in  the  labour  force  the 
unemployment rate rose from 15.9 % to 17.5 % in 2014 as a whole, before falling to 17.3 % 
in the second quarter of 2015. 56.6 % of the working-age population were employed in 2014, 
almost  unchanged  from  2013.  However,  the  high  prevalence  of  long-term  and  youth 
unemployment and large gender differences in labour force participation indicate significant 
structural  obstacles.  Nearly  a  third  of  the  employed  are  unpaid  family  workers  (mainly  in 
agriculture) and informal employment remains widespread; this affects job security and social 
security  entitlements  and  hinders  company  development.  Some  progress  was  made  on 
strengthening labour market policies in line with the national employment and skills strategy 
for 2014-2020, adopted in November 2014. However, more needs to be done to improve the 
functioning  of 
the  national  employment  service,  strengthen  employment  promotion 
programmes, modernise training services and develop a coherent labour market information 
system. 

Inflation  remained  weak,  allowing  the  central  bank  to  lower  the  key  interest  rate. 
Average  annual  inflation  remained  below  the  Bank  of  Albania’s  (BoA)  3 %  target  in  both 
2013  (at  1.9 %)  and  2014  (at  1.6 %).  This  resulted  from  below-potential  economic  activity, 
low inflation in trading partners and a stable exchange rate against the euro. In the first seven 
months of 2015, inflation was volatile as a result of floods temporarily disrupting agricultural 
production and driving up food prices; however, on average it remained well below the target 

25 

 
 
rate. Persistently low inflation allowed the BoA to bring down the key interest rate in several 
steps to a new historic low of 2 % in January 2015 in an effort to stimulate economic activity 
and  steer  inflation  towards  the  target.  The  BoA  was  successful  in  lowering  market  interest 
rates and supporting credit growth, even if banks’ increased risk aversion hampered the pass-
through of monetary stimulus to the economy. The degree to which the financial system uses 
the euro (‘euroisation’) lessened but remains high. This entails credit risks in case of abrupt 
changes in the exchange rate and reduces the room for manoeuvre for monetary policy. 

initial 

‘Pursue 

recommendation  1: 

ERP 
fiscal 
consolidation in line with the objective to put the 
public debt ratio on a downward path and lower it 
to  less  than  66 %  of  GDP  by  2017.  At  the  same 
time,  preserve  fiscal  space  for  growth-enhancing 
public  investment  by  making  sure  that  revenue 
performance  remains  on  track,  allowing  for  the 
initially  budgeted  capital  expenditure 
to  be 
executed.’ 

The budget performed well in 2014, but revenues fell short of the target in the first half 
of 2015. The 2014 deficit outcome, at 5.2 % of estimated full-year GDP, remained well below 
the 
target  of  6.6 %.  Revenues 
increased  by  12.1 %,  resulting  from  tax 
increases  and  successful  efforts  to  improve 
tax  collection.  At  the  same  time,  total 
spending was 3.9 % lower than budgeted due 
to  underperforming  public  investment  and 
operational  expenditure.  In  2014  the  budget 
also  had 
the  repayment  of 
government arrears to businesses, amounting 
to 2.4 % of GDP. Without this extraordinary 
expense, the budget actually posted a small primary surplus for the first time since 2010. In 
the  first  half  of  2015  tax  revenues  fell  short  of  targets  mainly  due  to  overoptimistic 
assumptions  about  revenue  growth,  lower-than-expected  inflation,  and  the  fall  in  oil  prices. 
The budget was revised  in July  and  revenue targets were lowered, but thanks  to savings on 
interest payments and substantial underspending on investment, the overall deficit target was 
left  unchanged  at  4  %  of  GDP  (which  includes repayment of arrears worth 1.3 % of GDP). 
Over-optimistic projections for tax revenue and investment spending are recurring problems 
that need to be tackled  

to  finance 

The high level of public debt, almost half of 
it  short-term,  remains  a  key  source  of 
macroeconomic  risk.  Public  debt  increased 
significantly  to  71.8 %  of  GDP  in  2014  from 
55.1 %  in  2008  in  the  wake  of  the  economic 
slowdown. The large proportion of short-term 
debt  translates  in  debt  equivalent  to  about 
20 % of GDP needing to be rolled over every 
year,  relying  mainly  on  domestic  banks, 
which  creates  refinancing  risks.  Accordingly, 
the stated objective for 2015 and beyond is to 
continue  fiscal  consolidation  and  reduce 
in  accordance  with  ERP 
public  debt, 
recommendation  1.  This  would  not  only  help  rebuild  fiscal  buffers  to  fight  any  future 
downturn, but also foster financial stability given large holdings of government debt by banks.  

An  ambitious  pension  reform  has  largely  been  implemented  with  the  aim  of  improving  the 
long-term  sustainability  of  the  system.  The  government  made  some  progress  in  addressing 
fiscal risks stemming from the electricity sector. This public utilities sector is characterised by 
very  high  distribution  losses  and  inadequate  bill  collection,  which  leads  public  finances  to 
bear the costs, including those of emergency imports of electricity. While the government has 
already  taken  measures  to  clamp  down  on  electricity theft and illicit connection to the grid, 
sustained efforts are needed to make the electricity sector financially sustainable, in line with  

26 

 
 
ERP recommendation 2. 

Additional fiscal risks include the obligation 
for the state, confirmed by judgments of the 
European  Court  of  Human  Rights,  to  pay 
compensation  to  former  owners  of  property 
confiscated during the communist regime. In 
line  with  ERP  recommendation  2,  Albania 
prepared  a  draft  law  which  would  improve 
the  financial  sustainability  of  the  current 
compensation scheme. 

ERP  recommendation  2:  ‘Progress  towards 
eliminating  high  fiscal  risks  posed  by 
the 
electricity sector by reducing distribution losses at 
an  average  rate  of  5  percentage  points  in  the 
coming years and by improving the bill collection 
rate.  Evaluate  the  fiscal  impact  of  the  property 
compensation scheme and accommodate the costs 
in  the  medium-term  budget,  if  necessary  by 
adjusting  the  parameters  of  the  scheme  with  the 
aim  of  creating  a  realistic, 
transparent  and 
sustainable compensation framework.’ 

ERP  recommendation  3:  ‘Reinforce  the  budget 
management  framework  by  implementing  the 
public  finance  management  strategy  agreed  with 
the Commission and adopted in December 2014, 
in  particular  by  moving  towards  adopting  a 
credible  fiscal  rule  which  will  effectively  ensure 
the  sustainability  of  public  finances  in  the  long 
run and by strengthening budget forecasting.’ 

framework 
The  budget  management 
needs  to  be  significantly  strengthened,  in 
accordance  with  ERP  recommendation  3. 
Shortcomings in public finance management 
(PFM)  include  weak  budget  planning  and 
monitoring,  over-optimistic  growth  and 
revenue  projections,  as  well  as  lax  tax 
collection  especially  in  election  years.  Over 
the 
have 
contributed  to  increased  public  debt  and 
large government arrears to the private sector. To address these weaknesses, the government 
approved an ambitious PFM strategy for the period 2014-2020, supported by the Instrument 
for  Pre-Accession  Assistance  (IPA).  It  contains  plans  to  strengthen  multi-year  budgets, 
introduce  rules  to  limit  politically  motivated  ad  hoc  spending  increases  and  eliminate 
systematic biases in budget forecasts. Fiscal credibility is to be reinforced by adopting a fiscal 
rule the details of which have yet to be worked out. 

shortcomings 

years, 

these 

Interplay of market forces 

Market  liberalisation  and  privatisation  are  advanced.  Price  and  trade  liberalisation  was 
carried  out  early  in  the  transition  process  and  privatisation  is  wide-ranging.  The  state’s 
involvement  in  the  economy  remains  limited  and  is  concentrated  in  a  few  sectors  such  as 
energy.  The  private  sector  remains  dominant,  accounting  for  more  than  80 %  of  the 
workforce.  Privatisation  efforts  are  now  focused  on  state-owned  small  and  medium-sized 
enterprises  (SMEs) 
in  non-strategic  sectors.  Some  companies  with  poor  economic 
performance  went into liquidation  in the reporting period, while  the unused assets of others 
were offered for lease to domestic and foreign investors. In addition, a decision was made to 
privatise the state insurance company INSIG through an open tender that attracted four bids. 
A working group has been set up to identify the best option for restructuring and privatising 
the oil company Albpetrol. 

Market entry and exit  

of 

resources. 

Further improving market entry and exit 
procedures  could  facilitate  the  efficient 
Business 
allocation 
registration continues to function reasonably 
well  through  the  established  network  of  the 
national  registration  centre  (NRC).  The 
number of start-ups surged by 43 % in 2014 
and  reached  a  six-year  high,  and  business 
registrations have continued to increase in 2015, partly reflecting efforts to formalise the large 

ERP  recommendation  6:  ‘Improve  the  overall 
business environment, including by implementing 
the  merger  of  the  NRC  (National  Registration 
Centre)  and  NLC  (National  Licensing  Centre)  to 
further  ease  the  regulatory  and  administrative 
burden  for  businesses.  Start  the  implementation 
of  the  simplification  regime  for  authorisations. 
Make  the  newly  established  investment  council 
fully operational.’ 

27 

 
informal  economy.  Plans  to  further  streamline  procedures  by  merging  the  NRC  with  the 
licensing authority to create a single service window for registration and licensing should be 
implemented  in  line  with  ERP  recommendation  6.  Steps  have  also  been  taken  to  create  an 
inventory  of  authorisations  to  remove  unnecessary  ones.  Firms’  access  to  formal  finance, 
especially in the start-up phase, remains a challenge. Bankruptcy procedures remain slow and 
the recovery rate for debtors in most cases turns out to be low. There was some progress on 
revising the bankruptcy law. 

Legal system 

There are significant shortcomings in the rule of law, property rights enforcement and 
the  fight  against  corruption  which  remain  key  aspects  to  improving  the  business 
environment. Steps have been taken to address these complex challenges (see Chapter 23 — 
Judiciary and fundamental rights), but much remains to be done. Efforts were also made to 
improve  the  government’s  communication  with  businesses,  notably  by  setting  up  an 
investment council and requiring mandatory consultation of stakeholders on new legal drafts, 
and to reduce the regulatory burden on businesses. However, results have yet to materialise.   

Financial sector development  

There is scope for banks to expand lending and better support the economic recovery. 
The  banking  sector,  dominated  by  foreign-owned  banks,  holds  90 %  of  all  financial  system 
assets. With loans to businesses and households amounting to less than 40 % of GDP, there is 
much scope for increasing the role of bank lending in the economy. However, credit growth 
has  only  started  to  gather  some  momentum  towards  the  end  of  2014,  despite  banks’  ample 
liquidity and the gradual fall in credit rates. While the economic slowdown has reduced the 
demand  for  loans,  the  high  proportion  of  non-performing  loans  (NPLs),  which  peaked  at 
24.9 %  in  2014  and  was  still  21 %  in  June  2015,  has  contributed  to  banks’  increased  risk 
aversion and cautious lending. Various regulatory and legislative changes have already been 
made to address the problem, and an inter-institutional working group was set up to develop a 
comprehensive  NPL  reduction  strategy.  However,  in  line  with  ERP  recommendation  4, 
further efforts are needed to encourage the clean-up of bank balance sheets and boost lending, 
including by addressing impediments to judicial enforcement and collateral execution. 

therefore, 

in  Greece: 

The  banking  system  appears  stable  but  is  exposed  to  credit  and  sovereign  debt  risks. 
Overall, the capital and liquidity ratios of the banking system well exceed regulatory minima, 
and  profitability  was  improving  in  2014  and  the  first  half  of  2015.  The  three  Greek-owned 
banks  operate  as  stand-alone  subsidiaries  with  adequate  capital  and  liquidity  buffers  and  no 
significant exposure to their parent banks. The central bank put in place additional prudential 
measures following the introduction of capital 
controls 
financial 
contagion risks seem well contained. Banking 
activity  continued 
fundamentally 
financed by deposits, with the loan-to-deposit 
ratio  standing  at  around  55 %.  Provisioning 
for  potential  losses  on  non-performing  loans 
improved,  but  NPLs  net  of  provisions  still 
amounted  to  36 %  of  bank  capital  in  July. 
Banks  are  also  exposed  to  credit  risks  originating  from  foreign  currency  loans  whose 
repayment is vulnerable to a potential depreciation of the Albanian currency (lek). Also, since 
government securities make up around a quarter of bank assets, severe sovereign debt stress 
would be detrimental to banks’ solvency. 

ERP  recommendation  4: 
further 
measures to address the issue of non-performing 
loans,  involving  all  key  stakeholders  including 
the Bank of Albania as necessary, with a view to 
achieving  a  sustainable  reduction of  their  level. 
In  this  context,  addressing  impediments  related 
to judicial enforcement and collateral execution 
would appear helpful.’ 

to  be 

‘Take 

28 

 
The size of the non-banking financial sector increased but remains small. It comprises the 
insurance and private pension businesses plus investment funds; total assets represent 6.5 % 
of GDP. The regulatory and supervisory framework for the sector needs further strengthening. 
The capital market remains rudimentary. There is great scope for expanding equity finance. 

3.2.  The  capacity  to  cope  with  competitive  pressure  and  market  forces  within  the 
Union 

Albania has some level of preparation in terms of capacity to cope with competitive pressure 
and  market  forces  within  the  Union.  Some  progress  was  made  particularly  as  regards 
transport  and  energy  infrastructure.  However,  significant  investment  in  human  and  physical 
capital is necessary to improve the country’s competitiveness. There is considerable scope for 
shifting  employment  to  more  productive  sectors  and  for  diversifying  export  products  and 
markets. In line with the ERP recommendations and in order to support long-term growth, in 
the coming year Albania should pay particular attention to: 

→  improving  the  quality  of  higher  education  and  continuing  the  restructuring  of  vocational 
education and training to improve its market relevance; 

→ adopting and implementing the national transport and energy strategies; 

→ lowering non-tariff barriers to trade. 

Human and physical capital 

private 

universities.  Continue 

ERP  recommendation  5:  ‘Adopt  and  start  to 
implement the law on higher education, as well as 
the  new  strategy  for  higher  education.  Establish 
an independent accreditation system for all public 
the 
and 
restructuring  of  the  vocational  education  and 
training  system  with  a  view  to  improving  the 
relevance  of  the  training  for  the  needs  of  the 
labour market.’ 

Despite significant improvements over the 
last decade, Albania still has considerable 
gaps  to  close 
in  terms  of  years  of 
schooling,  secondary  enrolment  rates, 
the  market 
education  quality  and 
relevance of qualifications. Public spending 
on  education  remains  low  at  around  3 %  of 
GDP and is expected to fall slightly in 2015 
due  to  lower  budgeted  investment  spending 
in  this  area.  Albania  adopted  and  started  to 
implement  the  national  employment  and  skills  strategy  for  2014-2020.  Institutional  changes 
are expected to be followed by the introduction of an apprenticeship system and upgrades to 
the  curricula  in  line  with  market  needs.  In  line  with  ERP  recommendation  5,  this  should 
remain a priority, along with drafting a new strategy on higher education and setting up a new 
accreditation  system  for  universities.  Low  scores  received  by  Albanian  students  in  the 
OECD’s PISA tests underline the need for improving the quality of basic education (see also 
Chapter 26: Education and culture). 

Improving  physical  capital  and  promoting  innovation  are  important  elements  for 
enhancing productivity and competitiveness. Investment as a share of GDP decreased from 
33.9 %  in  2008  to  24.9 %  in  2014,  driven  by  weak  investment  in  construction  and  in 
machinery and equipment. With some large foreign direct investment projects in the energy 
sector  under  way,  including  the  construction  of  a  large  hydropower  plant  and  the  Albanian 
section  of  the  Trans-Adriatic  Pipeline,  investment  is  likely  to  rebound  in  the  coming  years. 
Still, a more favourable investment climate is needed to attract capital into a wider range of 
sectors.  New  laws  were  adopted  in  May  with  the  aim  of  promoting  investment  in  strategic 
sectors  and  developing  economic  zones  through  lowering  administrative  burdens  and 
providing fiscal incentives for such projects. Public investment made up 5.1 %-5.5 % of GDP 
in past years, but was often the target of ad hoc spending cuts when budget adjustments were 

29 

 
needed. Public spending on research and development continued to represent only 0.01 % of 
GDP  and  much  remains  to  be  done  to  develop  an  innovation  culture  and  links  between 
science and industry. 

While  progress  has  been  made  over  the 
years,  Albania’s  transport  and  energy 
is  still  not  sufficiently 
infrastructure 
developed. 
and 
finalisation 
The 
implementation  of  the  transport  strategy 
2016-2020  are  expected  to  improve  overall 
transport  infrastructure  in  the  country  and 
in  ERP 
are  highlighted  as  a  priority 
recommendation  7.  Focusing  investment  on 
the  core  network, 
in  particular,  would 
improve connectivity within the Western Balkans as well as with the EU. 

ERP  recommendation  7:  ‘Adopt  and  start  to 
implement  the  transport  strategy  and  action  plan 
for  2016-2020.  Focus  investments  on  the  core 
network.  Adopt  and  start  to  implement  the 
national  energy  strategy  and  the  Power  Sector 
Law, including speeding up the unbundling of the 
energy  sector.  Prepare  single  sector  pipeline  of 
transport  and 
priority 
energy.’ 

investments  for  both 

Sectoral and enterprise structure 

from  2008, 

ERP  recommendation  8:  ‘Adopt  a  strategy  on 
the  land  cadastre  and  concrete  measures  to 
land 
increase  momentum 
consolidation.’ 

The  Albanian  economy  is  dominated  by 
services,  and  agriculture  still  plays  an 
important role. In 2014, services accounted 
for  around  half  of  gross  value  added, 
unchanged 
followed  by 
agriculture with a share of 22.6 %. Industry’s role has increased over the last years (making 
up  14.2 %  of  the  economy  in  2014,  up  from  11.4 %  in  2008)  due  mostly  to  increased  oil 
extraction. At the same time construction’s share of the economy fell to 11 % in 2014 from 
18 %  in  2008  following  the  economic  crisis  and  the  slowdown  in  lending.  Agriculture 
provides a gradually falling, but still very large, proportion of employment (around 42.7 % in 
2014), much of which is in the form of unpaid family jobs. In line with ERP recommendation 
8, a strategy on the land registry (cadastre) should be adopted. 

agricultural 

in 

The sectoral composition of merchandise exports remained highly concentrated, with 82 % of 
total  exports  in  2014  accounted  for  by  mineral  products  (33.6 %),  textiles  and  footwear 
(33.6 %)  and  construction  materials  and  metals  (14.5 %).  This  lack  of  diversification 
contributes to the large external deficit and exposes the economy to industry-specific shocks. 

Small and medium-sized enterprises (SMEs) play a significant role in the economy. They 
provide 81 % of employment and 70 % of value added in the non-agricultural private sector. 
Micro-businesses  in  particular  make  up  a  high  proportion  of  the  number  of  companies  and 
account  for  46 %  of  jobs.  Various  state  and  donor-funded  schemes  support  SMEs’ 
competitiveness  and  access  to  finance.  The  business  development  and  investment  strategy 
2014-2020 has made support services for SMEs and start-ups a priority. Besides putting this 
strategy into action, further efforts could be made in implementing an SME test to ensure that 
regulations and legislation do not impede SME development and growth. 

State influence on competitiveness 

Reported  state  subsidies  to  the  economy  remained  relatively  low,  but  the  electricity 
sector is an enduring drain on public resources. Total reported state aid stood at 0.5 % of 
GDP in 2014, marking a considerable decrease from 1.5 % in 2013. Around two-thirds of the 
subsidies  were  notionally  granted  for  less  distortive  general  business  purposes,  such  as 
research  and  development  and  employment.  However,  much  of  the  general  business  aid 
continued  to  benefit  certain  industries,  such  as  the  hydrocarbon  or  the  clothing  industries. 
Data on state aid does not include loan guarantees granted to the state-owned power company 

30 

 
KESH  to  ease  its  financial  difficulties.  There  is  scope  for  improving  the  enforcement  of 
competition rules. 

Economic integration with the EU 

The  EU  is  Albania’s  dominant  trading  partner,  with  especially  strong  links  to  Italy. 
Albania has increased its openness to trade, with total imports and exports rising to 92.3 % of 
GDP  in  2014  from  86 %  in  2008.  The  EU  remains Albania’s  largest  trading  partner  by  far, 
with a share of 77.4 % of its goods exports and 61.1 % of its goods imports in 2014. Italy is 
the main destination for Albanian exports, absorbing more than half of Albanian goods sold 
abroad  in  2014  and  providing  almost  a  third  of  its  goods  imports.  Trade  links  with  Central 
European  Free  Trade  Agreement  (CEFTA)  countries  are  also  relatively  important  as  they 
accounted for some 12 % of Albanian goods exports and 8 % of its imports of goods in 2014, 
but  these  shares  are  largely  unchanged  since  2008,  pointing  to  a  potentially  large  untapped 
potential for future growth. 

Substantial  progress  has  been  made  in  lowering  technical  barriers  to  trade.  However, 
additional  efforts  should  be  made  in  the  area  of  sanitary  and  phytosanitary  measures  and 
administrative  barriers,  such  as  introducing  electronic  clearance  of  goods  and  streamlining 
customs procedures. 

4. 

ABILITY TO ASSUME THE OBLIGATIONS OF MEMBERSHIP 

4.1.  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  is  moderately  prepared  in  the  area  of  free  movement  of  goods.  There  has  been 
some progress, mainly in standardisation and accreditation. In the coming year, the country 
should in particular: 

→  approximate  legislation  with  the  acquis  in  the  areas  of  metrology,  ‘new  and  global 
approach’ product legislation and procedural measures; 

→ establish a market surveillance inspectorate. 

Standardisation 

Some  progress  has  been  made  on  horizontal  measures.  On  standardisation,  Albania 
continued to adopt European standards, mainly through the ‘cover page’ translation method. 
In 2014, 1 269 European standards were adopted, comprising 597 standards of the European 
Committee  for  Standardisation  (CEN),  149  standards  of  the  European  Committee  for 
Electrotechnical 
the  European 
Telecommunications Standards Institute. A further 187 international standards were adopted, 
comprising  99  ISO  and  88  International  Electrotechnical  Commission  (IEC)  standards. 
Amendments to the Law on Standardisation were enacted by the Parliament in May, aiming at 
alignment  with  the  acquis  with  regard  to  notification  of  standards  on  technical  regulations. 
The strategy on consumer protection and market surveillance, covering also accreditation and 
metrology,  was  adopted.  In  February,  the  government  amended  the  Regulation  on  the 
Managing Board of the General Directorate of Standardisation.  

(CENELEC) 

from 

523 

and 

On  conformity  assessment,  in  May  Albania  became  a  full  member  to  the  European 
Accreditation  (EA)  body.  Albania’s  signature  of  the  EA  multilateral  agreement  on  testing 
laboratories is awaiting a decision by the EA.  

31 

 
 
A  new  advisory  board  on  accreditation  was  set  up  in  the  General  Directorate  of 
Accreditation (GDA) in December, aiming to better balance the representation of public and 
private  institutions  in  the  decision  making  process.  The  GDA  signed  a  memorandum  of 
understanding with the Tirana Chamber of Commerce in October. 

On  metrology,  a  new  Law  on  Metrology  was  adopted  in  September  2015.  The  General 
Directorate  of  Metrology  collected  about  75 %  of  the  fines  for  infringement  of  legislation 
issued  in  2014.  There  was  no  progress  on  alignment  with  the  Measuring  Instruments 
Directive. 

There was no progress on market surveillance. The legal base for establishment of a market 
surveillance  inspectorate  remains  to  be  adopted.  In  February,  amendments  to  the  law  on 
processing,  transport  and  trade  of  petroleum,  gas  and  their  by-products  were  prepared  but 
have not been adopted yet. 

Some  progress  has  been  made  in  the  area  of  ‘Old  Approach’  product  legislation,  through 
the  adoption  in  July  of  a  government  decision  on  the  technical  regulation  and  the  essential 
requirements, conformity assessment and CE marking of implantable medical devices. 

No progress was made on ‘New and Global Approach’ product legislation and in the area 
of procedural measures. 

4.2.  Chapter 2: Freedom of movement for 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  is  at  an  early  stage  in  freedom  of  movement  for  workers.  There  has  been  no 
progress in this area. 

As regards access to the labour market, no further progress has been made on guaranteeing 
equal treatment for EU workers in the Albanian labour market. 

As regards coordination of social security systems, bilateral agreements on social security 
transfer  were  signed  with  Kosovo  and  the  former  Yugoslav  Republic  of  Macedonia,  in 
February and March respectively. Comparable agreements with Hungary and Romania have 
yet  to  be  ratified,  while  negotiations  with  the  Czech  Republic  and  Germany  are  ongoing. 
Negotiations with Luxemburg, Belgium and Austria are envisaged.       

4.3.  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 gradually being opened up to competition. 

Albania is moderately prepared in the area of right of establishment and freedom to provide 
services. There has been good progress, mainly on aligning legislation with the postal acquis. 
In the coming year, the country should in particular: 

→  continue  to  align  its  legislation  with  the  Services  Directive  and  the  Professional 
Qualifications Directive; 

→  strengthen  institutional  capacity  for  the  right  of  establishment  and  mutual  recognition  of 
professional qualifications. 

As regards the freedom to provide cross-border services, preparations for further alignment 
with the acquis have continued with the preparation of a general law on services. Preparations 
for  merging  the  National  Registration  Centre  (NRC)  and  the  National  Licencing  Centre 

32 

 
(NLC)  have  started.  Sector  legislation  is  being  screened  for  consistency  with  the  Services 
Directive: the first screening  reports  on the mining  sector and on  the  veterinary  sector have 
been  completed,  while  legislation  in  the  field  of  tax,  social  services  and  legal  sectors  has 
started  to  be  screened.  Parliament  passed  amendments  to  the  legislation  on  company 
registration and licensing, authorisations and permits in February. 

A  new  Law  on  Postal  Services  was  adopted  by  parliament  in  May.  This  aims  to  ensure  a 
universal  postal  service  throughout  the  country  and  to  further  align  Albanian  law  with  the 
2008 EU Directive. 

As regards mutual recognition of professional qualifications, parliament passed laws on the 
professional associations for doctors and dentists, and amendments to the relevant laws on the 
professional  associations  for  nurses  and  pharmacists.  The  professions  of  social  worker  and 
psychologist were included in the list of recognised professions. The legislation still needs to 
be  aligned  with  the  Professional  Qualifications  Directive  (2005/36/EC)  including  on 
professions for which minimum training requirements have been harmonised  

4.4.  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. 

Overall,  Albania  is  moderately  prepared  in  this  area.  There  was  some  progress  on  free 
movement  of  capital,  mainly  due  to  improved  performance  in  the  fight  against  money 
laundering. In the coming year, Albania should in particular: 

→  implement  effectively  legislation  against  money  laundering  at  all  levels  and  further 
strengthen  the  national  anti-money  laundering  and  countering  the  financing  of  terrorism 
(AML/CFT) system; 

→ implement the action plan on acquisition of property by foreigners. 

Preparations on capital movements and payments remain weak. An action plan to make it 
easier for foreign citizens to buy property was adopted in March. 

On  payment  systems,  the  Albanian  Inter-Banking  Payment  System  processed  86 430 
transactions  in  2014  (0.09 %  more  than  in  2013  in  number  and  5.1 %  more  by  value).  The 
number  of  transactions  processed  through  the  Albanian  Electronic  Clearing  House  rose  by 
22 % compared to 2013, and the value was 14.2 % higher than in 2013. This trend continued 
in the first half of 2015. The Ministry of Finance continued to dominate the Clearing House 
system, with 54 % of the number of transactions and 49 % of the total value. 

On the fight against money laundering, in September Albania was removed from the list of 
countries  monitored  by  the  Committee  of  Experts  on  the  Evaluation  of  the  Anti-Money 
Laundering Measures and the Financing of Terrorism (Moneyval) in its ongoing compliance 
process  for  combating  the  financing  of  terrorism.  The  number  of  suspicious  transaction 
reports increased in 2014 and the first semester of 2015. 

33 

 
 
 
 
 
4.5.  Chapter 5: Public procurement 

EU  rules  ensure  public  sector  procurement  of  goods  and  services  in  any  Member  State  is 
open to all EU companies on the basis of non-discrimination. 

Albania  has  some  level  of  preparation  in  public  procurement.  Procurement  is  an  area 
particularly vulnerable to corruption and more efforts are needed to prevent corruption from 
occurring  in  the  procurement  cycle.  Some  progress  was  made  in  the  past  year,  especially 
through the adoption of amendments to the public procurement law. As regards concessions 
there was backsliding, with the introduction of measures incompatible with the acquis. In the 
coming year, Albania should in particular: 

→ ensure effective, efficient and transparent functioning of the public procurement system by 
implementing the public procurement part of the public finance management reform strategy; 

→  implement  a  legal  alignment  plan  to  ensure  increased  harmonisation  with  EU  public 
procurement rules, including in the area of concessions, and defence procurement; 

→  take  steps  to  strengthen  the  public  procurement  review  system  by  ensuring  the  Public 
Procurement Commission’s functional independence from the government. 

Institutional set-up and legal alignment 

As concerns the legal framework, the Law on Public Procurement is largely in line with the 
EU  directives  on  classical  and  utilities  procurement  and  is  harmonised  with  relevant 
administrative  and  budget  provisions.  Harmonisation  with  the  revised  directives  on  public 
procurement (Directive 2014/24/EU) and on procurement  by entities operating in the  water, 
energy, transport and postal services sectors (Directive 2014/25/EU) has yet to be achieved.  

Albania’s  legislation  is  not  yet  in  line  with  Directive  2009/81/EC  on  defence  and  sensitive 
security procurement and Regulation No 2195/2002 on the Common Procurement Vocabulary 
and there are gaps in conformity with the Remedies Directive. 

The  Law  on  Concessions  and  Public  Private  Partnerships  is  partly  aligned  with  Directive 
2014/23/EU. Amendments to the law adopted in July introduce the option of granting a bonus 
of 10 % for unsolicited proposals, which is a breach of acquis. Road infrastructure of national 
importance is exempt from the scope of the law. Urgent measures are needed to address these 
discrepancies between the law and the directive. 

The  public  finance  management  (PFM)  strategy  includes  actions  to  further  align  public 
procurement and concessions with the acquis and to strengthen inter-institutional cooperation 
and coordination. The PPA should adopt a detailed action plan for public procurement under 
the PFM strategy and report on its implementation. 

The  Public  Procurement  Agency  (PPA)  is  a  well-established  institution.  Mechanisms  for 
coordination  with  the  key  institutional  actors  and  stakeholders  should  be  put  in  place  to 
further strengthen PPA's role. Following the establishment of new local government units as a 
result  of  the  territorial  administrative  reform,  the  capacity  of  local  employees  assigned  to 
public procurement issues needs to be strengthened. 

Implementation and enforcement capacity 

The  country’s  public  procurement  market  in  relation  to  gross  domestic  product  (GDP) 
stood at 3.2 % in 2014, as compared to 3.6 % in 2013, with a decreasing trend over the last 
year  due  to  budget  cuts.  Planning,  preparation,  and  implementation  of  public  procurement 
procedures  generally  respect  transparency  and  efficiency  principles.  The  use  of  negotiated 
procedure without prior publication in 2014 fell to 31.2 % of all procedures, as compared to 

34 

 
33.6 % in 2013, and to 11.4 % in terms of volume, as compared to 19 % in 2013. However, in 
the  first  half  of  2015  the  number  of  unpublished  negotiated  procedures  increased 
considerably,  with  a  total  of  2  224  procedures  as  compared  to  2  121  procedures  for  all  of 
2014. A central public procurement portal is in place and is widely used. The e-procurement 
system  is  obligatory  and  is  fully  operational,  including  for  low-value  procurement.  A 
centralised procurement body for certain types of procurement is operational in the Ministry 
of Interior, but further centralisation is recommended to reduce vulnerability to corruption. 

Monitoring  of  procurement  procedures  and  of  the  award  of  contracts  needs  further 
improvement.  It  focuses  on  compliance  with  the  law  and  it  does  not  extend  to  a  full 
assessment of practices in the public procurement market. PPA needs to further increase the 
capacity  to  monitor  the  e-procurement  system  and  to  make  the  concession  procedures  and 
plans more transparent. 

Contracting authorities’ capacity to manage public procurement processes has improved. 
The PPA adopted new standard tender documents for each type of procedure (works, goods, 
services,  consultancy  and  design  contest)  and  in  January  issued  instructions  for  several 
procedures. The government committed itself to addressing corruption and conflict of interest 
in public procurement as part of the anti-corruption strategy. However the High State Control 
has estimated that the financial loss to the state budget from public procurement ran at EUR 
4.8 million in 2014, almost double that of 2013. 

Efficient remedies system 

The right to legal remedy is stipulated in the Constitution and in the public procurement law. 
It  is  broadly  in  line  with  the  general  EU  Treaty  principles  and  the  Remedies  Directive,  but 
further improvements are needed by establishing the legislative framework for ineffectiveness 
of  contracts,  for  alternative  penalties  and  for  ex  ante  voluntary  transparency  notices.  The 
remedies  system  includes  an  administrative  review  by  the  Public  Procurement  Commission 
(PPC),  whose  decision  can  be  challenged  in  the  Administrative  Court.  The  consistency  of 
decisions  on  public  procurement  cases  should  be  improved  by  organising  joint  training  for 
judges, PPA and PPC staff. The replacement of the PPC chairman and some of its members 
gives cause for concern about the body’s independence. Measures should be taken to ensure 
the  PPC’s  independence  and  impartiality,  which  are  seriously  undermined  due  to  its 
subordination to the Council of Ministers.   

The PPC received 834 complaints in 2014, or 48 % more than in 2013. Almost 60 % of them 
were  considered  unsubstantiated  and  most  of  the  complaints  accepted  were  related  to 
procurement  procedures  for  security  services.  In  about  40 %  of  cases,  the  legal  maximum 
time  for  processing  the  complaint  was  exceeded.  About  8 %  of  its  decisions  in  2014  were 
challenged in the Administrative Court. The provisions do not allow a complaint to be lodged 
against  unpublished  negotiated  procedures.  This  provision  excludes  31 %  of  procurement 
procedures from the review mechanism. 

While the remedy procedure has broadly been established, the capacity of the PPC and the 
Administrative  Court  to  deal  with  complex  and  increasing  number  of  procurement-related 
appeals needs to be strengthened to ensure timely processing of complaints. 

35 

 
 
 
4.6.  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 area of company law. Some progress was made in 
this field. In the coming year, the country should in particular: 

→ strengthen the capacity and independence of the Public Audit Oversight Body. 

On  company  law,  amendments  to  the  2008  Law  on  Entrepreneurs  and  Companies  were 
adopted in October aimed at further alignment with the acquis. Provisions include reporting 
and documentation requirements for mergers and divisions, and protection of the interests of 
members  and  third  parties.  The  Law  on  the  National  Registration  Centre  was  amended  in 
February  further  aligning  with  the  acquis  by  providing  for  online  submission  of  annual 
balance sheets and audit reports by companies.   

On  corporate  accounting,  the  national  accounting  standards  adopted  in  July  2014  apply  to 
statements  filed  from  January  2015  onwards.  The  translation  and  final  transposition  of 
international accounting standards at national level have yet to be completed. Although online 
notification of balance sheets is now available, steps should be taken to ensure that companies 
file a single set of financial statements (i.e. the duly approved version) in the national business 
register. Public access to companies’ financial statements should be further improved. 

In  relation  to  auditing,  the  Public  Audit  Oversight  Body  has  tabled  proposals  aimed  at 
increasing  its  budget  to  promote  its  independence  and  ensure  it  is  a  permanent  structure. 
Further efforts are needed to secure full independence. 

4.7.  Chapter 7: Intellectual property law 

The  EU  has  harmonised  rules  for  the  legal  protection  of  copyright  and  related  rights.  This 
covers, 
trademarks,  designs, 
biotechnological inventions and pharmaceuticals.  

instance,  computer  programs,  broadcasting  and 

for 

Albania has some level of preparation regarding intellectual property rights. Some progress 
was made in the last year. However, Albania has still not met its obligations under Article 73 
of the Stabilisation and Association Agreement on the protection of intellectual and industrial 
property rights. In the coming year, Albania should in particular: 

→ adopt a new copyright law in line with European standards; 

→ improve the functioning of the collective management agencies and payment of royalties 
to rights holders. 

As  regards  copyright  and  neighbouring  rights,  the  new  copyright  law  remains  to  be 
adopted.  

In  the  area  of  industrial  property  rights,  secondary  legislation  aimed  at  implementing  the 
amended  Law  on  Industrial  Property  was  adopted.  Two  regulations  on  the  approval  of  fees 
concerning  industrial  property  and  the  issuing  of  patents  for  inventions  and  utility  models 
entered  into  force  in  January  and  February  respectively.  Three additional regulations on the 
registration of trade and service marks, geographical indications and industrial designs were 
adopted in June. 

As concerns enforcement, the General Directorate of Patents and Trademarks' new structure 
was approved in June. Its cooperation with the National Registration Centre was strengthened. 

36 

 
The  General  Directorate  pursued  awareness-raising  activities,  and  saw  an  increase  in  the 
number of companies registering their trademarks.   

The Copyright Office conducted inspections and monitored the users of intellectual property, 
and issued certifications of author's rights and the transfer of economic rights and registered 
contracts. Its cooperation with the local authorities, police and some universities improved. In 
2014,  the  number  of  fines  imposed  by  the  office  increased  compared  with  2013.  Its 
administrative  capacity  improved,  but  remains  insufficient.  The  collective  management 
agencies continued to face difficulties in carrying out their work, and there were significant 
delays in renewing their licences. 

The  number  of  counterfeit  products  in  the  country  is  still  high  and  the  market  surveillance 
inspectorate has not yet been set up. The General Directorate of Customs continued to seize 
counterfeit products at customs posts. A joint operation to combat intellectual property rights 
infringements  and  the  production  and  trafficking  of  counterfeit  goods  was  conducted, 
resulting in 61 criminal proceedings and fines totalling EUR 15 000. Complaints to the police 
by  stakeholders  about  infringements  of  industrial  property  rights  and  illegal  production  of 
goods  increased,  resulting  in  67  perpetrators  being  prosecuted  in  2014.  Further  efforts  are 
needed to increase awareness among key stakeholders, including judges. 

4.8.  Chapter 8: Competition policy 

EU rules protect free competition. They include anti-trust rules against restrictive agreements 
between companies and abuse of dominant position. EU rules also prevent governments from 
granting state aid which distorts competition.  

Albania  is  moderately  prepared  in  competition  policy.  Some  progress  was  made 
particularly  as  regards  antitrust  and  mergers.  In  the  coming  year,  the  country  should  in 
particular: 

→ increase the operational independence of the State Aid Commission. 

→ strengthen the administrative capacity of the State Aid Control Unit. 

On  antitrust  and  mergers,  the  Albanian  Competition  Authority  (ACA)  adopted  guidelines 
on  the  assessment  and  abuse  of  dominant  market  position  and  drafted  new  guidelines  on 
remedies based on the European Commission notice on remedies. The administrative capacity 
of the ACA is sufficient and its staff has a good level of expertise. However, delays in court 
proceedings are too long and further efforts are needed to increase the availability and quality 
of training for judges on competition policy. 

On  state  aid,  an  inter-ministerial  working  group  was  set  up  to  improve  coordination.  The 
administrative  capacity  of  the  State  Aid  Control  Unit  in  the  Ministry  of  Economic 
Development,  Trade,  Tourism  and  Entrepreneurship  remains 
inadequate.  State  Aid 
Commission's  operational  independence  remains  a  concern.  The  State  Aid  Control  Law  is 
being  revised  to  strengthen  the  independence  of  the  enforcement  authorities,  but  the  law 
remains only partially aligned with the acquis. The amount of state aid granted in 2014 was 
EUR 46.4 million,  considerably  less  than  the  previous  year.  Access  to  information  on  the 
State Aid Commission’s decisions improved with the publication of its decisions online. 

As regards liberalisation, an ACA ex post evaluation revealed that the contracting authorities 
had not met their obligation to request ACA assessment when granting exclusive rights. 

37 

 
4.9.  Chapter 9: Financial services 

EU rules aim at ensuring fair competition between 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 financial services. Some progress was made in this field. 
For  banks  and  financial  conglomerates,  legislation  on  the  capital  adequacy  ratio  was 
amended. Preparations in financial market infrastructure, the securities market and investment 
services remain at an early stage. In the coming year: 

→ the Financial Supervisory Authority (FSA) should complete its board structure according 
to the FSA law. 

On  banks  and  financial  conglomerates,  the  Bank  of  Albania  adopted  a  regulation  on  the 
capital  requirements  for  second  tier  banks  based  on  the  Basel  III  capital  adequacy  ratio. 
Regulations  on  the  functioning  of  the  central  system  of  registering  and  liquidating  security 
titles  and  on  consumer  and  mortgage  credit  were  adopted.  Amendments  were  made  to 
regulations on the inter-bank large payment system; the activities of banks; foreign currency 
activities; and risk management of large exposures to counterparty failure among banks. The 
institutional and administrative capacity of the Bank of Albania supervisory department was 
increased.  Since  January,  it  has  been  assessing  banks  based  on  the  new  risk  assessment 
methodology, in line with the acquis. The banking system remained solid and liquid. 

In  the  non-banking  sector,  in  March  parliament  appointed  the  new  chair  of  the  Financial 
Supervisory  Authority  (FSA),  following  the  2014  amendments  to  the  Law  on  the  Financial 
Supervisory Authority. The FSA has taken steps to increase its institutional capacity, but its 
new organisational structure remains to be approved and the vacant positions in the board to 
be filled. A new micro-credit financial institution was licenced in June. 

In  insurance  and  occupational  pensions,  the  FSA  issued  regulations  on  principles  and 
procedures  related  to  insurance  companies’  accountancy,  including  internal  risk  control 
systems and liquidity obligations. It also adopted regulations on notification, correction or ban 
of prospectuses.  

As  regards  financial  market  infrastructure,  the  Tirana  stock  exchange  was  suspended  in 
December, as it did not list any companies and no securities were traded. It remains on stand-
by in case companies become interested in being listed on the stock market. 

On securities markets and investment services, the volume of investment funds continued 
to grow in 2014 and was dominated by government securities, which accounted for 85 % of 
total  assets.  Regulations  on  administering  the  liquidity  of  the  investment  funds  and  on 
notifying measures to prevent money laundering and financing of terrorism were adopted.  

4.10.  Chapter 10: Information society and media 

The EU supports the good functioning of the internal market for electronic communications, 
electronic  commerce  and  audio-visual  services.  The  rules  protect  consumers  and  support 
universal availability of modern services. 

Albania is moderately prepared in the  field of information  society and audiovisual media. 
There  was  some  progress  in  the  past  year.  The  capacity  of  the  Agency  for  Electronic  and 
Postal  Communications  (AKEP)  and  the  National  Agency  for  Information  Society  (NAIS) 
was strengthened. A new 2015-2020 digital agenda strategy was adopted. E-services provided 
to  public  institutions  and  citizens  increased.  In  the  coming  year,  the  country  should  in 
particular: 

38 

 
→ increase the independence of the media regulator and the public broadcaster; 

→ implement, as a matter of urgency, the switchover from analogue to digital broadcasting. 

In  electronic  communications  and  information  and  communications  technologies, 
legislation on public information and consultation was adopted in 2014, aiming at alignment 
with the acquis and the principles of the Digital Agenda for Europe. As for market regulation, 
mobile  termination  rates  (for  calls  received)  were  further  reduced,  and  AKEP  decided  on  a 
tariff plan which shall be adopted by all operators until January 2016. The fourth UMTS/3G 
license was awarded. Progress was made in implementing the frequency use plan approved by 
AKEP  in  February  2014.  AKEP’s  administrative  capacity  was  increased;  however,  no 
progress was made in increasing its operational independence. No progress has been made in 
making the emergency number 112 operational. 

While  the  overall  mobile  usage  is  high  and  mobile  broadband  usage  reached  35 %,  fixed 
broadband penetration remained low at 7.3 % in 2014. 

In  information  society  services,  the  cross-sectoral  2015-2020  digital  agenda  strategy  was 
adopted in April, including also a review of the national broadband plan of 2013. The number 
of  e-government  services  provided  through  the  e-Albania.al  portal  to  the  public  and 
businesses  increased.  A  centralised  infrastructure  along  with  an  upgraded  capacity  and 
security of online services for all institutions connected to the government network has been 
established in the National Agency for Information Society (NAIS). Its staff has doubled, and 
it has adopted a new organisational structure. 

On audiovisual policy, progress has been slow. The new members of the Audiovisual Media 
Authority  (AMA)  and  its  new  chair  were  appointed  in  2014.  The  opposition  disputed  the 
election process in court, alleging that it did not follow the correct legal procedures. AMA’s 
work  was  hampered  by  the  absence  of  its  members  nominated  by  the  opposition  from 
meetings.  While  the  implementation  of  the  strategy  for  switching  from  analogue  to  digital 
broadcasting  resumed  in  2015  -  after  the  conclusion  of  a  court  case  brought  against  the 
regulator  by  some  broadcasters  -  the  internationally  agreed  deadline  for  June  was  not  met. 
Substantial  efforts  are  needed  to  implement  the  digital  switchover  as  soon  as  possible.  This 
also applies to the delayed digitisation of the public service broadcaster (RTSH), which needs 
to speed up preparations to ensure that networks can host its programmes and those of local 
operators. The RTSH fee collection system improved. Since May, the RTSH Steering Council 
is  fully  operational.  It  is  expected  to  adopt  its  rules  of  procedure,  elect  members  of  its  new 
management body and adopt necessary documents and guidelines. 

4.11.  Chapter 11: Agriculture and rural development 

The  common  agricultural  policy  supports  farmers  and  rural  development.  This  requires 
strong management and control systems. There are also common EU rules for quality policy 
and organic farming.  

Preparations  are  at  an  early  stage  in  agriculture  and  rural  development.  There  was  some 
progress in strengthening the capacity of the Agricultural and Rural Development Agency in 
preparation  for  entrusting  it  with  budget  implementation  tasks.  In  the  coming  year,  the 
country should in particular:  

→ increase the capacity of the National Authorising Officer and National Fund to implement 
the Instrument for Pre-accession Assistance for Rural Development; 

→  set  up  a  farm  register,  establishing  the  land parcel  information  system  and  consolidating 
the animal register, as integral parts of its integrated administration and control system. 

39 

 
As  regards  horizontal  issues,  the  government  continued  its  direct  support  and  national 
investment  schemes  in  agriculture  and  agri-processing,  totalling  EUR  12,5  million  in  2015. 
Despite financial support from the EU for conduct of the agricultural census, the final results 
of  the  census  have  not  been  published.  With  a  view  to  improve  agricultural  statistics,  the 
government decided to return the task of carrying out statistical activities from the National 
Institute  of  Statistics  to  the  Ministry  of  Agriculture,  Rural  Development  and  Water 
Administration.   

In the area of common market organisation, the implementing legislation for the new law 
on  olive  oil  is  awaiting  adoption.  Activity  in  this  field  was  limited  to  the  approval  of 
regulations  on  marketing  standards  for  seeds.  There  was  no  progress  on  drafting  and 
approving standards for the marketing of agricultural products. 

The  2014-20  strategy  for  agriculture  and  rural  development  was  adopted  in  October.  The 
operating  structures  of  the  Instrument  for  Pre-accession  Assistance  for  Rural  Development 
(IPARD)  (the  paying  agency  and  managing  authority  in  the  Ministry  of  Agriculture,  Rural 
Development  and  Water  Administration)  have  gained  further  experience  following  the 
implementation  of  an  IPARD-like  scheme.  However,  the  capacity  for  decentralised  IPARD 
management of other relevant operational structures, such as the National Authorising Officer 
and the National Fund at the Ministry of Finance, still needs to be strengthened in line with 
the  requirements  for  entrusting  them  with  budget  implementation  tasks.  Following 
parliament’s ratification of the framework agreement in April, the sectoral agreement between 
Albania  and  the  European  Commission  setting  out  rules  for  the  management  and 
implementation  of  IPARD  funds  was  adopted  by  the  government  in  July.  The  2014-2020 
IPARD  programme  was  adopted  in  July.  Implementation of the  land  consolidation strategy, 
which remains to be adopted, requires strengthening of administrative capacity in the Ministry 
of Agriculture, Rural Development and Water Administration. 

On quality policy, the Ministry of Agriculture, Rural Development and Water Administration 
has  not  yet  developed  implementing  legislation  for  the  amended  law  on  industrial  property 
rights. 

On  organic  farming,  the  provision  of  subsidies  through  direct  schemes  and  training  on 
organic production continued. The law on organic farming is not yet in place. 

4.12.  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 
seed, plant protection material, harmful organisms and animal nutrition. 

Albania  has  some  level  of  preparation  in  food  safety,  veterinary  and  phytosanitary  policy. 
There was some progress, mostly related to food safety controls. Improvements in this area 
would  greatly  help  to  increase  export  potential.  In  the  coming  year,  the  country  should  in 
particular: 

→  train  staff  and  improve  coordination  among  relevant  institutions  with  a  view  to 
strengthening capacity to align with EU legislation in this field; 

→ adopt the strategy for restructuring the sector; 

→  implement  food  safety  rules,  including  official  controls,  import  conditions  and  controls, 
requirements for traceability of food and feed, and maximum pesticide residue levels. 

On  general food safety, the internal procedures and operational plans of the  National Food 
Authority  have  not  yet  been  endorsed.  No  steps  have  been  taken  to  improve  the  legal  and 

40 

 
institutional  framework  for  the  food  safety  system  by  establishing  responsibilities  and 
cooperation  between  implementing  bodies.  The  rules  on  the  organisation,  functioning  and 
procedures of the Scientific Committee and Panels have not been finalised. 

As  regards  veterinary  policy,  three  mass  vaccination  campaigns  were  carried  out  against 
rabies in red foxes, and relevant laboratory capacity for diagnosing and monitoring rabies was 
set  up.  Vaccination  of  replacement  animals  against  brucellosis  in  small  ruminants  was  also 
carried out. The veterinary service is fragmented, with unclear procedures, and limited human 
and financial resources. Animal databases are not updated regularly, due to a lack of reporting 
on animal movements and particularly on the slaughtering of animals. Disease reporting needs 
to be improved.  

With regard to the placing on the market of food, feed and animal by-products, the food 
establishments  database  (AKUnet)  has  started  to  be  used  for  the  preparation  of  official 
inspection plans. Residue monitoring programmes for undesired substances such as veterinary 
medicines,  mycotoxins  and  heavy  metals  are  being  implemented  in  small  ruminants,  swine, 
eggs, milk, honey and fish. The programmes need to establish quantitative testing capacity for 
aflatoxins in food products. 

As  regards  food  safety  rules,  no  progress  has  been  made  on  updating  regulations  on  food 
labelling,  food  contact  materials  and  contaminants  in  line  with  the  relevant  acquis.  The 
frequency  of  microbiological  monitoring  of  raw  milk  needs  to  be  increased  in  line  with  the 
regulations in place, and measures obliging producers to adopt good hygiene practices need to 
be stepped up for the production of safer milk. 

Legislation on specific rules for feed remains incomplete and unconsolidated. 

On phytosanitary policy, administrative and technical capacity remains limited. No progress 
has been made in the harmful organisms and seed and plant propagating material sectors. 

Regarding  genetically  modified  organisms  (GMOs),  the  Ministry  of  Agriculture,  Rural 
Development and Water Administration is still assessing the relevant EU legislation. 

4.13.  Chapter 13: Fisheries 

The common fisheries policy protects living resources of the sea and limits the environmental 
impact  of  fisheries.  This  includes  setting  catch  quotas,  managing  fleet  capacity,  rules  for 
aquaculture as well as support for fisheries and coastal communities. 

Preparations  are  at  an  early  stage  on  fisheries.  There  was  no  progress  in  this  area.  In  the 
coming year, the country should in particular: 

→ endorse the sector strategy; 

→ strengthen administrative capacity to ensure appropriate management of fish resources and 
enforcement of regulations. 

Resource and fleet management continue to suffer from a lack of clearly defined tasks and 
responsibilities,  institutional  coordination  and  capacity.  The  vessel  register  is  not  updated 
continuously.  Fish  landing  statistics  remain  inaccurate,  particularly  with  regard  to  data  on 
small fishing from coastal waters, lagoons and inland waters. The law on aquaculture has not 
been adopted yet. 

In  inspection  and  control,  some  progress  was  made  in  preventing  illegal  or  unregulated 
fishing in the main lakes. The Department for Fisheries Services and Aquaculture continues to 
lack the necessary resources and coordination with other bodies to ensure effective deterrence 
of  illegal  fishing  practices,  particularly  in  marine  waters.  The  functioning  of  the  Vessel 

41 

 
Monitoring  System,  set  up  in  2011,  has  been  subject  to  interruptions  due  to  delays  in 
procurement procedures for the provision of services. This jeopardises viable and long-term 
solutions for its maintenance and operation. 

As regards state aid, direct government support for aquaculture continued, with subsidies of 
up to 25 % of the price paid for fingerlings and feed. The government also adopted a decision 
exempting fishing vessels from the carbon tax and from VAT on fuel. 

As regards international agreements, Albania continued to cooperate with the International 
Commission for the Conservation of Atlantic Tunas and participated regularly in the meetings 
of the General Fisheries Commission for  the Mediterranean (GFCM).  However, gaps in the 
implementation  of  GFCM  decisions  and  difficulties  in  data  transmission  by  Albania  were 
reported.   

4.14.  Chapter 14: Transport policy 

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  this  area,  where  some  progress  was  made  in 
transport policy. In the coming year, the country should in particular: 

→  step  up  efforts  to  implement  railway  sector  reform,  in  particular  by  ensuring  necessary 
independence of train operations from infrastructure management in line with the aquis; 

→  strengthen  administrative  capacity  for  all  modes  of  transport,  in  particular  to  ensure  the 
implementation of legislation on dangerous goods; 

→ adopt and implement the transport strategy. 

On  road  transport,  the  road  code  was  amended  with  a  view  to  aligning  it  with  the  EU 
directive  on  driving  licences.  The  road  safety  remains  a  serious  concern;  legislation  on 
dangerous  goods  transport  is  fully  aligned  with  the  acquis,  but  is  not  fully  implemented 
because  the  General  Directorate  of  Road  Transport  lacks  capacity.  Legislation  on  road 
infrastructure and vehicle inspections needs to be further aligned with the acquis. No progress 
was  made  on  aligning  admission  to  the  occupation  of  road  haulier  and  access  to  the  road 
haulage  market  with  the  acquis.  In  March,  the  process  of  setting  up  gas  emissions  limits 
started. 

On rail transport, the new railway law has not yet been finalised. Upon adoption, it should 
pave  the  way  for  splitting  up  the  incumbent  Albanian  Railway,  separating  train  operations 
from  infrastructure  management  in  line  with  the  aquis,  and  for  setting  up  an  independent 
safety  authority  and  regulatory  authority.  The  level  of  investment  in  railway  infrastructure 
remains negligible, resulting in deterioration in transport services. 

As regards air transport, Albania fulfilled its single European sky commitments for the first 
transitional period under the European Common Aviation Area Agreement, but more work is 
needed  to  complete  the  remaining  requirements.  The  Albanian  Civil  Aviation  Authority 
(ACAA)  needs  to  address  the  non-compliance  findings  of  the  European  Aviation  Safety 
Agency  inspection  concerning  air  traffic  management  and  air  navigation  services.  .  In 
December, the law on the ACAA was amended to increase its institutional, organisational and 
management autonomy however the ACAA still lacks capacity to ensure oversight of all the 
organisations operating under its supervision. Albania actively participates in the joint service 
provisional area (JSPA) initiative.  

42 

 
In  maritime  transport,  as  a  result  of  the  removal  from  service  of  a  number  of  vessels,  the 
detention rate of vessels flying the Albanian flag fell and the national fleet remained on the 
grey list of the Paris Memorandum of Understanding (MoU) on Port State Control. Albania 
should  follow  up  on  its  membership  application  to  the  Paris  MoU  and  continue  efforts  to 
further  reduce  the  detention  rate  of  its  vessels.  Further  progress  is  needed  on  aligning 
legislation on reporting formalities for ships with the acquis. 

4.15.  Chapter 15: Energy 

EU energy policy covers competition and state aids, equal access to resources, the internal 
energy market, energy efficiency, nuclear energy and nuclear safety and radiation protection. 

Albania  is  moderately  prepared  in  this  area.  There  was  some  progress  on  energy, 
specifically on aligning power sector legislation with the relevant acquis and  improving the 
bill collection rate. In the coming year, the country should in particular: 

→  improve  the  financial  recovery  of  the  state  power  generation  company  and  ensure  the 
economic sustainability of the electricity sector by reducing distribution losses and improving 
the bill collection rate; 

→ adopt and implement the national energy strategy and implement the April 2015 power 
sector law; 

→ adopt the national energy efficiency and renewable energy action plans. 

On  security  of  supply,  preparations  to  construct  the  400  kV  interconnection  line  between 
Albania  and  Kosovo  are  ongoing  but  were  delayed  due  to  the  discovery  of  an  ancient 
historical site. Work continued on construction of a 100 kV transmission line in the south of 
Albania. The feasibility study and environmental impact assessment for the construction of a 
400  kV  interconnection  line  with  the  former  Yugoslav  Republic  of  Macedonia  were 
completed. In January, an agreement was signed on the permanent synchronous functioning 
of  the  Albanian  electricity  transmission  system  with  the  continental  European  system,  as  a 
step  towards  Albania’s  full  membership  of  the  European  Network  of  Transmission  System 
Operators  (ENTSO-E).  Albania  managed  to  cover  100%  of  its  demand  from  hydropower, 
even  though  it  produced  32 %  less  power  in  2014  compared  to  2013  as  a  result  of  poor 
hydrological  conditions.  Construction  work  on  the  Trans-Adriatic  Pipeline  (TAP)  project 
started in July. The construction of the Ionian Adriatic Pipeline (IAP) was launched in March 
and  a  joint  statement  on  IAP  was  signed  between  Albania,  Bosnia  and  Herzegovina, 
Montenegro and Croatia. Albania continued preparations for the development of a gas master 
plan. The Vlora thermal power plant is still not operational. 

The  legislation  on  hydrocarbons  was  amended  in  March  to  provide  for  new,  transparent 
reporting  requirements.  As  a  result  of  a  first  control  and  verification  operation  in  May, 
Albania  revoked  23  licenses  of  hydrocarbons  trading  companies.  Albania  already  broadly 
meets the obligation of keeping oil stock reserves corresponding to 90 days of imports.  

In the internal energy market, the new power sector law aligned with the EU’s third energy 
package was adopted in April and the law on the gas sector was adopted in September 2015. 
The  Energy  Regulatory  Entity  approved  a  new  electricity  tariff  structure  for  2015.  In  2014, 
non-technical  losses  in  power  distribution  were  reduced  to  44%  of  distribution  losses,  as 
compared  to  61%  the  previous  year.  The  bill  collection  rate  increased  to  92.6%  in  2014, 
compared to 83% in 2013. In February, the government adopted a financial recovery plan for 
the  energy  sector  and  an  action  plan  for  the  next  five  years.  Despite  efforts  to  clear  arrears 
accumulated  before  2014,  unpaid  arrears  by  the  public  power  operator  continue  to  create 
financial difficulties for private operators in the sector.  

43 

 
In  renewable  energy,  the  Energy  Community  took  infringement  proceedings  to  the  second 
stage, sending its reasoned opinion in February and a reasoned request in May on Albania’s 
failure to submit a renewable energy action plan. In October, legislation on the hydrocarbon 
sector  was  amended  to  cover  production,  transport  and  trade  in  bio-fuels  and  other 
renewables. Any further development of hydropower should take place in conformity with EU 
environmental legislation. The law on energy efficiency in buildings has not yet been adopted 
by  the  parliament.  Albania  missed  its  Energy  Community  deadline  to  align  its  law  with  the 
2006 Directive on Energy End-Use Efficiency and Energy Services. The second national plan 
for energy efficiency has yet to be adopted. 

In nuclear energy, nuclear safety and radiation protection, a regulation on the protection 
of  workers  from  risks  related  to  non-ionising  radiation  in  the  workplace  was  adopted  in 
December, aiming at alignment with the relevant acquis.  

4.16.  Chapter 16: Taxation 

EU  rules  on  taxation  cover  value-added  tax  and  excise  duties  as  well  as  aspects  of  taxing 
income from savings of individuals and of corporate taxes. They also deal with cooperation 
between tax administrations, including information exchange to prevent tax evasion. 

Albania  is  moderately  prepared  in  the  area  of  taxation.  Some  progress  was  made,  in 
particular as regards legislative approximation with the acquis on value added tax (VAT) and 
excise. Revenue performance in 2014 increased, as a result of tax increases and improvements 
in  the  tax  administration,  but  did  not  increase  as  budgeted  in  2015.  In  the  coming  year,  the 
country should in particular: 

→  implement  new  VAT  legislation  effectively,  which  entails  raising  awareness  among 
businesses and training tax officials; 

→  strictly  implement  measures  to  prevent  new  VAT  arrears  and  address  businesses’ 
complaints about VAT refund delays; 

→ ensure the new IT system is effective in reducing arbitrary practices, fraud and corruption 
and improving information exchange. 

On indirect taxation, the new value added tax law and implementing legislation came into 
force  in  January.  The  law  seeks  alignment  with  the  VAT  Directive  but  still  contains 
exemptions  (zero  rates)  which  are  not  in  line  with  the  acquis.  It  sets  clear  deadlines  for 
payment  of  VAT  refund  claims.  Measures  were  taken  to  refund  almost  all  VAT  arrears. 
Legislation  on  VAT  and  on  tax  procedures  was  amended  in  July  to  provide  for  the 
establishment of a central unit within the General Directorate of Taxation which will process 
VAT reimbursement requests based on a risk model, with the aim of shortening the duration 
of  the  procedure.  Implementing  instructions  on  some  VAT  exception  procedures  were  also 
adopted  in  June.  The  excise  law  was  amended  in  December,  increasing  excise  duties  on 
tobacco products, making changes to excise duty on energy drinks and removing excise duty 
on natural bitumen. Further work is needed to align excise rates with the acquis. 

On direct taxation, the rate of personal income tax levied on income from shares, rental of 
immovable property and copyright was raised to 15 %, while income deriving from voluntary 
pension schemes became exempt. Further steps remain necessary to improve transparency and 
public consultations on drafting fiscal legislation. 

As  regards  administrative  cooperation  and  mutual  assistance,  Albania  has  been 
participating  in  the  EU’s  Fiscalis  2020  programme  since  January.  The  tax  administration  is 
cooperating  with  the  Italian  revenue  agency  on  transfer  pricing  issues  under  the  OECD 

44 

 
programme  ‘Tax  inspectors  without  borders’.  Agreements  on  avoidance  of  double  taxation 
and prevention of tax evasion were concluded with Iceland and the Swiss Federation. 

As regards operational capacity and computerisation, a new IT system was deployed in the 
tax  administration  as  of  January.  Personal  income  tax  declarations  must  now  be  made  via 
electronic  means.  Initial  technical  problems  encountered  by  taxpayers  have  been  resolved. 
Coordination between the tax and customs administrations has been strengthened by ensuring 
their  IT  systems  are  interoperable.  Measures  were  taken  to  fight  fiscal  evasion  in  the  fuel 
market.  The  General  Directorate  of  Taxation  strengthened  its  cooperation  with  the  High 
Inspectorate for Declaration and Audit of Assets and Prevention of Conflicts of Interest. The 
management and revenue collection capacities of the tax administration need to be enhanced 
to ensure tax compliance and prevent further revenue slippages. 

4.17.  Chapter 17: Economic and monetary policy 

EU rules require the independence of central banks and prohibit them directly financing the 
public  sector.  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.  Some 
progress was made in particular through improved multi-annual budgeting and transparency 
in budget preparation,  but further  consultations with the business community are needed on 
drafting fiscal measures. In the coming year, the country should in particular: 

→  further  strengthen  the  medium-term  budgetary  framework  and  increase  commitment 
control,  partly  by  adopting  a  well-designed  fiscal  rule  in  line  with  the  Directive  on 
requirements for budgetary frameworks; 

→  ensure  better  internal  coordination  and  consultations  with  external  stakeholders  when 
formulating structural reform priorities, to strengthen ownership and implementation. 

On monetary policy, the Law on the Bank of Albania should be aligned with the acquis as 
regards  the  personal  independence  of  the  Supervisory  Council's  members  and  the  bank’s 
accountability.  The  Bank  of  Albania's  Supervisory  Council  is  fully  operational  after  a  new 
governor and chief inspector were appointed in February and April respectively. The security, 
transparency  and  internal  auditing  of  the  bank  were  strengthened.   The  central  bank  law 
establishes  the  primary  objective  of  price  stability,  in  line  with  the  primary  objective  of  the 
European  System  of  Central  Banks.  The  Bank  of  Albania  has  cut  the  key  interest  rate  in 
several steps over the past six years to a new historic low of 2 % in January 2015 in an effort 
to steer inflation towards the target rate of 3%. However, inflation remains below target. 

On  economic  policy,  Albania  adopted  its  Economic  Reform  Programme  (ERP)  in  January. 
The  programme's  macroeconomic  and  fiscal  frameworks  have  improved;  links  between  the 
macroeconomic  and  fiscal  assumptions  and  the  structural  reform  measures  have  also  been 
the  capacity  for  economic  policy  formulation  and 
made  more  explicit.  However, 
implementation  needs  to  be  further  improved.  Internal  coordination  of  the  programme  and 
consultations with external stakeholders remain weak. For the first time, as part of the budget 
law, parliament adopted prospects for budget expenditure and revenues for the period 2015-
2017. The budget for 2015 and the 2016–2018 Macroeconomic and Fiscal Framework were 
revised in July 2015 due to a shortfall in revenues. Budget forecasting needs to be improved. 

The  European  System  of  Accounts,  2010  standards  (ESA  2010)  have  been  implemented 
partially in annual GDP data and further efforts are needed in this area (see also Chapter 18: 
Statistics). Efforts were made to improve public financial management through the adoption 
of a public financial management strategy and action plan. 

45 

 
4.18.  Chapter 18: Statistics 

EU  rules  require  that  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  has  some  level  of  preparation  in  statistics.  Some  progress  was  made,  notably  in 
harmonising methodology with EU standards in some statistical areas. 

However, significant efforts are needed to strengthen the human and financial resources of the 
Institute of Statistics (INSTAT) to comply with European standards, to improve the quality of 
statistics and to ensure the alignment of agriculture, business and social statistics. INSTAT's 
role  as  coordinator  of  national  statistics  system  should  be  enhanced.  In  addressing  the 
shortcomings outlined below, in the coming year, Albania should in particular: 

→ strengthen the position of INSTAT in the public administration through adjustments in the 
salary structures and civil servants job positions;  

→ improve the professional independence of INSTAT through changes in the statistical law, 
among  others,  guaranteeing  the  professional  independence  of  INSTAT  in  recruitment  and 
staffing; 

→ further align statistics with the European system of accounts (ESA 2010). 

On statistical infrastructure, the legal framework is in line with the European statistics Code 
of Practice and classifications are in line with EU standards and applied in statistical surveys. 
INSTAT is the main producer and coordinator of statistics and its professional independence 
is  enshrined  in  the  law,  but  needs  further  enhancement  in  practice through  independence  in 
deciding on staffing and budget. In March, INSTAT signed a memorandum of understanding 
with  the  General  Directorate  for  Taxation.  Its  coordinating  role  in  the  national  statistical 
system  needs  to  be  further  strengthened  through  the  conclusion  of  Memoranda  of 
Understanding and an increase of its status and standing in the public administration.  

On  macroeconomic  statistics,  INSTAT  improved  national  accounts'  estimates  based  on 
European  System  of  Accounts  2010  (ESA  2010)  concepts  and  methodology.  Annual  and 
quarterly  gross  domestic  product  (GDP)  data  are  produced  in  constant  and  current  prices.. 
Albania  started  compiling  government  finance  statistics  and  excessive  deficit  procedure 
(EDP) notification tables and INSTAT submitted them to Eurostat in October 2014.. A new 
estimation method has been introduced for calculating annual GDP based on the expenditure 
approach, independent from the production approach. In February, INSTAT published, for the 
first time, supply / use tables and input and output tables for the years 2009-2011 according to 
ESA 2010. Data sources for macro-economic statistics need to be improved, in particular by 
data holders outside INSTAT. 

Structural business statistics and short-term statistics for industry and construction are mainly 
in  line  with  the  acquis,  but  further  quality  improvements  are  needed  as  well  as  efforts  to 
improve  statistics  for  the  service  sector.  The  revised  statistical  classification  of  economic 
activities  (NACE  Rev.2)  started  to  be  implemented  in  January  2015  by  statistical  units, 
ministries,  central  and  local  institutions,  juridical  and  physical  persons  who  carry  out 
economic  activities  in  the  country.  Statistics  on  research  and  development,  information  and 
communication  technologies  and  on  innovation  still  need  to  be  aligned.  In  June,  INSTAT 
carried out a sector review of the business sector. 

Within social statistics demographic statistics are to a large extent produced. A pilot survey 
of income and living conditions (SILC) was carried out in November. Labour market statistics 

46 

 
are  broadly  aligned  with  the  acquis.  The  labour  force  survey  is  conducted  and  published 
regularly and results from the labour cost survey for the year 2012 have been published. The 
labour  cost  index  and  the  structure  of  earnings  data  still  need  to  be  produced.  In  June,  the 
country  adopted  the  latest  version  of  the  International  Standard  Classification  of  Education 
(ISCED 2011). External migration statistics still need to be developed. 

Agricultural statistics are partially aligned with the acquis. In June, INSTAT presented the 
agriculture and livestock statistics for 2014. The results of the census of agricultural holdings 
have not been published yet, so the statistical farm register has not been finalised. The transfer 
of  responsibility  for  carrying  out  agriculture  surveys  from  INSTAT  to  the  Ministry  of 
Agriculture,  Rural  Development  and  Water  Administration  will  require  improved  technical 
capacity and a proper coordination mechanism with INSTAT. 

Environment and energy statistics are partially in line with the acquis. Energy balances for 
electricity were produced for the 2000-2014 period; energy balances for other energy sources 
are still missing. As part of the European Environment Information and Observation Network 
(EIONET),  the  Ministry  of  Environment  reports  timely  and  accurately  to  the  European 
Environment  Agency  on  air  and  water  quality.  However,  environmental  statistics  are  not 
complete and not updated regularly. Statistics on waste, on water and on waste water need to 
be  further  developed.  Material  flow  balances  and  environmental  protection  expenditure 
statistics are not yet produced. 

4.19.  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 anti-discrimination. They also promote social dialogue at European level.  

Albania has some level of preparation in social policy and employment. Some progress was 
made, notably efforts to align the law with the EU acquis on health and safety at work. Key 
reforms were launched in social protection. Amendments to the labour code and the national 
jobs and skills strategy were adopted. The employment rate and labour market participation 
remain low, and the informal economy is still a significant job provider. In the coming year, 
the country should in particular: 

→  finalise  and  adopt  the  2015-2020  social  protection  strategy  and  ensure  it  is  implemented 
effectively; make further progress in the social care reform; 

→ improve labour market statistics and develop social statistics in line with EU surveys. 

On labour law, amendments to the labour code were approved by the government, but remain 
to be enacted by parliament. They aim to bring the code in line with the acquis on health and 
safety  at  work,  non-discrimination,  relations  between  employers  and  employees,  and 
provision  of  social  security  to  a  series  of  unprotected  professions.  They  also  reflect 
recommendations  by  the  Council  of  Europe  Experts  Committee  for  Social  Rights  and 
commitments  on  implementing  the  relevant  International  Labour  Organisation  conventions 
and recommendations. 

As  regards  health  and  safety  at  work,  four  new  regulations  were  adopted,  covering  risks 
arising from electromagnetic fields, artificial optical radiation, noise and vibration, aiming at 
aligning legislation with the acquis. The government adopted secondary legislation related to 
safety measurements for  pregnant women,  protection of  minors in  the workplace and to the 
fishing  industry.  Efforts  were  made  to  improve  labour  inspection  by  training  inspectors  on 
applying the new occupational safety and health legislation and extending electronic reporting 
to  the  regional  labour  inspectorates.  Accident  reporting  and  labour  inspections  to  reveal 

47 

 
undeclared workers improved. The number of reported accidents at work increased from 86 in 
2013, to 111 cases in 2014.  

On  social  dialogue,  the  National  Labour  Council  (NLC)  is  functioning  properly;  however, 
further efforts are needed on collective bargaining at all levels and to increase social partners’ 
capacity  to  negotiate  collective  agreements.  Some  social  partners  expressed  concern  over 
being  excluded  from  the  six  NLC  tripartite  committees  that  were  set  up.  Bipartite  social 
dialogue  needs  to  be  improved  and  social  partners’  autonomy  needs  to  be  increased.  Much 
remains to be done to develop social dialogue at local and enterprise level. 

On  employment  policy,  the  2014-20  national  jobs  and  skills  strategy  and  action  plan  were 
adopted, but no mechanism for monitoring their implementation is in place yet. In June, the 
government  adopted  the  2015-2020  national  action  plan  on  youth.  The  unemployment  rate 
estimated  by  the  labour  force  survey  decreased  from  18.2  %  in  the  first  quarter  of  2014  to 
16.9 % in first quarter of 2015, but remains high, especially among women, young people and 
persons with disabilities. Employment rates for men rose from 50.7 % in 2013 to 51.4 % in 
2014,  while  women’s  employment  rate  fell  slightly  from  an  already  low  38.0 %  in  2013  to 
37.6 %  in  2014.  In  2014,  long-term  unemployment  represented  about  54.2 %  of  total 
unemployment. Administrative capacity for job placement was increased, with the creation of 
five  new  model  employment  offices.  Labour  market  statistics  are  broadly  aligned  with  the 
acquis.  However,  further  efforts  are  needed  to  improve  the  coverage  of  data.  Agriculture 
remains  the  main  job  provider,  followed  by  market  services  and  non-market  services.  The 
informal  economy  remained  a  significant  source  of  jobs,  accounting  for  around  40 %  of 
employment  in  the  non-agriculture  sector.  A  comprehensive  approach  to  inspection  of 
informal employment activity has yet to be developed. 

There  were  no  developments  on  the  European  Social  Fund.  The  agreement  for  Albania’s 
participation in the Programme for Employment and Social Innovation (EaSI) was signed. 

As regards social inclusion, a social care  reform was initiated. Minimum basic services are 
provided to residents, but need to be stepped up. Many social services are dependent on donor 
funding and civil society, and lack a clear legal framework and adequate budget.   

As regards inclusion of persons with disabilities, training was provided to social workers, the 
staff  of  Child  Protection  Units,  and  to  school  and  kindergarten  teachers  to  promote  the 
inclusion of children with disabilities. However, persons with disabilities still face difficulties 
in  accessing  education,  housing,  legal  aid,  employment,  healthcare  and  social  services,  and 
legal provisions on the inclusion of children with disabilities are not effectively implemented. 
Disability payments have been linked to the consumer price index published by INSTAT.   

In the area of social protection, the pension reform process is ongoing. Given the important 
role that municipalities play in providing social services, all strategies and policies on social 
inclusion and protection need to be closely coordinated with the territorial and administrative 
reform that significantly reduced the number of municipalities. 

As  regards  anti-discrimination,  the  number  of  cases  handled  by  the  Commissioner  for 
Protection  against  Discrimination  (CPD)  increased;  however,  more  outreach  and  a  more 
proactive approach are required. The CPD significantly increased its participation in judicial 
processes, participating in 18 judicial processes in 2014, compared to six in 2013. 

In the area of equal opportunities, further action is needed to increase the representation of 
women  in  the  labour  market  and  ensure  equal  opportunities  and  treatment.  Women  account 
for  only  24 %  of  the  labour  force  but  60 %  of  registered  long-term  unemployed.  (See  also 
Chapter 23 — Judiciary and fundamental rights) 

48 

 
4.20.  Chapter 20: Enterprise and industrial policy 

EU industrial policy enhances competitiveness, facilitates structural change and encourages 
an enterprise friendly environment that stimulates small and medium sized enterprises.  

Albania  is  moderately  prepared  in  the  area  of  enterprise  and  industrial  policy.  Some 
progress was made in this field in particular with alignment with the EU Small Business Act. 
In the coming year, the country should in particular: 

→  strengthen  the  capacity  of  the  Albanian  Investment  Development  Agency,  including 
capacity for services to both local and foreign investors; 

→ improve further policy consultations. 

On  the  principles  of  enterprise  and  industrial  policy,  the  business  and  investment 
development strategy and action plan were adopted in October 2014. They are in line with the 
principles  of  the  EU’s  ‘Small  Business  Act’,  the  national  plans  for  the  South  East  Europe 
2020 strategy and the World Bank’s ‘Doing Business’ indicators. Legislation on the National 
Registration Centre and on licensing, authorisations and permits was amended in January to 
reduce the administrative and regulatory burden on businesses. Further efforts are needed on 
the formalisation of the Regulatory Impact Assessment. In April, the Investment Council was 
set  up,  with  the  participation  of  six  members  from  state  institutions  and  six  business 
representatives,  to  further  improve  the  business  climate  and  facilitate  the  dialogue  between 
government, business and donors. The national employment and skills strategy was adopted 
in 2014. A law on strategic investments and amendments to the law on the establishment and 
functioning  of  the  economic  zones  were  enacted  by  the  Parliament  in  May  with  a  view  to 
improve the investment climate. 

As  regards  enterprise  and  industrial  policy  instruments,  Albania  ratified  in  June  an 
agreement to participate in the EU’s COSME competitiveness programme. Albania continued 
to support financing of small and medium-sized enterprises (SMEs)  through a credit  line of 
EUR  15  million  concluded  with  the  Italian  government,  the  Western  Balkans  Enterprise 
Development  and  Innovation  Facility,  and  the  European  Fund  for  Southeast  Europe. 
However,  SME  access  to  credit  and  the  lack  of  skilled  staff  remain  business  concerns.  The 
government introduced a package of legislation to support the inward processing industry by 
reducing administrative formalities. 

On  sector  policies,  a  new  law  on  tourism  was  adopted  in  June,  to  promote  and  attract 
strategic  domestic  and  foreign  investment  in  tourism,  in  line  with  the  Law  on  Strategic 
Investment  adopted  in  May.  Tourism  businesses  face  difficulties  related  to  informality,  the 
need  for  improved  infrastructure  (including  waste  management  and  access  to  energy)  and 
property  issues.  On  mining,  amendments  to  the  law  on  the  mining  sector  were  adopted  in 
October 2014, to improve the legislation as regards approval of mining operations. 

4.21.  Chapter 21: Trans-European networks 

The EU promotes trans-European networks in the areas of transport, telecommunications and 
energy to strengthen the internal market and contribute to growth and employment. 

Albania  has  achieved  some  level  of  preparation  in  the  area  of  trans-European  networks. 
Some  progress  was  made,  notably  in  developing  road  infrastructure  and  interconnecting 
energy networks. In the coming year, Albania should in particular: 

→ continue work on the development of the transport and energy networks in line with the 
infrastructure  investment  priorities  for  the  core  network,  agreed  under  the  regional 
connectivity agenda; 

49 

 
→ step up efforts on transport infrastructure maintenance and land expropriation. 

On transport networks, Albania continued to participate in the South East Europe Transport 
Observatory (SEETO).  Albania played an active role within the Western Balkans 6 process 
and has endorsed the extension to the Western Balkans of the TEN-T core network and core 
corridors focused on the improving connectivity within the Western Balkans as well as with 
the EU.  

Improvements  to  the  road  network  continued.  Construction  of  the  Fier  and  Rrogozhine 
bypasses is progressing. On the north-south corridor, works on the Damës-Tepelenë segment, 
Shkozet  overpass  and  the  extension  of  the  section  Durres-Rrogozhine  were  completed.  As 
regards road corridor VIII, completion of the Tirana-Elbasan road has been delayed. 

A five-year programme of  road maintenance started, with a focus on the maintenance and 
safety of the road core network. There was no progress on the railway network and the section 
from  Librazhd  to  Pogradec  remained  non-operational  due  to  a  lack  of  maintenance.  As 
regards  port  infrastructure,  dredging  works  to  improve  access  to  the  port  of  Shengjin  were 
completed; the port is now operational and its capacity has increased. 

As regards energy networks, Albania is making progress with the preparation of the Trans-
Adriatic  Pipeline  project.  Progress  was  made  in  regional  energy  connectivity.  Preparatory 
work  on  constructing  a  400  kV  interconnection  line  between  Albania  and  the  former 
Yugoslav Republic of Macedonia has started. 

4.22.  Chapter 22: Regional policy and coordination of structural instruments 

The  EU  funds  regional  development  in  the  Member  States.  Implementation  is  the 
responsibility of the Member States that must have adequate administrative capacity to ensure 
the good handling and sound financial management of the projects.  

Albania  is  moderately  prepared  in  the  area  of  regional  policy.  Some  progress  was  made, 
notably on the start of projects to be run in indirect management under the IPA 2013 national 
programme. In the coming year, the country should in particular:  

→  strengthen  project  management  under  the  IPA  2013  programme  to  minimise  the  risk  of 
delays in the use of EU funds; 

→  increase  programming  capacity  for  sector  policies  and  improve  design  of  mature  sector 
project pipelines, both at national and local level. 

On  the  legislative  framework,  further  efforts  are  needed  to  ensure  multiannual  sector 
programming in line with the new sector approach under the IPA framework for 2014-2020, 
together  with  flexibility  in  the  government’s  medium-term  budget  plan  and  appropriate  co-
financing capacity for EU projects at national and local level. 

On  the  institutional  framework,  following  the  conferral  of  management  powers  by  the 
European  Commission  under  component  I  of  the  2007-2013  IPA,  the  competent  national 
structures  are  implementing  projects  under  the  IPA  2013  programme.  Preparatory  work  for 
the  management  of  IPA  funds  in  agriculture  and  rural  development  needs  to  be  stepped  up 
with a view to start to managing funds as of 2016. (See also Chapter 11 — Agriculture). 

On  administrative  capacity,  further  action  is  needed  to  ensure  competent  staff  for  all  IPA 
structures in view of the workload stemming from management responsibilities. 

On programming, coordination between the Ministry of Finance and line ministries needs to 
be improved to develop and implement realistic and budgeted sector policies in line with the 
government medium-term budget plan. The national strategy for development and integration 

50 

 
for 2015-2020 has not yet been adopted. A mature project pipeline of investments in regional 
development  has  yet  to  be  developed.  As  a  result  of  the  recent  administrative  territorial 
reform, local governments are expected to increase their capacity to generate mature projects 
in order to benefit from national and IPA support. 

On monitoring and evaluation, the existing set-up of sector working groups was reorganised 
with  the  aim  of  improving  the  monitoring  of  policy  developments  and  providing  strategic 
advice.  Four  pilot  integrated  policy  management  groups  (water  management;  public 
administration  reform;  competitiveness  and  innovation;  and  employment  skills  and  social 
policy) were set up to support the government’s Strategic Planning Committee and other high-
level inter-ministerial committees in charge of key policy decisions. 

In  financial  management,  control  and  audit,  the  administrative  capacity  of  the  Central 
Finance  and  Contracting  Unit  (CFCU)  in  the  Ministry  of  Finance  needs  to  be  strengthened 
while the audit authority requires increased human resources with senior expertise on audit.  

4.23.  Chapter 23: Judiciary and fundamental rights 

The  EU's  founding  values  include  the  rule  of  law  and  respect  for  human  rights.  A  proper 
functioning  judicial  system  and  effective  fight  against  corruption  are  of  paramount 
importance, as is the respect for fundamental rights in law and in practice.  

independence  and  accountability  of 

Albania  has  some  level  of  preparation  for  implementing  the  acquis  and  the  European 
standards in this area. Some progress has been achieved. As regards the judiciary, the ad hoc 
Parliamentary Committee on Judicial Reform was set up to carry out comprehensive reform. 
is  not  ensured. 
Full 
Administration of justice is slow and judicial decisions are not always enforced. A new anti-
corruption  strategy  and  action  plan  were  adopted.  Corruption  remains  widespread  in  many 
areas and continues to be a very serious cause of concern. In the area of fundamental rights, 
further efforts are needed across the board as effective implementation of relevant legislation 
and strategies remains limited. In the coming year, Albania should in particular: 

judges  and  prosecutors 

→  strengthen  the  accountability  of  judges  and  prosecutors  and  fight  corruption  within  the 
justice system; 

→  demonstrate  further  progress  with  a  view  to  establishing  a  solid  track  record  of 
investigations,  prosecutions  and  convictions  in  the  fight  against  corruption  and  organised 
crime at all levels; 

→ improve institutional mechanisms to ensure child protection, the protection of victims of 
domestic  violence,  and  gender  equality,  enhance  efforts  to  bring  existing  legislation  on 
juvenile  justice  in  line  with  international  standards,  step  up  efforts  to  establish  a  solid  anti-
discrimination case law, and boost efforts to find a sustainable long-term housing solution for 
vulnerable groups; 

→  make  further  progress  with  the  implementation  of  the  2012-2020  strategy  on  property 
rights, and the processes of property registration, restitution and compensation.  

(See  also  the  specific  recommendations  on  the  judicial  system,  the  fight  against  corruption 
and freedom of expression in sections 2.3 and 2.4.) 

Functioning of the judiciary 

Strategic documents 

In November 2014, an ad hoc Parliamentary Committee on Judicial Reform - which is made 
up of members from both the ruling majority and the opposition - was set up. The Committee 

51 

 
is  assisted  by  a  high  level  group  of  experts  which  completed  an  analytical  overview  of  the 
current  justice  system  in  June  and  has  drafted  a  judicial  reform  strategy  and  accompanying 
action plan.  

Management bodies 

Two  members  of  the  High  Council  of  Justice  (HCJ),  including  its  deputy  head,  were 
dismissed by parliament following the adoption, in 2014, of contested amendments to the HCJ 
law and a controversial parliamentary process. An appeal against the dismissals was rejected 
by  the  Administrative  Court  and  a  new  HCJ  deputy  head  has  not  yet  been  appointed.  The 
reasoning behind HCJ's decisions is not published and there is still scope for improving the 
transparency of the Council's decision-making process. The budget of the HCJ has increased 
by  5.85  %  compared  to  last  year.  The  regulation  on  the  functioning  of  the  Council  of 
Prosecutors  was  amended  in  November,  to  include  detailed  criteria  on  evaluation  of 
prosecutors  for  promotion  purposes.  In  February,  a  manual  was  approved  with  a  view  to 
holding competitions for prosecutors. 

Independence and impartiality 

The  functioning  of  the  judicial  system  continues  to  be  affected  by  a  high  degree  of 
politicisation  and  poor  inter-institutional  cooperation.  The  independence  and  impartiality  of 
the High Court is still not fully guaranteed. Since September 2014, parliament has rejected all 
seven President’s nominations to the High Court and the vacancies concerned have yet to be 
filled. Key legislation on reforming the Constitutional Court, the High Court, the HCJ, and the 
Prosecutor’s  Office  is  currently  under  discussion.  Judges  and  prosecutors  still  do  not  have 
appropriate  working  and  security  conditions,  and  protection  against  undue  pressure  remains 
inadequate.  Hearings  continue  to  be  held  quite  frequently  in  judges’  offices,  which  raises 
concerns about potential undue influence and corrupt practices. 

Accountability 

The  memorandum  of  understanding  between  the  Ministry  of  Justice  and  the  HCJ  on 
inspections  continued  to  be  implemented  smoothly.  Both  institutions  conducted  various 
inspections  respectively  in  prosecution  offices  and  courts.  Requests  to  open  disciplinary 
proceedings  against  eight  judges  have  resulted  in  one  dismissal  and  three  judges  receiving 
reprimands. The cases against the other four judges were abandoned. The disciplinary system 
for  judges  needs  to  be  substantially  improved,  including  through  a  more  transparent  and 
efficient  inspection  system.  The  Minister  of  Justice's  role  in  the  process  also  needs  to  be 
reviewed and a track record of sanctions established. 

Upon  a  proposal  from  the  Council  of  Prosecutors,  the  General  Prosecutor’s  Office  (GPO) 
took measures against three prosecutors, including a reprimand, a warning of dismissal and a 
proposal for dismissal. 

The  HCJ  launched  a  website  which  enables  the  filing  and  monitoring  of  complaints  against 
judges. This was accompanied by an awareness-raising campaign on disciplinary complaints 
against judges.    

The transparency and impartiality of the appointment and dismissal procedures for key staff in 
the GPO need to be enhanced, and the role of the Council of the Prosecution reinforced. The 
lack of accountability of the GPO remains a matter of concern, as is the potential for political 
influence in the process of appointing the General Prosecutor.  

Judges’  asset  declarations  were  audited  in  2014  and  those  of  prosecutors  are  planned  to  be 
audited in 2015. Since October 2014, the HCJ suspended two judges for a lack of compliance 
with  declaration  of  assets  requirements.  Corruption  in  the  judiciary  remains  an  issue  of 

52 

 
serious  concern.  Substantial  efforts  are  needed  to  increase  transparency  and  accountability, 
and  to  implement  the  relevant  recommendations  made  by  the  Group  of  States  against 
Corruption (GRECO) in its fourth-round evaluation report on corruption prevention in respect 
of judges and prosecutors. 

Professionalism and competence 

Criteria  for  evaluating  judges’  performance  need  to  be  improved.  The  process  of  assessing 
judges’  performance  for  2007-2009  is  still  not  complete;  this  has  prevented  the  HCJ  from 
appointing  heads  of  court  in  full  compliance  with  the  relevant  legal  provisions.  A  new 
regulation of the HCJ on the evaluation of HCJ inspectors started to be implemented in June. 
Prosecutors and judicial police officers’ performance has been assessed for the year 2013.    

Procedures for the recruitment of administrative court judges need to be reviewed to address 
the limited number of applications in former competitions. There are still seven vacancies in 
the administrative courts. Legal advisors have been appointed in all administrative courts. The 
process of appointing judges who have recently graduated from the School of Magistrates is 
yet to be completed.  

Quality of justice 

Budget  planning  capacity  needs  to  be  improved  and  adequate  budgetary  resources  for  the 
justice system ensured. Despite some efforts, training of judicial administrative staff remains 
insufficient.  The  School  of  Magistrates  is  still dependent  on  foreign  aid.  Eleven  per  cent  of 
first- and second-instance court judges are receiving in-service training on EU law.  

The  audio  recording  system  was  further  extended  and  started  to  be  implemented  in  most 
administrative courts. The unified case management system has been rolled out to nearly all 
courts,  including  one  section  of  the  civil  chamber  of  Tirana  District  Court.  However,  the 
system is underused, is not fully operational and, in some courts, has not even been installed. 
The system needs to be substantially improved to meet the needs of the courts and provide the 
statistical data required by the Ministry of Justice. Budget allocations to courts for IT matters 
are  still  insufficient.  The  case  management  system  for  the  prosecution  service  has  yet  to 
become fully operational. 

Online access to jurisprudence is not fully guaranteed and there is no searchable database. If 
published,  court  rulings  often  lack  the  relevant  reasoning  and  publication  deadlines  are  not 
always  respected.  Efforts  are  also  needed  to  improve  judges'  drafting  skills.  Publication  of 
court decisions in an anonymous manner is still not possible. 

Since  October,  70  new  mediator  licences  were  delivered  and  there  are  now  367  licensed 
mediators, as opposed to 285 in 2014. In practice, only 61 mediators are operational and the 
number of mediation services provided remains very modest. 

The functioning of the private bailiff's service has improved since June 2014  when changes 
were  introduced  in  their  regulatory  framework  providing  for  the  abolition  of  fees  tying 
payments to the successful completion of the enforcement process. The ‘ALBIS’ public and 
private  bailiff  case  management  system  has  been  discontinued  for  lack  of  a  maintenance 
budget, although private bailiffs have since developed their own electronic system. 

As regards access to justice, the performance of the State Commission for Legal Aid needs to 
be  enhanced  so  as  to  cope  with  the  pressing  needs  of  a  considerable  number  of  vulnerable 
citizens. Six regional legal aid offices are yet to be set up. 

53 

 
 
 
Efficiency 

The  efficiency  of  the  court  system  is  undermined  by  insufficient  financial  and  human 
resources  and  the  lack  of  a  rational  organisation  of  the  administrative  staff.  The  length  of 
proceedings  remains  a  cause  of  concern.  The  process  of  adjusting  the  number  of  judges 
assigned to each court remains to be completed. Notification of court proceedings to parties is 
deficient and there is still no reliable address registry. Backlogs remain high, in particular in 
administrative courts, appeal courts and the High Court.  

A working group has been set up under the Ministry of Justice to tackle serious shortcomings 
identified in the process of producing and collecting statistical court data.  

Fight against corruption 

Track record                                                                                                                                                           

Albania’s  track  record  of  investigation,  prosecution  and  conviction  in  corruption  cases 
remains  limited.  The  number  of  corruption-related  cases  referred  to  the  prosecution  service 
has  increased.  However,  the  number  of  cases  being  brought  before  the  courts  remains  low, 
even  though  it  increased  by  82%  in  2014  compared  to  the  cases  sent  to  court  in  2013.  The 
number of final convictions involving junior or middle-ranking officials has nearly doubled in 
the first half of 2015, compared to the same period of the previous year. In 2015, there has 
been one first instance conviction of a corruption case involving a mayor and one conviction 
at  appeal  court  level  of  a  judge  on  corruption  related  grounds.  The  General  Prosecutor’s 
Office dismissed a prosecutor for a corruption-related offence.  

The  performance  of  the  High  Inspectorate  for  the  Declaration  and  Audit  of  Assets  and 
Prevention  of  Conflicts  of  Interest  (HIDAACI)  improved  considerably.  In  2014,  the 
inspectorate referred 74 cases to the prosecution service, out of which 25 were sent to court. 
In 2015, HIDAACI sent 82 referrals to the prosecution service, out of which five were sent to 
court.  These  referrals  resulted  in  three  prison  sentences  and  17  penalties.  Among  the 
HIDAACI referrals are twelve judges, two prosecutors and six members of parliament. Sound 
follow-up to referrals by the inspectorate, including a track-record of successful prosecution 
and  final  convictions,  has  yet  to  be  demonstrated.  In  2014,  the  inspectorate  imposed  400 
administrative  sanctions,  and  420  in  2015.  There  is  no  electronic  system  for  submitting, 
checking and publishing asset declarations. The process for selecting which public officials’ 
asset  declarations  to  check  has  yet  to  ensure  a  sufficient  sample  of  high-state  officials, 
including  members  of  parliament,  ministers  and  judges.  Prevention  of  conflict  of  interest 
requires greater awareness-raising, in particular in high-risk areas for corruption. 

Some  progress  has  been  made  with  the  upgrade  of  the  integrated  case  management 
information  system  ICMIS  and  the  introduction  of  a  case  management  system  in  some 
prosecution offices. However, the collection of inter-institutional and integrated statistics and 
track  record  remains  a  challenge.  Efforts  need  to  be  streamlined  and  Albania  should  work 
towards  setting  up  an  integrated  case  management  system,  into  which  all  law  enforcement 
bodies involved in the fight against corruption feed information, so that corruption cases can 
be followed from start to finish. The budget for the maintenance and implementation of the 
case management system in courts and prosecution offices needs to be secured. 

The  use  of  proactive  investigations and risk assessment in the tax and customs services has 
increased. Corruption in the tax and customs administration remains an issue of concern. 

Regarding internal control mechanisms, inspections carried out by the Internal Control and 
Anti-Corruption Unit of the Ministry of Interior need to substantially increase. The Council of 
Ministers’ Internal Administrative Control and Anti-Corruption Unit (UIACA) carried out 20 

54 

 
administrative  checks  in  2014,  which  have  led  to  39  disciplinary  measures  and  3  criminal 
referrals.  In  2015,  UIACA  carried  out  117  administrative  checks,  which  have  led  to  46 
recommendations  for  disciplinary  and  administrative  measures,  and  four  criminal  referrals. 
UIACA's recommendations have been implemented overall. 

Regarding  access  to  information,  214  complaints  were  registered  at  the  Commissioner  for 
Access to Information and Data Protection Office. In this period, 73 inspections were carried 
out, 45 decisions taken, and 21 complaints still are being processed. A system that captures 
the overall number of requests made to public institutions remains to be established. 

The law on the protection of whistle-blowers remains to be adopted. 

Institutional framework 

Prevention measures  

The capacity of the anti-corruption network in line ministries and at local level needs to be 
strengthened.  Sufficient  human  resources  need  to  be  ensured  for  the  anti-corruption  portal, 
and its scope and cooperation mechanisms with law enforcement bodies need to be defined so 
that complaints can be properly handled. The reporting mechanism has yet to demonstrate its 
effectiveness and impartiality.  

HIDAACI’s  budget  for  2015  was  around  30 %  higher  than  in  2014.  However,  its 
administrative, technical and financial capacity need to be further strengthened, particularly in 
view  of  the  greater  number  and  frequency  of  checks  provided  for  in  the  May  2014 
amendments that widened the scope of the asset declarations law. 

Further  efforts  are  needed  to  strengthen  the  role  of  the  High  State  Control  (HSC)  in  the 
overall  anti-corruption  framework  by  setting  up  an  effective  mechanism  for  parliament  and 
the  government  to  follow  up  its  findings.  Cases  involving  abuse  of  office  or  public  tenders 
referred to prosecutors by the HSC have led to very few investigations and no convictions. 

Regarding  political  party  financing,  vacancies  on  the  Central  Election  Commission  (CEC) 
board  have  been  filled.  The  CEC  needs  to  establish  clear  internal  responsibilities  for 
overseeing party finances and go beyond purely formal checks of statements by the political 
parties. Gaps in the legal and institutional framework need to be urgently addressed, including 
the  need  to  provide  for  regular  monitoring  and  reporting  on  expenditure  during  election 
campaigns  and  the  public  disclosure  of  preliminary  election  campaign  finances  prior  to 
election day. 

Recommendations  made  by  the  Group  of  States  against  Corruption  (GRECO)  in  its  fourth-
round  evaluation  report  on  preventing  corruption  among  MPs,  judges  and  prosecutors  have 
yet to be fully implemented. 

Law enforcement  

Proactive  investigations  —  based  on  thorough  risk  analysis  —  need  to  be  increased 
substantially to develop a solid track record of investigation, prosecution and final conviction 
in corruption cases. The next steps should include strengthening the investigative capacity of 
law enforcement agencies and conducting proactive and effective investigations by amending 
the  Criminal  Procedure  Code  in  relation  to  interceptions  and  surveillance,  time  limits  for 
investigations,  and  admissibility  of  evidence  before  a  court.  The  investigation,  prosecution 
and  judgment  of  corruption-related  offences  needs  to  be  improved  by  ensuring  sufficient 
autonomy and stability of police and prosecution staff, and clear jurisdiction over corruption-
related  crimes,  especially  for  the  highest  state  officials.  The  Joint  Investigative  Units,  the 
Serious  Crimes  Court  and  Prosecutor’s  Office,  and  the  HIDAACI  have  yet  to  be 

55 

 
guaranteed sufficient human and financial resources and training. 

Inter-agency  cooperation  needs  to  be  further  developed.  Cooperation  between  prosecution 
and  police  needs  to  be  improved  so  that  pre-trial  investigations  are  brought  as  a  result  of 
proactive  intelligence  gathering  and  access  to  information  from  both  public  and  private 
databases. The balance between effective prosecution instructions and an appropriate level of 
police autonomy and initiative has yet to be found. Concerns remain over weak cooperation 
between anti-corruption institutions and insufficient exchange of information, which hamper 
the  effective  conduct  of  investigations  and  prosecutions,  especially  for  high  state  officials. 
Bodies involved in the fight against corruption continue to suffer from inadequate allocations 
from the state budget. 

Legal framework 

Implementing  legislation  for  the  law  on  the  right  to  information  was  adopted  in  January. 
Provisions for setting up of a National Bureau of Investigation to tackle high-level corruption 
and associated crimes, under the new Law on State Police, were repealed by a Constitutional 
Court decision in April. 

Strategic framework 

In March, the cross-sectoral strategy (2015-20) and action plan (2015-17) against corruption 
were adopted. Both documents were widely consulted, including the preparation of the budget 
for  the  action  plan  measures. The  budget  for  the  action  plan  is  EUR  12  million.  It  contains 
specific  indicators  and  budgets  for  most  of  the  activities.  A  mechanism  to  monitor 
implementation of the action plan is provided for, but the monitoring framework and the body 
responsible  have  yet  to  be  set  up.  Representation  of  civil  society  organisations  in  the 
monitoring mechanism is planned. 

Fundamental rights  

Regarding  international  human  rights  instruments,  Albania  ratified  Protocol  16  of  the 
European  Convention  on  Human  Rights  enabling  the  European  Court  of  Human  Rights  to 
deliver  advisory  opinions  in  May.  Albania  has  ratified  most  international  human  rights  and 
humanitarian conventions, but further action is needed to ensure their full implementation. 

Since September 2014, the European Court of Human Rights (ECtHR) has found that the 
country violated the European Convention on Human Rights (ECHR) in three cases relating 
to the right to a fair trial, protection of property, right to liberty and security and right to an 
effective remedy. A total of 130 new applications were allocated to a decision-making body, 
bringing the number of pending applications to 402. Delays in applying the court’s judgments 
continued,  notably  on  property  rights,  judicial  proceedings,  the  right  to  a  fair  trial  and 
inadequate medical care in custody. 

Regarding the promotion and enforcement of human rights, the Ombudsman has continued 
to actively promote human rights and the rights of vulnerable groups, including by submitting 
special reports and recommendations.  Training  and  awareness-raising  campaigns  were  held; 
however,  human  rights  are  insufficiently  enforced.  Amendments  to  the  Law  on  the 
Ombudsman grant him the right to publish his reports even if parliament fails to discuss them. 
They  provide  for  more  transparent  and  inclusive  selection  of  candidate  commissioners,  but 
fail  to  increase  the  budget  of  the  Ombudsman’s  Office  or  its  organisational  autonomy.  The 
amendments provide for the creation of the Children’s Commissioner and the Commissioner 
for the national mechanism for prevention of torture. The capacity of institutions in charge of 
the protection and enforcement of human rights remains weak, and there is a particular need 
for better-trained, specialised staff in the judiciary and police. 

56 

 
As regards the right to life, blood feuds remain a problem, albeit on a limited scale. In March, 
parliament adopted a resolution and recommendations on blood feuds, based on the findings 
of the Ombudsman’s special report. The resolution calls for the coordination council on blood 
feuds set up in 2005 to be revived, for educational and social programmes to be run in rural 
areas, and for the prosecution and the police to step up investigation efforts and to invest more 
in preventing conflicts.  

On  prevention  of  torture  and  ill-treatment,  in  2014  the  national  preventive  mechanism 
(NPM)  conducted  115  inspections,  checks  and  monitoring  visits.  The  81  resulting 
recommendations were acknowledged, but most have not been addressed. In 2014, the NPM 
and the Ombudsman’s Office handled 35 complaints about disproportionate use of force and 
violence  by  police  officers  and  prisons  guards,  of  which  eight  were  found  to  have  valid 
grounds.  Very  view  investigations  are  launched  against  police  officers.  In  some  prisons, 
special  care  units  providing  psychological  support  have  been  set  up.  No  progress  has  been 
made on setting up a specialised medical institute to treat mentally ill detainees, who continue 
to  be  kept  in  inadequate  conditions  in  detention  in  Kruja  prison  hospital.  Further  action  is 
needed to ensure specialist treatment for this vulnerable category of prisoners in all facilities. 

Overcrowding  of  the  prison  system  remains  a  concern.  The  total  number  of  offenders  on 
probation rose from 700 in 2009, when the probation service was set up, to about 13 359 in 
December  2014.  Local  probation  offices  have  been  extended  to  all  22  judicial  districts. 
Despite this, the number of probation service staff has not risen which hampers the effective 
functioning  of  the  service  and  the  provision  of  alternatives  to  detention.  The  electronic 
monitoring system available in all judicial districts since February has yet to be used by the 
courts. Further action is needed to improve detention conditions and address overcrowding in 
prison and pre-trial detention which increased to 26 % above capacity in 2014. Problems with 
dilapidated infrastructure and poor maintenance of recently built facilities persist. 

Privacy issues and the lack of confidentiality of inmates’ conversations with visitors have yet 
to  be  addressed,  and  access  to  appropriate  healthcare  services  needs  to  be  secured,  as  do 
hygiene  and  health  standards.  Inmates  continue  to  rely  on  food,  equipment  and  medicines 
provided  by  relatives.  Support  networks,  before  and  after  prisoners’  release,  are  needed  to 
allow successful reintegration into society. Vocational courses in prisons as part of pre-release 
programmes, foreseen since November, have yet to be put into practice. The few inmates who 
work have their sentences remitted instead of receiving remuneration; the legal framework for 
employment scheme payments needs to be improved. Existing penitentiary legislation needs 
to be effectively implemented and aligned with EU standards. 

In the area of protection of personal data, the complaints submitted to the Commissioner for 
Right  to  Information  and  Data  Protection  increased.  The  free  phone  number  for  citizens' 
complaints  is  operational  and  a  complaint  form  is  available  on  the  commissioner's  website. 
Trainings and awareness-raising activities increased. The commissioner has been consulted on 
an  increasing  number  of  legislative  proposals.  The  capacity  of  the  commissioner's  office 
needs to be strengthened in order to ensure effective implementation of the law on access to 
information.  The  publication  of  court  decisions  is  not  always  in  line  with  data  protection 
requirements.  The  right to personal data  protection is frequently violated by the media. The 
independence  of  the  commissioner  should  be  strengthened,  in  particular  as  regards 
appointment and dismissal procedures as foreseen by its statute. 

Freedom of thought, conscience and religion was generally upheld and religious tolerance 
prevailed.  In  August,  an  Orthodox  Church  in  Dhërmi  was  demolished  by  the  Albanian 
authorities  on  the  alleged  grounds  that  it  was  illegally  built,  provoking  protests  by  the 
Church's community.  

57 

 
As  regards  freedom  of  expression,  one  case  of  a  failed  attempt  on  a  journalist’s  life  was 
reported  in  December  2014.  Another  journalist  received  death  threats  after  reporting  on  a 
police  drug  operation.  Proper  prosecution  and  judicial  follow-up  needs  to  be  ensured. 
Although rare, such cases remain a cause for concern.  

The  implementation  of  the  Law  on  Audiovisual  Media  has  been  slow,  mainly  because  the 
mandate  of  the  chair  of  the  Audiovisual  Media  Authority  (AMA)  was  suspended  and  there 
were  delays  in  filling  AMA  vacancies.  The  authority  drafted  an  action  plan  for  the  digital 
switchover  process  and  approved  a  regulation  that  allowed  the  launch  of  the  process  for 
licensing digital networks.  

The AMA has not been able to make decisions to carry out much of its remit in 2014, as the 
chair  was  suspended  while  prosecutors  conducted  an  investigation.  The  confrontational 
climate in parliament has also affected the regulator’s work. The election of two new AMA 
board  members  and  a  chair,  relying  on  ruling  majority  votes  only,  was  contested  by  the 
opposition in court. Opposition-nominated AMA members did not attend AMA meetings, as 
they disputed the legitimacy of the board, and this made it difficult for the regulator to reach 
the quorum needed for major decisions. 

There  have  been  some  defamation  lawsuits  brought  by  directors  of  public  administration 
offices  against  journalists,  but  no  reported  defamation  cases  brought  by  politicians  against 
journalists.  Further  action  is  needed  to  ensure  proper  implementation  of  amendments  on 
defamation  and  guidelines  on  setting  damages  at  a  reasonable  level,  in  particular  through 
training  for  judges  and  prosecutors.  A  new  amendment  to  the  Civil  Code  was  proposed  to 
hold administrators of news portals liable for filtering comments that offend human dignity. 
This may impose undue limits on freedom of expression. 

Media ownership has become more transparent, but concerns remain over hidden ownership. 
The  transparency  of  media  financing  remains  problematic.  Concerns  remain  over  the 
distribution of state advertising and public funds to media and business owners close to the 
government,  as  this  affects  fair  competition  among  media  businesses.  The  proposed 
amendment to remove limits on ownership of audiovisual media has led to concerns that this 
will facilitate the establishment of monopolies in the audiovisual media sector.    

Many  journalists  are  not  organised  or  represented  in  any  form.  Poor  implementation  of  the 
labour code for both full-time journalists and freelancers is an issue of major concern. Most 
journalists  work  without  employment  contracts  or  have  contracts  which  can  be  terminated 
arbitrarily.  Many  journalists  face  delayed  payment  of  their  salaries  and/or  losing  years  of 
social security payments. 

Freedom  of  assembly  and  association  has  generally  been  upheld.  A  number  of  peaceful 
protests and political demonstrations were held without major incidents. 

More efforts are needed to update and implement the 2012-2020 strategy on property rights 
and to complete the process of registering properties, to ensure judicial decisions are enforced 
and to continue the process of restitution and compensation.  

Regarding  the  execution  of  ECtHR  judgments  in  property  cases,  financial  compensation 
awarded  by  the  court  is  being  provided  to  relevant  individual  applicants.  To  implement  the 
2014  action  plan  agreed  with  the  Committee  of  Ministers  of  the  Council  of  Europe,  the 
government is finalising a new law setting up a mechanism to enforce decisions providing for 
restitution of, or compensation for, property nationalised under the communist regime.  

As regards non-discrimination policies, the number of cases handled by the Commissioner 
for Protection against Discrimination (CPD) increased and its ex-officio powers were used in 

58 

 
18 cases in 2014. The CPD significantly increased its participation in judicial processes. The 
Commissioner conducted awareness-raising activities and training, contributing to an increase 
in  complaints.  However,  more  outreach  and  a  more  proactive  approach  are  required.  Anti-
discrimination case law needs to be further developed and implementation improved. Data on 
hate crime is not collected.  

Equality between women and men is undermined by the poor functioning of mechanisms to 
address  gender  equality  and  gender-based  violence.  The  online  system  for  reporting  and 
monitoring  cases  of  gender-based  violence  is  still  operational  in  only  29  out  of  61 
municipalities.  The  number  of  reports  of  serious  offences  and  cases  of  domestic  violence 
increased,  signalling  more  trust  in  the  system,  but  the  vast  majority  of  cases  still  go 
unreported. The number of criminal proceedings for domestic violence increased. Courts have 
begun  to  prosecute  domestic  violence  cases  more  effectively  –  especially  in  Tirana.  The 
number of shelters and reintegration services needs to be increased, and existing volunteer-run 
shelters have yet to be supported by the authorities. Due to poor administrative and financial 
resources,  the  national  referral  mechanism  for  domestic  violence  is  operational  in  very  few 
municipalities, and it applies unnecessarily restrictive admission criteria for victims. Services 
for  victims  of  domestic  violence  should  improve  in  quality,  quantity,  accessibility  and 
geographical  coverage,  and  there  should  be  more  work  on  reintegration  and  economic 
empowerment.  

Legislative provisions that discriminate between men and women in a wide range of sectors 
need  to  be  repealed,  and  gender  bias  in  court  decisions  and  treatment  by  law  enforcement 
agencies  has  to  be  tackled.  Amendments  to  the  Electoral  Code  were  adopted  in  April  and 
provide for a 50 % gender quota requirement in candidate lists for municipal councils, and the 
rejection of lists which fail to meet this quota. Ten percent of mayoral candidates in the June 
local  elections  were  women  and  nine  women  were  elected  mayors,  marking  a  considerable 
increase. In 2015, out of a total of 140 members of parliament, 29 were women (21%).  

Regarding  the  rights  of  the  child,  the  child  protection  system  lacks  sufficient  budgetary 
means, staff continuity and standards of operation. Further action is needed to make it more 
accessible  to  children.  A  joint  directive  from  four  ministers  was  adopted,  identifying 
procedures to protect children at risk, including sexually abused children. The number of child 
protection units (CPU) rose to 196 at local level; however, many children in rural areas still 
lack access to them. Only five child rights units are working at regional level; seven stopped 
functioning  due  to  lack  of  funding.  CPUs  need  to  be  integrated  with  social  services,  and 
backed up by clear reporting and monitoring guidelines, and cooperation with institutions at 
regional and national levels increased. 

Further  work  is  needed  on  returning  children  to  family  settings,  expanding  foster  care  and 
ensuring  special  protection  for  children  in  residential  institutions.  A  revision  of  the  family 
code  is  needed  to  facilitate  placement  of  children  in  foster  families  and  ensure  adoption 
procedures  in  line  with  international  standards.  The  emigration  of  unaccompanied  minors 
from Albania to the EU remains a matter of concern.  

A specific juvenile justice system has yet to be established, that brings the existing legislation 
in  line  with  international  standards.  Most  of  the  96  juveniles  in  detention  are  held  in  the 
juvenile correction centre in Kavaja and the pre-trial detention facility in Vlora, which offer 
better conditions than other facilities. However, juveniles are still being detained longer than 
provided by law in detention and pre-detention for minor offences. Excessive length of pre-
trial  detention  is  a  concern.  The  level  of  reoffending  among  juveniles  is  high  and  no 
possibility  is  offered  for  secondary  education  in  detention.  A  lack  of  coordination  persists 

59 

 
between the justice and protection systems for juveniles coming out of the justice system who 
need support to reintegrate into society. 

As regards child labour, a nation-wide survey on street children completed in April found that 
up to 2 500 children, mostly Roma and Egyptian, live and/or work on the streets. The number 
of children working in cannabis plantations is an issue of serious concern. Albania remains a 
source  country  for  trafficked  children,  forced  child  labour  and  for  the  worst  forms  of  child 
labour as defined by ILO Convention 182.  

As  regards  integration  of  persons  with  disabilities,  sign  language  was  approved  as  an 
official  language  for  deaf  people.  Most  children  with  disabilities  remain  excluded  from 
schools  and  vocational  education.  Persons  with  disabilities  continue  to  face  difficulties  in 
accessing education, employment, healthcare, social services and decision-making. 

The  first  shelter  for  lesbian,  gay,  bisexual,  transgender  and  intersex  (LGBTI)  persons 
opened in Tirana in December. In May, parliament approved a resolution on the protection of 
rights and freedoms of persons belonging to the LGBTI community, which calls for an action 
plan, legislative amendments and other measures in support of LGBTI persons, and made the 
Ombudsman  responsible  for  monitoring  its  implementation.  The  international  day  against 
homophobia, transphobia and biphobia was celebrated in May with a number of awareness-
raising  events  but  public  awareness  remains  low.  Albania  was  one  of  the  signatories  of  the 
joint statement of Ministers of the region at the 2015 IDAHO forum. The second Tirana pride 
event  was  held  in  June  without  major  incidents.  Discrimination  against  transgender  and 
intersex persons need to be removed from the legislation.  

Labour and trade union rights are generally respected. The new National Labour Council 
improved its functioning and is meeting regularly. 

Regarding procedural rights, basic components are in place, but more efforts are needed to 
enhance the level of protection provided by the existing legislation and to ensure its effective 
implementation. As regards legal aid, the performance of the State Commission for Legal Aid 
needs to be enhanced so as to cope with the needs of vulnerable citizens. Six regional legal 
aid offices are yet to be set up. 

As  regards  respect  for  and  the  protection  of  minorities,  overall,  inter-ethnic  relations 
remained good, but the legal and policy framework still needs improving. In April the inter-
institutional  working  group  on  minorities  led  by  the  Ministry  of  Foreign  Affairs  submitted 
conclusions  aimed  at  addressing  shortcomings  in  the  protection  of  minorities,  taking  into 
account the recommendations of the Advisory Committee of the Framework Convention for 
the  Protection  of  National  Minorities.  The  group  suggested  drafting  a  specific  law  on 
minorities aimed at equal treatment of national and ethno-linguistic minorities, and enhancing 
the representativeness and consultative role of the State Committee on Minorities. Albania has 
not yet adopted the European Charter for regional and minority languages. National minority 
representatives  have  challenged  the  recent  local  government  boundary  changes,  maintaining 
that  the  new  system  violates  their  rights  and  international  norms.  Equal  access  to  rights  for 
persons from all minorities has yet to be ensured. 

The  implementation  of  policies  on  Roma  inclusion  remains  inadequate  overall,  as  does  the 
implementation  of  the  conclusions  of  the  2011  and  2014  Roma  seminars.  The  2015-2020 
national  action  plan  for  the  integration  of  Roma  and  Egyptians  still  remains  to  be  adopted. 
The  inclusion  of  Roma  children  in  the  education  system  has  improved  slightly;  however, 
enrolment  and  drop-out  rates  remain  a  serious  concern:  42 %  of  Roma  children  attend  pre-
school  education  (3-6),  but  only  16.1 %  finish  middle  school,  2.1 %  have  high  school 
education, and 0.3 % have university education. 40.3 % of the Roma population is illiterate. 

60 

 
The number of Roma and Egyptian street children remains a concern. The existing legal and 
institutional framework for registering births is not delivering the intended results. Roma and 
Egyptians continue to face very difficult living conditions and frequent social exclusion and 
discrimination,  particularly  regarding  access  to  healthcare,  social  protection,  education, 
employment and housing. 

Budgetary allocations for housing Roma and Egyptians have tripled, but remain insufficient to 
address needs. Most of the Roma families evicted from their settlements in August 2013 and 
transferred to the National Emergency Transition Centre are still living there. While some of 
the  families  left  the  centre  and  benefitted  from  municipal  social  housing,  no  long  term 
solution has been  found to  relocate the others. Further evictions took place  in Selita for the 
construction of the Tirana ring road. Apart from being offered two years’ worth of rent, most 
evicted  families  were  not  provided  assistance  to  find  new  accommodation  suited  to  their 
specific needs.  

4.24.  Chapter 24: Justice, freedom and security 

The EU has common rules for border control, visas, external migration and asylum. Schengen 
cooperation entails the lifting of border controls inside the EU. There is also cooperation in 
the  fight  against  organised  crime  and  terrorism,  and  judicial,  police  and  customs 
cooperation.   

Albania is at an early stage of preparation in this area and made some progress. Steps have 
been taken to improve the capacity of institutions in the areas of border management, asylum 
and  the  fight  against  terrorism.  Albania  has  started  issuing  identity  and  travel  documents  to 
refugees  and  is  ready  to  issue  such  documents  to  people  granted  subsidiary  protection  too. 
The alarming increase of unfounded asylum applications lodged by Albanian citizens in the 
EU is a matter of serious concern. In the coming year, Albania should in particular: 

→  step  up  intelligence-led  investigations  on  money  laundering  and  financial  crimes,  and 
increase confiscation of criminal assets; 

→  further  pursue  efforts  to  sustainably  prevent  and  fight  terrorism  by  strengthening  the 
counterterrorism  directorate,  increasing  inter-institutional  coordination  and  implementing 
targeted policies to prevent radicalisation; 

→  step  up  efforts  to  effectively  address  the  negative  phenomenon  of  unfounded  asylum 
applications, and prioritise investigations of facilitators of irregular migration. 

(See also the specific recommendations on the fight against organised crime in section 2.3.) 

Legal and irregular migration 

The  extended  2013  migration  profile,  containing  key  data  on  Albanian  migration,  was 
adopted  in  December;  the  2014  profile  has  been  finalised  and  is  expected  to  be  adopted  in 
October  2015.  Efforts  were  made  to  address  migration  issues  in  several  national  sector 
strategies  for  the  period  2014-20,  including  social  protection  and  inclusion,  employment, 
business and development, integrated border management, and the fight against trafficking in 
human beings. However, the lack of the new cross-sector national migration strategy remains 
an  issue  of  concern.  The  pre-screening  process  at  the  borders  and  reception  capacity  for 
irregular migrants need to be improved, in particular at the southern border, to cope with the 
increasing  migration  flows.  Registration  and  referral  mechanisms  also  need  to  be  further 
strengthened.  In  the  first  semester  of  2015,  1  963  irregular  migrants  were  apprehended, 
compared  to  601  during  the  same  period  in  2014.  Albania  needs  to  effectively  prosecute 
people's smugglers since the number of arrests and prosecutions remains low.  

61 

 
Asylum  

Albania is hosting Iranian exiles and former residents of the temporary transit location Camp 
Hurriya, Iraq. In November, Albania received 235 people from this community, bringing their 
total  number  to  479.  In  2014,  427  people,  mainly  from  Iran  and  Syria,  sought  asylum  in 
Albania. Asylum was granted to 10 people. In the first half of 2015, 112 new asylum requests 
were  submitted,  and  50  people  were  granted  asylum.  The  issuance  of  identity  and  travel 
documents  to  refugees  started  in  May.  Accommodation  capacity  and  asylum  procedure 
require  improvements.  While  interpretation  services  are  provided,  lack  of  qualified 
interpreters is a concern. A proper asylum case management system needs to be ensured. No 
specialist unit collects country of origin information. Procedures for determining international 
protection status need to be further improved. Albania has established initial contacts with the 
European Asylum Support Office (EASO). 

Visa policy  

Albania has yet to align its legislation with the EU ‘positive’ and ‘negative’ lists. The visa-
free  travel  regime  between  Albania  and  the  EU  continued  unhindered.  However,  irregular 
migration flows from Albania have increased considerably since 2013 and reached new peaks 
in 2014 and 2015. The number of asylum applications lodged by Albanian citizens grew by 
51 % between 2013 and 2014, reaching 16 795 in total. From January to end of August 2015, 
EU  Member  States  and  Schengen  associated  countries  reported  some  45  000  asylum 
applications  lodged  by  Albanian  citizens.  Albania  has  intensified  border  control  procedures 
and  engaged  in  outreach  activities.  However,  the  country  is  expected  to  further  step  up  its 
efforts to address the increasing number of manifestly unfounded asylum applications lodged 
by its citizens to EU Member States and Schengen-associated countries, and take immediate 
and  determined  action  via  the  post-visa  liberalisation  monitoring  mechanism.  This  is  even 
more urgent following  the  recent  peak of applications during the summer. Albania needs to 
engage in closer operational cooperation and information exchange with EU Member States, 
step  up  investigations  of  facilitators  of  irregular  migration,  conduct  regular  information 
campaigns  for  travellers  and,  most  importantly,  reduce  socioeconomic  push  factors.  All 
efforts  in  these  areas  need  to  continue  systematically  and  with  the  appropriate  allocation  of 
resources.  Increased  attention  needs  to  be  paid  to  the  effectiveness  of  border  controls, 
including  preventing  that  unaccompanied  minors  leave  the  country.  The  number  of 
unaccompanied minors from Albania, either staying irregularly or seeking asylum in the EU 
and Schengen-associated countries, has increased.  

Some  progress  was  made  on  cooperation  with  civil  society  on  awareness-raising,  assisted 
voluntary  returns,  monitoring  returns,  and  reintegrating  vulnerable  groups.  Further  action  is 
still  needed  to  ensure  effective  implementation  of  the  2010-15  strategy  and  action  plan  for 
returned  migrants,  and  to  develop  a  new  reintegration  strategy,  based  on  a  thorough  impact 
assessment  of  the  previous  one.  Implementation  of  the  readmission  agreements  continued 
implementation  protocol  was  signed  with  Portugal.  Negotiations  on 
smoothly.  An 
readmission  agreements  and  implementation  protocols  with  Ukraine  and  the  Russian 
Federation,  and  on  an  implementation  protocol  with  Greece,  are  ongoing.  Agreements  on 
exchanging  of  information  on  migration  should  be  signed  with  more  EU  Member  States  to 
strengthen  cooperation  on  readmission  and  return.  In  2014,  12 867  refusals  of  entry  of 
Albanian citizens to the EU and 11 923 refusals of exit from Albania were recorded. 

Schengen and external borders  

Two  police  cooperation  centres  at  the  border  crossing  points  with  Montenegro  and  Kosovo 
are  being  set  up  and  should  be  operational  by  the  end  of  the  year.  A  trilateral  police 
cooperation  centre  with  Greece  and  Italy  and  a  bilateral  centre  at  the  Greek  border  are 

62 

 
expected  to  be  set  up  shortly.  Work  is  about  to  start  at  two  border  crossing  points  with 
Montenegro and one with Kosovo, and an implementation protocol for a new border crossing 
point  with  Montenegro  is  expected  to  be  signed.  In  the  period  January-August,  Albania 
detected  157  cases  of  forged  and  counterfeit  documents,  compared  to  134  cases  during  the 
same period in 2014. The integrated border management strategy and its action plan are fully 
in  line  with  European  standards.  Further  investments  in  border  management  are  required  to 
keep  pace  with  the  evolving  challenges  stemming  from  cross-border  crime  and  irregular 
migration. Cooperation with Frontex in joint risk analysis has been consolidated. The capacity 
of  border  and  migration  police  needs  to  be  strengthened  to  further  upgrade  border  crossing 
points  and  reinforce  ‘green’  and  ‘blue’  (land  and  water)  border  surveillance.  The  non-
implementation  of  exit  checks  at  the  border  crossing  points  with  Albania  and  Kosovo  is  an 
issue of concern. Cooperation and coordination among authorities managing the blue border 
has  improved.  The  Interinstitutional  Maritime  Operations  Centre  (IMOC)  and  the  maritime 
surveillance and communication systems are fully operational. Appropriate planning of IMOC 
budgetary  resources  needs  to  be  guaranteed  to  ensure  adequate  operational  capacity  and 
sustainable surveillance systems.  

Judicial cooperation in civil and criminal matters  

Albania has maintained good judicial cooperation in civil and criminal matters, including with 
EU  Member  States.  However,  international  cooperation  needs  to  be  further  strengthened 
based on timely implementation of multilateral instruments and greater institutional capacity. 
Further  efforts  are  needed  to  strengthen  cooperation  with  Eurojust.  The  assessment  of  data 
protection standards by Eurojust is ongoing.  

Fight against organised crime 

Track record 

In  2014,  134  people  were  convicted  for  serious  and  organised  crimes  (compared  to  129  in 
2013),  mostly  for  drug  trafficking.  There  were  very  few  cases  brought  for  trafficking  in 
human beings. Eleven new cases were tried before the Serious Crimes Court of First Instance 
compared to none in 2013, with only eight convictions (no convictions in 2013). 

As regards money laundering, the number of suspicious transaction reports rose to 1 230 in 
2014,  more  than  double  that  of  2013.  However,  the  number  of  final  convictions  on  money 
laundering remained low. The total value of criminal assets confiscated increased: the Court 
of Appeal for Serious Crimes issued five confiscation decisions for over EUR 1 million and 
five land properties, compared with only EUR 747 000 in 2013. 

On  drug  trafficking,  Albania  intensified  the  fight  against  drug  trade  and  distribution 
networks.  The  amount  of  drugs  seized  increased.  In  2014,  73.5  kg  of  heroin,  10.3  kg  of 
cocaine  and  more  than  97  tonnes  of  marijuana  were  seized  (in  comparison  with  47.3 kg  of 
heroin,  16.1  kg  of  cocaine  and  almost  21  tonnes  of  marijuana  in  2013).  Secure  storage  of 
seized drugs and effective destruction procedures are not yet ensured and remain an issue of 
concern. In 2014, 180 cybercrime cases involving 86 people were detected, compared with 
108 cases in 2013. 

Institutional and operational capacity 

The  police  remains  vulnerable  to  political  pressure  and  corruption,  thus  hindering  effective 
investigation  of  organised  crime  cases.  Substantial  efforts  are  still  needed  to  strengthen  the 
capacity and improve the performance of all law enforcement authorities. Prosecutors dealing 
with  sensitive  cases  related  to  organised  crime  should  be  granted  special  protection  and 
ensured independence from any external and internal interference.  

63 

 
The  establishment  of  three  mobile  units  in  Tirana,  Vlora  and  Elbasan  contributed  to  the 
identification of an increased number of victims and potential victims of trafficking in human 
beings.  Since  their  creation  in  September  2014,  102  potential  victims  of  trafficking  were 
identified.  Most  of  the  victims  are  trafficked  for  sexual  exploitation,  forced  labour  and 
begging. 

The IT system for crime statistics is currently being reviewed to provide a clearer and more 
reliable overview of the status of criminal offences. An electronic case management system at 
the  prosecution  offices  started  with  a  pilot  phase  in  January.  Preparations  for  building  the 
capacity of the forensic laboratory to collect, compare and  store DNA profiles have started. 
The Combined DNA Index System (CODIS) was installed in April and users were trained. 

An exchange programme with the European Police College (CEPOL) is ongoing. A working 
agreement is in place; however, it has yet to be fully exploited to benefit from all CEPOL’s 
learning products.  

Legal framework 

The  new  Law  on  the  State  Police  entered  into  force  in  March.  It  established  a  merit-based 
recruitment and career evaluation system, and brought the code of ethics and internal control 
standards  closer  to  European  levels.  In  February,  parliament’s  National  Security  Committee 
adopted the draft law on military police in the armed forces, aiming at preventing, detecting 
and investigating criminal activities in the armed forces. The scope of the new law has yet to 
be clarified as regards the division of responsibilities between the military criminal police and 
judicial  police.  In  February,  the  government  adopted  a  decision  on  the  organisation  and 
functioning of the security academy.  

Strategic framework 

In November, the 2014-17 strategy for combating trafficking in human beings and its action 
plan were adopted. Albania has updated and continued to implement the strategy and action 
plan on the fight against organised crime and trafficking. A cyber security policy document 
has been prepared and is pending governmental approval. In April, the General Prosecutor’s 
Office  approved  the  2015-17  mid-term  strategy  and  action  plan  to  raise  the  standard  of 
investigation and increase the professionalism and integrity of prosecutors.  

Fighting  organised  crime  and  corruption  remains  fundamental  to  countering  criminal 
infiltration of the political, legal and economic systems. 

Fight against terrorism 

Albania  has  continued  to  implement  the  strategy  and  action  plan  on  the  fight  against 
terrorism. A security strategy was adopted, but the action plan and a clear timetable have yet 
to be adopted. The strategy to prevent extremism and terrorism was finalised and remains to 
be  adopted.  In  September,  the  Committee  of  Experts  on  the  Evaluation  of  the  Anti-Money 
Laundering Measures and the Financing of Terrorism (Moneyval) removed Albania from the 
list  of  countries  under  monitoring  for  money  laundering  and  terrorism  financing.  In 
December, a new counterterrorism directorate and four regional branches were set up in the 
Albanian  State  Police.  However,  they  are  not  yet  fully  staffed  and  operational.  A  fully 
functional counterterrorism directorate, working in close cooperation with the secret service 
and the border police, remains crucial to tackling terrorism threats effectively. A task force on 
terrorism and religious extremism was set up, involving the General Prosecutor’s Office, the 
Ministry  of  Interior,  the  Albanian  State  Police  and  the  Intelligence  Service  (SHISH).  Nine 
self-proclaimed  imams  are  standing  trial  over  allegations  of  promoting  acts  of  terrorism. 
Albania needs to develop an effective policy to prevent radicalisation, including through law 

64 

 
enforcement  measures  and  socioeconomic  actions  aimed  at  strengthening  social  inclusion, 
particularly among young people, and to enhance efforts to identify, prevent and disrupt the 
flow of foreign terrorist fighters traveling to conflict areas such as Iraq and Syria. 

Cooperation in the field of drugs  

Cooperation with the European Monitoring Centre for Drugs and Drug Addiction continued. 
The deployment of aerial surveillance contributed to a significant increase in the identification 
of  drug  plantations  and  subsequent  destruction.  In  2014,  a  total  of  551 414  cannabis  plants 
were  destroyed,  which  represents  an  increase  of  460 %  compared  to  2013.  In  the  first  ten 
months of 2015, the number of destroyed marijuana plants further increased by almost 40 % 
compared  to  the  total  number  for  2014,  accounting  for  more  than  99  %  of  the  plantations 
identified. In January, a major international police operation succeeded in dismantling a large 
drug lab in Elbasan, where cocaine was processed for the European market. Another operation 
carried out in cooperation with Germany resulted in the seizure of 19.4 kg of pure cocaine and 
97.6  kg  of  mixed  cocaine,  and  the  confiscation  of  EUR  321 950  and  a  number  of  firearms. 
While  the  successful  major  police  operation  in  Lazarat  in  2014  marked  an  important 
operational  achievement  in  the  fight  against  drug  cultivation,  the  investigation  and 
prosecution follow up has not been decisive. Of the 187 referrals handled from the police, the 
Serious  Crimes  Prosecutor’s  Office  submitted  to  court  the  request  for  trial  against  sixteen 
people  for  several  criminal  offences.  No  accusations  of  participation  in  a  criminal 
organisation were made. 

Customs cooperation  

The  24-hour  digital  camera  monitoring  system  is  fully  operational.  The  number  of 
investigations  against  customs  officials  for  crime  and  corruption  increased  compared  with 
previous years. 

For measures against counterfeiting the euro, see Chapter 32- Financial control. 

4.25.  Chapter 25: Science and research 

The  EU  provides  significant  support  to  research  and  innovation.  All  Member  States  can 
benefit from the EU’s research programmes, the more so where there is scientific excellence 
and solid investment in research. 

Preparations are at an early stage in the area of science and research. There was no progress 
in the past year. In the coming year, the country should in particular: 

→ build capacity and increase investment in research to ensure integration into the European 
Research Area and contribute to the Innovation Union; 

→  increase  efforts  for  successful  participation  in  the  research  and  innovation  framework 
programme Horizon 2020. 

Overall, actions in line with EU policy on research and innovation have not been implemented 
due to lack of national funding. 

As  regards  framework  programmes,  Albania  is  associated  to  the  EU  research  and 
innovation  programme  'Horizon  2020'  (2014-2020)  and  all  administrative  actions  for 
participation  are  in  place  (national  contact  points  and  representatives  in  Horizon  2020 
programme  committees  have  been  appointed).  Based  on  first  Horizon  2020  statistics,  the 
number of Albanian participants in proposals selected for funding has been very small. The 
Agency  for  Research,  Technology  and  Innovation  still  lacks  the  resources  to  promote 
cooperation on research and innovation. Albania should take actions to improve the scientific 
excellence  and  participation  of  the  private  sector  in  research  and  innovation  should  be 

65 

 
stimulated. Albania has been active in cooperating at regional level following its co-signing of 
the Western Balkan regional R&D strategy for innovation and it cooperates with the Central 
European Initiative. 

On  integration  into  the  European  Research  Area,  Albania  has  appointed  a  member  in  the 
European Research Area Committee, however, is not participating in it on a regular basis. The 
level of investment in research stagnated at about 0.4 % of Albania’s GDP. This is insufficient 
to make a meaningful contribution to competitiveness and growth. Due to a lack of reliable 
statistics  it  is  also  difficult  to  measure  the  precise  level,  in  particular  for  expenditure  on 
research by the private sector.  

On the Innovation Union, no specific actions to stimulate innovation have been taken. 

4.26.  Chapter 26: Education and culture 

The  EU  supports  cooperation  in  education  and  culture  through  funding  programmes  and 
through  the  open  method  of  coordination.  Member  States  must  also  prevent  discrimination 
and facilitate education of children of EU migrant workers. 

Albania  is  moderately  prepared  in  education  and  culture.  Apart  from  the  adoption  of  the 
new  law  on  higher  education,  no  progress  was  made  in  the  past  year.  Further  efforts  are 
needed  to  ensure  the  inclusiveness,  credibility,  transparency  and  quality  of  the  education 
system. In the coming year, the country should in particular: 

→ implement the new law on higher education with the aim of improving quality;  

→ continue to implement competence-based curricula with learning outcomes, and complete 
teacher training for it; 

→  continue  the  restructuring  of  vocational  education  and  training  to  improve  its  market 
relevance and enhance links with private sector.  

On  education,  training  and  youth,  following  the  recommendations  of  the  independent 
commission  for  higher  education  and  scientific  research  reform,  a  new  law  on  higher 
education was adopted. The accreditation process begun for all public and private universities. 
The comprehensive national qualifications framework is under revision. It will be important 
to ensure that diplomas comply with the law on higher education.  

The education sector remains a high-risk area for corruption. The recruitment  procedure for 
teachers  and  school  directors  needs  to  become  more  transparent  and  merit-based.  Despite 
significant improvements over the last decade, Albania still has considerable gaps to close in 
terms  of  years  of  schooling,  secondary  school  enrolment  rates,  education  quality  and  the 
market relevance of qualifications. Albania joined the European Alliance for Apprenticeship. 

Public  spending  on  education  is  low,  at  around  3 %  of  GDP,  with  primary  education 
commanding most of the expenditure (61 %). The 2012 PISA results for Albania, in testing 15 
year olds, were the lowest in the region and ranked Albania as 57th out of the 65 participating 
countries.  The  participation  rate  in  pre-school  education  is  about  30%.  The  2014-2020 
national strategy for jobs and skills and the relevant action plan were adopted in November. 
They need  to  be accompanied by  a financial and monitoring plan. Further efforts should be 
made to strengthen linkages between education and the labour market. 

Roma and Egyptian children are still not fully integrated in the education system, which often 
leads  to  unemployment  and  exclusion.  Quotas  for  the  enrolment  of  Roma,  Egyptians  and 
disadvantaged  students  in  public  universities  continued  to  be  applied.  Enrolment  rates  for 
Roma and Egyptian children increased slightly, but overall they remain very low. The 2015-
2020  action  plan  for  the  integration  of  Roma  and  Egyptians  and  the  social  inclusion  policy 

66 

 
 
document are yet to be adopted by the government (see also chapter 19 – Social policies and 
employment). 

As  regards  youth,  Albania  participates  in  the  Erasmus+  Youth  in  Action  strand  and  the 
Western Balkans Youth Window.  

In  the  area  of  culture,  Albania  continued  to  fully  participate  in  the  EU  Creative  Europe 
programme. 

4.27.  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  is  at  an  early  stage  of  preparation  in  this  area.  There  was  some  progress  on 
environment and climate change, however, industrial control and monitoring of emissions and 
waste management remain poor. Overall, resources remain limited and substantial investment 
is needed. In the coming year, the country should in particular: 

→  establish  systematic  strategic  planning,  start  implementing  the  Intended  Nationally 
Determined Contribution (INDC) to the expected 2015 Paris Climate Agreement; 

→ monitor the quality of the environment and increase administrative capacity; 

The  cross-cutting  strategy  for  the  environment  has  not  been  adopted  yet.  Further  work  is 
needed  to  align  horizontal  environmental  legislation,  in  particular  with  the  Directive  on 
Environmental  Crime.  Public  consultation,  access  to  information  and  cooperation  with  civil 
society organisations have improved. Initial steps taken to strengthen law enforcement need to 
be stepped up. The environmental impact assessment process has improved, but needs to be 
strengthened considerably, in the hydropower and mining sectors especially.  

As regards air quality, the national strategy for air quality and the law on ambient air quality 
were adopted and need to be enforced. The division of responsibilities between the National 
Environment Agency (NEA) and implementing bodies was clarified. The indoor smoking ban 
has  proved  effective.  Albania  has  missed  its  Energy  Community  deadline  to  implement  the 
1999 Directive  on Sulphur Content in Fuels. Known breaches of the standard values for air 
quality persist. Air quality in cities remains very problematic. 

Planning, coordination and implementation of policies on waste management are progressing 
very slowly and administrative capacity remains very limited. Implementing legislation in line 
with the acquis has been adopted in the areas of exporting and transiting non-hazardous and 
construction waste, and use of sewage sludge. Waste separation is very limited and recycling 
remains rare. Most waste continues to be disposed of unsafely in legal and illegal dumpsites, 
or burned. Hazardous medical waste is a major concern. 

In the area of water, water management was transferred to the Ministry of Agriculture, Rural 
Development  and  Water  and  a  National  Secretariat  of  the  Water  Council  was  created. 
Important  regulations  on  water  use,  under  the  law  on  integrated  water  management,  were 
adopted. Bathing water quality has improved overall however remains unsatisfactory in rivers. 
Untreated  sewage  is  the  main  source  of  pollution.  Further  efforts  are  needed  to  extend  the 
water  test  range  of  the  NEA.  In  March,  the  Velipoja  wastewater  treatment  plant  was 
completed, but is not yet operational. The number of operational plants thus remains five. 

In  the  field  of  nature  protection,  in  February,  parliament  passed  an  amendment  on 
international  trade  in  endangered  species  of  flora  and  fauna.  The  Research  Centre  for  Flora 

67 

 
and  Fauna  must  now  be  consulted  before  a  trade  permit  is  issued.  A  National  Agency  for 
Protected  Areas  and  Agency  for  the  Albanian  Coast  were  set  up.  Effective  protection  for 
designated protected areas still needs to be guaranteed. The investments in hydropower need 
to comply with nature protection obligations especially for protected areas and areas of high 
natural  value  and  to  be  carried  out  in  conformity  with  the  acquis  in  particular  with  the 
environmental  impact  assessment,  Water  Framework  Directive  and  Birds  and  Habitats 
Directives. 

In  the  area  of  industrial  pollution  control  and  risk  management,  the  law  transposing  the 
EU Directive on the control of major accident hazards has still not been adopted. Preventive 
measures are not enforced and risk preparedness is not applied. Self-monitoring of emissions 
is not reliable. In October, a task force was set up to inspect and evaluate the environmental 
compliance of oil exploration companies. Best available techniques to guide compliance have 
not been adopted yet. 

A framework law on chemicals management has not been adopted yet. A decision regulating 
import  of  ozone  depleting  gases  (HFCF)  over  the  coming  years  until  2040  was  amended  in 
line with Albania's commitments under the Montreal Protocol.  

On environmental noise, a joint order of the Ministers of Transport and of Environment was 
adopted, laying down the rules for protection from aircraft noise. It only partially transposes 
EU directives. 

As  regards  civil  protection,  the  2014-2018  national  strategy  for  disaster  risk  reduction  and 
civil protection has not been adopted yet. The floods in the south of the country in February 
showed the need for Albania to further strengthen its capacity in this sector. 

On climate change, Albania needs to develop a comprehensive policy and strategy consistent 
with  the  EU  2030  framework.  Significant  efforts  are  needed  to  fully  integrate  climate 
considerations  into  all  relevant  sectoral  policies.  The  preparation  of  the  national  plan  for 
adaptation to climate change has started. INDC to the 2015 Paris Climate Agreement has been 
adopted in September. Alignment with the EU monitoring mechanism regulation should be a 
priority. A decision on the reduction and stabilisation of fluorinated greenhouse gas emissions 
was  adopted  but  it  is  only  partially  aligned  with  the  relevant  EU  regulation.    The 
establishment of a monitoring, verification and reporting system for greenhouse gas emissions 
has not started yet.  

The  NEA  has  strengthened  its  administrative  capacity  considerably.  The  environmental 
monitoring  system  has  improved,  but  needs  more  financing.  The  State  Inspectorate  of  the 
Environment took initial steps to strengthen law enforcement. The incomplete implementing 
legislation,  in  particular  in  the  water  sector,  and  limited  logistical  resources  hamper  the 
normal functioning of the inspectorate. 

4.28.  Chapter 28: Consumer and health protection 

EU rules protect consumers 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, patients’ rights and communicable diseases.  

Preparations are at an early stage in the area of consumer and health protection. There was 
some progress over the last year. In the coming year, the country should in particular: 

→  align  legislation  with  the  acquis  on  tobacco  control,  substances  of  human  origin  and 
serious cross-border health threats, including communicable diseases; 

→ adopt the national strategy on consumer protection and market surveillance; 

68 

 
→ set up a market surveillance inspectorate. 

Legislation on consumer protection with regard to certain aspects of timesharing, long-term 
holidays and exchange contracts was adopted in October, aiming at bringing them in line with 
the acquis. An awareness-raising campaign on consumer protection was launched in 2014, but 
further  action  is  needed  to  empower  consumers.  The  Consumer  Protection  Unit  remains 
understaffed  and  the  capacity  of  the  Consumer  Protection  Commission  needs  to  be 
strengthened. The 2020 national strategy for consumer protection and market surveillance has 
been adopted in September 2015. 

In safety related issues, the Market Surveillance Inspectorate has not been established yet. 

In  non-safety-related  issues,  the  Consumer  Protection  Commission  issued  decisions  on 
standard energy and water contracts for consumers, asking for provisions with unfair terms to 
be  removed.  Based  on  consumer  complaints  against  a  currency  exchange  office,  the 
Commission  issued  a  decision  requiring  the  operator  to  fully  respect  the  legislation.  It 
recommended the adoption of a code of conduct for telephone operators. 

As  regards  public  health,  a  package  for  primary  healthcare  services  was  approved  in 
February,  addressing  prenatal  and  postnatal  care  and  new-born  and  child  care.  Significant 
efforts  have  been  made  to  fight  corruption  in  the  sector  (see  Chapter  23).  The  national 
electronic health record started to be implemented, following the completion of a feasibility 
study  in  October.  The  hospital  information  system  was  launched  in  several  institutions. 
Albania signed a loan agreement with the World Bank to set up health information systems 
and  strengthen  governance  of  public  hospitals  and  health  financing  to  improve  efficacy  and 
quality of healthcare. The coverage of insurance-based care remained very low. 

On tobacco control, the law on health protection against tobacco products has been unevenly 
implemented in the hospitality services sector. 

On communicable diseases, people with HIV/AIDS have difficulty accessing healthcare. A 
mosquito  control  strategy  and  action  plan  remain  to  be  adopted.  Little  has  been  done  to 
increase  the  capacity  of  hospital  microbiology  laboratories  and  provide  additional  human 
resources.  Reporting  systems  on  communicable  diseases  and  microbiology  laboratories  are 
not integrated with the national electronic health record system. 

On  blood,  tissues,  cells  and  organs,  blood  safety  and  transfusion  practices  improved,  but 
further efforts are needed to bring the legislation into line with the acquis. 

On  pharmaceuticals,  the  law  on  drugs  and  pharmaceutical  services  came  into  force  in 
September 2014. The law is only partially in line with the aquis. 

On  mental  health,  some  progress  has  been  made  in  the  implementation  of  secondary 
legislation  regulating  mental  health  services,  which  sets  out  the  responsibilities  of  mental 
health  professionals  and  physical  restraint  standards  for  mentally  ill  patients.  On  health 
inequalities,  some  steps  were  taken  to  improve  access  for  Roma  to  healthcare  through 
vaccination  campaigns,  community  nurses  and  home  visits;  however,  Roma  still  face 
difficulties  in  access  to  health  services.  Further  work  is  needed  to  ensure  access  to  good 
quality  healthcare  for  the  most  vulnerable  groups.  As  regards  nutrition,  700  family  doctors 
and  nurses  have  so  far  been  trained  using  integrated  training  modules  on  nutrition  for 
pregnant  women,  infants  and  children.  Child  malnutrition  remains  a  serious  concern.  On 
cancer  screening,  a  structure  for  cancer  screening  services  and  a  cancer  registry  system 
remain to be set up. 

69 

 
4.29.  Chapter 29: Customs union 

All Member States are part of the EU customs union and follow the same customs rules and 
procedures.  This  requires  legislative  alignment  as  well  as  adequate  implementing  and 
enforcement capacity and access to the common computerised customs systems. 

Albania is moderately prepared in the area of the customs union. Some progress was made 
in  particular  as  regards  further  approximation  of  the  legislation  with  the  acquis  and  the 
country’s increased participation in EU programmes and regional cooperation. In the coming 
year, the country should in particular: 

→ strengthen the fight against smuggling and imports of counterfeit products; 

→ ensure the interoperability of customs IT systems with those of the EU; 

→ continue fighting corruption and malpractice in the customs administration. 

On  customs  legislation,  the  new  customs  code  came  into  force  in  January,  together  with 
implementing instructions, in line with the acquis on a broad range of issues. The code was 
again  amended  in  March  to  allow  the  operation  of  duty-free  shops.  The  customs  tariff  was 
updated  in  line  with  the  2015  version  of  the  EU’s  combined  nomenclature.  As  of  May,  the 
rules  of  origin  for  the  Stabilisation  and  Association  Agreement  refer  to  the  Regional 
Convention on pan-Euro-Mediterranean preferential rules of origin. Legislation which entered 
into  force  on  26  August,  requires  payment  of  a  "scanning  fee"  per  customs  declaration. 
Article 33.1 of the SAA prohibits the introduction of customs duties on imports or exports or 
charges having equivalent effect in trade between the Community and Albania. 

As  regards  administrative  and  operational  capacity,  the  General  Directorate  of  Customs 
started to  implement a ‘Green  channel’ at customs houses. This initiative allows  companies 
with  a  good  customs  record  to  benefit  from  a  preferential  customs  procedure,  speeding  up 
trade formalities. The civil servant status of customs officials was confirmed in the customs 
code  in  line  with  the  Law  on  Civil  Servants,  and  legislation  on  the  procedures  and 
requirements for employment and promotion within the customs administration was adopted 
in  December.  Customs  revenue  decreased  during  the  first  quarter  of  2015  and  collection 
capacities  need  to  be  strengthened.  Cooperation  with  the  prosecution  and  the  High 
Inspectorate  for  the  Declaration  Audit  of  Assets  and  Conflicts  of  Interest  in  identifying 
corruption cases improved, leading to the dismissal of a number of customs officials. In May 
2015 integrity tests were carried out on 123 customs officials and disciplinary measures were 
taken  against  26  officials.  Albania  participates  in  the  EU  Customs  2020  programme  since 
December. 

A  joint  Albania-Kosovo  transit  corridor  was  inaugurated  in  February  to  facilitate  transit 
customs procedures and increase trade in the region. 

4.30.  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.  

Albania is moderately prepared in the area of external relations. There was some progress 
in  the  past  year.  Albania  continued  to  cooperate  well  with  the  EU  in  the  World  Trade 
Organisation (WTO). In the coming year, Albania should in particular: 

→ strengthen trade coordination/consultation policy mechanisms. 

70 

 
Albania has continued to coordinate its trade policy with the EU common commercial policy 
in  the  WTO.  Albania’s  2014  self-assessment  on  trade  facilitation  capacity  showed  85 % 
compliance  with  WTO  requirements.  Albania  notified  the  provisions  under  the  WTO  Trade 
Facilitation  Agreement  which  it  will  implement by  the  time  the  agreement  enters  into  force 
and started preparation for ratification of the agreement. 

There  were  no  developments  on  export  credits.  Preparations  have  started  for  transposing 
Annex  1  of  the  EU  Regulation  on  export  controls  on  dual-use  goods  but  further  efforts  are 
needed to align export control legislation with the acquis.  

As regards bilateral agreements with third countries, Albania continued negotiations with 
Turkey  under  the  Free  Trade  Agreement  (FTA),  focusing  on  the  liberalisation  of  trade  in 
services and the inclusion of investment provisions in the FTA. Albania finalised memoranda 
on  economic  cooperation  with  Kuwait,  Montenegro  and  Czech  Republic,  and  a  bilateral 
investment treaty with Kosovo. Economic and technical cooperation agreements with Bosnia 
and Herzegovina, Brazil, China, Kazakhstan and South Korea were finalised. Negotiations are 
ongoing  on  bilateral  investment  treaties  with  Canada,  Iceland,  Morocco,  Lebanon  and  the 
United  Arab  Emirates.  Albania  continued  its  constructive  participation  in  Central  European 
Free  Trade  Agreement  (CEFTA)  structures.  Negotiations  on  a  new  chapter  on  sustainable 
development to Albania's agreement with EFTA countries were concluded. 

There  were  no  legislative  changes  in  development  policy  or  humanitarian  aid,  which 
remain at an early stage of alignment.  

4.31.  Chapter 31: Foreign, security and defence policy 

Member  States  must  be  able  to  conduct  political  dialogue  in  the  framework  of  the  foreign, 
security and defence  policy,  to  align with EU  statements, to take part in EU actions and to 
apply agreed sanctions and restrictive measures. 

Albania has a  good level of preparation in foreign, security and defence policy. There has 
been some progress in the destruction of surplus of conventional ammunition and small arms 
and light weapons. On the common foreign and security policy, Albania aligned itself with all 
relevant EU declarations and European Council conclusions (100% alignment). This trend has 
been  consistent  for  the  last  few  years,  thus  demonstrating  a  very  clear  commitment  in 
supporting  the  positions  promoted  by  the  European  Union  on  issues  related  to  international 
peace  and  security.  Albania  has  also  continued  to  participate  in  civil  and  military  crisis 
management missions. In the coming year, the country should in particular: 

→ make full use and ensure maintenance of the online register of weapons and ammunition 
under the management of the State Police. 

Regular  political  dialogue  between  the  EU  and  Albania  on  foreign  security  policy  issues 
continued.  (For  more  information  on  relations  with  other  enlargement  countries  and  EU 
Member States, see Political criteria — Regional issues and international obligations.) 

On the common foreign and security policy, Albania aligned itself, when invited, with all 
relevant  EU  declarations  and  European  Council  conclusions  (100 %  alignment).  This  trend 
has  been  consistent  for  a  number  of  years,  thus  demonstrating  a  very  clear  commitment  in 
supporting  the  positions  promoted  by  the  European  Union  on  issues  related  to  international 
peace  and  security.  (As  regards  the  International  Criminal  Court,  see  Political  criteria  — 
Regional issues and international obligations.) 

Albania itself aligned with and implemented all restrictive measures introduced by European 
Council decisions. 

71 

 
 
On non-proliferation, Albania has made further progress in implementing the action plan for 
the destruction of surplus  weaponry.  The destruction of  surplus conventional ammunition is 
well  on  track.  Clearance  of  hot  spots,  removal of  hazardous  chemicals,  and  final  closure  of 
unneeded depots and renovation of permanent depots remains to be done. The destruction of 
small  arms  and  light  weapons  is  almost  complete.  Some  action  has  been  taken  to  upgrade 
armament and storage security, which remains a concern. The online register of weapons and 
ammunition under the management of the State Police has been installed and is operational. A 
national  security  strategy  was  adopted.  The  strategy  on  counter  violent  extremism  was 
finalized  and  remains  to  be  adopted.  (As  regards  the  International  Criminal  Court,  see 
Political criteria 2.3 — Regional issues and international obligations.) 

Albania has continued to engage actively in cooperation with international organisations. 
Albania maintained four observers to the two OSCE missions in Ukraine, and also sent two 
OSCE observers for parliamentary elections in Ukraine held in October 2014. 

On  security  measures,  a  security  agreement  with  the  EU  on  the  exchange  and  mutual 
protection of classified information is under negotiation. 

Albania has continued to participate in civil  and  military  crisis  management  missions  under 
the  common  security  and  defence  policy  (CSDP),  in  particular  EUFOR  Althea  Bosnia 
Herzegovina  (with  one  military  officer).  Via  NATO,  Albania  has  provided  significant 
supplies of surplus weapons and ammunition to Kurdish forces fighting Da'esh. 

4.32.  Chapter 32: Financial control 

Based  on  international  standards,  EU  financial  control  rules  promote  sound  financial 
management  of  national  income  and  expenditure.  They  also  protect  the  EU's  financial 
interests against fraud in the management of EU funds and the euro against counterfeiting. 

Albania is moderately prepared in this chapter. Some progress was made in the past year, 
especially in adopting a comprehensive public financial management reform strategy and an 
amended State Audit Institution (SAI) law. However, the managerial accountability principle 
is  not  yet  fully  embedded  in  the  management  culture  and  public  internal  financial  control 
(PIFC)  legislation  is  not  systematically  implemented  by  all  institutions.  In  the  coming  year 
Albania should in particular: 

→ adopt amendments to the PIFC legislation; 

→ strengthen follow-up to the annual PIFC assessment addressing systemic weaknesses; 

→ ensure quality of external audit by further aligning SAI operations to the standards of the 
International Organisation of Supreme Audit Institutions (INTOSAI). 

Public internal financial control 

In  December  2014  the  government  adopted  the  2014-2020  public  financial  management 
reform strategy. The PIFC Council, an advisory body for the Ministry of Finance, has yet to 
take  a  more  active  role  in  promoting  reforms  while  the  government  has  yet  to  ensure 
systematic follow-up to the findings of the annual PIFC report. 

The  two  Central  Harmonisation  Units  for  Financial  Management  and  Control  and  for 
Internal  Audit  continue  to  focus  on  organising  training  and  preparing  legislation  and 
guidelines.  This  focus  should  be  changed  to  undertaking  more  strategic  policy-driven 
activities. The recommendations from annual reporting have yet to be effectively followed up.  

Draft amendments to the financial management and control (FMC) law clarifying the role 
of authorising officers are awaiting adoption. Primary and secondary legislation is largely in 

72 

 
line  with  the  internal  control  framework  of  the  Committee  of  Sponsoring  Organisations 
(COSO)  and  INTOSAI  guidelines  but  implementation  remains  weak  at  all  levels  of  the 
administration. Particular examples are the low proportion of budget institutions (30%), which 
have drawn up internal procedures for FMC; the uneven introduction of delegation; and the 
insufficient application of risk management. Effective implementation and supervision of the 
FMC systems, and appropriate training for staff and senior programme officers, have yet to be 
ensured. The draft law, which is to make the centralised budget inspection function in line 
with  PIFC  requirements,  is  awaiting  adoption.  The  operational  capacity  of  the  Financial 
Inspection Directorate is not sufficient to fight high-risk fraud and corruption. 

The internal audit law is in line with international standards. Manuals and codes of ethics are 
largely in place. The share of certified auditors is 82% but a new national certification scheme 
is  being  developed.  Of  116  institutions,  28  are  not  sufficiently  staffed.  The  internal  audit 
function is yet to reach its potential with managers still asking auditors to perform inspection 
type work rather than identifying systemic weaknesses and modalities to address them. 

External audit 

Since  a  revised  SAI  law,  in  line  with  INTOSAI  guidelines,  was  adopted  in  February  2015, 
there  is  an  adequate  constitutional  and  legal  framework  in  place  to  guarantee  the  SAI’s 
functional  and  operational  independence.  Work  now  needs  to  focus  on  ensuring  that  the 
revised legal provisions are fully implemented. 

The SAI has a total of 149 allocated posts, which are not sufficient to cover its audit mandate 
involving  all  public  sector  institutions.  To  help  boost  its  institutional  capacity,  the  SAI 
updated its strategic development plan for the period 2015-17, which foresees improvement of 
the quality of audit work in line with INTOSAI standards. While the SAI may carry out any 
type  of  audits,  it  mostly  undertakes  compliance  audits  determining  economic  damage  and 
violations of rules rather than focusing on how to prevent such damages. Financial audits do 
not yet result in professional audit opinions. Performance audits have to increase in numbers 
and fully comply with international standards. Audit manuals are in place but they need to be 
revised to comply with INTOSAI standards.  

The impact of audit work is limited by the low number of audited institutions. In 2014, the 
SAI  completed  160  audits,  uncovering  irregularities  totalling  11.19  billion  Albanian  LEK. 
The SAI presented 41 cases concerning 149 officials to the General Prosecutor Office as part 
of  the  fight  against  economic  crime,  fraud  and  corruption.  Audit  reports  are  summarised 
quarterly  and  published  on  the  SAI  website.  The  Ministry  of  Finance  developed  an  action 
plan  to  follow-up  on  SAI  findings  but  systematic  follow-up  needs  to  be  further  reinforced. 
The  SAI  annual  audit  report  to  the  Parliament  is  discussed  in  the  Economic  and  Financial 
Committee, but there is again no systematic parliamentary follow-up.    

Protection of the EU’s financial interests 

As regards acquis alignment, the national legislation incorporates the main elements of the 
Convention on the Protection of the EU’s Financial Interests and regulates the obligation to 
safeguard evidence. The revised law covering the requirements for the national anti-fraud 
coordination  service  (AFCOS),  assigned  to  the  public  financial  inspection  directorate 
under  the  Minister  of  Finance,  remains  to  be  adopted.  AFCOS  has  limited  operational 
capacity.  With  regard  to  cooperation  with  the  European  Commission,  procedures  for 
reporting  irregularities  and  suspected  fraud  cases  remain  to  be  strengthened.  The 
irregularity management system has been set up but so far no suspected cases have been 
reported. A solid track record on investigation activities still needs to be established. 

73 

 
 
Protection of the euro against counterfeiting 

Albania has signed, but not yet ratified, the 1929 International Convention for the Suppression 
of  Counterfeiting  Currency.  Acquis  alignment  is  partial.  Medals  and  tokens  similar  to  euro 
coins  are  not  yet  regulated.  Technical  analysis  of  counterfeit  money  is  performed  by  the 
National  Analysis  Centre  (NAC)  of  the  National  Bank,  which  has  assessed  a  considerable 
number of domestic and foreign currency banknotes in the period 2014-15. It cooperates with 
competent  authorities  at  national  and  international  level.  The  National  Bank  concluded  a 
formal cooperation agreement with the European Commission on coins in 2013. A similar 
agreement  on  banknotes  with  the  European  Central  Bank  is  pending.  National  competent 
authorities participate regularly in activities organised under the Pericles 2020 programme.  

4.33.  Chapter 33: Financial and budgetary provisions 

Rules for funding the EU budget provide for contributions based mainly on the gross national 
income of each Member State as well as from value-added tax and customs duties. 

Albania  has  some  level  of  preparation  in  financial  and  budgetary  provisions.  There  was 
some progress in this area. Albania will need to set up a coordinating body in due course to 
steer pre-accession preparations in the own resources field. 

There were limited developments in the area of traditional own resources, the value added 
tax-based  resource  and  the  gross  national  income-based  resource.  On  the  VAT-based 
resource, tax evasion remains a priority to be tackled. As regards the gross national income-
based  resource,  work  on  introducing  ESA  2010  standards  will  need  to  continue.  (For 
developments in the underlying policy areas, see Chapters 16 — Taxation; 18 — Statistics; 29 
— Customs union; and 32 — Financial control.). 

Albania  has  put  in  place  the  main  administrative  infrastructure  for  the  underlying  policy 
areas  that  indirectly  affect  the  own  resources  system.  Further  efforts  are  needed  to  ensure 
effective  measures  for  fighting  tax  evasion  and  the  informal  economy.  In  due  course,  work 
will need to be done to set up the institutions and the coordinating body in charge of preparing 
the administrative conditions for applying the own resources rules. 

74 

 
 
 
 
 
Annex I – Relations between the EU and Albania 

The Stabilisation and Association Agreement between Albania and the EU came into force 
in April 2009. Albania presented its application for membership of the European Union on 28 
April  2009.  Following  a  request  by  the  Council,  the  Commission  submitted  its  Opinion  on 
Albania’s  application  in  November  2010.  In  December  2010,  the  Council  noted  that  the 
opening  of  accession  negotiations  would  be  considered  once  the  Commission  has  assessed 
that  the  country  has  achieved  the  necessary  degree  of  compliance  with  the  membership 
criteria and, in particular, has met the key priorities set out in the Commission’s Opinion. In 
view of the progress made by Albania, the Commission recommended in October 2013 that 
Albania be granted candidate status,  on the understanding that  it continues to take action in 
the  fight  against  organised  crime  and  corruption,  and  the  Commission  identified  five  key 
priorities  for  opening  accession  negotiations.  In  December,  the  Council  stated  that  it  would 
decide  on  whether  to  grant  candidate  status  in  June  2014,  in  the  light  of  a  report  by  the 
Commission focusing on Albania’s implementation of its judicial reform strategy and on the 
fight  against  organised  crime  and  corruption.  The  Council  stressed  that  sustained 
implementation  of  reforms  and  fulfilment  of  all  key  priorities  would  be  necessary  for  the 
opening  of  negotiations.  In  a  report  published  in  June  2014,  the  Commission  confirmed  its 
recommendation  that  the  Council  should  grant  Albania  candidate  status.  The  European 
Council of June 2014 endorsed the decision of the General Affairs Council granting Albania 
candidate status. 

In the past year, Albania has implemented smoothly its obligations under the Stabilisation and 
Association Agreement (SAA). Regular political and economic dialogue between the EU and 
Albania has continued through the relevant structures  under the SAA. The Stabilisation and 
Association  Committee  and  Council  met  in  April  and  May  2015,  respectively.  Meetings  of 
subcommittees and of the special group on public administration reform were held. Albania 
continued  to  actively  participate  in  high  level  dialogue  meetings,  which  were  held  in 
September 2014, March 2015 and September 2015, as well as in the related meetings of the 
joint working groups on the five key priorities in September and February.  

Albania  has  made  steady  progress  in  addressing  the  key  priorities  for  the  opening  of 
accession negotiations, pursuing a set of reforms necessary to advance in the EU integration 
path.  The  most  relevant  achievements  are  related  to  public  administration  reform  and  the 
preparation  of  a  comprehensive  reform  of  the  judicial  system.  It  is  essential  to  build  on  the 
progress  made  and  keep  the  reform  momentum.  In  the  area  of  rule  of  law,  further  tangible 
results are necessary. The finalisation of the comprehensive reform of the judiciary is amongst 
the  most  significant  challenges.  Albania  needs  to  demonstrate  progress  with  a  view  to 
establishing  a  solid  track  record  of  investigations,  prosecutions  and  final  convictions  in 
corruption  and  organised  crime  at  all  levels.  The  implementation  of  effective  measures  to 
reinforce  the  protection  of  human  rights,  including  of  Roma  citizens  and  other  vulnerable 
groups within the society, and anti-discrimination policies, as well as the implementation of 
property rights are of utmost importance. Albania should pursue economic reforms aimed at 
increasing competitiveness and tackling high unemployment, as well as improve the business 
environment.  The  commitment  to  inclusive  dialogue  and  cooperation  under  the  agreement 
reached between the ruling majority and the main opposition party in December 2014 needs 
to  be  maintained  for  the  overall  sustainability  of  all  the  ongoing  and  upcoming  EU-related 
reform processes. 

Visa liberalisation for citizens of Albania travelling to the Schengen area has been in force 
since December 2010. As part of the monitoring mechanism in place since visa liberalisation, 

75 

 
 
the  Commission  has  been  regularly  assessing  the  progress  made  by  the  country  in 
implementing  reforms  introduced  under  the  visa  roadmap.  The  monitoring  mechanism  also 
includes an alert mechanism to prevent abuses, coordinated by Frontex. The Commission has 
organised  a  post-visa  liberalisation  peer  review  mission  in  June  and  submitted  regularly  its 
monitoring  reports  to  the  European  Parliament  and  the  Council.  The  next  post-visa 
liberalisation  report  will  be  presented  in  the  last  quarter  of  2015.  A  readmission  agreement 
between the European Union and Albania has been in force since 2006. 

The  EU  provided  financial  assistance  to  Albania  under  the  Instrument  for  Pre-accession 
Assistance  (IPA)  for  the  period  2007-2013  with  a  total  allocation  of  €  594  million.  The 
assistance  has  been  predominantly  implemented  under  direct  management  by  the  EU 
Delegation  in  Tirana.  The  indirect  management  modality  has  been  introduced  with  a  pilot 
approach for the IPA 2013 national programme. 

Under IPA II, Albania will continue to benefit from pre-accession assistance for 2014-2020 in 
line with the priorities set out in the indicative strategy paper, with a total indicative allocation 
of € 649.4 million. The Framework Agreement for IPA II entered into force in April.   

The  2014  action  programme  for  Albania  provides  approximately  € 67  million  to  promote 
reforms in key  sectors such  as  democracy  and governance and rule of law and fundamental 
rights.  It  includes  a  budget  support  operation  for  public  finance  management  and  a  set  of 
actions  for  support  to  public  administration  reform,  participation  in  union  programmes  and 
economic and social empowerment of minority groups, as well as an EU integration facility. 

Albania  continues  to  benefit  from  support  under  the  IPA  multi-country  and  regional 
programmes.  It  continues  to  participate  in  five  cross-border  cooperation  programmes  with 
neighbouring  Western  Balkan  countries  and  Member  States,  as  well  as  in  transnational 
cooperation  programmes  under  the  European  Regional  Development  Fund  and  the  IPA 
Adriatic cross-border programme. 

Albania participates in the following EU programmes, with IPA support:  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). 

76 

 
Annex II – Statistical Annex 

STATISTICAL DATA (as of 7.09.2015) 
Albania 

Basic data 
Population (thousand) 
Total area of the country (km²) 

Note 
1) 

2002 
3 057e 
28 750 

2010 
2 919e 
28 750 

2011 
2 907e 
28 750 

2012 
2 902e 
28 750 

2013 
2 899e 
28 750 

2014 
2 896e 
28 750 

National accounts 
Gross domestic product (GDP) (million national 
currency) 
Gross domestic product (GDP) (million euro) 
GDP (euro per capita) 
GDP (in Purchasing Power Standards (PPS) per 
capita) 
GDP (in Purchasing Power Standards (PPS) per 
capita), relative to the EU average (EU-28 = 
100) 
Real GDP growth rate: change on previous year 
of GDP volume (%) 
Gross value added by main sectors 
Agriculture, forestry and fisheries (%) 
Industry (%) 
Construction (%) 
Services (%) 
Final consumption expenditure, as a share of 
GDP (%) 
Gross fixed capital formation, as a share of GDP 
(%) 
Changes in inventories, as a share of GDP (%) 

Exports of goods and services, relative to GDP 
(%) 
Imports of goods and services, relative to GDP 
(%) 

Business 
Industrial production volume index (2010 = 100) 
Number of active enterprises (number) 
Birth rate: number of enterprise births in the 
reference period (t) divided by the number of 
enterprises active in t (%) 
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) (%) 
Value added by SMEs (in the non-financial 
business economy) (EUR million) 
Total value added (in the non-financial business 
economy) (EUR million) 

Inflation rate 
Consumer price index (CPI), change relative to 
the previous year (%) 

2002 
622 71
1 
4 705 
1 537 
: 

2010 
1 239 645
b 
8 997b 
3 088b 
7 089e 

2) 

2) 
2) 
2) 3) 

2011 

2012 
1 300 624  1 332 811  1 350 555

2013 

9 268 
3 191 
7 409e 

9 586 
3 305 
7 300 

p 
9 629p 
3 323p 
7 400 

2014 
1 393 54
0p 
9 956p 
3 440p 
7 800 

2) 4) 

: 

28 

28 

28 

28 

29 

5) 

4.2 

3.7b 

2.5 

1.4 

1.1p 

2.1p 

2) 
2) 
2) 
2) 
2) 6) 

: 
: 
: 
: 
86.0 

20.7 
13.8 
14.9 
50.7 
88.9b 

21.0 
13.5 
14.6 
50.9 
88.9s 

21.7 
13.3 
13.1 
51.9 
88.5 

22.5p 
14.4p 
11.9p 
51.1p 
88.9p 

22.6p 
14.2p 
11.0p 
52.2p 
90.7p 

2) 6) 

37.9 

28.4b 

29.4s 

26.5 

25.9p 

24.9p 

2) 6) 
7) 
2) 6) 

0.8 

1.9b 

2.0s 

1.8 

2.4p 

: 

19.6 

32.4b 

34.0s 

33.4 

35.4p 

29.9p 

2) 6) 

44.3 

53.0b 

56.7s 

52.0 

53.5p 

49.0p 

Note 

2002 
: 
56 490 
18.0 

2010 
100.0 
103 038 
16.0 

2011 
111.9 
109 039 
11.8 

2012 
118.7 
106 837 
12.0 

2013 
135.1 
111 083 
10.9 

2014 
138.9 
112 537 
15.4 

: 

: 

: 

: 

: 

73.6 

83.8 

81.4 

81.7 

81.0 

496e 

1 574 

1 521 

2 126 

1 961 

740 

2 476 

2 239 

3 077 

2 948 

: 

: 

: 

: 

Note 
8) 

2002 
1.7 

2010 
3.6 

2011 
1.7 

2012 
2.4 

2013 
1.9 

2014 
0.7 

77 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance of payments 
Balance of payments: current account total 
(million euro) 
Balance of payments current account: trade 
balance (million euro) 
Balance of payments current account: net 
services (million euro) 
Balance of payments current account: net 
income (million euro) 
Balance of payments current account: net 
current transfers (million euro) 
of which government transfers (million euro) 
**3 year backward moving average of the current 
account balance relative to GDP (%) 
Net inward foreign direct investment (FDI) 
(million euro) 
Foreign direct investment (FDI) abroad (million 
euro) 
of which FDI of the reporting economy in the EU-
28 countries (million euro) 
Foreign direct investment (FDI) in the reporting 
economy (million euro) 
of which FDI of the EU-28 countries in the 
reporting economy (million euro) 
**Net international investment position, relative 
to GDP (%) 
Year on year rate of change in gross inflow of 
remittances (in national currency) from migrant 
workers (%) 

Public finance 
***General government deficit / surplus, relative 
to GDP (%) 
***General government gross debt relative to 
GDP (%) 
Total government revenues, as a percentage of 
GDP (%) 
Total government expenditure, as a percentage 
of GDP (%) 

Financial indicators 
Gross foreign debt of the whole economy, 
relative to GDP (%) 
Gross foreign debt of the whole economy, 
relative to total exports (%) 
Money supply: M1 (banknotes, coins, overnight 
deposits, million euro) 
Money supply: M2 (M1 plus deposits with 
maturity up to two years, million euro) 
Money supply: M3 (M2 plus marketable 
instruments, million euro) 
Total credit by monetary financial institutions to 
residents (consolidated) (million euro) 
Interest rates: day-to-day money rate, per 
annum (%) 
Lending interest rate (one year), per annum (%) 
Deposit interest rate (one year), per annum (%) 
Euro exchange rates: average of period (1 euro 
= … national currency) 
Trade-weighted effective exchange rate index 
(2005 = 100) 

Note 
9) 

2002 
-444 

2010 
-1 019 

2011 
-1 225 

2012 
-978 

2013 
-1 037 

2014 
-1 303p 

9) 

9) 

9) 

9) 

9) 

-1 218 

-2 083 

-2 242 

-1 999 

-1 893 

-2 137p 

-8 

232 

116 

-90 

667 

922 

135 

-25 

906 

213 

-72 

880 

155 

268p 

21 

-160p 

680 

725p 

41 
-7.2 

45 
-14.1 

29 
-13.3 

33 
-11.6 

17 
-11.4p 

9p 
: 

141.4 

788.5 

608.9 

647.8 

923.2 

801.3p 

0.0 

4.8 

21.4 

17.9 

21.6 

76.3p 

: 

: 

: 

: 

: 

: 

141.4 

793.3 

630.4 

665.8 

944.8 

877.6p 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

-11.0 

-3.9 

1.6 

-19.6 

8.8p 

Note 

2002 
-6.1 

2010 
-3.1 

2011 
-3.5 

2012 
-3.4e 

2013 
-4.9 

2014 
-5.1 

62.8 

57.7 

59.4 

62.0 

70.1 

71.8 

24.8 

26.2 

25.4 

24.7 

24.0 

25.9 

30.9 

29.3 

28.9 

28.2 

28.9 

31.0 

Note 
10) 

2002 
62.8 

2010 
54.0 

2011 
55.7 

2012 
58.0 

2013 
61.1 

2014 
65.2 

320.6 

166.6 

163.7 

174.2 

174.1 

174.0 

1 102 

1 999 

1 973 

2 023 

2 109 

2 524 

2 430 

4 387 

4 611 

4 816 

4 942 

5 161 

3 083 

7 114 

7 626 

8 080 

8 192 

8 538 

302 

3 506 

3 862 

3 990 

3 906 

4 001 

: 

4.92 

5.07 

3.96 

3.53 

2.55 

14.96 
8.50 
132.36 

11.29 
6.40 
137.79 

11.17 
5.87 
140.33 

10.28 
5.38 
139.04 

9.52 
4.17 
140.26 

7.66 
1.92 
139.97 

: 

: 

: 

: 

: 

: 

11) 

12) 
13) 

78 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Value of reserve assets (including gold) (million 
euro) 
External trade in goods 
Value of imports: all goods, all partners (million 
euro) 
Value of exports: all goods, all partners (million 
euro) 
Trade balance: all goods, all partners (million 
euro) 
Terms of trade (export price index / import price 
index * 100) (number) 
Share of exports to EU-28 countries in value of 
total exports (%) 
Share of imports from EU-28 countries in value 
of total imports (%) 

Demography 
Crude rate of natural change of population 
(natural growth rate): number of births minus 
deaths (per thousand inhabitants) 
Infant mortality rate deaths of children under one 
year of age (per thousand live births) 
Life expectancy at birth: male (years) 
Life expectancy at birth: female (years) 

Labour market 
Economic activity rate for persons aged 20–64: 
proportion of the population aged 20–64 that is 
economically active (%) 
*Employment rate for persons aged 20–64: 
proportion of the population aged 20–64 that are 
in employment (%) 
Male employment rate for persons aged 20–64 
(%) 
Female employment rate for persons aged 20–
64 (%) 
Employment rate for persons aged 55–64: 
proportion of the population aged 55–64 that are 
in employment (%) 
Employment by main sectors 
Agriculture, forestry and fisheries (%) 
Industry (%) 
Construction (%) 
Services (%) 
People employed in the public sector as a share 
of total employment, persons aged 20–64 (%) 
People employed in the private sector as a 
share of total employment, persons aged 20–64 
(%) 
Unemployment rate: proportion of the labour 
force that is unemployed (%) 
Male unemployment rate (%) 
Female unemployment rate (%) 
Youth unemployment rate: proportion of the 
labour force aged 15–24 that is unemployed (%) 
Long-term unemployment rate: proportion of the 
labour force that has been unemployed for 12 
months or more (%) 
Unemployment rate for persons (aged 25–64) 
having completed at most lower secondary 
education (ISCED 0–2) (%) 
Unemployment rate for persons (aged 25–64) 

: 

1 905 

1 912 

1 972 

2 015 

2 192 

Note 

2002 
1 587 

2010 
3 328 

2011 
3 867 

2012 
3 797 

2013 
3 699 

2014 
3 941 

90 

1 169 

1 400 

1 531 

1 761 

1 827 

-1 497 

-2 160 

-2 467 

-2 267 

-1 938 

-2 114 

101 

72 

78 

83 

86 

86 

75.9 

70.4 

72.8 

75.6 

76.7 

77.4 

79.1 

66.9 

65.3 

63.2 

64.3 

61.1 

Note 

2002 
7.6e 

2010 
4.8e 

2011 
4.9e 

2012 
5.0 

2013 
5.3 

2014 
5.2 

17.2 

9.6 

8.7 

8.8 

7.9 

7.9 

: 
: 

Note 

2002 
: 

74.7e 
79.4e 

2010 
69.7e 

75.3e 
79.8e 

2011 
75.6e 

75.5e 
79.7e 

2012 
71.9e 

76.0 
80.3 

2013 
67.6e 

76.4 
80.3 

2014 
68.6e 

: 

: 

: 

: 

: 
: 
: 
: 
: 

: 

14) 
14) 
14) 
14) 

60.3e 

64.9e 

62.4e 

56.7e 

56.6e 

71.5e 

72.8e 

70.1e 

64.8e 

65.2e 

49.8e 

57.2e 

54.9e 

49.3e 

48.5e 

48.3e 

54.7e 

56.3e 

51.1e 

51.2e 

: 
: 
: 
: 
: 

: 

45.4e 
10.6e 
8.2e 
35.7e 
: 

46.1e 
9.1e 
8.2e 
36.6e 
15.7e 

44.0e 
9.7e 
7.1e 
38.8e 
17.8e 

42.7e 
11.0e 
6.4e 
39.4e 
17.5e 

: 

84.3e 

82.2e 

82.5e 

15) 

15.8 

14.0e 

14.0e 

13.4e 

15.9e 

17.5e 

15) 
15) 
15) 

13.6 
19.1 
26.8 

12.6e 
15.9e 
30.5e 

13.6e 
14.4e 
23.6e 

14.6e 
11.7e 
29.8e 

17.8e 
13.5e 
31.4e 

19.2e 
15.2e 
39.0e 

10.6e 

10.2e 

10.3e 

11.5e 

11.2e 

10.9e 

12.1e 

10.5e 

13.6e 

13.4e 

7.9e 

10.1e 

11.8e 

11.7e 

13.7e 

: 

: 

: 

79 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
having completed tertiary education (ISCED 5 & 
6) (%) 
Social cohesion 
Average nominal monthly wages and salaries 
(national currency) 
Index of real wages and salaries (index of 
nominal wages and salaries divided by the 
inflation index) (2000 = 100) 
GINI coefficient — see definitions 
Poverty gap 
*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 (%) 

Standard of living 
Number of passenger cars relative to population 
size (number per thousand population) 
Number of mobile phone subscriptions relative 
to population size (number per thousand 
population) 

Infrastructure 
Density of railway network (lines in operation per 
thousand km²) 
Length of motorways (kilometres) 

Innovation and research 
Public expenditure on education relative to GDP 
(%) 
*Gross domestic expenditure on R&D relative to 
GDP (%) 
Percentage of households who have internet 
access at home (%) 

Environment 
Energy intensity of the economy (kg of oil 
equivalent per 1 000 euro GDP at 2005 constant 
prices) 
Electricity generated from renewable sources 
relative to gross electricity consumption (%) 
Road share of inland freight transport (based on 
tonne-km) (%) 

Energy 
Primary production of all energy products 
(thousand TOE) 
Primary production of crude oil (thousand TOE) 
Primary production of hard coal and lignite 
(thousand TOE) 
Primary production of natural gas (thousand 
TOE) 
Net imports of all energy products (thousand 
TOE) 
Gross inland energy consumption (thousand 
TOE) 
Electricity generation (thousand GWh) 

Note 

2002 
19 659 

2010 
44 375 

2011 
46 665 

2012 
50 093 

2013 
52 150 

2014 
53 025 

121.1 

216.1 

223.5 

238.2 

: 

234.4 

28.2 
5.7 
: 

: 
: 
31.9e 

: 
: 
35.2e 

: 
3.0 
31.6e 

: 
: 
30.6e 

: 
: 
26.0e 

Note 

2002 
49e 

2010 
104 

2011 
106p 

2012 
107 

2013 
122 

2014 
131 

261.4e 

1 584.4 

1 841.8 

2 015.0 

1 822.5s 

1 686.5 

Note 

2002 
15.0 

2010 
13.9 

2011 
13.9 

2012 
13.9 

2013 
12.0 

2014 
12.0 

Note 

2002 
3.0 

2010 
3.4 

2011 
3.2 

: 

: 

: 

: 

: 

: 

Note 

2002 
: 

2010 
: 

2011 
: 

: 

: 

: 

: 

: 

: 

Note 

2002 
896 

2010 
1 643 

2011 
1 494 

308 
5 

8 

744 
3 

13 

895 
2 

15 

2012 
3.3 

: 

14.3 

2012 
: 

: 

: 

2012 
1 676 

1 031 
2 

2013 
3.2 

2014 
3.3 

: 

: 

: 

: 

2013 
: 

2014 
: 

: 

: 

2013 
2 041 

1 207 
2 

: 

: 

2014 
2 014 

1 368 
0 

15 

16 

28 

965 

552 

668 

320 

567 

662 

1 862 

2 106 

2 162 

2 014 

2 346 

2 342 

3.7 

7.7 

4.2 

4.7 

7.0 

4.7 

80 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Agriculture 
Agricultural production volume index of goods 
and services (at producer prices) (previous year 
= 100) 
Utilised agricultural area (thousand hectares) 
Livestock numbers: live bovine animals 
(thousand heads, end of period) 
Livestock numbers: live swine (thousand heads, 
end of period) 
Livestock numbers: live sheep and live goats 
(thousand heads, end of period) 
Production and utilisation of milk on the farm 
(total whole milk) (thousand tonnes) 
Harvested crop production: cereals (including 
rice) (thousand tonnes) 
Harvested crop production: sugar beet 
(thousand tonnes) 
Harvested crop production: vegetables 
(thousand tonnes) 

Note 

2002 
: 

2010 
107.3 

2011 
103.9 

2012 
104.5 

2013 
: 

2014 
: 

1 140 
690 

1 201 
493 

1 201 
492 

1 201 
498 

1 190 
498 

1 178 
500 

114 

164 

163 

159 

152 

172 

2 773 

2 581 

2 517 

2 619 

2 723 

2 804 

1 010 

1 070 

1 101 

1 105 

1 131 

1 133 

519 

662 

701 

697 

703 

700 

39 

0 

0 

0 

0 

0 

668 

860 

890 

914 

924 

950 

: = not available 
b = break in series 
e = estimated value 
p = provisional 
s = Eurostat calculation 
* = Europe 2020 indicator 
** = Macroeconomic Imbalance Procedure (MIP) indicator 
*** = The government deficit and debt data of enlargement countries are published on an "as is" basis and without any 
assurance as regards their quality and adherence to ESA rules. 

  Footnotes: 

1)  2002 and 2010–12: based on retro projection made by INSTAT. 
2)  2010–14: based on ESA 2010. 
3)  2012–14: Source, Eurostat. 
4)  Source, Eurostat. 
5)  2014: flash estimate based on quarterly data. 
6)  2010–14: the shares of the GDP expenditure components do not sum to 100 % due to statistical discrepancy. 
7)  2002: change in inventories and statistical discrepancy. 
8)  2002: variation between December of one year compared with December of the previous year. 
9)  2013 and 2014: based on balance of payments manual edition 6 (BPM6). 

10)  Data disseminated by the Bank of Albania. 
11)  Annual average of the overnight rate exchanged in money market. 
12)  Average weighted rate applied on new 12-month loans over the respective month, on 12-month maturity. 
13)  Deposit interest rate represents the average weighted rate for newly accepted deposits over the respective month, on 12-

month maturity. 

14)  2013 and 2014: the sum of the shares in the analysis of employment by activity does not sum to 100% due to cases where 

persons have not or cannot be classified to a particular activity. 

15)  2002: administrative data. 

81