COMMISSION STAFF WORKING DOCUMENT Albania 2019 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 2019 Communication on EU Enlargement Policy
Date: 2019-05-29
Institutions: Directorate-General for Neighbourhood and Enlargement Negotiations, European Commission
Subjects: Albania, accession criteria, accession negotiations, pre-accession strategy

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 29.5.2019  SWD(2019) 215 final  COMMISSION STAFF WORKING DOCUMENT Albania 2019 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 2019 Communication on EU Enlargement Policy {COM(2019) 260 final}  
 
 
1.  

1.1. 

1.2. 

2. 

Table of Contents 

INTRODUCTION 

Context 

Summary of the report 

3 

3 

3 

FUNDAMENTALS  FIRST:  POLITICAL  CRITERIA  AND  RULE  OF  LAW 
5 
CHAPTERS 

2.1. 

Functioning of democratic institutions and public administration reform 

2.1.1   Democracy 

2.1.2.  Public administration reform 

2.2. 

Rule of law and fundamental rights 

2.2.1.  Chapter 23: Judiciary and fundamental rights 

2.2.2.  Chapter 24: Justice, freedom and security 

5 

6 

10 

14 

14 

31 

FUNDAMENTALS 
COMPETITIVENESS 

FIRST: 

ECONOMIC 

DEVELOPMENT 

AND 

The existence of a functioning market economy 

The capacity to cope with competitive pressure and market forces within the Union  49 

 GOOD NEIGHBOURLY RELATIONS AND REGIONAL COOPERATION 

ABILITY TO ASSUME THE OBLIGATIONS OF MEMBERSHIP 

Chapter 1: Free movement of goods 

Chapter 2: Free movement of workers 

Chapter 3: Right of establishment and freedom to provide services 

 Chapter 4: Free movement of capital 

Chapter 5: Public procurement 

Chapter 6: Company law 

Chapter 7: Intellectual property law 

Chapter 8: Competition policy 

Chapter 9: Financial services 

3. 

3.1. 

3.2. 

4. 

5.  

5.1.  

5.2.  

5.3.  

5.4. 

5.5.  

5.6.  

5.7.  

5.8.  

5.9. 

5.10. 

 Chapter 10: Information society and media 

5.11.   Chapter 11: Agriculture and rural development 

5.12.   Chapter 12: Food safety, veterinary and phytosanitary policy 

5.13.   Chapter 13: Fisheries 

5.14.   Chapter 14: Transport 

5.15.   Chapter 15: Energy 

5.16.   Chapter 16: Taxation 

5.17.   Chapter 17: Economic and monetary policy 

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44 

52 

54 

54 

55 

56 

57 

58 

60 

61 

62 

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65 

66 

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69 

70 

72 

75 

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5.18.   Chapter 18: Statistics 

5.19.   Chapter 19: Social policy and employment 

5.20.   Chapter 20: Enterprise and industrial policy 

5.21.   Chapter 21: Trans-European networks 

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

5.25.   Chapter 25: Science and research 

5.26. 

 Chapter 26: Education and culture 

5.27.   Chapter 27: Environment and climate change 

5.28.   Chapter 28: Consumer and health protection 

5.29.   Chapter 29: Customs union 

5.30.   Chapter 30: External relations 

5.31.   Chapter 31: Foreign, security and defence policy 

5.32.   Chapter 32: Financial control 

5.33.   Chapter 33: Financial and budgetary provisions 

ANNEX I – RELATIONS BETWEEN THE EU AND ALBANIA 

ANNEX II – STATISTICAL ANNEX 

77 

78 

81 

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87 

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92 

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94 

96 

97 

99 

101 

103 

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1.  

INTRODUCTION 

1.1.  Context  
Albania  has  continued  to  implement  the  Stabilisation  and  Association  Agreement  and  the 
meetings of the joint bodies under the agreement took place. In April 2018, the Commission 
recommended that the Council decides that accession negotiations be opened with Albania, at 
the same time encouraging Albania to maintain and deepen the current reform momentum, in 
particular in the key field of the rule of law. In June 2018, the Council set out the path towards 
opening  accession  negotiations  in  June  2019.  Albania  has  continued  to  implement  reforms 
that  are  crucial  to  the  EU  agenda,  in  particular  delivering  concrete  results  in  the  conditions 
identified in the Council Conclusions of June 2018 for the opening of accession negotiations. 
The Commission has continued to monitor thoroughly the developments in these areas. 

Summary of the report1 

1.2. 
As regards the  political  criteria, Albania has  continued to  make progress on its  EU reform 
agenda throughout  the reporting period. Strong polarisation persisted in the political  sphere. 
Parliamentary activities were affected by a prolonged boycott from opposition parties, which 
then also relinquished en bloc their parliamentary mandates in February 2019. More than half 
of the relinquished parliamentary mandates have now been reassigned by the Central Election 
Commission  and  the  quorum  for  the  full  functioning  of  Parliament  is  maintained.  Main 
opposition parties decided not to register for the local elections, which are scheduled to take 
place on 30 June 2019. The main opposition parties’ disengagement has negatively affected 
the  efforts  for  a  bipartisan  electoral  reform  despite  the  majority’s  efforts  to  move  forward. 
Opposition parties should constructively re-engage in the democratic institutions. 

Albania  is  moderately  prepared  in  what  concerns  the  reform  of  its  public  administration. 
Efforts  continued  in  several  related  areas,  resulting  in  some  progress  in  the  efficiency  and 
transparency  of  public  services  delivery,  improving  the  regulatory  framework  on  impact 
assessment of policies, more transparent recruitment procedures, and the overall strengthening 
of  the  administration’s  capacity 
to  undertake  merit-based  civil  service  procedures. 
Consolidation  of  these  achievements  should  advance  further,  to  ensure  a  more  efficient, 
depoliticised, and professional public administration. 

level  of  preparation.  The 

Albania's  judicial  system  has  some 
implementation  of 
comprehensive  and  thorough  justice  reform  has  continued  consistently,  resulting  in  good 
progress overall. The new institutions for the self-governing of the judiciary, the High Judicial 
Council,  the  High  Prosecutorial  Council  and  the  Justice  Appointment  Council  have  been 
established, representing a crucial step in strengthening the independence and accountability 
of the judiciary. The temporary re-evaluation of all judges and prosecutors (vetting process) 
has  advanced  steadily,  producing  tangible  results.  Under  the  aegis  of  the  European 
Commission,  the  International  Monitoring  Operation  has  continued  to  oversee  the  process. 
More  than  140  files  have  been  processed,  resulting  in  88  dismissals/resignations  of 
magistrates  from  office and 53 confirmations. Most dismissals pertained to  issues related to 
unjustified  assets.  These  concrete  and  credible  results  have  substantially  strengthened  the 
sector and consolidated independence, impartiality, professionalism, and accountability of the 
judiciary. 

Albania  has  some  level  of  preparation  in  the  fight  against  corruption.  Good  progress  was 
made, notably with the adoption of the new Action Plan 2018-2020 for the implementation of 

1 This report covers the period from March 2018 to March 2019. It is based on input from a variety of sources, 
including: contributions from the government of Albania, contributions  from the EU Member States, European 
Parliament reports, and information from various international and non-governmental organisations.  

3 

 
 
                                                 
the Inter-sectoral Strategy against Corruption, the amendments to the Law on the Declaration 
and Audit of Assets, the Law on Public Procurement as well as the adoption of the Code of 
Conduct for members of Parliament. The establishment of an Anti-corruption Task Force has 
increased  the  proactivity  of  administrative  investigations.  Direct  access  to  databases  for 
prosecutors  and  the  police  continued  to  improve.  Good  progress  has  continued  through  the 
strengthening  of  the  track  record  on  investigating,  prosecuting  and  trying  high  level 
corruption cases.  Concrete results in  the fight  against corruption include  the vetting process 
which has led to the dismissal from office of a number of high-ranking magistrates, including 
at  Constitutional  Court  and  High  Court  level.  The  establishment  of  the  High  Prosecutorial 
Council (HPC) allowed the launch of the establishment of specialised anti-corruption bodies 
(Special  Anti-Corruption  and  Organised  Crime  Structure  –  SPAK,  National  Bureau  of 
Investigation  –  NBI).  Once  the  vetting  of  candidates  is  completed,  the  bodies  will  become 
operational which will strengthen the overall capacity to investigate and prosecute corruption. 
However, overall, corruption is prevalent in many areas and remains an issue of concern.  

Albania has some level of preparation in the fight against organised crime. Police operations 
to  dismantle criminal organisations have been intensified.  Several  police operations resulted 
in multiple arrests, and a number of important indictments and convictions took place. These 
operations  resulted  in  the  arrest  and  prosecution  of  known  leaders  of  organised  criminal 
groups.  International  police  cooperation,  especially  with  EU  Member  States,  has  also 
intensified,  leading  to  a  number  of  successful  large-scale  law  enforcement  operations. 
Consistently  for  the  past  years,  Albania  showed  a  strong  commitment  to  counter  the 
production and trafficking of cannabis. Albania allows an intrusive monitoring mechanism by 
an  EU  Member  State  (aerial  surveys  by  the  Italian  Guardia  di  Finanza,  co-financed  by  the 
EU) to be in place. In the past two crop seasons, aerial surveillance has certified that almost 
no cultivation of cannabis has taken place in Albania. These steps represent tangible progress 
in  meeting  last  years’  recommendations  on  improving  the  track  record.  Efforts  need  to 
continue, in particular by tackling money laundering and confiscating assets stemming from 
crimes and other unjustified wealth.  

On  fundamental  rights,  Albania  complies  overall  with  international  human  rights 
instruments  and  developed  its  legal  framework  in  line  with  European  standards.  During  the 
reporting  period,  Albania  has  made  efforts  to  meet  obligations  that  arise  from  international 
legal  instruments.  The overall implementation  of those instruments  remains, however, to  be 
strengthened.  Legal  framework  was  improved  in  the  areas  of  child’s  rights  and  domestic 
violence. A new law on social housing was approved by the parliament in May 2018, which 
aims to strengthen the protection of the right to housing of the most vulnerable members of 
the  Roma  and  Egyptian2  communities.  Further  efforts  are  needed  in  relation  to  the 
consolidation of property rights. As regards the freedom of expression, the overall legislative 
environment  is  conducive  to  the  exercise  of  freedom  of  expression,  but  implementation 
requires further efforts. 

As  regards  the  economic  criteria,  Albania  has  made  some  progress  and  is  moderately 
prepared  in  developing  a  functioning  market  economy.  Economic  growth  increased  further 
and  unemployment  decreased  but  remains  still  high.  Exports  grew  solidly  and  the  current 
account  deficit  narrowed.  The  high  public  debt-to-GDP  ratio  continued  to  decrease  but  the 
pace  of  fiscal  consolidation  remained  slow.  Banks  continued  to  reduce  the  number  of 
non-performing  loans  and  the  use  of  foreign  currency.  The  banking  sector  remained  stable, 
though business credit growth did not pick up. Steps towards developing the financial market 

2  In  line  with  the  terminology  of  European  institutions,  the  umbrella  term  ‘Roma’  is  used  here  to  refer  to  a 
number of different groups, without denying the specificities of these groups. 

4 

 
 
                                                 
have been taken. The business environment has improved only in some aspects. Progress in 
the implementation of comprehensive justice reform is expected to contribute to strengthening 
the business environment and attracting investments. Some progress was made on increasing 
labour market participation and the quality and effectiveness of labour market institutions and 
services,  but  the  employment  rate  and  labour  market  participation  remain  low,  and  the 
informal economy is still a significant job provider. 

Albania  has  made  some  progress  and  has  some  level  of  preparation  in  terms  of  capacity  to 
cope with competitive pressure and market forces within the Union. Albania has made some 
progress  in  terms  of  energy,  transport  and  digital  infrastructure  development,  but  lack  of 
productive  know-how,  low  education  levels  and  technology  transfers  hinder  Albania’s 
competitiveness  and  integration  into  international  value  chains.  Exports  and  regional 
integration are below potential. Efforts to improve education and training show some results 
but reforms need to continue in particular to better address rural areas and vulnerable groups. 
Albania’s capacity for research, development and innovation remained very low. 

With  regard  to  good  neighbourly  relations  and  regional  cooperation,  Albania  has 
continued  to  participate  actively  in  regional  cooperation  and  maintain  good  neighbourly 
relations. Important steps have been taken to address bilateral issues with Greece. 

Albania continued to align its legislation to EU requirements in a number of areas, enhancing 
its ability to assume the obligations of membership. The country is moderately prepared in 
many areas, such as financial control, education and culture and statistics, or has some level 
of  preparation,  including  in  the  areas  of  public  procurement  and  trans-European  networks. 
Albania  will  need  to  continue  its  efforts  related  to  its  overall  preparations  to  adopt  and 
implement the EU acquis. Adopting a comprehensive Public Internal Financial Control policy 
and  coordinating  its  implementation  with  ongoing  public  administration  and  public  finance 
management  reform  remains  key  towards  a  functioning  system  of  internal  control  in  public 
sector.  Albania  should  continue  work  on  the  development  of  the  transport  and  energy 
networks,  and  related  connectivity  reform  measures,  also  with  a  view  to  improving 
connectivity throughout the region.  

The  administrative  capacity  and  professional  standards  of  bodies  charged  with  the 
implementation  of  the  acquis  need  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.  Albania  has  continued  to  fully  align  with  all EU 
common foreign and security policy positions and declarations. 

With regard to migration, some progress was made in improving the institutional capacity on 
border management and asylum. Albania signed the European Border and Coast Guard Status 
Agreement  with  the  EU  in  October  2018.  Reception  capacity  to  deal  with  mixed  migration 
flows  was  further  enhanced.  The  number  of  unfounded  asylum  applications  lodged  by 
Albanian  nationals  in  the  EU  has  decreased  but  remains  high  and  requires  continuous  and 
sustained efforts, as well as to address the phenomenon of unaccompanied minors.  

2. 

FUNDAMENTALS FIRST: POLITICAL CRITERIA AND RULE OF LAW CHAPTERS 

2.1. 

Functioning of democratic institutions and public administration reform 

5 

 
 
2.1.1   Democracy 

The political environment remained polarised throughout the reporting period. The opposition 
carried out repeated boycotts of parliamentary activities. These culminated in the decision by 
the main opposition parties to relinquish their parliamentary mandate en bloc. This has led to 
delays  in  the  electoral  reform  and  the  adoption  of  amendments  to  the  Law  on  the  Status  of 
Judges and Prosecutors. More than half of the relinquished parliamentary mandates have now 
been reassigned by the Central Election Commission and quorum for the full functioning of 
Parliament is maintained. 

Elections 

The ad hoc parliamentary committee on electoral reform established in October 2017 held a 
number  of  technical  meetings.  This  bipartisan  body  worked  intermittently.  However,  no 
progress was made to address outstanding recommendations from the Office for Democratic 
Institutions and Human Rights (ODIHR) of the Organisation for Security and Cooperation in 
Europe  (OSCE).  A  new  ad  hoc  parliamentary  committee  has  been  established  in  October 
2018  to  address  the  OSCE/ODIHR  recommendations  still  outstanding  from  the  last  three 
rounds of elections (2013, 2015, and 2017). The committee has worked intermittently, under 
the  chairmanship  of  representatives  from  the  two  main  political  parties,  holding  workshops 
and  consultations.  In  the  absence  of  cross-party  consensus,  unilateral  proposals  by  the 
government  majority  were  tabled  in  October  2018  and  again  in  December  2018,  but  no 
decisions resulted.  

The President of the Republic has issued a decree for holding local elections on 30 June 2019. 
The Central Election Commission (CEC) launched the related preparatory activities. The CEC 
is still missing two members, which shall be appointed by the opposition, while the members 
proposed  by  the  Socialist  Party  were  elected  in  October  2018.  The  main  opposition  parties 
have  decided  not  to  present  their  lists  of  candidates  for  the  upcoming  local  elections.  The 
deadline for the registration of parties has now expired.  

Parliament 

Parliamentary  activities  were  affected  by  a  high  degree  of  polarisation  and  a  prolonged 
boycott  by  the  opposition,  which  began  in  September  2018.  In  February  2019,  with  very 
limited exceptions, Members of Parliament (MPs) from opposition parties relinquished their 
mandate. The Assembly has continued to increase transparency by intensifying consultations 
with interest groups and the public, while increasing its role in initiating new — or amending 
existing — legislative proposals. Capacities for oversight and involvement of the Assembly in 
the  EU  integration  process  remain  to  be  strengthened.  The  transparency  and  control  of 
political party financing need to be improved.   

Strong  polarisation  and  the  opposition’s  repeated  boycott  of  parliamentary  activities  has 
negatively affected the Assembly’s work. Since September 2018, the opposition took part in 
very few parliamentary activities, mostly at committee level, and cross-party consensus  was 
reached  only  on  a  limited  number  of  laws  (8).  A  joint  resolution  of  the  EU-Albania 
Parliamentary  Stabilisation  and  Association  Committee  was  adopted  only  in  the  first  of  the 
two  meetings  held  during  the  reporting  period  (February  and  November  2018).  The  second 
session was marked by a walkout by the members of the opposition parties. In February 2019, 
the  members  of  opposition  parties  relinquished  their  parliamentary  mandate  en  bloc.  The 
process of re-appointments through the CEC is ongoing.  

Replacements of MPs have respected gender quota provisions, resulting in a further increase 
of women in the Assembly. There are now 43 women in the Assembly (out of a total of 140 

6 

 
 
members). At present, 8 of the government’s 15 members are women (53%), and there are 13 
female  deputy  ministers  (out  of  31  deputy  ministers  in  total,  or  41%).  Representation  of 
women  in  municipal  councils  increased  to  34.6%  in  2015  (up  from  12%  in  the  2011  local 
elections).  In  those  2015  elections,  10  women  were  elected  as  mayors  (out  of  61 
municipalities in total).  

During  the  reporting  period,  there  were  no  issues  leading  to  the  opening  of  new 
‘decriminalisation’ dossiers. 

In February 2018, the Parliament set up a subcommittee on human rights, and in July 2018 it 
set up a subcommittee on the implementation of the vetting law in the Albanian State Police. 
In May 2018, the Parliament established an independent  commission  on enforcement of the 
law on justice-system governance bodies. The members of this commission were nominated 
only in November 2018.    

A  code  of  ethics  was  adopted  in  April  2018  without  support  by  the  opposition  and,  in 
September 2018 the Parliament Bureau (a grouping of the chairs of parliamentary groups and 
commissions) approved a handbook on conduct in Parliament. These documents aggregate: (i) 
existing  legal  provisions  providing  guidance  to  MPs  on  legal  and  ethical  issues,  and  (ii) 
measures for the registration and disclosure of finances, gifts, lobbying contacts, and conflicts 
of interest. Although these are non-binding standards, they are expected to be applied by MPs. 
Communication channels between citizens and MPs need to be formalised and strengthened. 

The Parliament adopted fewer acts compared to the previous reporting period. In spite of this, 
it  continued  to  strengthen  its  contribution  to  legislative  review  through  more  legislative 
initiatives, amendments from MPs, and interest-group hearings. Urgent legislative procedures 
were  used  in  about  10%  of  cases  (6  times  out  of  66  laws),  including  two  cases  of  laws  on 
special  financing  agreements  for  public  works.  The  Parliament  accepted  one  presidential 
decree  returning  laws  for  parliamentary  review  and  rejected  two  of  such  requests  by  the 
President.  

Parliamentary  rules  of  procedure  do  not  yet  reflect  the  existing  Law  on  the  role  of 
Parliament in the EU integration process. Parliament’s capacity to monitor the compliance 
of new legislation with the acquis and ensure implementation remains limited. Coordination 
with the executive needs to be improved. About 10% of overall legislative activity was aimed 
at  partial  alignment  with  the  EU  acquis  (7  out  of  66  laws).  The  EU  Integration  Committee 
held  only  two  hearings  during  the  reporting  period.  The  National  Council  for  European 
Integration  still  has  to  consolidate  its  role  and  guarantee  broader  involvement  in  EU 
integration issues.  

On  Parliament’s  oversight  function,  the  work  of  inquiry  committees  remained  highly 
polarised.  The  committees  on  telephone  surveillance,  on  the  case  pertaining  to  a  former 
Minister of the Interior, and on the privatisation and renationalisation of the electricity power 
distribution  system  operator  did  not  lead  to  conclusive  results.  Other  oversight  mechanisms 
remained generally underused. In 2018, there were five ‘interpellations’ (formal enquiries by 
parliament)  with  ministers  and  two  motions  with  debate.  Parliament  conducted  a  structured 
review of annual reports from independent institutions, including hearings at committee level, 
following  up  and  monitoring 
and  adopted  21 
recommendations by Parliament and independent institutions marked a step towards stronger 
oversight,  but  has  yet  to  show  results.  The  Assembly  elected  two  heads  and  a  number  of 
members  of  independent  institutions.  The  chair  of  the  State  Audit  Institution  and  two  CEC 
members remain to be appointed. 

resolutions.  The  mechanism 

for 

7 

 
 
On transparency and accountability, the Parliament has ensured  access to  documents  and 
activities. It has also held a number of thematic public meetings. The review of internal rules 
on  the  Parliament’s  administration  continues.  Research  staff  and  support  to  MPs  and 
parliamentary groups remain limited.  

All positions of commissioners at the Ombudsman office were filled. The Ombudsman, the 
Commissioner  for  Protection  against  Discrimination  and  other  independent  institutions  still 
face poor implementation of their recommendations by the Albanian administration.  

Political parties have partially adhered to OSCE/ODIHR recommendations on transparency 
of  party  funding.  Further  reform,  including  amendments  to  the  Electoral  Code,  is  required. 
Issues persist in relation to internal party democracy, transparency of party financing and due 
implementation of statutes.  

Governance 

The government  remained committed to the EU integration process.  In  December 2018, the 
Prime Minister carried out  a substantial  reshuffle of the government.  Nine cabinet positions 
were changed, including that of the Deputy Prime Minister and the Minister for Europe and 
Foreign Affairs. The replacement of the latter led to controversy between the Prime Minister 
and  the  President  of  the  Republic  on  constitutional  provisions  regarding  ministerial 
appointments.  The  restructuring  of  ministries  and  agencies  has  streamlined  some  existing 
structures,  but  has  also  created  administrative  gaps  that  must  be  overcome.  The  territorial 
administrative  reform  needs  to  be  further  consolidated  as  part  of  the  wider  decentralisation 
agenda.  This  is  particularly  necessary  to  guarantee  local  fiscal  autonomy,  ensure  capacity 
building for staff, and empower municipalities to provide standard quality public services.   

EU  integration  has  remained  a  key  driving  feature  of  the  Albanian  government’s  actions. 
However,  a  persistently  tense  political  situation  and  the  opposition’s  boycott  in  particular 
have hampered  cross-party dialogue  and inclusiveness  for EU-related reforms.  Political  will 
to advance on the EU agenda needs to be combined with appropriate administrative capacities 
to align with the EU acquis. In particular, the Ministry for Europe and Foreign Affairs - and 
line ministries responsible for the EU acquis - would benefit from further streamlining of staff 
and  resources.  Some  positive  steps  have  been  taken  to  increase  consultations  with 
stakeholders  and  reach  out  to  civil  society  groups,  especially  on  the  future  structure  for 
accession negotiations.  The restructuring of the ministries, which began in September 2017, 
had an impact on the performance of the administration. Some gaps in administrative capacity 
and a certain lack of clarity in institutional responsibilities in various policy areas remain to be 
overcome. 

The ruling majority has established structures to improve government accountability, inviting 
citizens to submit their assessment through ‘co-governance platforms’. Implementation of this 
initiative should be pursued in ways that better allow preserving the distinction between party 
and government. 

In December 2018, following several weeks of student protests against the existing education 
system, the government announced a large reshuffle. The reshuffle affected nine government 
posts,  including  the  position  of  the  Deputy  Prime  Minister  and  Minister  for  Europe  and 
Foreign  Affairs.  Ministerial  changes  also  involved  the  Minister  of  Finance,  Minister  of 
Education, the Minister of Transport, Energy and Infrastructure, the Minister of Agriculture, 
the  Minister  of  Culture,  the  State  Minister  on  the  Protection  of  Entrepreneurship  and  the 
Minister for Relations with the Parliament.  The replacement  of the Minister for Europe and 
Foreign Affairs (as well as the earlier change of the Interior Minister in November 2018) led 
to  a  dispute  between  the  Prime  Minister  and  the  President  of  the  Republic.  This  dispute 

8 

 
 
centred  on  contrasting  interpretations  of  the  constitutional  provisions  on  ministerial 
appointments  between  the  Prime  Minister  and  the  President  of  the  Republic.  Given  the 
presidential refusal to nominate the new Minister for Europe and Foreign Affairs, the Prime 
Minister took over the post, and delegated the acting functions to a deputy minister. 

The  Constitutional  Court  has  been  unable  to  fulfil  its  mandate  over  most  of  the  reporting 
period due to the absence of a quorum. The court should have nine members, but only one of 
its  nine  members  is  in  office,  due  to  resignations,  retirements,  and  a  vetting  process  that 
removed  some  of  the  sitting  judges.  The  process  to  fill  these  vacant  posts  started  after  the 
creation of the new Justice Appointment Council (see section 2.2.1 Chapter 23: Judiciary and 
fundamental rights), as foreseen in the justice reform package. 

On  local  government,  the  territorial  administrative  reform  (TAR)  needs  to  be  further 
consolidated as part of the wider decentralisation agenda. The government undertook a mid-
term  review  of  the  2015-2020  national  cross-cutting  strategy  for  decentralisation  and  local 
governance. The Supreme State Audit  Institution also carried out an assessment of the TAR 
and issued a report on it, in October 2018. The new legislation affecting local government is 
not  yet  fully  harmonised  and  implemented.  Most  notably,  while  municipalities  have  been 
attributed  larger  powers,  the  adequacy  of  financial  resources  available  to  local  government 
units  (LGUs)  are  at  risk.  LGUs’  fiscal  autonomy  is  also  at  risk.  73%  of  the  LGUs’  budget 
comes from national transfers. The central budget allocates about 1% of GDP to  LGUs, the 
lowest  in  the Western  Balkans.  In most municipalities,  LGUs are not  effective at collecting 
revenues. As a result, the overall ability of local institutions to deliver quality public services 
remains limited. Appointments not fully in line with all the principles of the civil service law 
have continued, hindering the establishment of a fully merit-based civil service.  

On  public  participation  in  local  decision-making,  further  progress  has  been  made  by 
municipalities,  especially  in  the  area  of  participatory  budgeting.  However,  the  institutional 
framework for effective and inclusive participation needs further strengthening. The Agency 
for  the  Delivery  of  Integrated  Services  (ADISA)  expanded  its  presence  throughout  the 
territory  with  its  one-stop-shops.  A  parallel  process  to  roll  out  ‘front  desks’  for  service 
delivery  at  the  local  level  is  ongoing.  The  definition  of  national  minimum  standards  for 
services remains outstanding.   

local  plans  for 

On  territorial  planning,  general  local  plans  have  been  approved  and  budgeted  for  45 
the  remaining  16  are  budgeted  for 
municipalities,  and  general 
2019. Coordination  of  the  national  sectoral  strategies  with  local  plans  is  weak.  On 
transparency, guidelines for disclosure of information to the public by local governments were 
adopted by the Commissioner on the Right to Information and Protection of Personal Data in 
September  2018.  All  municipalities  in  Albania  now  regularly  publish  decisions  of  their 
municipal  councils  online.  The  network  of  61  EU  local  coordinators  has  strengthened  the 
LGUs’ involvement in the EU accession process, raising more awareness of EU policies and 
the  acquis.  The  so-called  ‘EU  desks’  in  municipalities  have  been  upgraded  into  structured 
units, based on a Council of Ministers decision of July 2018. A report on the performance of 
municipalities on EU matters was presented in April 2018.    

Civil society 

Progress is yet to be made on the implementation of the roadmap on an enabling environment 
for civil society. The Law on the National Council for Civil Society needs to be amended to 
reflect  changes  in  ministerial  portfolios  and  provide  for  appropriate  representation  in  the 
National  Council  for  Civil  Society.  Substantial  efforts  are  needed  to  ensure  meaningful  and 
systematic consultations with civil society as part of an inclusive policy dialogue for reforms. 

9 

 
 
These  efforts  should  involve  comprehensive  feedback  and  follow  up  mechanisms.  The 
financial  sustainability  of  civil  society  organisations  remains  a  challenge  due  to  fiscal  and 
legal frameworks.  

Albania’s legal and regulatory framework on the right of freedom of association is generally 
in line with international standards. Nevertheless, the legal framework on free assembly needs 
improvement  to  clarify  the  different  requirements  for  ‘notification’  versus  ‘permission’  for 
free  assembly.  The  law  also  needs  to:  (i)  address  the  right  to  spontaneous  assembly  and 
counter  assembly  and  (ii)  make  the  procedures  for  notification  more  easy  to  complete  and 
more accessible. The public consultation law requires reporting on how inputs by civil society 
organisations (CSOs) are taken into consideration. However, little evidence exists on the use 
and efficiency of the feedback mechanisms. The scope of the law should be amended to cover 
governmental decisions (sub-legal acts).  

The 2014 Law on Public Consultation laying down the procedural norms for transparency and 
public  participation  in  decision-making  is  overall  in  line  with  European  standards.  The 
registration process continues to be problematic due to the high costs of registration, lengthy 
procedures and lack of specialised judges. No progress was made on public consultation in the 
adoption  of  sub-legal  acts  and  the  implementation  of  the  laws  on  volunteerism  and  social 
enterprises. 

The  National  Council  for  Civil  Society  has  organised  regular  meetings.  The  Law  on  the 
National  Council  should  be  amended  to  reflect  changes  in  ministerial  portfolios  and  their 
representation  in  the  Council.  There  is  a  need  to  further  increase  the  Council’s  engagement 
with  other  civil  society  actors  articulating  CSOs’  opinions  in  the  policy  making  processes. 
The revised roadmap on an enabling environment has not yet been approved.  

The  Agency  for  the  Support  of  Civil  Society  remains  the  main  public  body  providing 
financial  support  for  civil  society.  However,  public  funding  is  insufficient  to  sustain  CSOs’ 
actions, in particular in the social services sector. No significant developments took place in 
the  legal  and  regulatory  framework  of  the  relevant  tax  regime  for  CSOs,  which  remains  an 
issue.  This  absence  of  a  favourable  tax  regime  represents  a  significant  financial  burden  for 
CSOs,  and  the  current  legal  environment  does  not  support  alternative  funding  sources.  Tax 
incentives for corporate donations do not promote donations to CSOs, while no tax incentives 
are given for individual donations.  

2.1.2.  Public administration reform 
Albania is moderately prepared with the reform of its public administration. Some progress 
was  made  in  improving  the  quality  of  public  services,  strengthening  the  administration’s 
capacity  to  undertake  merit-based  recruitments,  and  upgrading  the  regulatory  framework  on 
impact assessments. Implementation of the public administration reform and public-financial-
management  reform  strategies  has  continued,  although  the  reorganisation  of  ministerial 
portfolios  and  structures  has  affected  its  pace  and  effectiveness.  Only  partial  progress  was 
made on the Commission’s 2018 recommendations, which remain largely valid.  

In the coming year, Albania should in particular: 

  build  capacity  and  implement  regulatory  and  budgetary  impact  assessments  in  all 
ministries  to  improve  the  quality  and  financial  sustainability  of  legislative  and  policy 
proposals; 

  upgrade  the  regulatory  framework  on  policy  planning  and  monitoring,  and  roll  out  the 

integrated policy making system; 

10 

 
 
 
  develop  and  adopt  a  salary  policy  for  civil  servants  and  connect  the  human-resource-

management information system with the treasury to provide an automated payroll. 

Strategic framework for public administration reform 

Throughout 2018, the government has continued to monitor implementation of the 2015-2020 
public  administration  reform  strategy  and  the  2014-2020  public-financial-management 
(PFM) reform strategy. In April 2018, it also published the third annual monitoring report. 
The implementation record of the public administration reform strategy has remained modest.  

The  deputy  prime  ministers,  who  have  been  in  charge  of  the  overall  reform,  ensured 
continued  political  support  for  the  reform.  Coordination  between  the  Prime  Minister’s 
Office, the Ministry of Europe and Foreign Affairs, and the Ministry of Finance and Economy 
needs  to  be  further  strengthened.  The  prime  minister’s  office  should  play  a  greater  role  in 
steering  policy  processes  and  managerial  accountability  (see  Chapter  32).  The  Integrated 
Policy Management Group on Good Governance (IPMG) was established in  2018 with  two 
main  aims.  The  first  aim  was  to  improve  high-level  policy  dialogue  among  institutions, 
development partners and civil society. The second aim was to ensure a common monitoring 
and  reporting  framework  for  all  related  reforms.  Financial  sustainability  needs  to  be 
improved,  as  the  overall  reform  of  public  administration  is  still  too  dependent  on  external 
donor funding.  

Policy development and coordination 

The  legal  basis  and  the  institutional  set-up  are  partially  in  place  to  ensure  a  consistent 
policy-making system. The creation of a coherent strategic planning and monitoring system 
is being held back by: (i) weaknesses in the existing regulatory framework on medium-term 
policy planning and (ii) a lack of a dedicated central quality control function. Some progress 
was made in preparing the rollout of the Integrated Planning System Information System, an 
IT  tool  that  should  help  to  link  strategic  policy  planning  and  budgeting.  The  government 
needs to step up efforts to upgrade administrative capacity in: (i) strategic policy planning and 
(ii)  policy  monitoring.  These  increased  efforts  should  be  made  at  both  ministerial  level  and 
the level of the Prime Minister’s Office. 

The  Ministry  for  Europe  and  Foreign  Affairs  prepares  and  monitors  implementation  of  the 
national  plan  for  European  integration  (NPEI).  The  rate  of  implementation  of  the  NPEI 
remains low, at less than 30%, and the overall quality of policy planning remains weak. The 
government  should  step  up  efforts  to  establish  functional  inter-institutional  co-ordination 
structures for more effective implementation of the NPEI at both political and administrative 
level.  

On  inclusive  and  evidence-based  policy  and  legislative  development,  the  administration 
needs  to  further  strengthen  its  capacity,  particularly  to  harmonise  the  legislation  with  the 
acquis.  Administrative  data  collection  and  its  systematic  use  for  policy  and  law-making 
should  be  improved  across  the  administration.  The  government  introduced  a  formal 
requirement to carry out regulatory impact assessment (RIA) on legislative proposals through 
amendments  to  the  rules  of  procedure,  approved  in  2018.  Full  implementation  of  this 
requirement  needs  to  be  ensured  in  2019.  Stronger  coordination  is  needed  between  the 
Ministry  of  Finance  and  Economy  and  the  RIA  unit  in  the  Prime  Minister’s  Office.  Public 
consultations  are  required  for  policy  and  legislative  development,  but  methodological 
guidance and quality control is lacking. The electronic web-portal for public consultations is 
operational, but its use by the public remains limited.  

11 

 
 
Public scrutiny of government work remains limited. Most government reports on various 
policies continue to present implemented activities rather than explain the actual results and 
outcomes  that  have  been  achieved  through  the  implementation  of  government  policies. 
Coordination  structures  for  monitoring  policy  implementation  need  to  become  operational 
through IPMGs. It is also necessary to ensure a less fragmented system on policy monitoring 
by streamlining the relevant legislative framework.  

Public financial management 

The Ministry of Finance and Economy, which leads the public financial management reform, 
underwent further restructuring in 2018. There are still several posts unfilled in the Ministry at 
present.  Based  on  a  mid-term  review  of  the  PFM  strategy  in  2018,  priorities  are  currently 
being  reassessed.  The  goal  of  this  reassessment  is  to:  improve  budget  planning  and 
management;  strengthen internal  control implementation  across  government; prevent  arrears 
at  central  and  local  government  level;  follow  up  on  internal  and  external  audit 
recommendations; 
improve  public 
procurement  review  and  compliance  with  procurement  rules;  grant  more  institutions  online 
access to the treasury; and analyse the fiscal risks of state-owned enterprises.  

investment  planning  and  management; 

improve 

Progress  was  achieved  with  the  preparation  of  the  2018  and  2019  budgets  and  with  the 
execution  of  the  2017  budget  in  line  with  the  revised  Organic  Budget  Law.  Adherence  to 
fiscal rules has improved, mainly thanks to the inclusion in the 2019 budget proposal of both a 
section  on  fiscal  risks  and  a  list  of  Public-Private-Partnerships  (PPPs).  The  new  public 
investment  management  (PIM)  guidelines  were  adopted  in  March  2018.  A  campaign  to 
combat  the  informal  economy  was  implemented,  and  external  audit  manuals  were  piloted. 
(See also Chapters 5, 16, 29 and 32)  

Budget  transparency  has  improved  with  the  publication  of  all  key  budget  documents  on 
time.  The  2019  budget,  the  citizens’  budget,  and  the  list  of  public  investments  (including 
PPPs under the medium-term budget programme) have been published. Public participation in 
the budget process needs to be further strengthened. The 2017 budget implementation report 
was published. However, information on state  assets contained in this report does not  allow 
for a full comparison with the original budget.  

Public service and human resources management 

Due  to  a  fragmented  legislative  framework,  there  are  not  yet  uniform  standards  on  merit-
based  recruitment,  promotion  and  dismissal  across  the  whole  public  administration.  The 
Civil  Service  Law  (CSL)  provides  a  solid  basis  for  merit-based  recruitment  and  promotion, 
which continued to improve in 2018 thanks to a centralised recruitment process. 92% of the 
planned vacancies in 2018 were filled, compared to 46.5% in 2017. Overall transparency and 
fairness of recruitment  at the central level has improved thanks to refinements of the online 
application  system,  improved  quality  of  examination  procedures,  and  the  use  of  electronic 
written tests. An ad-hoc selection procedure was used for the integration of highly qualified 
young graduates in the public administration. Notwithstanding merits in the objectives of this 
initiative, the relevant decision of the Council of Minsters should be brought fully in line with 
the  principle  of  merit-based  recruitment  enshrined  in  the  Civil  Service  Law.  Proper 
implementation of the Civil Service Law requires more efforts at the local level, where many 
appointments  have  been  made  in  breach  of  this  law.  There  were  568  dismissals  of  civil 
servants in 2018, a slight increase compared to the 460 dismissals in 2017. This was mainly 
due to the reduction in the number of ministries. The backlog of court decisions confirming 
unlawful dismissal of civil servants was reduced. 

12 

 
 
The  human  resources  management  information  system  (HRMIS)  is  still  not  fully 
functional.  The  system  now  includes  more  data  on  public-service  organisations  and 
employees,  but  does  not  cover  the  whole  civil  service.  The  number  of  institutions  that  can 
generate payroll reports has increased, but the link between the HRMIS and the treasury’s IT 
system  is  not  yet  operational.  The  Commissioner  for  Oversight  of  the  Civil  Service  needs 
more  staff  and  more  financial  resources  to  better  fulfil  its  responsibilities.  The  government 
needs  to  step  up  efforts  to  establish  a  coordination  mechanism  on  human  resource 
management  between  central  and  local  level.  These  efforts  should  include  extension  of  the 
HRMIS to the local level and systematic oversight at the local level. 

The remuneration system is based on a job classification system, which needs to be further 
reformed.  There  is  no  coherent  salary  policy  that  would  establish  clear  criteria  for  pay 
supplements and salary increases. This means that it is a common practice for salary increases 
for  certain  positions  to  be  awarded  through  a  decision  of  the  Council  of  Ministers.  This 
impairs  the  fairness  and  coherence  of  the  system.  Salary  supplements  are  not  awarded  in  a 
uniform  manner  across  institutions.  Salary  increases  are  not  linked  to  the  promotion  and 
performance appraisal system.  

The  training  programmes  implemented  by  the  Albanian  School  of  Public  Administration 
contribute to the professional development of civil servants. However, an integrated training 
management cycle remains to be established. The School’s budget in 2018 has been reduced 
compared  to  2017,  although  the  number  of  training  courses  has  increased.  Local-level  civil 
servants receive very little training. A law is in place that prevents corruption and ensures the 
integrity  of  public  officials  and  civil  servants.  However,  institutional  capacity  for  verifying 
assets and assessing conflict-of-interest declarations should be reinforced.  

Accountability of the administration 

The  legal  framework  on  the  organisation  of  the  central  administration  duly  regulates 
accountability lines between institutions. However, this legal framework lacks clarity on the 
creation  of  administrative  bodies  that  are  sub-ordinated  to  ministries,  the  parliament  and 
prime  minister.  Some  subordinated  bodies  are  already  being  reorganised,  but  new  agencies 
are  still  being  set  up  without  any  strategic  planning.  Recruitment  to  these  new  agencies  is 
mostly regulated outside the scope of the civil service law. Managerial accountability within 
institutions  is  still  focused  on  processes  rather  than  the  achievement  of  results,  and  there  is 
little  delegation  of  decision-making  to  top  and  middle  management.  (See  Chapter  32).  The 
government needs to step up its efforts to develop a long-term strategy on accountability by 
ensuring  appropriate  supervision  and  reporting  lines  between  ministries  and  subordinated 
agencies.  

Citizens’  right  to  good  administration  is  limited.  Public  institutions  do not  systematically 
implement  the  recommendations  of  oversight  bodies.  The  number  of  implemented 
recommendations  from  the Ombudsman remains low. The  Law on the Right  to  Information 
regulates  citizens’  right  to  access  public  information.  An  increasing  number  of  public 
authorities  have  adopted  transparency  programmes.  However,  public  institutions  need  to 
make more efforts to pro-actively disclose information of public interest. The capacity of the 
Commissioner  for  the  Right  to  Information  and  Protection  of  Personal  Data  to  oversee  the 
process needs to be increased. There is already a central registry on information requests, but 
it needs more funding. 

The legislative framework for the right to administrative justice is in place. The capacity of 
the  administrative  court  system  to  deal  with  the  backlog  of  cases  has  improved  at  the 
first-instance level, but a backlog persists at the appeal-court level since Albania has only one 
administrative court of appeal. The capacity of appeal boards to process cases remains weak. 

13 

 
 
The legislation for protecting the right of citizens to seek compensation is in place, but court 
cases remain rare due to the public’s limited awareness of their rights. Due to the lack of data 
collection, the effectiveness of the liability regime cannot be assessed. 

Service delivery to citizens and businesses 

Institutions and laws on public-service delivery are in place to ensure citizens’ user-oriented 
administration.  Three  important  documents  have  been  adopted:  a  guide  to  standardise 
service delivery, a citizens’ charter that explains the organisation of the public service, and an 
ethics  manual  for  service  desks.  The  Agency  for  the  Delivery  of  Integrated  Services  has 
started  measuring  user  satisfaction,  and  has  continued  to  set  up  one-stop-shops  across  the 
country.  E-services,  such  as  online  payment  of  taxes,  have  been  further  developed. 
Information on public services is more accessible to citizens. 

The  Code  of  Administrative  Procedures  provides  the  legislative  framework  for  simplifying 
administrative  procedures.  However,  legal  uncertainty  for  citizens  and  businesses 
continues, as there have been delays in adopting the necessary implementing legislation and 
amending the sectoral policy legislation. This is due to the weak capacity of the Ministry of 
Justice to  coordinate and promote implementation  of the new law  and the weak capacity of 
line  ministries  to  harmonise    sectoral  legislation  that  contradicts  provisions  in  the  Code  of 
Administrative Procedures. Training is needed to upgrade the capacities of the administration 
to both harmonise and effectively implement the legislation. 

2.2.  Rule of law and fundamental rights 

2.2.1.  Chapter 23: Judiciary and fundamental rights 

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

Albania has some level of preparation in implementing the acquis and European standards in 
this  area.  Good  progress  was  made,  in  particular  through  the  further  determined  
implementation  of  far-reaching  justice  reforms  (which  included  the  establishment  of  the 
institutions for the self-governance of the judiciary) and the continuation of tangible results in 
the vetting process. All the vetting priority cases were finalised in first instance and a number 
of  appeals  were  also  completed.  To  date,  over  280  vetting  dossiers  have  been  processed, 
leading  to  decisions  on  more  than  140  assessees.  The  legislative  framework  has  been 
strengthened  to  fight  corruption  more  effectively.  Operational  efforts  against  high-level 
corruption  have  started  to  bring  some  concrete  results.  However,  corruption  is  prevalent  in 
many  areas  and  remains  an  issue  of  concern.  There  has  been  further  progress  in  enforcing 
human rights,  strengthening the institutional  and  legislative  framework  for the protection of 
children’s rights,  tackling  gender based violence and the protection of vulnerable  groups, in 
particular the Roma and Egyptian communities.  

Functioning of the judiciary 

Albania  has  some  level  of  preparation.  Good  progress  has  been  made  through  continued 
implementation  of  the  justice  reform.  The  re-evaluation  of  all  judges  and  prosecutors  has 
advanced steadily and delivered substantial results. The number of magistrates having left the 
judicial  system,  through  dismissals  and  resignations  (88),  is  higher  than  the  number  of 
confirmations  in  office  of  existing  magistrates  (i.e.  existing  magistrates  who  passed  the 
vetting process), which is currently at 53. The outcome of thorough vetting has  affected the 
pace  of  setting-up  the  new  judicial  institutions.  Due  to  the  outcome  of  the  vetting,  the  new 
bodies  for  the  self-governance  of  the  judiciary  (the  High  Council  of  Justice,  the  High 

14 

 
 
Prosecutorial Council, and the Justice Appointment Council) were formed in December 2018. 
Dismissals  due  to  vetting  have  resulted  in  several  vacancies  at  other  key  institutions,  in 
particular at the High Court level. The Constitutional Court has lost its quorum, with only one 
judge out of nine remaining in office. The new bodies for the self-governance of the judiciary 
the  other 
are 
recommendations  from  the  2018  report,  making  more  effective  use  of  an  improved  case 
management system remains outstanding.  

the  necessary  steps 

transition.  On 

this  ongoing 

to  address 

taking 

In the coming year, Albania should in particular: 

  further  advance  the  process  of  re-evaluating  judges  and  prosecutors  (moving  on  with 
appeals  is  expected  to  consolidate  a  jurisprudence  on  the  most  critical  issues  of  the 
re-evaluation  process);  make  progress  in  the  recruitment  of  new  magistrates  to  fill  the 
positions made vacant by the vetting; 

  complete the set-up of specialised investigative and judicial bodies against corruption and 
organised crime, and consolidate the structures of the newly established institutions for the 
self-governing of the judiciary; 

  continue  to  pursue  a  sector-based  approach  to  the  justice  reform  under  the  cross-cutting 
strategy  for  2017-2020  and  ensure  adequate  governance,  monitoring  and  reporting 
mechanisms  through  well-developed  structures,  methods  and  indicators  coupled  with 
adequate financial support for implementation of the reform. 

The comprehensive transitional re-evaluation  process  (vetting) of all judges and prosecutors 
has  continued  steadily.  The  vetting  has  been  implemented  thoroughly,  with  the  overall 
objectives  of  strengthening  professionalism  across  the  sector;  eradicating  corruption; 
consolidating independence and impartiality; and, ultimately, rebuilding public confidence in 
the judiciary. The vetting institutions have continued to build their investigations on the basis 
of the three pillars provided for in the law: proficiency assessment; asset verification (which is 
performed  on  all  assessees,  as  well  as  on  all  their  close  relatives  for  wealth  accumulated  in 
Albania and abroad); and links to organised criminal networks. The vetting process is carried 
out under the independent oversight of an international monitoring operation, which has been 
deployed  under  the  aegis  of  the  European  Commission.  The  international  monitoring 
operation  follows  the  work  of  all  vetting  institutions:  the  Independent  Qualification 
Commission (IQC), the two Public Commissioners, and the Appeal Chamber.  

To date, investigations on 280 assessees have been initiated (out of the 800 magistrates that 
will  undergo  vetting).  In  total,  more  than  140  dossiers  have  been  processed,  leading  to  88 
dismissals/resignations  and  53  confirmations  in  office.  The  International  Monitoring 
Operation  (IMO)  has  consistently  performed  its  oversight  role  in  the  vetting  process.  The 
IMO has issued opinions on first-instance assessments, including seven recommendations to 
appeal first-instance decisions of confirmation. All were followed up by the Albanian vetting 
institutions.   

Strategic documents 

The cross-sectoral justice strategy for 2017-2020 and its action plan were adopted in 2016. 
Parts of the earlier action plan have already been implemented. The estimated budget for its 
implementation  is  EUR  98  million,  of  which  35%  is  provided  by  international  donors.  The 
establishment  of  appropriate  monitoring,  evaluation  and  reporting  mechanisms  is  still 
pending.  A  monitoring  body  has  been  appointed  within  the  Ministry  of  Justice,  and  it 
presented  its  third  monitoring  report  in  November  2018.  In  May  2018,  the  Parliament 
established an independent commission for the coordination, monitoring, and enforcement of 

15 

 
 
the Law on Justice System Governance Bodies. The members of this independent commission 
were eventually nominated in November 2018.    

New judicial governance bodies 

The  new  High  Judicial  Council,  a  separate  High  Prosecutorial  Council,  and  the  Justice 
Appointment Council started to perform their functions in January 2019.  

Independence and impartiality 

The  principles  of  impartiality  and  judicial  independence  are  set  out  in  the  Constitution  and 
reflected  in  the  laws  on  the  governance  of  the  judiciary  and  on  the  status  of  judges  and 
prosecutors.  The  reform  has  given  prosecutors  greater  autonomy  and  reduced  the 
centralisation of the system around the General Prosecutor. Judges and prosecutors cannot be 
transferred  without  their  consent.  Exceptions  concern  disciplinary  measures,  structurally 
justified changes or temporary needs. Judges can be dismissed only for serious misconduct or 
if  sentenced  for  a  criminal  offence.  The  dismissal  decision  may  be  appealed  at  the 
Constitutional Court. 

Attempted  interference  with  the  judiciary,  including  by  authorities  within  the  judiciary,  has 
been an issue  and needs to be addressed beyond the vetting process. The allocation of cases 
should  be  conducted  randomly  by  lot  and  electronically.  However,  the  electronic  case 
management  system  has  shown  many  shortcomings.  Random  allocation  of  cases  to 
prosecutors is partially used, but prosecution offices often fail to make full use of the system 
and produce reliable data. The laws provide for strict procedures in case of undue influence 
over a court case or when judges consider their independence to be jeopardised. 

Accountability 

The Code of Ethics  for  judges and prosecutors is now regulated by law  and is  no longer  a 
non-binding  document  produced  by  the  National  Conference  of  Judges.  The  High  Judicial 
Council and the High Prosecutorial Council are now responsible for approving the ethics rules 
and  code  of  conduct  and  for  monitoring  them.  The  High  Justice  Council  has  improved 
evaluation  forms  and  adapted  these  forms  to  the  new  legal  standards.  However,  the 
performance  of  judges  continues  mostly  to  be  measured  on  the  basis  of  numbers  of 
complaints and final court convictions. Until the High Justice Inspector (HJI) is established, 
the High Judicial Council and the High Prosecutorial Council should continue to investigate 
disciplinary  misconduct.  Based  on  the  latest  reform,  disciplinary  proceedings  have  to  be 
initiated and conducted by the High Justice Inspector and no longer by the Minister of Justice. 
However, the Minister of Justice retains the right to submit a complaint and to ask the HJI to 
carry out investigations on prosecutors. 

The recruitment process for the School of Magistrates has been improved with the inclusion 
of  an  integrity  test  and  a  psychological  assessment  of  the  integrity  and  moral  standards  of 
candidates.  Judges  and  prosecutors  are  obliged  to  declare  their  assets  on  an  annual  basis. 
Provisions  should  be  adopted  to  address  the  current  lack  of  legal  definitions  for  the  list  of 
misconduct for judges and prosecutors. Previous provisions addressing these definitions were 
repealed by the Constitutional Court decision on the Law on Status. 

Professionalism and competence 

The  system  for  recruiting,  selecting,  appointing,  transferring  and  dismissing  judges  and 
prosecutors has improved. Constitutional  and legal  changes have reduced political  influence 
during the appointment process, ensuring a merit-based career system. 

16 

 
 
The High Court has currently only three members exercising their functions, and is awaiting 
new  appointments  from  the  High  Judicial  Council.  Former  members  have  mostly  resigned 
after the termination of their mandate and one judge was dismissed after being found guilty of 
corruption. Five members were dismissed at the first-instance level of the vetting procedure 
and three were confirmed. However, two of the confirmation cases have been appealed by the 
Public Commissioner. The newly appointed High Judicial Council is expected to fill all open 
vacancies at the High Court. Appointments to the Constitutional Court are ongoing. The new 
Justice  Appointment  Council  has  set  in  motion  the  process  to  appoint  the  eight  vacant 
Constitutional Court judges, as well as of the High Justice Inspector. The General Prosecutor 
should be elected following a proposal by the High Prosecutorial Council and approval by a 
qualified  majority  in  Parliament.  While  the  appointment  process  is  ongoing,  a  Temporary 
Prosecutor  General  remains  in  office.  The  responsibilities  of  the  temporary  General 
Prosecutor are limited under the law. 

Quality of justice 

Albania had 358 full-time judges (12 per 100 000 inhabitants) and 336 full-time prosecutors 
(11  per  100 000  inhabitants)  in  2018.  According  to  the  European  Commission  for  the 
Efficiency of Justice (CEPEJ), the European average is 21 judges/11 prosecutors per 100 000 
inhabitants. The 2017 budgetary plan for the justice sector was EUR 98 million, while in 2018 
it  was  raised  to  approximately  EUR  100  million,  with  a  14%  increase.  This  amounts  to 
approximately EUR 5.3 per inhabitant. The new justice institutions and the vetting process are 
supported by a budgetary plan of EUR 12 million. Court infrastructure remains poor overall 
and future budget allocations should take this aspect into account. 

 Some hearings continue to be held in judges’ offices, as spending on court premises has not 
been prioritised due to the establishment of the new judicial institutions.  

The School of Magistrates is responsible for the initial and continuous in-service training of 
judges  and  prosecutors.  The  training  needs  are  identified  by  the  School  in  cooperation  with 
stakeholders within the judiciary. The new legislation expanded the School’s responsibilities, 
which  now  also  include  training  legal  advisers  at  all  court  levels,  court  chancellors,  court 
administrators and state advocates. However, the School continues to rely heavily on donors’ 
support  and  has  limited  capacity  in  terms  of  premises,  academic  staff,  and  qualified 
specialised trainers. A structured needs assessment and proper evaluation mechanism should 
also  be  developed  to  strengthen  the  overall  effectiveness  of  the  School  with  more  adequate 
financial and human resources.  

The School of Magistrates has not managed to attract enough candidates, resulting in only 10 
candidates  passing  the  entry  exam  for  the  academic  year  2018/19.  One  of  these  successful 
candidates  withdrew  and  another  one  was  dismissed  at  first-instance  level  in  the  vetting 
process. The Parliament failed to adopt transitional provisions allowing for a doubling in the 
number of students for the 2018/19 academic year, which were necessary back then since the 
two  new  councils  for  the  self-governance  of  the  judiciary  had  still  to  be  formed.  The 
amendments  could  not  be  adopted  since  the  boycott  by  the  opposition  of  plenary  sessions 
prevented the Law on the Status of Judges and Prosecutors to be revised with the necessary 
qualified majority. The newly formed High Judicial Council and High Prosecutorial Council 
set the number of candidates to be admitted in the 2019/20 academic year at 75. The first 53 
have already been selected.  

The  High  Judicial  Council  monitors  and  evaluates  court  activities  on  a  monthly  basis.  All 
courts  are  required  to  send  a  monthly  report  to  the  High  Judicial  Council.  They  are  also 
required  to  produce  annual  activity  reports.  All  courts  have  websites,  which  are  publicly 
accessible, although the data is not always fully updated due to lack of capacity. This is also 

17 

 
 
affected  by  the  lack  of  full  functionality  in  the  electronic  case  management  system,  which 
thus  far  did  not  produce  reliable  and  coherent  statistical  information.  A  new  modern, 
centralised and unified case management system is being developed with donors’ support, but 
remains to be established.  

The impact of alternative dispute resolution continues to be low. The total number of cases 
referred to and solved through mediation was 2 077 compared with 1 260 in 2016. 

Efficiency 

There  is  still  a  lack  of  consolidated  reporting  on  the  efficiency  of  the  justice  system. 
Efficiency  of  the  justice  system  is  affected  by  issues  such  as  the  length  of  proceedings,  the 
clearance rate, and the number of pending cases at all court levels including the Constitutional 
Court.  The  clearance  rate  is  lowest  for  the  appeal  courts,  particularly  for  the  Appeal 
Administrative Court (37%). This is due to a high number of appeals and the low number of 
judges allocated to the Court. The highest clearance rate (100%) is in the first-instance court 
of serious crimes.  

Dismissals and resignations resulting from the  vetting process have created vacant positions 
in  the  judiciary.  This  increased  the  backlog  in  cases,  in  particular  at  the  High  Court  level, 
where the current  backlog is  approximately 30,000 pending  cases. The Constitutional  Court 
repealed  the  provisions  of  the  Law  on  Status  regulating  the  rights  for  retirement  for  judges 
and  prosecutors.  Revised  ‘repairing’  provisions  remain  to  be  adopted  to  clarify  the  age  of 
retirement for judges and prosecutors.  

There are 205 related applications pending at the European Court of Human Rights. 

Changes  in  the  procedural  codes  under  the  reform  have  provided  for  improved  legal 
provisions  on  the  length  of  proceedings.  A  human-resources  strategy  should  also  be 
developed by the High Judicial Council. However, correct implementation of these improved 
legal provisions requires more training for judges and advocates.  

In addition to the overall length of court proceedings, the execution of court decisions remains 
a cause of concern. Since the introduction of the private offices’ service, enforcement of court 
decisions  has  improved.  However,  the  enforcement  of  monetary  claims  against  the  state 
should be improved further. Success fees should be more proportionate to the final value of 
the immovable property at the end of the enforcement procedure, rather than its initial value. 
The centralised electronic system into which all enfacement cases should be registered is not 
yet functional. The system should also be effective and accessible for other related agencies, 
such  as  notaries  and  the  Immovable  Property  Registration  Office.   At  the  same  time, 
enforcement  officers  should  have  access  to  existing  state-run  registers  and  databases  on 
assets, such as immovable property. Further amendments in the procedural laws are necessary 
to ensure the timely implementation of decisions, particularly for territorial powers linked to 
the residence of the debtor.  

Fight against corruption 

Albania  has  some  level  of  preparation  in  the  fight  against  corruption.  Good  progress  has 
been made, notably with the adoption of the new action plan 2018-20 for the implementation 
of  the  Inter-sectoral  Strategy  against  Corruption;  the  amendments  to  the  Law  on  the 
Declaration  and  Audit  of  Assets;  the  Law  on  Public  Procurement;  and  the  adoption  of  the 
Code  of  Conduct  for  Members  of  Parliament.  Although  the  vetting  of  members  of  the 
judiciary  is  an  administrative  process,  progress  in  this  area  is  relevant  to  assess  Albania’s 
concrete  results  in  fight  against  corruption.  Improvements  are  still  expected  to  the  Law  on 
political  party  financing,  the  Electoral  Code  and  the  Law  on  Conflicts  of  Interest.  The 

18 

 
 
establishment of an Anti-corruption Task Force has increased the proactivity of administrative 
investigations and is already producing its first concrete results. Good progress has continued 
through  further  consolidating  efforts  towards  the  establishment  of  a  solid  track  record  on 
investigating prosecuting and trying high-level corruption cases.  

The  recommendations  of  the  last  annual  report  were  partially  implemented.  Efforts  should 
continue towards consolidating a track record of seizure and confiscation/recovery of criminal 
assets  resulting  from  corruption-related  offences.  The  ongoing  establishment  of  specialised 
anti-corruption  investigative  and  judicial  bodies  remains  crucial.  Direct  access  to  databases 
for prosecutors and the police continued to improve. Overall, corruption is prevalent in many 
areas  and  remains  an  issue  of  concern.  There  is  awareness  at  political  level  of  the  need  to 
effectively address corruption. The justice response against high-level corruption has started 
to generate concrete results, which needs to continue. 

In the coming year, Albania should therefore: 

  further  progress 

record  of  seizure  and 
confiscation/recovery of criminal assets resulting from corruption-related offences; further 
increase the use of financial investigations; 

towards  establishing  a  solid 

track 

  finalise  the  procedures  for  the  establishment  of  the  specialised  anti-corruption  bodies, 
composed  of  the  Special  Anti-Corruption  and  Organised  Crime  Structure  (SPAK),  the 
National  Bureau  of  Investigation  (NBI),  and  the  Court  to  address  high-level  corruption; 
ensure adequate resources and cooperation between these new structures; 

  continue  to  improve  access  to  national  electronic  registries  for  law  enforcement 

authorities.  

Track record 

On  the  track  record  of  investigations,  prosecutions  and  convictions  in  the  fight  against 
corruption, the overall positive trend of recent  years continued. However, further efforts  are 
needed to consolidate this trend, as shown by some statistical data. In particular, the number 
of  final  convictions  involving  junior  or  middle-ranking  officials  has  slightly  decreased 
compared  with  the  previous  reporting  period  (there  were  289  such  convictions  in  2018 
compared with 331 in 2017). The overall number of referrals to prosecution has also slightly 
decreased (2 126 in 2018 and 2 342 in 2017). 

On  convictions  of  high-level  state  officials,  the  judiciary  has  achieved  some  good  initial 
results.  In  2018,  one  Appeals  Court  judge  was  sentenced  by  the  Serious  Crime  Court  (case 
currently  at  appeal  level)  and  one  prosecutor  was  sentenced  by  the  Court  of  Appeal  for 
Serious  Crimes  (case  currently  at  the  Supreme  Court).  There  were  102  new  cases  against 
high-level  state  officials  sent  to  prosecution  in  2018  (7  persons  indicted),  this  has  been  an 
increase  compared  to  61  in  2017  (10  persons  indicted).  However,  these  frequent 
investigations  in  recent  years  have  so  far  not  resulted  in  a  substantial  number  of  final 
convictions of high-ranking state officials. This risks fostering a culture of impunity. 

In February 2019, 12 officials and former officials of the Ministry of Justice were arrested for 
suspected abuse of office and violation of equality in tenders during the period 2016-17. The 
officials include a former secretary general of the Ministry of Justice. 

Although the vetting of  members of the judiciary  is  an administrative process,  it is  relevant 
for  assessing  Albania’s  concrete  results  in  fight  against  corruption.  Of  the  more  than  140 
magistrates  who  underwent  vetting  so  far  88  have  been  dismissed  from  office,  mostly  for 
issues  related  to  unjustified  assets,  or  resigned.  These  results  have  been  crucial  to  restoring 
public trust  in  the judiciary.  Institutional support has been  crucial to  the  progress  made and 

19 

 
 
confirms the strong commitment of all relevant authorities in Albania to eradicate corruption 
in  the  judiciary.  Among  the  high-ranking  judges  and  prosecutors  that  have  been  dismissed 
through  the  vetting  to  date,  it  should  be  noted  that  eight  out  of  nine  Constitutional  Court 
judges and 15 out of 18 High Court judges have been dismissed through the vetting or have 
resigned. This represents a significant number of cases involving high-level state officials.  

On asset declarations by high-level state officials, the number of cases referred by the High 
Inspectorate of Declaration and Audit of Assets  and Conflicts of Interest (HIDAACI) to the 
prosecution has increased: 27 cases were referred in 2018 and 22 cases in 2017. In 2018, eight 
high-level officials (four of whom were heads of commune and one of whom was a head of 
municipality) were convicted, compared to five in 2017 (including one head of commune and 
two customs officials). In total, HIDAACI referred 53 low- and mid-ranking officials to the 
prosecution services in  2018 (of which 17 resulted in  final  convictions). This  is  an increase 
compared to the 32 referrals resulting in 14 final convictions in 2017. 

Seizure and confiscation of criminal assets are not systematically ordered and carried out in 
corruption-related  cases.  Risk  assessments  have  been  piloted  in  some  sectors  (Customs 
Administration,  General  Inspectorate),  and  should  be  further  expanded.  Establishing  a  solid 
track record of investigations, prosecutions and final convictions in corruption cases remains a 
long term objective to be further consolidated. 

Some  progress  was  made  in  setting  up  an  interface  between  the  different  electronic 
case-management  systems  of  the  police,  prosecution  and  courts.  However,  the  electronic 
case-management system of the courts needs a technical update before further progress can be 
achieved. 

Implementation of the Law on whistle-blowing and whistle-blower protection continued. At 
both  central  and  local  level,  163  units  responsible  for  protecting  whistle-blowers  and  for 
reporting  cases  to  HIDAACI  have  been  established.  In  2017,  446  units  responsible  for  the 
protection of whistle-blowers were established across private companies. In 2018, 16 external 
reporting cases were registered and investigated by HIDAACI, compared with eight in 2017.  

On internal control mechanisms, the newly established Anti-corruption Task Force carried 
out 70 inspections leading to 108 dismissals from the civil service and 36 criminal referrals. 
The  State  Supreme  Audit  Institution  referred  41  cases,  including  high-level  officials,  to 
prosecution.  The  rate  of  implementation  of  the  State  Supreme  Audit  Institution’s  general 
recommendations by public institutions remains low. 

On  access  to  information,  the  Commissioner  for  Information  and  Data  Protection  received 
820 complaints and issued 37 decisions in 2018, while 560 complaints were received in 2017. 
A system was established and installed in 27 public institutions to record the overall number 
of requests made and to enable citizens to submit online requests for public information. 

The  impact  of  anti-corruption  measures  in  particularly  vulnerable  areas  (customs,  tax 
administration,  education,  health,  public  procurement  etc.)  remains  limited.  There  is  still  a 
strong and urgent need to improve and strengthen internal checks and inspection mechanisms 
within the public administration. There is also a need to improve their cooperation with law 
enforcement authorities. 

Institutional framework 

Prevention of corruption 

The capacity of the anti-corruption network in line ministries, at local level and in the Office 
of the National Coordinator against Corruption (NCAC) needs to be further strengthened. The 
Ministry of Justice, which serves as the new NCAC since September 2017, is currently vested 

20 

 
 
with  the  role  of  the  Secretariat  of  the  Inter-ministerial  Coordinating  Committee  for  the 
Implementation  of  the  Strategy,  established  in  2018.  The  Inter-ministerial  Committee  is 
chaired by the Minister of Justice and is composed of 10 deputy ministers representing their 
respective  ministries.  The  newly  established  Anti-corruption  Task  Force  is  responsible  for 
inter-institutional  inspections  and  has  started  to  produce  positive  results.  Coordination 
between  the  new  structures  and  the  Council  of  Ministers’  Unit  for  Transparency  and 
Anti-Corruption as well as the Integrated Policy Management Group has to be consolidated. 
The  impact  of  the  anti-corruption  structures  on  preventing  public  sector  corruption  remains 
unclear. 

The role of HIDAACI in detecting conflicts of interest and checking asset declarations was 
strengthened  by  the  adoption  of  the  Law  on  whistle-blowing  and  whistle-blower  protection 
and  the  implementation  of  the  vetting  process.  An  online  asset  declaration  system  is  being 
installed and tested and will be used fully as of January 2020.  

The  role  of  the  State  Supreme  Audit  Institution  in  the  overall  anti-corruption  framework 
should  be  strengthened  to  identify  and  effectively  address  systematic  weaknesses.  The 
inspection  capacity  in  public  procurement  needs  to  be  further  improved.  E-procurement  is 
expected to achieve more transparency and reduce opportunities for abuse. 

The  Council  of  Europe’s  Group  of  States  against  Corruption  (GRECO)  has  published  its 
Second  Compliance  Report  (fourth  round)  on  Albania  in  July  2018,  and  concluded  that 
Albania  had  dealt  satisfactorily  with  only  four  of  the  10  recommendations.  Albania  should 
now  prioritise  the  implementation  of  the  remaining  six  recommendations.  Albania  had 
implemented  satisfactorily  or  dealt  in  a  satisfactory  manner  with  all  12  recommendations 
from the third round. 

Integrity-related  secondary  legislation  is  in  place  but  an  overall  integrity  risk-management 
system has yet to be established. No integrity plans have been developed yet for ministries but 
a ‘Manual of Ethics on Public Service Delivery’ has been adopted. 

A new online portal has been created to promote ‘co-governance’ with citizens. Since 2017, 
33 336  citizens’  complaints  against  the  public  administration  have  been  registered.  Out  of 
28 565  cases  related  to  the  central  government,  27 335  were  resolved,  leading  to  300 
dismissals.  

Law enforcement 

Specialised  bodies  in  charge  of  investigating,  prosecuting  and  sanctioning  corruption  are 
being set up. These include an investigative body (NBI), a specialised prosecution office, and 
a specialised court (SPAK). The process is advancing based on the foreseen legal deadlines. 
The Special Prosecution Office has performed a preliminary verification of the fulfilment of 
the eligibility criteria of all the candidates for the SPAK. The High Prosecutorial Council has 
already submitted the list of candidates to the Independent Qualification Commission, which 
is carrying out the relevant vetting investigations.  

Police  and  prosecution  have  been  granted  direct  access  to  additional  private  and  public 
national registries, including 22 key national registries, through a central task force. This has 
improved  the  capacity  of  law  enforcement  authorities  to  operate,  and  has  also  made 
investigations  more  efficient.  Concerns  remain  over  high  staff  turnover  and  insufficient 
inter institutional cooperation. The overall resources of law enforcement authorities need to be 
strengthened.  

Legal framework 

21 

 
 
Albania is party to all international anti-corruption conventions, including the United Nations 
Convention  Against  corruption.  It  has  continued  to  improve  its  legal  framework  on  the 
prevention  and  combatting  of  corruption.  The  Code  of  Conduct  for  members  of  Parliament 
adopted  in  April  2018  has  strengthened  the  rules  on  conflicts  of  interest;  declarations  of 
private interests; limitations on outside activities whilst in office; acceptance of gifts; contacts 
with  lobbyists  and  third  parties;  post-employment  restrictions;  and  standards  on  conduct 
during parliamentary and non-parliamentary activities. The Law on the Declaration and Audit 
of Assets, Financial Obligations of Elected Persons and Certain Public Officials was further 
amended in December 2018, making it possible to use the online declaration system. The Law 
on  Conflicts  of  Interest  needs  to  be  further  improved.  A  Law  on  lobbying  remains  to  be 
adopted. The legal framework on whistle-blower protection still needs to be aligned with the 
new EU acquis on this issue. 

The latest amendments to the Law on political party financing provide for the publication of 
financial reports on the election campaigns of political parties, election campaign monitoring 
reports and financial audit reports. However, further amendments to the Law on political party 
financing are necessary, as well as to the Electoral Code. Amendments to the Criminal Code 
introducing a clear definition of ‘high state official’ have yet to be adopted. All the secondary 
legislation for the legal framework on integrity is in place but it remains highly complex and 
fragmented. While Albania has an increasingly comprehensive legal framework, effective and 
high-quality implementation should be prioritised. 

Strategic framework 

The  implementation  of  the  Inter-sectoral  Strategy  against  Corruption  is  overall  on  track, 
although  weaknesses  remain.  These  weaknesses  include  the  need  to  strengthen  ownership, 
strengthen institutional capacities, ensure proper costing of the strategy’s measures and ensure 
harmonisation  with  the  ongoing  actions  in  the  anti-corruption  sector  (including  donor 
activities).  A  new  action  plan  for  2018-20  for  the  implementation  of  the  strategy  was 
approved  in  April  2018,  but  it  should  be  reviewed  to  include  a  detailed  costing  of  the 
measures.  According  to  the  2018  draft  annual  monitoring  report,  53  activities  out  of  97 
planned  have  been  realised  (54%)  while  17  are  ongoing.  In  2017,  out  of  191  planned 
activities, 52% were fully implemented, and 31% were partially implemented. The monitoring 
mechanism and its accountability need to be strengthened. There should be consultations with 
the  relevant  stakeholders  before  the  approval  of  the  reports.  Feedback  should  also  be 
systematically  provided  to  the  stakeholders  who  participate  in  developing  anticorruption 
policies.  

A comprehensive performance assessment framework has been finalised, and reporting on the 
performance indicators is for the first time included in the annual monitoring report for 2018. 
The lack of human and  financial resources  for  implementing the measures  and reporting on 
progress remains a concern. 

Fundamental rights 

Albania  complies  overall  with  international  human  rights  instruments  and  has  ratified  most 
international conventions related to the protection of fundamental rights. It has yet to ratify 
the  Optional  Protocol  to  the  Convention  on  the  Rights  of  Persons  with  Disabilities  and  the 
Optional Protocol to the International Convention on Economic, Social and Cultural Rights. 
During  the  reporting  period,  Albania  made  efforts  to  meet  obligations  that  arise  from 
international  legal  instruments.  However,  the  overall  implementation  of  those  instruments 
needs to be strengthened. The legal framework was improved in the areas of children’s rights 
and  domestic  violence.  A  new  Law  on  Social  Housing  was  approved  by  the  Parliament  in 
May 2018, which addresses shortcomings in the field of housing and forced eviction. This law 

22 

 
 
creates  a  quota  for  5%  of  housing  to  be  reserved  for  the  most  vulnerable  members  of  the 
Roma  and  Egyptian  communities.  Adoption  of  secondary  legislation  on  minority  rights  is 
ongoing. Efforts are ongoing to consolidate property rights and shall be further pursued. 

In the coming year, Albania should: 

  further  improve  institutional  mechanisms  for  protecting  children,  protecting  victims  of 
domestic violence, guaranteeing gender equality and providing minimum health and social 
services, especially at the local level;  

  step  up  efforts  to  establish  solid  anti-discrimination  case-law;  enact  the  sub-legal  acts 
related to the Law on Social Housing, which also foresees 5% of housing to be reserved 
for the most vulnerable members of the Roma and Egyptian communities; 

  swiftly adopt the full package of secondary legislation related to the 2017 framework Law 

on the Protection of National Minorities; 

  further consolidate the entrenchment of property rights, notably by advancing the revision 
of  property  deeds,  implementing  the  compensation  scheme,  and  making  the  necessary 
progress on the digitalising and mapping of property. 

Albania complies overall with international human rights instruments and has ratified most 
international conventions. It has yet to ratify the Optional Protocol to the Convention on the 
Rights of Persons with Disabilities and the Optional Protocol to the International Convention 
on Economic, Social and Cultural Rights. Albania has made efforts to address human rights 
and  to  fulfil  the  obligations  that  arise  from  international  legal  instruments.  However,  the 
implementation  of  such 
level  of 
implementation of policies, analyses and strategies remains a challenge due to the absence of 
comprehensive  monitoring  and  data.  It  is  therefore  important  to  develop  comprehensive 
reports  and  critical  analysis.  An  inter-institutional  action  plan  (2018-2020)  on  the 
implementation  of  UN  Security  Council  Resolution  1325  was  adopted  in  September  2018. 
Albania underwent its third Universal Periodic Review cycle in May 2019. Albania is in the 
process of becoming an observer to the European Union Agency for Fundamental Rights. 

instruments  should  be 

improved.  Assessing 

the 

Albania continues to ensure good cooperation with the European Court of Human Rights. 
Between 1 January and 31 December 2018, the Court delivered nine judgments on Albania, 
seven of which found that Albania had violated rights guaranteed by the ECHR. The majority 
of  cases  are  related  to  the  right  to  a  fair  trial.  On  20  September  2018,  the  Committee  of 
Ministers of the Council of Europe decided to close the examination of 16 cases on the Driza 
Group and Manushaqe Puto. 

On  the  promotion  and enforcement  of  human  rights,  the  Ombudsman  has  been  awarded 
‘A’ status by the Global Alliance of National Human Rights Institutions since 2014. During 
the reporting period, all five vacant positions for Commissioners have been filled. In 2018, the 
Ombudsman submitted a total of 171 recommendations, of which 93 were accepted, 17 were 
rejected, five went without response, and 56 remain in process. Effective implementation of 
the Ombudsman’s recommendations by the public administration remains to be strengthened 
and made more systematic.  

In  October  2018,  the  Ombudsman  launched  an  online  mobile  application  to  which  citizens 
can submit complaints about human rights violations and corruption. In November 2018, the 
Ombudsman launched an ex-officio administrative inquiry into the new ring-road demolition 
case,  noting  that  central  and  local  government  bodies  had  failed  to  address  earlier 
recommendations on similar demolitions. The Ombudsman called for the planned demolitions 
to  be  preceded  by  consultations  with  the  affected  residents,  and  also  recommended  that  the 

23 

 
 
necessary construction permit should be issued before this infrastructure project is allowed to 
proceed. 

A  comprehensive  targeted  approach  is  necessary  to  strengthen  the  capacities  of  the 
Ombudsman and of the Commissioner for Protection from Discrimination in handling cases 
of human rights violations. This will include ensuring an appropriate budget for the former. In 
this  regard,  guidance  is  provided  by  the  European  Commission’s  Recommendation  on 
standards for equality bodies, adopted on 22 June 2018. 

On  the  right  to  life,  following  a  visit  to  the  country  in  December  2016,  the  UN  Working 
Group on Enforced or Voluntary Disappearances (WGEID) issued several recommendations 
for  Albania  to  address  the  crimes  committed  during  the  communist  regime.  A  cooperation 
agreement with the International Commission for Missing Persons (ICMP) was signed in July 
and  ratified  by  the  Albanian  Parliament  in  November  2018,  allowing  the  ICMP  to  start 
collecting DNA samples with financial support from the EU. 

On  the  prevention  of  torture  and  ill-treatment,  the  National  Preventive  Mechanism 
conducted 51 inspections in 2018, resulting in 51 recommendations. During this period, two 
complaints  of  violence  in  police  facilities  and  penitentiary  institutions  were  processed.  The 
European  Committee  for  the  Prevention  of  Torture  (CPT)  visited  the  country  in  February 
2017 and subsequently published a report. Particular attention was paid to the treatment and 
conditions of detention of persons in police custody and the situation of remand prisoners and 
forensic  psychiatric  patients.  The  recommendations  issued  by  the  CPT  have  only  been 
partially  implemented  by  the  Albanian  authorities.  As  recommended  by  the  CPT  and  the 
European Commission, the government has started preparing plans for the establishment of a 
special institute for the treatment of persons with mental illness in prison. Preparation of these 
plans should be accelerated. In November 2018, the Ombudsman carried out an inspection at 
the Burrel prison. The Ombudsperson reiterated that this correctional facility should be closed 
because of its poor state. 

On the prison system, a strategic action plan to improve detention conditions was  adopted in 
2014 but its implementation was not monitored. A new action plan is currently being drafted 
for  2019-2022.  Legislation  on  prisons  and  prison  police  should  be  amended  to  ensure 
compliance  with  European  standards.  With  the  opening  of  the  new  EU-funded  prison  in 
Shkodra,  there  has  been  some  progress  in  addressing  overcrowding  in  prisons.  In  total,  the 
number  of  inmates  decreased  by  8%.  During  the  reporting  period,  the  newly  appointed 
director of the Prison Directorate was dismissed on corruption charges. Several former prison 
directors  and  prison  police  officers  have  also  been  charged,  and  are  under  investigation  for 
abuse of office and corruption. Training for prison personnel was carried out by the Ministry 
of Justice and the Ministry of Interior. There was also training for prison personnel as part of 
EU and Council of Europe projects.   

The use of alternatives to custody has increased compared with the previous reporting period. 
There were 6 171 cases of non-custodial alternatives in 2018 and 4 904 in 2017. The use of 
electronic  monitoring  has  been  suspended  since  2017  because  of  a  legal  dispute.  The 
specialist monitoring of convicts by the Probation Service slightly decreased from 85 in 2017 
to 82 in 2018.  

On the protection of personal data, the capacities of the office of the Commissioner for the 
Right to Information and Data Protection need to be adequate to perform its tasks effectively. 
In  2018,  the  Commissioner  received  170  complaints  from  data  subjects,  carried  out  190 
administrative  inspections,  issued  30  decisions,  and  imposed  61  administrative  sanctions, 
which  represent  an  increased  activity  compared  to  2017.  Further  efforts  are  needed  to  align 
the personal data protection legislation with the General Data Protection Regulation 2016/679 

24 

 
 
and the Police Directive 2016/680.  Albania has  not  yet signed or ratified the 2018 Protocol 
amending  the  Convention  for  the  Protection  of  Individuals  with  regard  to  Automatic 
Processing of Personal Data. 

Freedom of thought, conscience and religion was generally upheld, and there continued to 
be good relations overall between religious affiliations and practices. However, the restitution 
of properties belonging to religious groups remains an issue. The government allocated EUR 
880,000  to  support  the  five  official  religious  communities  in  May  2018.  The  religious 
communities  –  the  Muslim  Community,  the  Orthodox  Church,  the  Catholic  Church,  the 
Bektashi  Community  and  the  Evangelical  Fraternity  –  have  jointly  expressed  strong  public 
support for Albania’s EU integration process.  In May, the religious communities in Albania 
signed  a  joint  statement  pledging  their  engagement  in  interreligious  dialogue.  The 
Interreligious Council, a forum for the country’s religious leaders to discuss shared concerns, 
has increased its activities. In April, the head of the Russian Orthodox Church, Patriarch Kirill 
of Moscow and All Russia, paid his very first visit to the country.  

--------------------------------------------------------------------------------------------------------- 

Freedom of expression 

The country has some level of preparation / is moderately prepared in the area of freedom 
of expression. There was limited progress over the reporting period. Threats and intimidating 
language  against  journalists  have  increased,  although  these  acts  have  been  systematically 
condemned.  There  have  been  some  convictions  on  past  and  current  cases.  During  the 
reporting period, financial resources and staff levels at the audio-visual media regulator were 
reinforced.  The  new  Code  of  Ethics  for  journalists  was  launched  in  March  2018  and 
incorporates  ethical  guidelines  for  online  media.  The  overall  legislative  environment  is 
conducive  to  the  exercise  of  freedom  of  expression,  but  implementation  of  this  legislation 
remains a challenge. Ownership of audio-visual media and the transparency of media funding 
and public advertising remain key issues. Self-regulation in online media needs to be ensured. 
Legislation on public advertising needs to be introduced to improve transparency in line with 
international best practices.  

In the coming year, Albania should in particular:  

  ensure  implementation  of  the  Labour  Code  and  strengthen  the  protection  of  Albanian 

journalists’ labour and social rights; 

  bring the legal requirements for transparency of media ownership and its limitations into 

line with international standards; 

  introduce  legislation  in  line  with  international  best  practice  on  public  advertising  to 

increase transparency. 

Intimidation of journalists 

During  the  reporting  period,  there  were  two  cases  of  physical  assaults  against  journalists, 
reported respectively in June and September 2018. In addition, in August bullets were fired on 
the  parental  home  of  an  investigative  journalist,  while  a  television  programme  moderator 
received  a  threat  in  December.  Media  associations  and  public  authorities  resolutely 
condemned  these  attacks.  Investigations  were  launched,  but  there  have  been  no  arrests  on 
these cases so far.  

In  May,  a  politician  was  convicted  in  relation  to  a  defamation  case  involving  a  journalist, 
while a first instance court dismissed a defamation case against two investigative journalists. 
A  total  of  13  cases  in  which  journalists  or  newspapers  were  parties  in  the  judicial  process 

25 

 
 
were registered in first instance courts in 2018 with 10 first instance court rulings. In addition, 
there were 7 cases registered in  appeal  courts in  2018 with  1 ruling. Albania should further 
strengthen  its  efforts  to  ensure  a  policy  of  zero  tolerance  for  intimidation  of  journalists  and 
threats against the media, including in political discourse. 

Legislative environment 

The  Constitution  and  relevant  laws  are  in  line  with  international  human  rights  law.  They 
guarantee individual liberties, including the right to privacy and freedom of expression. They 
also include sanctions  against incitement to hatred.  Defamation remains a criminal offence, 
although it does not carry a prison sentence. However, journalists convicted of defamation are 
at risk of fines. In December 2018, the government announced a package of amendments to 
the  Law  on  Audiovisual  Media  and  the  Law  on  Electronic  Communications,  and  a  public 
consultation on these amendments was held in January 2019. It is important that the opinions 
of  the  relevant  stakeholders,  including  the  media  sector,  are  taken  into  account  before  any 
new  measure  is  adopted.  Specific  concerns  have  also  been  raised  by  the  international 
community. Among others, these concerns included the scope of the definition of electronic 
publication, the extent of the domain registration obligation, and the implications of failure to 
register. The package of amendments is currently being reviewed for alignment with the EU 
acquis  and  European  standards.  Albania  still  needs  to  introduce  legislation  strengthening 
transparency in public advertising. 

Access to information about procurement contracts, audits and salaries of officials should be 
strengthened. Decisions of the Commissioner for the Right to Information are non-binding on 
public administration officials. 

Implementation of legislation/institutions 

The  Audio-visual  Media  Authority  (AMA),  the  regulatory  authority  in  the  field  of  audio 
and visual broadcasting  services, approved its 2017-19 strategic action plan in  March 2017. 
The  funding  of  the  AMA  has  been  doubled,  and  it  has  changed  its  structure  to  focus  more 
strongly on supervisory and inspection activities to identify illegal broadcasting. The AMA’s 
activities  are  subject  to  parliamentary  oversight  by  the  Committee  on  Education  and  Public 
Information Means. 

The new deadline set by the AMA for the digital switchover process is September 2019. The 
infrastructure to access digital broadcasting is generally already in place. However, the AMA 
has postponed the deadline of the digital switchover in Tirana and Durres due to the scarcity 
of DVB-T2 digital decoders on the market and the associated public discontent. These events 
indicated a shortcoming in the AMA’s role in the management of the process as well as a lack 
of public awareness about the digital switchover.  

Public service broadcaster 

The public broadcaster RTSH has a new internal structure that reflects the digital switchover 
process.  RTSH  has  developed  and  approved  editorial  principles  to  guard  against  political 
interference. RTSH still needs to ensure its financial sustainability. 

In June 2018, private broadcasters pushed for changes to the Audio-visual Media Law, which 
would have allowed for part of the TV licence fee to be diverted from the public broadcaster 
to private TV channels. The proposed amendments were opposed by international actors, the 
public broadcaster, and media organisations. The initiative was rejected by the government.  

Economic factors 

26 

 
 
Oversaturation  of  the  media  landscape  and  opaque  media  ownership  create  concerns  about 
fair competition for independent media organisations. The editorial direction of private media 
continues to be the subject of political and business interests. Media funding remains key to 
improving media freedom, especially given new challenges such as fake news and third-party 
influence.  

Self-censorship  and  the  precarious  nature  of  employment  for  journalists  remain  issues  of 
concern. 

Internet 

In October 2018, the regulatory Authority for Electronic and Postal Communications (AKEP) 
warned that 44 online portals would be shut down if they were not registered within 72 hours 
with  the  National  Business  Centre  and  if  they  failed  to  publish  their  respective  tax 
number/business  registration  number.  As  mentioned  above, 
the  recently  proposed 
amendments  to  the  media  law  legal  framework  include  the  obligation  of  online  media 
registration, the scope of which remains to be clarified.  

Professional organisations and working conditions 

Job  security  for  journalists  needs  to  be  strengthened.  Media  owners  do  not  formalise  work 
contracts  and  the  Labour  Code  needs  to  be  properly  implemented  for  journalists.  A  recent 
survey  supported  by  the  EU  indicates  that  employment  in  the  media  sector  continues  to  be 
problematic,  with  one  third  of  respondents  stressing  that  they  do  not  currently  have  a  work 
contract.  More than half of the respondents  claimed that the salary they received was  lower 
than the average salary in the public sector and the same proportion complained of delays in 
receiving their salaries in a timely manner. Delays that last for several months are regularly 
reported.  The  AMA,  together  with  the  Parliamentary  Media  Committee,  is  pressuring  the 
authorities  to  properly  implement  the  Labour  Code  for  journalists.  However,  institutional 
steps to ensure this implementation need to be more concrete. 

(See also Chapter 10 - Information society and media) 

--------------------------------------------------------------------------------------------------------- 

Freedom  of  assembly  and  association  are  provided  for  in  the  Constitution  and  legislative 
framework and are broadly in line with international standards.  Assemblies are regulated by 
the  Law  on  Assemblies  which,  although  largely  in  line  with  the  Guidelines  on  Freedom  of 
Peaceful Assembly of the OIDHR, needs to address the right to spontaneous assemblies and 
counter–assemblies.  During the reporting period, freedom  of assembly and association were 
generally  respected.  However,  incidents  have  been  registered  in  some  protests  and  political 
demonstrations. 

Issues  of  labour  and  trade  union  rights  are  further  covered  in  Chapter  19  -  Social  policy 
and employment. 

On property rights, progress has yet to be made towards improving the legal framework for 
registration, expropriation and compensation. In February 2019, the Parliament approved the 
Law  on  Cadastre.  Albania  should  conclude  first  registration  of  property  titles  in  all  its 
territory. The decision on the registration and management of land located in the coastal area 
adopted  by  the  government  in  November  2018  and  contested  by  stakeholders  has  been 
amended.  There  are  572  cases  pending  before  the  ECtHR,  most  of  which  are  related  to 
property  and  due  legal  process  in  property-related  cases.  On  20  September  2018,  the 
Committee of Ministers of the Council of Europe issued a Resolution in which it decided to 
close  the  monitoring  of  the  Driza  group  and  Manushaqe  Puto  cases.  The  total  fund  for 
compensating property owners amounts to approximately EUR 700 million. Around EUR 17 

27 

 
 
million have already been disbursed.  Further progress is dependent on the budget  allocation 
for integrated land management and on follow-up legislation. Prior to the creation of the State 
Cadastre Agency, the Agency for the Treatment of Property treated 3 000 applications in the 
course of 2018, while 6 950 are still pending. 

On  non-discrimination,  the  policy  and  legal  framework  is  generally  aligned  with  EU 
standards.  The  Law  on  protection  against  discrimination  does  not  address  the  concept  of 
multiple  discriminations.  The  implementation  of  the  anti-discrimination  legal  framework 
needs  to  be  strengthened  by  the  continuous  provision  of  specialised  training  to  judges  and 
prosecutors. In 2018, the Commissioner for Protection against Discrimination (CPD) handled 
an  increased  number  of  cases  of  alleged  discrimination  (205  cases  handled  in  2018,  against 
173  in  2017),  out  of  which  179  complaints  and  eight  ex-officio.  The  Commissioner 
participated in 66 judicial proceedings (53 in 2017) and imposed seven penalties (against 11 
in 2017). The local offices of the CPD, opened in three main cities, are now fully operational. 
The  capacity  of  the  CPD  has  been  strengthened  with  additional  staff  and  with  an  increased 
budget.  Laws  on  hate  speech  are  in  line  with  international  standards.  Three  cases  of  hate 
speech were registered during the year, and related complaints were submitted to the CPD on 
minority, gender and sexual orientation grounds. Awareness campaigns were organised across 
the  country,  but  much  remains  to  be  done  to  eliminate  the  stigma  of  being  discriminated 
against, particularly in rural and remote areas. 

The effective implementation  of the national  strategy and action plan 2016-2020 on  gender 
equality is hampered by a persistent funding gap. At central level, the deputy Prime Minister 
has  been  nominated  as  the  National  Coordinator  for  Gender  Equality.  More  efforts  are 
required to ensure that the gender equality mechanism is fully operational and that all sectoral 
strategies  at  central  and  local  level  are  gender  mainstreamed  and  apply  gender  responsive 
budgeting. In July 2018, Albania progressed in tackling gender-based violence by amending 
the  Law  on  Measures  against  Violence  in  Family  Relations.  The  changes  introduced  are  in 
line with the Istanbul Convention and the Convention on Elimination of all forms of Violence 
against Women. The law has strengthened protection measures for survivors of violence. It is 
important  that  implementation  of  the  new  legislative  framework  starts  swiftly,  as  domestic 
violence remains a serious concern. In 2018, there was evidence of 4 951 cases of domestic 
violence.  In  1 914  cases,  the  required  investigative  and  procedural  acts  were  referred  to  the 
prosecution office to initiate criminal proceedings. 608 alleged perpetrators were arrested, 77 
were  detained,  and  688  prosecuted  at  large.  541  cases  of  other  criminal  offences  related  to 
family relationships were reported. In 2018, 60 women and girls were identified and referred 
to relevant services as victims or potential victims of human trafficking. While the number of 
local  referral  mechanisms  for  reporting  gender-based  violence  has  increased  to  39 
municipalities  out  of  61,  efforts  should  be  stepped  up  to  set  up  and  make  these  referral 
mechanisms  functional  in  all  municipalities.  There  are  several  women’s  organisations  that 
operate shelters for victims of domestic violence, but they have limited hosting and financing 
capacity. Women from disadvantaged and marginalised groups, such as Roma and Egyptian 
women,  are  often  unaware  of  their  rights  and  how  to  access  services,  including  shelters. 
Effective implementation  of the  free legal  aid  system  and the promotion of legal  awareness 
and empowerment will be essential to ensure women’s access to justice. In September 2018, 
the  government  adopted  its  first  national  action  plan  to  transpose  UN  Security  Council 
Resolution  1325  on  women,  peace,  and  security.  During  2018,  Albania’s  parliamentary 
subcommittee on gender equality and its Women Caucus continued to step up efforts in the 
area of gender equality legislation. A new health and psychosocial centre for victims of sexual 
abuse is now open and its service delivery standards have been adopted.  

28 

 
 
On the rights of the child, the adoption of the Law on the Rights and Protection of the Child 
in 2018 constituted a major step in improving the legal framework for child protection. This 
new law requires a multi-sectoral preventive and responsive approach to all forms of violence 
against children. Several by-laws have also been adopted. The mandate of the State Agency 
on Child Rights and Protection (a dedicated state institution under the Ministry of Health and 
Social Protection) has now been reinforced. This constitutes an opportunity to build a strong 
child protection system  in  Albania. However, the resources awarded to  this institution, both 
financial and human, do not correspond to its increased legal responsibilities. Moreover, the 
fact  that  social  protection  and  child  protection  fall  under  the  mandates  of  two  different 
government agencies does not allow for a comprehensive approach to the implementation of 
the  national  childcare  reform.  Coordination  between  these  bodies  as  well  as  the  local 
governments  and  the  Commissioner  for  Children’s  Rights  should  be  improved.  In  October 
2018, the Parliament of Albania adopted legal amendments to the country’s civil registration 
law. The aim of these amendments was to remove barriers to birth registration and reduce the 
risk of childhood statelessness in Albania, particularly for children of Albanian parents born 
outside the country and for children of the Roma and Egyptian communities. 

The National Council on the Rights and Protection of the Child was created in 2018. Concrete 
measures to implement child protection legislation have been planned as part of the National 
Agenda  on  Child  Rights  2017-20,  which  contains  clear  objectives  and  budgeted  activities. 
However, little action has been taken so far to  implement  these actions.  Currently, there are 
223  child  protection  workers  in  total  (52%  of  the  required  number)  out  of  which  only  45 
(26%) work full-time. The new law requires all child protection workers to have a background 
in social work. However, currently only 78 out of 223 (35%) have such experience. 

There  is  growing  evidence  of  child  abuse  and  exploitation  through  the  internet.  Three 
ministries  (Interior,  Health  and  Social  Protection,  and  Education)  adopted  a  national  action 
plan in 2018 to address these issues. However, capacities for investigation and prosecution of 
crimes  against  children  committed  through  the  internet  need  to  be  strengthened.  The 
phenomenon  of  child  marriage/union  is  still  prevalent,  particularly  in  Roma,  Egyptian  and 
rural communities. There is a lack of data and reporting on child poverty. 

The legislative and policy framework on juvenile justice was strengthened with the approval 
of  the  National  Justice  for  Children  Strategy  (2018-21)  in  September  2018.  The  strategy 
covers implementation of the Criminal Justice for Children Code. The strategy is based on the 
government’s  budgetary  programmes.  Implementing  the  new  strategy  and  the  Criminal 
Justice  for  Children  Code  adopted  in  2017  will  require  a  shift  in  administrative  culture, 
considerable  capacity  building,  specially  adapted  infrastructure,  the  establishment  of 
community  services,  and  inter-disciplinary/inter-institutional  coordination  at  the  central  and 
local  level.  There  are  still  structural  gaps  in  juvenile  justice  in  Albania.  In  February  2019, 
there were 31 juveniles in the Kavaja detention centre for minors. 

Albania’s  framework  legislation  on  the  rights  of  persons  with  disabilities  is  partially 
compliant  with  the  UN  Convention  on  the  Rights  of  Persons  with  Disabilities.  However, 
Albania  has  yet  to  ratify  the  Optional  Protocol  to  the  Convention  on  the  Rights  of  Persons 
with Disabilities. Persons with disabilities continue to face difficulties in accessing education, 
employment, healthcare and social services and in participating in decision-making. There are 
also widespread difficulties in removing environmental and infrastructural barriers that hinder 
mobility.  Since  the  adoption  of  the  law  on  inclusion  and  accessibility  in  2014,  only  three 
by-laws  have  entered  into  force,  while  most  of  the  secondary  legislation  still  needs  to  be 
adopted.  Despite  efforts  to  ensure  inclusive  education,  the  quality  of  education  for  disabled 
children,  especially  deaf  children,  is  a  cause  for  concern.  Children  with  disabilities  are  still 
placed  in  residential  care  centres.  The  number  of  assistant  teachers  for  children  with 

29 

 
 
disabilities in the pre-university education system increased to 944 in the 2018/19 school year 
(compared  to  700  at  the  end  of  the  2017/18  school  year),  but  these  assistant  teachers  need 
further tailor-made training. The number of children with disabilities in the education system 
has  reached  4336,  out  of  which  only  652  children  or  15%  attend  special  schools.  The 
assessment of disabilities is still based on an outdated medical model, but a new bio-psycho-
social  model  of  disability  assessment  is  being  piloted  in  two  administrative  units  of  Tirana 
with  a  view  to  reform  the  assessment  system  countrywide.  Monitoring  of  how  disability-
related measures are being implemented is hampered by a lack of data. 

Despite  the  fact  that  the  Constitution  does  not  include  references  to  sexual  orientation  and 
gender  identity,  Albania's  anti-discrimination  legislation  prohibits  discrimination  against 
lesbian, gay, bisexual, transgender and intersex (LGBTI) persons. However, more efforts 
are needed to protect  LGBTI persons from discrimination when it comes to access to health 
care,  education,  justice,  employment  and  housing.  In  2018,  10  members  of  the  transgender 
community sought asylum abroad due to severe discrimination. The national action plan for 
LGBTI  persons  (2016-2020)  lacks  a  budget  and  is  yet  to  produce  visible  results.  An  inter-
ministerial team responsible for monitoring the action plan in Albania is operational and held 
its last meeting in January 2019 to take stock of implementation. Police officers, prosecutors 
and  gender  ‘focal  points’  in  line  ministries  have  been  given  training  on  preventing 
discrimination  on  the  basis  of  sexual  orientation  and  gender  identity.  The  donor-funded 
shelter for LGBTI persons has continued to provide care, support and advocacy to homeless 
LGBTI individuals. During the reporting period, there were no court rulings in cases related 
to  sexual  orientation  and  gender  identity.  In  addition,  public  awareness  and  acceptance  of 
LGBTI  persons  remain  low,  particularly  in  rural  areas.  Hate  speech  and  discriminatory 
language continue to  be  a  problem in  the media, especially online media.  In March 2018, a 
hate-speech  campaign  against  the  LGBTI  community  developed  on  social  media,  with  the 
active  participation  of  members  of  the  Parliament  and  a  former  minister.  Despite  strong 
statements  from  the  international  community,  the  response  of  equality  bodies  and  state 
institutions was limited compared with the gravity of the campaign. 

On  procedural  rights,  the  new  Law  on  Legal  Aid  broadens  the  category  of  persons  that 
benefit from legal aid, and introduces primary and secondary legal aid concepts. The rights of 
victims were strengthened through amendments to the Criminal Procedure Code in May 2017. 
Nevertheless, the legal aid scheme still needs to develop an outreach mechanism and promote 
access  to  its  services.  A  directorate  for  free  legal  aid  within  the  Ministry  of  Justice  was 
supposed  to  be  established  by  the  end  of  October  2018  but  this  has  not  materialised.  There 
continue  to  be  reports  of  obstacles  to  access  to  justice  and  a  lack  of  access  to  legal  aid  for 
vulnerable  groups,  including  Roma,  Egyptians,  persons  with  disabilities,  and  persons  with 
economic difficulties. The vast majority of cases involving vulnerable groups are still handled 
by civil society groups with donor support. 

Albania  demonstrated  a  strong  commitment  to  promoting  and  protecting  minority  rights 
through  the  adoption  of  the  framework  Law  on  the  Protection  of  National  Minorities  in 
2017.  However,  Albania  still  needs  to  swiftly  adopt  the  full  package  of  related  secondary 
legislation,  in  line  with  European  standards.  These  steps  are  necessary  to  ensure 
implementation of all the principles and rights enshrined in the framework law, including the 
right  to  free  self-identification,  the  use  of  minority  languages,  and  the  right  to  education  in 
minority  languages.  As  of  May  2019,  5  bylaws  related  to  the  package  have  been  approved. 
The  adoption  of  the  remaining  bylaws  is  scheduled  to  be  finalised  by  June  2019.  The 
implementation of all the secondary legislation will require strengthening the capacity of the 
State  Committee  on  National  Minorities  and  providing  sufficient  financial  resources.  In 
October 2018, the Council of Europe’s Advisory Committee on the Framework Convention 

30 

 
 
for the Protection of National  Minorities adopted its fourth  Opinion on Albania, which was 
published  in  March  2019.  Concerns  have  been  raised  by  the  Greek  minority  in  relation  to 
property rights in the southern coastal area. 

The implementation of the 2016-2020 national  action plan for the integration of  Roma and 
Egyptians  is  ongoing.  The  fourth  policy  dialogue  seminar  on  inclusion  of  Roma  and 
Egyptians  took  place  in  December  2018,  and  made  a  number  of  recommendations  to  be 
implemented  throughout  the  coming  2  years.  The  structure  of  the  Ministry  of  Health  and 
Social  Protection,  in  charge  of  the  coordination  of  Roma-related  policies,  needs  to  be 
strengthened. In recent years, there has been a positive overall trend in Albania in the field of 
education.  This  is  particularly  the  case  with  regard  to  compulsory  education  enrolment  of 
Roma  children  aged  7-15  years  (currently  at  66%)  and  compulsory  education  completion 
(43%) by Roma. However, the gap between Roma/ Egyptians and other non-Roma children 
living  in  the  same  areas  remains  significant.  Roma  children  continue  to  benefit  from  free 
textbooks and transportation to remote schools. Segregation in schools remains an issue that 
should be systematically addressed. The overall employment and labour force participation of 
Roma  remains  very  low  (over  56%  of  economically  active  working-age  Roma  are 
unemployed).  Informal  employment  among  Roma  accounts  for  62%  of  total  Roma 
employment. There is  a  need to  review the national  employment  approach because it is  not 
producing the expected results.  Health insurance coverage for Roma in Albania remains low 
and gaps persist between Roma and the majority population. A new Law on Social Housing 
was approved by the Parliament in  May 2018, which addresses shortcomings in  the field  of 
housing and forced eviction. The law requires a  quota of 5% of housing to be reserved for the 
most vulnerable members of the Roma and Egyptian communities. The related sub-legal acts 
still need to be enacted. In 2018, there were 424 Roma families that benefited from projects to 
improve  housing  conditions  (508  in  2017).  Albania  is  still  the  country  with  the  region’s 
lowest  rate  of  access  to  piped  water  (46%)  and  electricity  (84%)  by  the  Roma  population. 
Legal  amendments  to  the  country’s  civil  registration  law  in  October  2018  have  allowed  the 
regularisation  of  157  unregistered  children.  Overall  access  to  public  services  for  Roma 
remains difficult, particularly in rural areas. An electronic data collection system, ROMALB, 
is operational and used by all local governments. 

On  citizens’  rights,  in  January  2019  Albania  took  steps  to  amend  the  Law  on  Citizenship, 
which would potentially establish an investors’ citizenship scheme. Such schemes pose risks 
as  regards  security,  money  laundering,  tax  evasion,  terrorist  financing,  corruption  and 
infiltration  by  organised  crime.  As  a  candidate  country,  Albania  should  refrain  from  any 
measure that could jeopardise attainment of the EU's objectives, when using its prerogatives 
to award nationality. 

2.2.2.  Chapter 24: Justice, freedom and security 

Albania  has  some  level  of  preparation  /  is  moderately  prepared  in  implementing  the 
acquis  in  this  area.  Some  progress  was  made  in  improving  the  institutional  capacity  on 
border management, asylum, countering terrorism  and violent  extremism.  Albania signed  a 
European Border and Coast Guard status agreement with the EU. Reception capacity to deal 
with  mixed  migration  flows  was  further  improved.  Organisational  changes  in  law 
enforcement  agencies  introduced  in  the  previous  reporting  period  were  implemented.  The 
number  of  unfounded  asylum  applications  lodged  by  Albanian  nationals  in  the  EU  has 
decreased  but  remains  high  and  requires  continuous  and  sustained  efforts.  These  efforts 
should include addressing the phenomenon of unaccompanied minors.  

In the coming year, Albania should in particular: 

31 

 
 
  further develop the systematic use of parallel financial investigations when dealing with 

organised crime, illicit trafficking, terrorism, and money laundering;  

  implement the recommendations of the report from  the Council of Europe’s Committee 
of  experts  on  the  evaluation  of  anti-money  laundering  measures  and  financing  of 
terrorism  (Moneyval)  on  preventing  money  laundering  and  countering  terrorism 
financing; 

  further  step  up  measures  to  address  effectively  the  problem  of  unfounded  asylum 
applications in the EU through addressing the ‘push factors’ behind it, improving border 
checks  and organising information  campaigns on the rights  and obligations of visa-free 
travel,  continuing  the  relevant  cooperation  and  dialogue  with  the  most  affected  EU 
Member States. 

Fight against organised crime 

The  country  has  some  level  of  preparation  in  implementing  the  acquis  in  this  area.  Good 
progress  was  made in  meeting last  year’s recommendations.  Police  operations to  dismantle 
criminal organisations have been intensified. In recent years, Albania has consistently shown 
a  strong  commitment  to  counter  the  production  and  trafficking  of  cannabis.  Albania  allows 
airborne  monitoring  by  an  EU  Member  State  (aerial  surveys  by  the  Italian  Guardia  di 
Finanza, co-financed by the EU). In the past two crop seasons, aerial surveillance has found 
that  almost  no  cannabis  has  been  cultivated  open-air  in  Albania.  International  police 
cooperation, especially with EU Member States, has also intensified, leading to a number of 
successful large-scale law enforcement operations. These steps represent tangible progress in 
meeting  last  years’  recommendations  on  improving  the  track  record  on  fighting  organised 
crime.  The  ‘Power  of  law’  special  task  force  has  promoted  stronger  police/prosecutor 
cooperation,  which  should  also  be  expanded  to  other  relevant  agencies  and  bodies.  Some 
progress  was  also  made  on  aligning  relevant  legislation  with  European  standards  and  best 
practices,  and  on  seizures  of  criminal  assets.  Efforts  need  to  continue  to  ensure  increased 
prosecutions  and  final  convictions,  and  more  effective  destruction  of  cannabis  stockpiles. 
More  efforts  are  needed  to  tackle  money  laundering  and  confiscate  assets  stemming  from 
crime and other unjustified wealth. 

In the coming year, Albania should in particular: 

  make further tangible progress in effectively dismantling organised crime groups, issuing 
deterrent sentences, taking away the proceeds of their crimes through asset  confiscation, 
and addressing money laundering; 

  establish or designate an asset recovery office/agency in line with the EU acquis that is in 

charge of the identification and tracing of criminal assets; 

  adopt  a  new  strategy  and  action  plan  on  drugs,  fill-in  the  legislative  gap  on  drug 

precursors, and intensify the fight against the trafficking of hard-drugs; 

  adopt  a  cybercrime  strategy  and  establish  a  more  effective  law-enforcement  response 

focusing on the detection, traceability and prosecution of cyber criminals. 

Institutional set-up and legal alignment 

There are 10 145 officers in the Albanian State Police (ASP), equivalent to 374 officers per 
100 000  inhabitants,  compared  with  the  EU  average  of  318  per  100  000  people  in  2016 
according  to  Eurostat.  Albania  reorganised  its  police  structures  in  March  2018,  separating 
management  and  administrative  functions  from  operational  and  investigative  ones.  The 
reorganisation also merged relevant sectors, such as those dealing with money laundering and 

32 

 
 
criminal assets. The restructuring involved the reallocation of human, logistics and financial 
resources. Albania should establish or designate a specialised structure (asset recovery office) 
in line with the EU acquis that is in charge of the identification and tracing of criminal assets. 
This  should  further  increase  the  effectiveness  of  the  national  asset  recovery  system  and 
facilitate  operational  cooperation  with  asset-recovery  offices  in  EU  Member  States.  In 
December, the ASP law was amended to allow for the recruitment of military personnel. All 
the  army  ranks  are  now  administratively  equal  to  police  ranks.  The  recruitment  of  military 
staff could have an impact on the career and promotion system within the ASP.  

The multi-disciplinary special task force set up in the framework of the ‘Power of law’ action 
plan  was  operational  throughout  2018.  Within  the  task  force,  cooperation  between  the  ASP 
and the General Prosecution Office (GPO) has proven to be efficient. The proactivity of law 
enforcement has been improved and its ability to conduct parallel financial investigations has 
increased.  The  legal  framework  has  been  further  aligned  with  the  acquis.  Albania  has  a 
robust  legal  framework  for  confiscation  of  criminal  proceeds.  Some  legal  amendments  on 
unjustified wealth have not yet been adopted. These include the introduction of the concept of 
extended confiscation and of legal financial ceilings in cash transactions; the admissibility of 
suspicious transactions reports as evidence in court; and the establishment of a central registry 
of bank accounts. The Law on weapons is partially aligned with EU provisions. Albania has 
yet to harmonise its legislation with the latest acquis developments in this area. 

The  Law  on  re-evaluating  (vetting)  officers  of  the  ASP,  Republican  Guard,  and  Service  for 
Internal Affairs and Complaints at the Ministry of Interior was approved in March 2018 and 
amended  in  March  2019.  The  evaluation  will  be  based  on  personal  integrity,  professional 
capacity  and  verification  of  officers’  assets,  and  will  affect  around  12 000  officials. 
Approximately  250  officers  of  all  ranks  have  already  resigned  before  this  vetting  began.  In 
January  2019,  the  government  allocated  funds  for  the  salaries  and  expenses  of  the  vetting 
bodies. In February 2019, the selection board finalised the list of candidates for the External 
Evaluation Commission and the Technical Secretariat. On the strategic framework, Albania 
has a cross-cutting strategy on organised crime, illicit trafficking and terrorism (2017-2020). 
It  also  has  an  action  plan  on  the  fight  against  organised  crime  (the  ‘Power  of  law’  action 
plan). The new strategy and action plan on the fight against trafficking in human beings for 
2018-2020 was approved in December 2018. 

Implementation and enforcement capacity 

On  Albania’s  track  record  for  investigations,  indictments,  and  convictions  on  organised 
crime,  in  2018  and  the  first  quarter  of  2019  there  was  an  increasing  number  of  large-scale 
police  operations,  targeting  organised  crime  groups.  These  operations  were  also  helped  by 
closer  cooperation  with  EU  Member  States.  Several  police  operations  resulted  in  multiple 
arrests, and a number of important indictments and convictions took place. These operations 
resulted  in  the  arrest  and  prosecution  of  known  leaders  of  organised  criminal  groups.  In 
November  2018,  the  first  instance  Serious  Crimes  Court  sentenced  an  Albanian  criminal 
leading a structured criminal network. In January 2019, a major police operation resulted in 
the  arrest  of  an  Albanian  national  who  was  wanted  for  being  the  alleged  leader  of  a  well-
known  criminal  group.  The  subject  is  now  facing  charges  for  participation  in  a  criminal 
group, drug trafficking, and money laundering.  In February 2019, a joint  operation between 
Albanian and Italian law enforcement authorities against four criminal groups resulted in the 
arrest  of  27  people  (21  of  whom  were  Albanians)  for  drug  trafficking.  In  March  2019,  the 
Serious Crimes Court issued a final decision on a criminal organisation that in 2017 trafficked 
2.5 tonnes of drugs to Italy. In May 2019, one of the biggest drug traffickers in Albania was 
sentenced to 10 years of imprisonment for drug trafficking, participation in a criminal group, 
concealment  of  assets  and  money  laundering.  In  the  same  month,  Albanian  and  Greek  law 

33 

 
 
enforcement agencies carried out a coordinated operation against an organised criminal group 
involved  in  international  drug  trafficking.  The  operation  resulted  in  61  arrests,  of  which  26 
were  made  in  Albania.  Another  police  operation  followed  few  days  later,  whereby  thirteen 
people were arrested as part of a criminal group involved in drug trafficking from Albania to 
Greece.  

Overall,  the  number  of  new  cases  related  to  criminal  organisations  and  structured  criminal 
groups referred to prosecutors increased from 34 in 2017 to 51 in 2018. However, the number 
of  final  convictions  remains  very  limited.  In  2017,  there  was  one  case  with  eight  final 
convictions, while in 2018 there were  two cases with five final  convictions.  On indictments 
for organised crime, there were seven in 2017 and five in 2018. There are still several cases 
every year that are initially reported as organised crime cases, but subsequently transferred to 
local prosecutors’ offices (therefore not legally considered organised crime cases anymore) or 
dismissed  for  lack  of  evidence  and/or  due  to  the  poor  quality  of  the  referrals.  Statistics  on 
serious  crimes  that  are  not  linked  to  criminal  organisations  and  structured  criminal  groups 
indicate  a  large  percentage  of  crimes  related  to  the  production  and  cultivation  of  narcotics. 
Narcotics-related  cases  accounted  for  66.5%  of  such  crimes  in  2016,  72.3%  in  2017,  and 
68.9%  in  2018.  Narcotics-related  cases  were  followed  by  money  laundering;  trafficking  in 
vehicles; money counterfeiting and forgery; and trafficking in human beings. In these cases, 
there is also a serious gap between the numbers of new referrals and final convictions.  

Following the conclusion of the 2013 agreement on operational and strategic cooperation with 
Europol (and the updated framework amended in September 2018), Albania has taken further 
steps to strengthen international police cooperation with EU law enforcement agencies and 
Member States. The reinforced international law enforcement cooperation led to several large 
operations, which resulted in  the dismantling of some prominent  organised criminal  groups, 
as  also  highlighted  above.  In  November  2018,  a  liaison  agreement  on  the  secondment  of  a 
Europol  liaison  officer  in  Albania  was  ratified  and  it  has  now  entered  into  force.  The  ASP 
continued  to  assess  the  main  organised  crime  threats  in  line  with  Europol  methodology.  A 
growing  number  of  messages  are  exchanged  through  the  Europol  Secure  Information 
Exchange Network Application (SIENA): in 2018, a total of 8,960 messages were exchanged 
between Albania and Europol in this way, 28% more than in 2017. However, Albania should 
become more proactive in  international  police cooperation and make more  use of Europol’s 
strategic  intelligence  products.  Albania’s  law  enforcement  authorities  should  make  use  of 
regional  initiatives,  such  as  the  Joint  Operational  Office  in  Vienna,  and  the  Task  Force 
Western  Balkans,  which  serve  as  a  regional  operational  platform  for  international 
investigations into migrant-smuggling organised crime groups. In 2018, Albania took part in 
the  annual  planning  of  the  operational  activities  under  the  European  multidisciplinary 
platform against criminal threats (EMPACT). Albania should also enhance its participation in 
the  different  priorities  of  the  EU  Policy  Cycle  on  serious  and  organised  crime.  There  have 
been positive developments in the cooperation with Interpol. The Albanian Security Academy 
also cooperated with CEPOL and other international agencies and academies. 

On  domestic  operational  capacity,  legal  and  institutional  reforms  have  strengthened  law 
enforcement  and  security  institutions.  These  reforms  have  been  particularly  helpful  in 
enabling  the  establishment  of  the  special  task  force  under  the  ‘Power  of  law’  action  plan. 
However, law enforcement authorities’ response to organised crime is often delayed, limited, 
and  still  conducted  in  a  reactive  rather  than  proactive  way.  This  is  due  to  a  combination  of 
factors: inadequate resources; undue influence and pressure on law enforcement; frequent and 
unjustified  turnover  of  State  Police  personnel;  low  salaries;  and  limited  equipment  made 
available to the judicial police. Albania is encouraged to further establish joint investigation 
teams, and to step up the use of special investigation techniques and proactive investigations.  

34 

 
 
Police and prosecutors have been granted access to additional national registries (40 in total). 
However, they still lack direct access to some key national registries, including the electronic 
register  of  mobile  phone  subscribers.  Steps  have  been  taken  to  improve  cooperation  and 
mutual trust between police, prosecutors and other relevant agencies and bodies to detect and 
investigate complex criminal cases. This has led to operational results. Investigations of large 
criminal networks should be started proactively and in a more systematic way. 

Parallel  financial  investigations  are  not  systematically  conducted  in  criminal  proceedings, 
and  their  effectiveness  is  limited.  Albania  should  ensure  appropriate  measures  to  initiate 
financial  investigations  in  a  systematic  manner  in  all  proceedings  involving  assets  derived 
from organised and serious crime, including drug trafficking and terrorism. Law enforcement 
structures  and  prosecution  offices  should  be  given  further  training  in  financial  investigation 
techniques to improve their capacity to investigate unjustified wealth. 

Some progress was made on seizures of criminal assets. It is crucial that seizures are followed 
by final decisions on confiscation. The number and value of  asset confiscations in criminal 
proceedings are limited. In fact, the non-conviction-based confiscation regime under the anti-
mafia law is more widely used than the criminal confiscation regime pursuant to Article 36 of 
the  Criminal  Code,  which  is  mandatory  and  applies  to  all  criminal  offences.  In  domestic 
proceedings,  there  is  no  strategic  or  systemic  approach  to  identify  and  confiscate  criminal 
assets  located  abroad.  Albania  has  developed  tools  for  freezing,  managing  and  confiscating 
criminal assets through amendments to the anti-mafia law. These tools include the possibility 
of non-conviction-based  confiscation and third-party  confiscation. However, Albania should 
focus  on  adopting  and  implementing  rules  on  extended  confiscation  and  precautionary 
freezing  of  assets.  Albania  should  also  urgently  improve  its  capacity  to  manage  frozen  or 
confiscated assets so that they do not lose economic value. A national asset recovery strategy 
is currently being drafted. 

Albania  is  a  source,  transit  and  destination  country  for  trafficking  in  human  beings. 
Albanian  women  and  children  are  subject  to  trafficking  for  sexual  and  labour  exploitation 
within the country and in some EU Member States. The Prosecutor’s Office registered 30 new 
criminal  proceedings  for  trafficking  in  2017  and  21  in  2018.  Most  of  the  referrals  involved 
adults. The number of final convictions remained very low (9 in 2017 and 3 in 2018). In 2018, 
there have been 94 victims of trafficking (VOTs) and potential victims of trafficking (PVOTs) 
who  were  identified  and  assisted.  Cooperation  between  the  police  and  prosecutors  during 
investigations improved and administrative procedures were simplified. NGO-run shelters are 
underfunded and the government does not consistently conduct victim-centred investigations 
and  prosecutions.  Albania  is  encouraged  to  conduct  financial  investigations  related  to 
trafficking in human beings cases; ensure early identification of VOTs; improve cross-border 
and  international  cooperation;  contribute  to  successful  reintegration  of  victims;  and  provide 
child victims of trafficking with adequate protection. The improved legislative framework for 
VOTs,  including  amendments  to  the  Criminal  Procedural  Code,  has  yet  to  be  implemented. 
The national referral mechanism for VOTs/PVOTs was fully functional. In August 2018, the 
government adopted new standard operating procedures for the protection of VOTs/PVOTs. 
These  procedures  provide  for  the  identification,  referral,  protection  and  assistance  of 
VOTs/PVOTs, including children. Albania should strengthen its criminal justice system and 

35 

 
 
step  up  efforts  to  prevent  trafficking  in  human  beings.  It  should  pay  particular  attention  to 
unaccompanied children and child victims of trafficking. 

On  trafficking  in  weapons,  large  numbers  of  military-grade  firearms  are  available  in 
Albania. These firearms are used by Albanian criminal groups and are trafficked primarily to 
neighbouring  countries.  Albania  is  also  a  destination  and  transit  country  for  light  firearms. 
There  were  5  new  criminal  cases  in  2017  and  11  in  2018.  The  number  of  final  convictions 
were 59 in 2017 and 34 in 2018. Albania participates in Europol operational activities within 
the  EMPACT  on  firearms.  Albania  should  finalise  the  establishment  of  the  firearms  focal 
point in the ASP. 

Cybercrime  and  internet  fraud  in  particular  remain  a  concern.  The  number  of  registered 
criminal  proceedings  related  to  computer  fraud  increased.  Final  convictions  for  cybercrime 
have thus far remained low: one in 2018 and five in 2017. Albania should adopt a cybercrime 
strategy  and establish a  more effective law enforcement response  focusing on the  detection, 
traceability and prosecution of cyber criminals. 

Albania  has  a  large  informal  sector  and  its  economy  is  primarily  cash-based.  Crimes  that 
generate large amounts of money in Albania include drug trafficking, tax evasion, smuggling 
and  human  trafficking.  The  main  money  laundering  methods  are  illegal  gambling 
establishments, exploitation of exchange houses, and cross-border transportation of currency. 
The  Moneyval  report  published  in  December  highlighted  a  number  of  deficiencies  in  the 
Albanian  system  for  tackling  money-laundering  and  terrorist  financing.  Albania  has  been 
placed under enhanced follow-up, and should implement without delay the recommendations 
of the Moneyval report to avoid a possible ‘grey-listing’ by the Financial Action Task Force 
in  February  2020.  The  government  adopted  an  action  plan  in  September  to  address  these 
recommendations; its implementation has been so far in line with the planned deadlines. 

In  2017,  309  cases  on  money  laundering  were  referred  to  prosecutors,  against  257  in  2018. 
The number of convictions for money laundering at appeal level remains low (2 in 2017 and 
10  in  2018).  Limited  law-enforcement  resources,  weak  legal  institutions,  corruption,  and  a 
largely cash-based economy with substantial informal sectors all make Albania vulnerable to 
money  laundering.  The  witness  protection  programme  within  the  ASP  has  worked 
satisfactorily. In 2018, it implemented 17 witness protection programmes. Proactively fighting 
organised crime and corruption remains fundamental to countering criminal infiltration of the 
political, legal and economic systems. 

Cooperation in the fight against drugs 

Institutional set-up and legal alignment 

The  Ministry  of  Interior  and  Ministry  of  Health  and  Social  Protection/Institute  of  Public 
Health are the main  bodies in  Albania in  charge of fighting drug trafficking and preventing 
drug  abuse  respectively.  Albania  still  has  no  national  drug  observatory  and  no  functional 
Early  Warning  System  on  new  psychoactive  substances.  In  May  2018,  Albania  adopted  the 
national plan against cannabis cultivation and trafficking 2018-20. The national drug strategy 
and action plan 2012-2016 expired, and a new strategy and action plan remain to be adopted. 

Implementation and enforcement capacity 

On  the  track  record,  in  2018  the  police  submitted  to  prosecutors  1 907  cases  of  drug 
production  and  trafficking  involving  2 357  possible  offenders.  This  was  164  cases  and  128 
people  fewer  than  in  2017  (when  there  were  2 071  cases  and  2 485  possible  offenders).  In 
2018, the Prosecutor’s Office registered 1 524 drug production and trafficking cases (against 

36 

 
 
1 766 in 2017). Most of these cases were dismissed or suspended, and 532 cases resulted in 
indictments. Some 685 offenders received final convictions in 2018 (570 in 2017).  

Albania  has  been  a  source  country  for  herbal  cannabis  trafficked  into  the  EU.  It  is  also 
increasingly  a  transit  country  for  cocaine  and  heroin.  However,  the  coordinated  approach 
between  Albanian  institutions,  cooperation  with  Member  States  (especially  with  Italy  in 
carrying out airborne monitoring of the Albanian territory), and checks by the Albanian police 
have  brought  positive  results.  In  2018,  there  was  a  significant  decline  in  the  number  of 
cannabis  crops  detected  by  the  airborne  surveillance  campaign  carried  out  by  the  Italian 
Guardia di Finanza and co-financed by the EU (675 plants detected by the airborne campaign 
were  destroyed  in  2018  compared  with  4 844  in  2017  and  753 468  in  2016).  In  addition  to 
airborne  surveillance,  the  police  carried  out  helicopter  and  drone  monitoring  of  suspicious 
areas,  and  was  active  in  inspecting  greenhouses  and  warehouses.  Compared  with  2017,  in 
2018 there were 24% fewer cannabis-cultivation plots detected and almost 46% fewer plants 
destroyed  (67  000  plants  destroyed  in  2017  against  36  000  in  2018).  Most  of  the  cannabis 
plants  were  identified  by  the  ASP  during  land  operations.  While  the  quantity  of  cannabis 
seized  in  2018  was  almost  75%  lower  than  in  2017,  there  was  a  substantial  increase  in 
seizures of cocaine (from 3.7 kg in 2017 to 630.5 kg in 2018), heroin (from 21.5 kg in 2017 to 
24 kg in 2018), and hashish oil (from 7.1 litres in 2017 to 51.7 in 2018). The main points of 
entry  for  Albanian  cannabis  into  the  EU  are  the  Adriatic  Sea  coast  and  the  EU’s  external 
border  with  the  Western  Balkans.  The  lack  of  secure  storage  for  drugs  and  drug  precursors 
prior to destruction remains an issue of concern. The practice of keeping only a small sample 
as material  evidence for  court proceedings instead of the entire seized quantity is  not  yet  in 
place.  An  appropriate  process  for  the  destruction  of  precursors  has  yet  to  be  set  up.  A  new 
laboratory for collecting and analysing data allows for faster processing and response on the 
destruction of the plants.  

Albania  is  a  transit  and  storage  country  for  heroin  and  cocaine.  Seizures  of  hard  drugs 
increased considerably in 2018. Since the large seizure of 613.4 kg of cocaine from Colombia 
in  February  2018,  there  have  been  several  significant  operations  conducted  by  Albania  all 
over  the  country.  In  October,  a  nationwide  coordinated  operation  led  to  44  arrests  and  the 
dismantling of a heroin lab in Has, with 182.5 kg of morphine seized.  

Cooperation continued with the European Monitoring Centre for Drugs and Drug Addiction 
(EMCDDA).  In  March  2019,  Albania  signed  a  working  arrangement  with  the  EMCDDA. 
This agreement will facilitate information exchange between the EU and Albania and capacity 
building activities. It will also contribute to the development of data collection and reporting 
on drugs. 

The list of precursors for which the production, trafficking and possession is illegal in Albania 
has  not  been  updated  since  1995  when  Albania  ratified  the  United  Nations  Convention  on 
Psychotropic Substances. This leaves many such activities without criminal penalty.  

Fight against terrorism 

Institutional set-up and legal alignment 

The Counter-Terrorism  Directorate of the ASP is  the lead body  on counter-terrorism. Other 
agencies active in this field are the State Intelligence Service and the Defence Intelligence and 
Security Agency. In addition, the State Police’s community policing personnel are involved in 
preventing  radicalisation  and  combating  violent  extremism.  In  June  2018,  the  office  of  the 
National  Coordinator  for  countering  violent  extremism  (CVE),  who  is  charged  with 
overseeing the implementation of the national strategy for CVE, was upgraded to a National 
Coordination Centre for CVE, under the lead of the National Coordinator. 

37 

 
 
Albania has a comprehensive legal framework for preventing and combating the financing of 
terrorism. The country is a party to all Council of Europe conventions on counter-terrorism, 
including  those  covering  the  seizure  and  confiscation  of  the  proceeds  from  crime  and 
financing of terrorism. Albania has  national  counter-terrorism strategies  on CVE and the 
prevention  of  violent  extremism.  In  October,  the  country  signed  the  joint  EU-Western 
Balkans  action  plan  on  counter-terrorism,  which  sets  out  concrete  steps  for  enhanced 
cooperation  in  countering  terrorism  and  preventing  radicalisation  over  the  next  two  years. 
Albanian  authorities  have  been  cooperating  with  the  EU  in  identifying  priority  actions  for 
Albania to implement the related bilateral action plan. Albania should proactively implement 
the Albanian counter terrorism strategy, the Albanian CVE strategy and its action plans. 

Implementation and enforcement capacity 

On the track record, in 2017 there were 7 new proceedings, while in 2018 there were 4 new 
proceedings. In both years, there were no convictions. A number of deficiencies remain in the 
Albanian  system  for  tackling  terrorist  financing.  No  Albanians  are  reported  to  have  left  the 
country  to  become  foreign  fighters  since  2015.  Some  45  individuals  have  returned  from 
fighting  in  Syria,  while  26  are  believed  to  have  died,  and  73  remain  in  Syria.  The 
Counter-Terrorism  Directorate  has  continued  to  improve  its  capacity  through  specialised 
training,  personnel  and  equipment.  However,  its  operational  and  logistical  capacity  remains 
limited,  in  particular  for  special  investigations  and  operations  such  as  surveillance  and 
interceptions.  The  upgraded  CVE  Centre  is  working  with  different  line  ministries  and  local 
authorities  in  the  implementation  of  the  CVE  strategy.  The  Centre  should  be  provided  with 
sufficient funding, staff and political support to perform its tasks effectively.  

On  international  cooperation,  regional  cooperation  and  exchange  of  sensitive  information 
with  international  partners  was  satisfactory.  A  protocol  on  cooperation  in  the  fight  against 
terrorism  was  signed  with  North  Macedonia  in  February  2018.  Albania  cooperated  swiftly 
with Interpol on urgent verifications of suspected terrorists following attacks in EU Member 
States.  Cooperation  with  Europol  was  satisfactory.  However,  Albania  should  make  more 
proactive  use  of  Europol’s  European  Counter-Terrorism  Centre,  which  has  useful 
communication platforms, products, services and capabilities. Links between organised crime 
and terrorism should continue to be investigated. 

The  government  needs  to  develop  programmes  to  reintegrate  returning  foreign  terrorist 
fighters  and  their  families.  Efforts  are  also  needed  to  improve  the  programmes  to  prevent 
radicalisation  in  prisons,  and  strengthen  the  monitoring  mechanisms  involving  civil  society 
and  religious  communities.  Online  radicalisation  content  in  Albanian  is  on  the  rise.  The 
authorities need to enhance their online monitoring and response capacities, and enhance their 
efforts  to  empower  civil  society  to  develop  positive  and  alternative  narratives  online.  The 
government  also  needs  to  step  up  efforts  to  counter  external  influences,  including  financial 
flows  that  could  lead  to  further  radicalisation.  Albania  is  actively  participating  in  the 
implementation of the Western Balkan counter-terrorism initiative (WBCTi). 

Legal and irregular migration  

Institutional set-up and legal alignment 

The Ministry of Interior is the main actor in the field of migration. The main bodies under its 
supervision in implementing migration policies are the Department of Border and Migration 
of the General Directorate of the ASP, and the Directorate of Anti-Trafficking and Migration. 
On  legal  and  labour  migration,  other  actors  are  the  Ministry  of  Finance  and  Economy  and 
employment  offices  active  at  local  level.  The  legal  framework  on  migration  needs  to  be 
further  aligned  with  recent  developments  in  the  acquis.  Negotiations  on  readmission 

38 

 
 
agreements  (agreements  to  return  irregularly  staying  migrants  with  no  right  to  stay  to  their 
country  of  origin)  are  ongoing  with  Russia,  and  were  signed  in  2018  with  Morocco, 
Afghanistan,  Iraq  and  Iran.  There  are  readmission  implementing  protocols  with  12  Member 
States. The implementation protocol with Spain was signed in May 2018. 

In June 2019, Albania plans to  adopt  the national  strategy  on migration governance and its 
action plan covering 2019-22, providing a clear framework to better manage and coordinate 
migration  flows.  The  national  strategy  for  the  diaspora  2018-24  and  its  action  plan  were 
adopted  in  May  2018.  As  part  of  the  broader  policy  area  of  migration  and  development, 
efforts  to  engage  the  diaspora  should  continue.  The  status  agreement  with  the  EU  on  the 
deployment  of  the  first  European  Border  and  Coast  Guard’s  teams  entered  into  force  on  1 
May.  It  will  allow  the  European  Border  and  Coast  Guard  Agency  (EBCGA)  to  assist  the 
Albanian  authorities  in  external  border  management.  The  Status  Agreement  was  swiftly 
operationalised  through  the  deployment  of  first  EBCG  teams  on  22  May.  This  will  also 
strengthen border controls and the fight against migrant smuggling. 

Implementation and enforcement capacity 

The number of irregular migrants arriving in Albania and trying to reach EU Member States 
increased significantly in 2018 (5 730 in 2018 against 1 047 in 2017). By far the largest group 
were  Syrian  nationals,  followed  by  Pakistani  and  Iraqi  nationals.  The  migratory  flows  were 
largely of a transitory nature, with most migrants arriving from Greece and leaving Albania 
after a couple of days.  

Albania’s reception capacity to accommodate migrants was sufficient. Its reception centre for 
irregular migrants in Karreç, with a total capacity of 150 beds, requires refurbishment. The 
country  still  does  not  have  facilities  for  unaccompanied  minors.  Alternatives  to  detention 
should  be  put  in  place  for  children,  women  at  risk,  and  people  with  serious  medical 
conditions, as provided for in the Law on foreigners. Border police staff should be trained in 
identifying  vulnerable  categories  of  people  and  referring  them  for  assistance.  Albania  is 
updating its contingency plan for a possible mass influx of migrants and asylum seekers. The 
plan, initially drafted in 2015, was never formally approved by the government.  

The  overall  staffing  of  the  State  Police’s  Department  for  Border  and  Migration  is  limited 
(1 635 employees) and needs to be increased. Albania should continue to ensure appropriate 
training of its  border police staff in  compliance  with  basic training standards for EU border 
guards. The number of irregular migrants with no right to stay that returned from Albania to 
their country of origin remained low. In 2018, 1 044 irregular migrants received an order to 
return  to  their  country  of  origin,  compared  with  683  in  2017.  Most  of  them  were  returned 
(mainly  to  Greece)  with  a  voluntary  departure  order.  There  were  also  reports  of  informal 
returns (pushbacks) to Greece. Albania is encouraged to apply the return procedures in a way 
that  is  compliant  with  the  Law  on  foreigners  and  to  ensure  that  its  return  mechanism  for 
irregular migrants is in line with the EU acquis.   

The readmission agreement with the EU, in force since 1 May 2006, is being implemented 
in a satisfactory manner, with Albania swiftly honouring readmission requests from Member 
States  both  for  own  and  third  country  nationals.  Albanian  nationals  ordered  to  leave  are 
effectively returned. The cooperation between Albania and the EBCGA in the area of return 
operations is very good. In total, from 2016 to 2018, 254 return operations were organised to 
Albania  and  a  total  of  10 043  Albanian  nationals  were  returned.  In  2018,  the  EBCGA 
coordinated  81  return  operations  to  Albania,  returning  2 953  Albanian  nationals.  Additional 
efforts are required to provide reintegration support to returned Albanian citizens. Training of 
staff  working  at  the  migration  counter  and  regional  employment  offices  should  be 
strengthened.  

39 

 
 
Asylum 

Institutional set-up and legal alignment 

On  paper,  the  country  has  the  necessary  institutions  in  place  to  handle  asylum  claims. 
Appeals can be lodged in principle with the National Commission for Refugees and Asylum. 
However, the Commission was not functional in 2018. This issue should be addressed swiftly 
and the Commission reactivated. Judicial appeals can be lodged at the administrative courts. 
Procedural safeguards to guarantee fair procedures for the most vulnerable individuals should 
be  improved  through  cooperation  by  the  Ministry  of  Interior  with  other  relevant  ministries. 
The  instruction  regulating  pre-screening  and  detention  should  be  revised  and  aligned  with 
international  standards.  The  revised  version  should  include:  procedural  safeguards  for 
vulnerable  persons,  and  provisions  on  the  identification,  referral  and  protection  of  children 
and  persons  with  special  needs.  It  should  align  its  content  with  the  new  Law  on  child 
protection,  and  refer  specifically  to  compliance  with  the  non-refoulement  principle  and 
language rights. Albania is party to the 1951 Geneva Convention. The current Law on asylum 
is partially aligned to the EU acquis.  

Implementation and enforcement capacity 

The number of asylum seekers in 2018 increased more than tenfold compared with 2017. In 
2018, 4,386 individuals applied for asylum in Albania, against 309 in 2017. As most asylum 
seekers leave the country after a few days, the vast majority of asylum requests are not further 
processed.  In 2018, there were 105 decisions, with three refugee-status recognitions, and 13 
subsidiary protections awarded. 

On the asylum procedure, asylum requests are recorded by the Border and Migration Police 
during  pre-screening  and  are  then  referred  to  the  Directorate  for  Asylum  and  Citizenship. 
Although the sharp increase in arrivals in 2018 was met with a generally adequate response by 
the authorities, the capacity and staffing of the Directorate for Asylum and Citizenship need to 
be enhanced. Some asylum seekers faced considerable delays in the treatment of their cases. 
To adhere to legal timeframes, a more proactive approach by the Directorate for Asylum and 
Citizenship  is  needed  to  process  applications  by  asylum  seekers  that  have  remained  in  the 
country.  More  training  is  needed  on  how  to  assess  individual  claims,  particularly  the 
assessment of information on country of origin and cases involving vulnerable people. Access 
to  information  about  asylum  procedures  and  interpretation  has  improved  but  should  be 
guaranteed  without  exception.  Electronic,  biometric  and  fingerprint  data  management  needs 
to be strengthened, and border crossing points interconnected. 

There is consensus among stakeholders that the pre-screening instructions should be amended 
to  include  additional  safeguards,  and  involve  the  participation  of  other  relevant  ministries, 
notably  for  vulnerable  persons  and  persons  with  specific  needs.  More  direct  input  from  the 
Directorate for Asylum and Citizenship, with regular attendance at interviews and support to 
the police, would improve the whole asylum procedure.  

Albania has tripled its reception capacity for asylum seekers since October 2017. The total 
number  of  places,  including  at  the  National  Centre  for  Asylum  Seekers  in  Tirana  and 
temporary  accommodation  facilities  in  Gjirokastra  and  Shkodra,  now  stands  at  400 
bed-places.  As  most  asylum  applications  were  withdrawn  after  a  few  days,  the  increased 
capacity has so far been sufficient. Provisions were made to set up emergency camps for 500 
people in Gjirokastra and 100 people in Korça in the event of a massive influx. The reception 
conditions were generally adequate. A reception centre for vulnerable groups has been made 
available  in  Gjirokastra.  In  light  of  the  increased  number  of  unaccompanied  and  separated 

40 

 
 
children, a mechanism needs to be put in place for their effective and timely identification and 
referral. 

The  status  of  some  2  700  Iranians  (from  the  People’s  Mujahedeen  of  Iran),  relocated  to 
Albania  in  2015  and  2016,  has  yet  to  be  decided.  They  currently  hold  temporary  residence 
permits on humanitarian grounds. Albania cooperates on an informal basis with the European 
Asylum Support Office (EASO). 

Visa policy 

Albania’s visa policy is not yet aligned with the EU’s, including with the EU lists of countries 
whose nationals require a visa and those who are exempt from this requirement. Albania has a 
visa free regime with Kazakhstan, Kuwait, and Turkey, which are not on the EU’s visa-free 
list. Between April and October, Albania lifts its visa requirement for citizens from Bahrain, 
Belarus, China, Oman, Qatar, Russia, Saudi Arabia and Thailand, a practice which is not in 
line  with  the  EU  acquis.  In  order  to  ensure  a  well-managed  migration  and  security 
environment as the underlying condition for the continuous fulfilment of the benchmarks, the 
country  needs  to  ensure  alignment  with  the  EU  visa  policy.  Albania  has  in  place  an  e-visa 
system, used to register all foreign nationals applying for a visa when entering Albania. The 
system is provided by TIMS software (total information management system). 

Overall,  the  visa  liberalisation  benchmarks  continue  to  be  fulfilled.  Good  progress  was 
achieved in the implementation of actions to tackle irregular migration. Albania continued to 
strengthen  its  operational  cooperation  with  the  Member  States  most  affected  by  irregular 
migration from Albania, including through information exchange on Schengen entry bans and 
information  campaigns  on  the  rights  and  obligations  of  visa-free  travel.  Cooperation  with 
France,  in  particular,  has  intensified.  Following  the  signature  in  December  2017  of  an 
agreement with France on strengthening operational police cooperation, four Albanian police 
liaison  officers  were  posted  to  France  to  support  French  law  enforcement  authorities  in 
investigating criminal cases where Albanian nationals are involved. Repatriation operations of 
unfounded  Albanian  asylum  seekers  are  organised  in  full  cooperation  and  coordination 
between the two countries (a recent operation in April involved the repatriation of 50 people 
from France). 

The  number  of  manifestly  unfounded  asylum  applications 
in  Member  States  and 
Schengen-associated  countries  decreased  but  remained  high.  The  number  of  asylum 
applications  fell by  almost  15% (from 26 020 in 2017 to  22 170 in 2018).  In France, which 
remained  the  main  receiving  country  for  Albanian  asylum  applicants,  the  number  of 
applications fell by 20% (from 12 130 in 2017 to 9 680 in 2018). In Germany, the number of 
applications decreased by 52%. Another important destination country is Greece, with 3 325 
applications. In 2018, the recognition rate (i.e. the number of successful asylum applications 
expressed as a percentage of all decisions) in the EU Member States and Schengen associated 
countries was around 7.6% (made up of a subsidiary protection rate of 4.7%, a refugee status 
rate of 1.7%, and a national protection status of 1.2%). 

Albanian  nationals  remained  the  largest  group  of  asylum  seekers  from  visa-free  Western 
Balkan countries. Albanian nationals also had the highest number of illegal stayers and cases 
of  illegal  entry.  Albania  has  implemented  measures  to  prevent  abusive  asylum  applications. 
These  include  tighter  checks  at  border  crossing  points,  more  thorough  exit  interviews  and 
information campaigns. In 2018, 20 255 Albanian citizens were refused permission to exit the 
Albanian  territory  at  border  crossings  compared  with  12 175  in  2017  (an  increase  of  59%). 
Border surveillance was intensified for the prevention of illegal crossing of borders. In 2018, 
2 158 Albanian citizens were detected attempting to illegally exit the Albanian territory, 24% 
more  than  in  2017.  Albania  needs  to  continue  and  strengthen  its  efforts  to  tackle  the 

41 

 
 
phenomenon  of  unfounded  asylum  applications  and  address  the  ‘push  factors’  behind  it. 
Immediate  and  determined  action  should  be  taken  under  the  post-visa  liberalisation 
monitoring mechanism.  

There has been a large increase in the number of seized forged EU passports, used mostly by 
Albanian  nationals  to  reach  destinations  in  the  EU.  In  December,  39  persons  were 
apprehended with fake passports. In February, a major police operation resulted in the arrest 
of 32 persons suspected of being part of a criminal organisation involved in the falsification of 
travel documents for citizens travelling to EU countries, the US and Canada.  

Unaccompanied  minors  from  Albania  travelling  to  EU  Member  States  remain  a  matter  of 
great concern. The ASP continued to carry out tight checks on children travelling abroad with 
one or both parents. The Albanian authorities should continue to work closely with the most 
affected Member States. Increased attention should be given to the successful reintegration of 
returnees,  especially  the  most  vulnerable,  such  as  Roma  and  Egyptians.  A  new  strategy 
document  on  reintegration  of  returnees  and  clear  definition  of  responsibilities  for  its 
implementation  is  needed  following  the  expiration  in  2015  of  the  previous  strategy  for 
reintegration.  Better  communication  and  coordination  is  required  between  ministries,  local 
government, international organisations and NGOs active in the reintegration of returnees. 

Schengen and external borders 

Institutional set-up and legal alignment 

The Law on border control and associated implementing by-laws are aligned with the acquis. 
However, the legislative framework for the management of Albania’s external borders is not 
yet  fully  aligned with  EU standards.  The 2014-2020 integrated-border-management strategy 
and action plan is broadly aligned with European standards.  

Implementation and enforcement capacity 

Implementation  of  the  integrated-border-management  strategy  and  action  plan  continued 
smoothly.  The  focus  of  this  implementation  was  on  the  regulatory  and  institutional 
framework; human resources and training; communication and exchange of information; and 
infrastructure  and  equipment  for  border  control  and  surveillance.  The  reconstruction  of  the 
Hani i Hoti and Morinë border crossing points with Montenegro and Kosovo was completed 
in  the  summer  of  2018.  In  April  2018,  Albania  signed  a  protocol  with  Montenegro  for  the 
implementation  of  joint  border  checks  at  the  shared  Zatriebaçka  Cijevna-Grabon  crossing 
point.  In  December,  the  agreement  with  Montenegro  on  the  opening  of  the  joint 
Zogaj-Skje/Ckla  crossing  point  entered  into  force.  The  trilateral  centre  in  Plav  has  been 
operational  since  July.  In  December,  Albania  concluded  an  agreement  with  Kosovo  on  the 
shared  border  crossing  point  at  Morinë.  This  agreement  regulates  the  border  checks  at  the 
shared  border  crossing  point  and  entails  joint  control  activities  in  line  with  the  concept  of 
integrated border management.  

The  integrated  sea  surveillance  system  of  radars  for  the  ‘blue’  (sea)  border  is  operational. 
Overall,  more  resources  need  to  be  devoted  to  modernising  border  infrastructure  and 
increasing surveillance of the ‘green’ (land) and ‘blue’ borders. The TIMS database system is 
interconnected with Interpol’s system. The automatic generation of alerts through the Interpol 
system  enables  border  police  to  identify  internationally  wanted  persons,  stolen  vehicles,  or 
lost/stolen travel documents. Albania should continue risk-analysis training at all levels and 

  This designation is without prejudice to positions on status, and is in line with UNSCR 1244/1999 and the ICJ 
Opinion on the Kosovo declaration of independence. 

42 

 
 
                                                 
ensure sufficient training for border police. In particular, it should include protection-sensitive 
migration management in the curriculum of the Police Academy. 

Inter-agency  cooperation  improved.  Joint  and  integrated  ‘blue’  border  patrols  were 
conducted  regularly  between  the  Albanian  Navy,  the  Coast  Guard  and  the  Border  and 
Migration Police. Cooperation between border guards and customs worked well, including on 
mutual access to databases. The border police’s investigative powers need to be strengthened, 
in  particular  to  detect  cases  of  people-smuggling  and  trafficking. In  October  2018,  Albania 
signed the status  agreement with  the EU, which  will allow the deployment  of EBCG teams 
with  executive  powers  for  joint  operations  with  Albanian  authorities  on  Albanian  territory. 
The  status  agreement  will  also  ensure  better  management  of  irregular  migration.  Albania 
actively participated in the Western Balkan risk analysis network. Operational cooperation 
with  neighbouring  countries  continued  to  be  good,  although  efforts  to  improve  bilateral 
cooperation must continue.  

Albania  is  planning  to  introduce  the  United  States-sponsored  personal  identification  secure 
comparison  and  evaluation  system  (PISCES)  at  its  border  crossing  points.  Albania  should 
ensure  that  PISCES  is  set  up  and  operated  in  a  manner  consistent  with  the  EU  acquis.  The 
installation of cameras at the border crossing points has helped to reduce  corruption at the 
borders.  The  adoption  and  application  of  standard  operating  procedures  set  out  detailed 
procedures and strict deadlines for service delivery and resulted in lower corruption. In 2018, 
the Department for Border and Migration decided on disciplinary measures against 139 police 
and migration officers, of which 34 were removed from the police and 105 were sanctioned 
with disciplinary measures. In 2017, there were far fewer disciplinary measures (65). Some 27 
police and migration officers were removed from their jobs in 2017. 

Judicial cooperation in civil and criminal matters 

Albania  continued  to  intensify  judicial  cooperation  in  criminal  matters,  including  with  EU 
Member  States.  Albania  signed  a  cooperation  agreement  with  Eurojust  in  October  2018, 
which will allow for the exchange of personal data on operational cases. However, additional 
steps are still necessary for the agreement to enter into force. In 2018, Albania was involved 
in  8  Eurojust  cases  (against  4  in  2017),  mainly  dealing  with  drug  trafficking  and  crimes 
against  life,  limb  or  personal  freedom.  Albania  participated  in  one  joint  investigation  team 
supported by Eurojust. A concrete result of the cooperation with Eurojust was the arrest of 43 
people involved in a large drug trafficking case, thanks to a joint investigation team created 
by Italy and Albania with the support of Eurojust.  

On judicial cooperation in civil matters, in 2017 Albania received 200 requests and sent out 
104 requests of mutual legal assistance, against 383 and 218 respectively in 2018. On judicial 
cooperation  in  criminal  matters,  in  2017  the  country  received  1 311  requests  and  sent  out 
1 177  requests  for  mutual  legal  assistance,  compared  with  1 096  and  1 330  respectively  in 
2018. The country issued 89 extradition requests and received 181 in 2017, against 160 and 
115 respectively in 2018. There were eight incoming and eight outgoing requests for transfers 
of criminal proceedings in 2018 (compared with three for both kinds of requests in 2017). 

Albania  needs  to  further  improve  international  cooperation,  the  timely  implementation  of 
multilateral  instruments,  and  its  institutional  capacity.  Further  efforts  are  necessary  to  align 
legislation with the acquis and promote the exchange of best practices in judicial cooperation.  

All aspects of customs cooperation are now covered under Chapter 29 – Customs Union. 

43 

 
 
 
3. 

FUNDAMENTALS FIRST: ECONOMIC DEVELOPMENT AND COMPETITIVENESS 

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 EU. 

Economic governance has become even more important in the enlargement process in recent 
years.  The  Commission’s  monitoring  involves  two  processes:  the  economic  reform-
programme process, and the assessment in the pages below of compliance with the economic 
criteria  for  accession.  Each  enlargement  country  prepares  an  economic  reform  programme 
(ERP)  every  year,  which  sets  out  a  medium-term  macro-fiscal  policy  framework  and  a 
structural-reform agenda aimed at ensuring competitiveness and inclusive growth. The ERPs 
are  the  basis  for  country-specific  policy  guidance  jointly  adopted  by  the  EU,  the  Western 
Balkans and Turkey at ministerial level in May each year. 

3.1.  The existence of a functioning market economy 
Albania has made some progress and is moderately prepared in developing a functioning 
market  economy.  Economic  growth  increased  further  and  unemployment  decreased  even 
though it remains  high.  Exports grew solidly and the current-account  deficit narrowed. The 
high  public-debt-to-GDP  ratio  continued  to  fall.  The  stability  of  the  financial  sector 
improved,  as  banks  continued  to  reduce  non-performing  loans.  However,  lending  to  the 
private corporate sector remained muted and the high use of foreign currency in the domestic 
market  persisted.  Steps  have  been  taken  to  develop  the  non-banking  financial  market.  The 
comprehensive judicial reform advanced well, but shortcomings in the rule of law continued 
to hamper businesses and deter investment. The business environment has only improved in 
some areas,  and while formal employment  grew, informality is  estimated to  have  remained 
high. The liberalisation of the energy sector progressed, albeit with some delays.    

In order to improve the functioning of the market economy, Albania should in particular: 

  advance  fiscal  consolidation  and  developing  a  plan  to  mobilise  revenue  and  to  address 

44 

Albania: Key economic figures2010-15 average201620172018GDP per capita (% of EU-28 in PPS)30.431.2 31.732.2Real GDP growth 2.23.43.84.1Economic activity rate of the population aged 15-64 (%), total62.9*66.266.868.3      female53.2*58.357.759.7      male72.8*74.175.876.9Unemployment rate (%), total16.4**15.614.112.8      female14.7**14.612.812.3      male17.7**16.415.113.2Employment (annual growth %)1.562.72.1Nominal wages1 (annual growth %)5.2-0.83.0:Consumer price index (annual growth %)2.21.32.02.1Exchange rate against EUR139.5135.2133.0123.4Current account balance (% of GDP)-11.6-7.6-7.5-6.6Net foreign direct investment, FDI (% of GDP)8.68.87.87.9General government balance (% of GDP)-4.0-1.8-2.0-1.5General government debt (% of GDP)64.772.370.067.3Source: Eurostat and national sourcesNotes: * 2014-2015           ** 2013-2015           1average gross monthly wages 
 
 
informality; 

  ensure  monitoring  and  control  of  fiscal  liabilities  stemming  from  Public-Private 

Partnerships and of arrears; 

  improve  access  to  finance  by  strengthening  collateral  enforcement  and  raising  financial 

inclusion; 

  improve  the  labour  market  relevance,  quality  and  targeting  of  active  labour  market 

policies, including upskilling of adults. 

Economic governance  

Albania  remained  committed  to  strengthening  macroeconomic  stability  and  fiscal 
consolidation.  The  government  continued  to  reduce  the  still-high  level  of  public  debt  at  a 
faster pace than originally planned due to the appreciation of the currency and underspending 
on  the  budget.  Reforms  to  the  management  of  public  finance  have  progressed  with  EU 
support.  However,  administrative  restructuring  following  national  elections  has  negatively 
affected  overall  capacity  in  the  public  administration.  It  remains  a  challenge  to  create  a 
stronger  link  between  the  budget  process  and  policy-making,  and  this  challenge  affects 
expenditure  planning.  The  budget  for  2018  was  published  and  adopted  in  time,  and 
consultations with civil society groups for the preparation of the 2019 budget had also started 
in  time.  The  policy  guidance  jointly  agreed  at  the  May  20183  Economic  and  Financial 
Dialogue  between  the  EU  and  the  Western  Balkans  and  Turkey  has  been  partially 
implemented.  

Macroeconomic stability 

The  Albanian  economy  has  continued  to  expand,  thanks  to  both  domestic  and  foreign 
demand. Annual real GDP growth, averaging 2.2 % between 2010 and 2015, accelerated to 
3.8% in 2017, and averaged 4.2% in the first three quarters of 2018. In 2018, all components 
of domestic demand contributed positively to output expansion. Private consumption was the 
main  driver,  supported  by  rising  employment  and  low  rates  of  interest  and  inflation.  The 
contribution  made  by  net  exports  to 
GDP  growth  remained  negative  in 
2018,  as  high 
the 
recovery  in  goods  exports.  Despite 
strong  economic  growth  and  rising 
employment,  per  capita  GDP 
(at 
purchasing power parity) stood at only 
29%  of  the  EU-28  average  in  2017, 
representing  a  very  slow  pace  of 
convergence. 

imports  offset 

The  high  current-account  deficit 
continued  to  narrow,  and  was  financed  by  foreign  direct  investment  (FDI)  inflows. 
Albania has historically run a large trade deficit in goods, which has recently widened due to 
exceptional FDI-related imports. The goods trade deficit was partly offset by a surplus in the 
balance  of  services,  which  benefited  from:  (i)  strongly  increasing  revenues  from  foreign 
tourism  between  2016  and  2018;  and  (ii)  an  even  stronger  increase  in  the  contribution  of 
manufacturing  services.  The  real-effective-exchange-rate  index  (REER)  climbed  9%  by  the 
end of 2018, reflecting the recent acceleration in the appreciation of the Albanian currency. 

3  Western  Balkans  and  Turkey: 
Joint  conclusions  of 
releases/2018/05/25/western-balkans-and-turkey-joint-conclusions-of-the-economic-and-financial-dialogue/  

the  economic  and 

financial  dialogue,  2018,  https://www.consilium.europa.eu/en/press/press-

45 

-4-202468201320142015201620172018*Albania: Real GDP growth and contributions Priv. cons.Gov. cons.GFCFStocksNet exportsreal GDP growthSource: Macrobond, own calculations% y-o-y* forecast 
 
                                                 
Overall, the current-account deficit fell considerably, dropping to 6.3% of GDP in 2018 from 
its  2010-2015  average  of  11.6%.  This  decline  in  the  current-account  deficit  was  helped  by 
larger  remittances  and  rising  exports  of  both  goods  and  services.  Both  remittances  and  FDI 
recorded a slightly decreasing share in GDP: remittances fell to from 5.8% in 2015 to 5.2% of 
GDP in 2018, while FDI softened from 8.6% to 7.9%, as the construction of two large energy 
projects is nearing completion. Foreign reserves continued to cover 6.5 months of imports and 
37% of total external debt in 2018, providing an adequate safeguard against adverse shocks.   

Persistently  below-target  inflation  and  the  rapidly  strengthening  currency  prompted 
further  monetary  easing  and  foreign-exchange  interventions  by  the  Albanian  central 
bank.  The  freely  floating  exchange  rate  of  the  Albanian  lek  appreciated  by  about  7.2% 
against  the  euro  by  the  end  of  2018.  In  the  middle  of  the  year,  the  central  bank  began  to 
intervene  on  the  foreign-exchange  market  to  contain  this  appreciation.  Average  annual 
inflation  has  been  below  the  central  bank’s  3%  target  since  2013.  Food  prices  pushed  the 
inflation  rate  upwards,  but  lower  import  prices  due  to  the  stronger  lek  meant  that  overall 
inflation  only  increased  slightly,  rising  to  2.2%  in  2018  from  2.0%  in  2017.  The  Albanian 
central bank, the Bank of Albania, has therefore maintained a very accommodative monetary 
policy  by  lowering  the  key  policy  rate  (the  repo  rate)  to  a  record  low  of  1%  in  July.  The 
monetary-policy stance effectively supported price stability in line with the policy framework. 

The  government’s  fiscal  deficit  is  now  50%  below  its  2010-2015  average.  The  general 
government  deficit  fell  to  2.1%  of 
GDP  in  2017  from  4.1%  in  2015. 
Based  on  preliminary  data,  the  2018 
budget has turned out with a deficit of 
1.5%  of  GDP,  lower  than  the  initially 
targeted 2% of GDP. This lower-than-
expected  deficit  is  mainly  due  to 
ambitious plans for capital expenditure 
that  were  not  fully  implemented.  The 
successful clearance of arrears in 2014 
under  the  IMF  programme  accounted 
for  most  of  the  deficit  reduction  in 
2015/16. However, the last 3 years have seen lower expenditure and higher revenues, both of 
which  helped  to  lower  the  deficit.  At  the  same  time,  new  arrears  emerged  due  to:  (i) 
weaknesses  in  budget  planning  and  implementation;  (ii)  policy-coordination  issues  between 
government levels (local-government arrears); and (iii) slow tax-refund procedures (arrears of 
VAT refunds). A broader tax base, reduced informality and an increase in social contributions 
from  increased formal  employment  helped to  increase revenue. The recent  multiplication of 
VAT exemptions will complicate attempts to broaden the tax base and improve the efficiency 
of  tax  collection.  Overall,  tax  revenues  remain  far  below  potential.  This  is  mainly  due  to 
informality but also due to tax evasion in the formal economy.  

At 67.3% of GDP, public debt remains high. This high debt level could be unsustainable 
in case of an adverse shock to the economy. Supported by the appreciation of the lek, the 
gross-public-debt-to-GDP  ratio  declined  to  67.3%  at  the  end  of  20184.  The  government 
successfully placed a EUR 500 million seven-year eurobond in October 2018. This helped to 
reduce the still-high annual rollover needs, and reduce the pressure by government financing 
on the domestic local-currency debt market. 

4  The  Albanian  government  includes  its  loan  guarantees  fully  in  its  public  debt  calculation,  and  uses  the  IMF 

GDP forecast to calculate the debt-to-GDP ratio. 

46 

020406080-10-50510201320142015201620172018*Albania: Fiscal developmentsPrimary balance (lhs)Interest (lhs)GG balance (lhs)Public Debt (rhs)Source: National sources% ofGDP* forecast 
 
                                                 
Public  financing  is  not  sufficient  to  bridge  the  large  infrastructure  gap,  so  the 
government  is  seeking  to  mobilise  private  capital  -  mainly  through  public-private 
partnerships  (PPPs).  Public  investment  grew  on  average  6.2%  per  year  in  2013-2018,  and 
accounted for about  18% of total  public expenditure on average. The increasing reliance on 
PPPs generates contingent  liabilities and therefore fiscal  risks. The newly established Fiscal 
Risk  Unit  does  not  have  sufficient  capacity  to  monitor  these  risks.  Infrastructure  financing 
could  be  made  more  efficient  by  taking  advantage  of  the  potential  for  synergies  in  the 
planning and execution of both PPPs and conventional public investment. 

The overall macroeconomic policy mix has been broadly appropriate, and Albania has 
complied  with  fiscal  rules.  The  main  fiscal  rule  —  to  keep  the  public-debt-to-GDP  ratio 
declining until the limit of 45% is reached — has been complied with. Budget implementation 
and public financial management (PFM) should be strengthened to avoid arrears and manage 
fiscal  risks.  Increasing  tax  revenues  could  help  speed  up  the  path  to  the  45%-debt-to-GDP 
limit, thus strengthening debt sustainability. Maintaining a loose monetary-policy stance has 
been appropriate for promoting a sustained rise in inflation towards the 3% target. 

Functioning of product markets 

Business environment 

Albania’s competitiveness and private-sector development remained below potential, as 
efforts  to  improve  the  business  environment  had  poor  results.  Growth  in  the  number  of 
active  domestic  enterprises  slowed  from  5.5%  in  2016  to  1%  in  2017,  with  the  number  of 
newly  established  enterprises  in  2017  about  half  that  of  2015.  Similarly,  the  number  of 
foreign enterprises in industry and construction in 2017 actually declined compared to 2015, 
as  did  the  number  of  greenfield  investments.  However,  in  the  services  sector  and  in 
agriculture,  foreign  enterprises  grew  strongly  in  2017  compared  to  2015.  Major  concerns 
raised by the business community include a lack of effective implementation of legislation, ad 
hoc  regulatory  changes,  cumbersome  tax  payment  procedures,  and  the  controversial  use  of 
public-procurement  procedures.  Consultation  with  the  private  sector  is  ineffective.  In 
addition, the development of a proper real-estate market has been held back by the lack of a 
cadastre  and  the  problem  of  land  titles  that  are  burdened  by  ownership  conflicts.  This  has 
been a particular hindrance to investment in agriculture and tourism. 

Although  judicial  and  institutional  reforms  continued,  ineffective  regulation  and 
informality continue to pose major challenges for businesses. Progress has been made on 
judicial reforms, but this has not yet resulted in a more favourable business environment. The 
new  Bankruptcy  Law  still  awaits  the  adoption  of  accompanying  regulations,  and  the 
implementation  of  the  amended  Private  Bailiffs  Law  is  hampered  by  disputes  over  fee 
schedules and the selection of bailiffs. In addition, corruption remains a widespread problem. 
In  spite  of  measures  taken  to  address  the  informal  economy,  it  is  estimated  to  account  for 
about one third of GDP. This is causing losses in tax revenue, a lack of labour protection and 
unfair competition among firms. 

State influence on product markets 

State involvement and public subsidies remained overall low in  the Albanian economy, 
but  the  increased  reliance  on  PPPs  raises  the  potential  of  state  influence  in  certain 
markets.  The  government  has  increasingly  engaged  in  PPPs,  in  particular  for  energy  and 
transport,  where  there  are  price  or  volume  agreements  for  services  and  goods.  Government 
payments under these contracts are by law limited to 5% of the previous year’s tax revenue, 
and for 2018 this limit has reportedly been complied with. Most of the existing PPP contracts 
were selected on the basis of unsolicited proposals, which reduce competition in procurement. 

47 

 
 
It  is  welcome  that  the  ongoing  review  of  the  procurement  guidelines  for  these  projects 
proposes to restrict the use of unsolicited proposals. Although the procurement legislation has 
recently improved, the implementation of public procurement remained flawed and continued 
to  be perceived as not  being  transparent.  The reported state aid  granted  in  Albania between 
2014 and 2017 was estimated at about 0.7% of GDP annually. In 2017, it was reported that 
0.14% of GDP was  spent on state aid, amounting to  EUR 16.88 million, an increase on the 
EUR 12.7 million spent on state aid in 2016. Most of this EUR 16.88 million was spent on 
grants (about 77%) and tax exemptions (about 23%). Reportedly, most state aid goes to public 
services. 

Privatisation and restructuring 

The  private  sector  remained  dominant  in  the  economy,  but  although  overall  market 
liberalisation  is  well  advanced  in  Albania,  there  are  delays  in  the  liberalisation  of  the 
energy market. About 19% of assets in the Albanian economy in 2017 were owned by the 
state.  State  involvement  in  the  economy  is  concentrated  in  electricity,  with  state-owned 
enterprises providing around three quarters of the electricity used in the country. State-owned 
enterprises are also active in other public utilities, such as railways, water supply and natural 
resources.  Albania  has  moved  ahead  with  separating  the  production,  purchasing  and 
distribution  of  electricity.  However,  the  functional  unbundling  of  the  distribution-system 
operator  from  generation  operators  has  not  been  completed.  Restructured  public  electricity 
companies face difficulties in freely accessing the market, and electricity prices for consumers 
are not fully deregulated. This provides little economic incentive for electricity companies to 
enter the market. The reforms of the public electricity companies have substantially decreased 
their  technical  losses,  improved  their  bill-collection  rates,  and  strengthened  their  financial 
situations.  However,  shortcomings  remain  in  the  corporate  governance  and  finances  of  the 
state-owned electricity companies. Competitive mechanisms have only been fully introduced 
for  projects  in  renewable  energy.  In  2018,  Albania successfully  completed the  first-ever 
renewable-energy  support  auction  in  the  Energy  Community,  an  organisation  that  aims  to 
connect the EU’s energy market with the energy market of some of the non-EU neighbours.  

Functioning of the financial market 

Financial stability 

The  declining  stock  of  non-performing  loans  (NPLs)  improved  the  stability  of  the 
banking  system,  but  sovereign  exposure  and  poor  collateral-execution  remain  risks  to 
stability. The ratio of NPLs to total loans fell to 11% by the end of 2018, down from 15.6% 
in 2017. NPLs declined mainly through write-offs, but Albanian banks resolved more NPLs 
through collateral execution in 2018 than they did in 2017. The banking sector also holds over 
20% of its assets in government securities, exposing it to sovereign risks, while a quarter of 
domestic loans and deposits remain exposed to exchange-rate risks. Banking supervision and 
management  have  been  increasingly  aligned  with  international  standards.  The  banking 
sector’s  capital  adequacy  and  liquidity  ratios  remain  well  above  the  minimum  regulatory 
levels. Return on equity softened from 15.7% in 2017 to 12.9% in 2018. 

Access to finance 

Financial  intermediation  remained  undeveloped,  and  credit  growth  to  the  business 
sector stayed subdued. Credit to the private sector amounted to about 39% of banking sector 
assets  in  2018.  Credit  growth  to  business  was  sluggish  due  to:  (i)  banks’  greater  risk 
awareness;  (ii)  tighter  lending  conditions;  (iii)  the  low  financial  literacy  of  SMEs;  and  (iv) 
‘unbankable’  business  plans.  Only  lending  to  households  picked  up  recently.  The  small  but 
growing non-bank financial sector, with about 30 institutions, owned 10.7% of total financial 

48 

 
 
sector  assets  in  the  first  half  of  2018.  In  February  2018,  the  first  private  stock  exchange 
(ALSE  -  the  Albanian  Security  Exchange)  began  trading  government  securities,  but  equity 
and  corporate  bond  finance  remain  underdeveloped.  Overall,  financial  inclusion  remained 
low, with only 40% of adults and about 75% of SMEs holding bank accounts. The Bank of 
Albania  has  set  out  a  plan  to  promote  financial  inclusion,  which  is  important  for  reducing 
informality, illicit financial flows and remittance fees.   

The functioning of the labour market  

into 

increasing  employment  and 

The  economic  upswing  has  translated 
lower 
unemployment.  Employment  growth  of  2.7%  in  2017  allowed  the  unemployment  rate  to 
decline from 15.6% in 2016 to 14.1% in 2017 and to 12.8% in 2018. However, employment 
growth slowed further in 2017, falling to 2.1%. The high youth unemployment rate (covering 
the 15-29 age group) continued to fall, dropping from 33.2% in 2015 to 25.9% in 2017 and 
further  to  23.1%  in  2018.  The  working  age  population  began  decreasing  in  2015,  so  the 
growth in labour supply has been driven by rising participation rates (which rose from 66.8% 
in 2017 to 68.3% in 2018). The gap between the labour force participation rates of men and 
women fell from 20.9 pps in 2014 to 17.2 pps in 2018. Public employment services improved 
job  mediation,  but  active  labour  market  policies  remain  limited  in  scope,  insufficiently 
targeted  and  underfunded.  Only  a  very  limited  number  of  the  unemployed  (2.2%)  receive 
unemployment  benefits  or  are  in  active  employment  promotion  programmes.  Thus,  social 
benefits  are  not  providing  an  incentive  to  withdraw  from  the  labour  market  and  the  labour 
code provides sufficient flexibility not to dampen job creation. Overall, wages grew by about 
3% in 2018 but overall Albanian salaries are among the lowest in the region and reflect the 
low  productivity.  Low  incomes,  low  social  security  and  low-quality  job  offers  continued 
driving  Albanians  -  in  particular  the  higher  educated  (“brain  drain”)  -  into  emigration, 
although the recent employment growth decelerated this trend. 

Three  trends  continue  to  transform  the  structure  of  the  Albanian  economy:  the 
significant  shift  of  employment  to  the  non-agricultural  private  sector;  the  declining 
importance  of  agriculture;  and  the 
increasing service orientation of the 
economy.  The  share  of  employment 
in  the  non-agricultural  private  sector 
jumped from 34.1% in 2015 to 43.3% 
in  2018  (administrative  data),  but 
informal  employment  in  this  sector 
remained  widespread  with  30.3%  of 
2017). 
the 
Meanwhile,  the  share  of  the  labour 
force  employed  in  agriculture  and  in 
the public sector continued to decline. 
In agriculture, the share of the labour force fell from 42.4% in 2015 to 39% in 2018, and in 
the public sector, it fell from 15.5% in 2015 to 14.5% in 2018. Still, agricultural employment 
is relatively high in absolute terms. Agriculture is often a form of self-employment for people 
with  no  other  employment  options,  and  the  high  levels  of  agricultural  employment  keep 
productivity low. 

workforce 

(LFS 

3.2.  The  capacity  to  cope  with  competitive  pressure  and  market  forces  within  the 
Union 
Albania has made some progress and has some level of preparation in its capacity to cope 
with  competitive  pressure  and  market  forces  within  the  EU.  Energy,  transport  and  digital 

49 

455055606570750102030201020112012201320142015201620172018Albania: Labour market trends (15-64 age group)Unemployment rate (lhs)Participation rate (rhs)Employment rate (rhs)Source: Instat 
 
infrastructure  improved.  However,  Albania’s  competitiveness  is  hindered  by  a  lack  of 
entrepreneurial  and  technological  know-how  and  low  education  levels.  This  also  hinders 
Albania’s  integration  into  international  value  chains.  Exports  and  regional  integration  are 
below  potential.  Efforts  to  improve  education  and  training  have  led  to  some  improvements, 
but reforms must continue to close the significant skills gap. Albania’s capacity for research, 
development and innovation remained low.  

In order to improve competitiveness and long-term growth, Albania should in particular: 

  increase spending on education and research in percentage of GDP and implementing the 

envisaged reforms to vocational education and training; 

  improve the planning and execution of public investment; 

  make  better  technical  support  services  locally  available  for  micro,  small  and  medium-

sized enterprises to help them to invest, innovate and to export. 

Education and innovation 

Although  education  system  outcomes  have  improved,  they  remained  well  below  EU-
average  and  are  inadequately  tuned  to  private  sector  needs.  From  a  low  base,  Albania 
improved its scoring in the OECD's 2015 PISA assessment strongly but still about half of the 
tested students showed less than basic proficiency in three main competences. Almost half of 
the  children  enrolled  in  lower  secondary  education  (85%  enrolment)  did  not  successfully 
complete it. Although VET enrolment as share of upper secondary education increased from 
13% in 2013 to over 20% in the school year 2018-2019, only 11% of all youngsters between 
15  and  19  years  are  attending  vocational  schools.  Government’s  spending  on  education 
declined  from  3.5%  of  GDP  in  2013  to  2.4%  of  GDP  in  2018,  remaining  below  regional 
average and far below the appropriate level for a country with a large young population. As 
the  Government’s  education  policy  does  not  systematically  take  into  account  private  sector 
needs  and  often  fails  to  enforce  quality  standards  in  vocational  training  institutions,  young 
graduates often do not meet private sector expectations, with only 46.9% graduates being in 
employment  in  the  year  following  graduation.  The  implementation  of  the  action  plan  that 
requires the involvement of the public and private sectors together with universities is lagging 
behind. 

The  capacity  for  technological  absorption,  research,  development  and  innovation 
remained low. Moreover, data on research spending is scarce; the few indicators available on 
research  and  innovation  show  a  mixed  picture:  while  the  number  of  articles  in  scientific 
journals has declined, the number of patents and trademark registrations has increased, albeit 
from a very low level. The low research and technical extension capacity in the agricultural 
sector has not improved. 

Physical capital and quality of infrastructure 

Albania’s  annual  public  investment  averaged  5.3%  of  GDP  since  2013  and  its 
infrastructure improved significantly, but the infrastructure gap to the regional and the 
EU  average  levels  remains  large. 
Investment  has  accounted  for  roughly 
one  quarter  of  GDP  in  recent  years. 
Overall  investment  grew  by  4.6%  in 
2017,  with  about  40%  invested  in  the 
electricity,  gas  and  water  sector. 
Private 
large 
investment  (including 
foreign  investments)  in  energy  and 

50 

02004006008001000AL, 2006EU, 2006AL, 2016EU, 201604812Albania: Selected indicators relative to populationElectricity production, GWh per 1000 inhabitantsRoad length, km per 1000 inhabitantsRail passenger-km per inhabitant, lhsSource: Eurostat 
 
transport infrastructure has increased significantly in recent years. The IMF composite public 
infrastructure index of 2017 estimated the gap to the EU average infrastructure level at 70%. 
In  particular,  broadband  internet  coverage,  highways  and  installed  electricity  generation 
capacity,  though  constantly  increasing,  were  much  below  EU-levels  and  electricity  outages 
remained  frequent.  The  Albanian  capital  budget  execution  rate  of  91%  has  been  above  the 
average of its regional peers in 2017. In 2018, the capital budget execution could not keep up 
with the planned high growth of public investment and fell to 88% which still represents an 
annual capital expenditure growth of 12%. Public investment management still suffers from 
institutional-capacity  constraints,  overoptimistic  planning  and  backloading.  The  large 
infrastructure  investment  needs  and  the  increasing  number  of  PPPs  require:  (i)  more 
financing;  (ii)  clear  frameworks  for  regulated  prices  (electricity,  water,  toll  fees);  and  (iii) 
improved institutional capacity in the public sector for planning and supervision. 

Sectoral and enterprise structure 

The Albanian economy shifted further to the services sector, followed by agriculture and 
industry. Services further increased their share in GDP from 45.8% in 2014 to 48%, in 2018 
led by trade and tourism related services and an increasing share of services in education and 
health.  Agriculture  as  well  as  industry  have  lost  some  ground  between  2014  and  2018  with 
shares decreasing from 23% to 18.4% and 14.8% to 12.2 respectively. The number of foreign 
enterprises in tourism, ICT and agriculture increased by almost 12% from 2016 to 2017. 

Most investment and employment depends on a very small number of enterprises.  89% 
of all enterprises in Albania had less than 5 employees in 2016 (‘micro-enterprises’) and only 
5%  of  all  enterprises  had  over  10  employees.  The  latter  account  for  75%  of  formal 
employment  and  86%  of  investment  in  the  economy.  The  slow  change  in  this  structure  in 
recent years signals persistent obstacles for enterprise growth. Many micro-enterprises cannot 
access  microfinance  due  to  their  lack  of  know-how  or  because  they  operate  in  the  informal 
economy, whereas many SMEs (with more than 5 employees) are too large for microfinance 
institutions, but also face problems accessing bank financing. The low level of public support 
to SMEs and farmers poses a challenge for businesses aspiring to grow or to export. 

Economic integration with the EU and price competitiveness 

The  EU  remained  Albania’s  main  trading  partner,  but  overall  trade  levels  remained 
well below potential and undiversified. Albania’s total global exports increased by 17% in 
value in 2018, exceptionally dominated in this year by electricity exports. Over the last years, 
commercial services led by tourism dominated exports, accounting for 58% of global exports. 
Goods  exports  -  mainly  manufactured  textiles  and  footwear  -  continued  to  show  little 
diversification  in  terms  of  products  and  destinations,  while  the  potential  for  agricultural 
exports  remained  untapped.  The  EU  accounted  for  76.3%  of  Albania’s  goods  exports  and 
61.1%  of  its  goods  imports  in  2018,  slightly  less  than  in  2017.  Italy  remained  the  main 
destination for Albanian exports and a major source of remittances. 

FDI  inflows  into  Albania  from  the  EU  grew  strongly  over  the  last  2  years.  FDI  flows 
from  the  EU  into  Albania  increased  by  22%  in  2016  and  44%  in  2017.  FDI  from  the  EU 
accounted for 38.5% total FDI flows into Albania’s in 2017. Nevertheless, the EU’s share in 
Albanian FDI stocks declined from its peak of 66% in 2015 to 56% in 2017, partly due to a 
large build-up of FDI stocks  in  the energy sector by non-EU partners. Albania’s integration 
into  global  value  chains  is  mostly  limited  to  manufacturing  services  in  the  textile  and 
footwear apparel industries for Italian lead firms (known as ‘cut, make and trim’ services). 

Albania’s trade  with  Central  European  Free Trade Agreement  (CEFTA) countries  increased 
on  account  of  a  continuously  increasing  share  of  exports  to  CEFTA  countries,  mainly  to 

51 

 
 
Kosovo.  Exports to CEFTA increased from about 11% of its total exports in 2013 to about 
16% of total exports in 2018. Imports from CEFTA, in contrast, fell back to their 2016 level 
in 2018 at 6.7% of total Albanian imports while imports from other countries increased their 
share from 30.4% to 32.3%. 

4. 

 GOOD NEIGHBOURLY RELATIONS AND REGIONAL COOPERATION  

Good neighbourly relations  and regional cooperation  form  an essential  part of Albania’s 
European  integration  process.  Albania  has  continued  to  participate  actively  in  regional 
initiatives  such  as  the  South  East  European  Cooperation  Process,  the  Regional  Cooperation 
Council, the Central European Free Trade Agreement (CEFTA), the Western Balkans Six, the 
Adriatic-Ionian  Initiative,  the  Energy  Community  Treaty,  the  European  Common  Aviation 
Area  Agreement,  the  Central  European  Initiative,  the  Regional  Initiative  for  Migration  and 
Asylum,  the  Regional  School  of  Public  Administration  (ReSPA),  and  the  ‘Brdo-Brijuni 
process’.  

Albania  participated  in  the  Western  Balkans  London  Summit  of  July  2018  and  hosted  a 
follow-up  meeting  of  Prime  Ministers  in  Durres  in  August  2018  to  support  the 
implementation  of the Multiannual  Action Plan (MAP) for the Regional Economic Area.  In 
this regard, more attention is  needed to  secure timely  adoption of the incurred measures,  as 
well  as  streamlining  regional  commitments  into  national  policies.  Tirana  hosts  both  the 
Western  Balkans  Fund  and  the  Regional  Youth  Cooperation  offices.  Dialogue  with  the 
Western Balkans continued in Skopje on the implementation of the Digital Agenda, to which 
all  leaders  of  the  region  had  committed  through  a  statement  of  support.  More  particularly 
concerning the negotiations on roaming fees, a regional agreement was signed in Belgrade in 
April 2019 enabling Roam like at Home (RLAH) as of July 2021. 

Albania  has  continued  to  strengthen  bilateral  relations  with  the  countries  of  the  region, 
organising joint government meetings with many of them to deepen cooperation.  

Relations  with  Bosnia  and  Herzegovina  remain  overall  positive,  however  with  no  bilateral 
exchanges at high level. Trade flows remain at a low level compared to other countries of the 
region.  

Albania reconfirmed its very good relations with Kosovo by signing several new agreements 
in key areas of cooperation during the fifth governments' meeting in November 2018 in Peja, 
Kosovo.  In  December  2018,  Kosovo  and  Albania  signed  an  agreement  to  establish  joint 
border  controls.  Trade  between  the  two  in  2018  increased  slightly  above  20%  compared  to 
2017. Albania continued to advocate for Kosovo’s full participation to regional processes and 
to  support  the  dialogue  between  Kosovo  and  Serbia.  Any  decision  with  respect  to  the 
management of border control must be in line with Integrated Border Management standards. 

52 

 
 
 
 
Any  actions  and  statements  that  could  be  interpreted  as  going  against  good  neighbourly 
relations must be avoided. 

Relations  with  Montenegro  have  further  strengthened,  in  particular  following  the  first  joint 
government meeting in July 2018. In the framework of this meeting, 12 bilateral agreements 
were  signed  on  migration  and  refugee  flows  as  well  as  minority  and  security  issues.  Cross-
border cooperation was strengthened with projects to improve infrastructure on both sides of 
the border. Albania also cooperates with Montenegro under the Albania-Montenegro-Croatia 
Trilateral, established in 2017, as part of the Adriatic-Ionian dialogue. One trilateral meeting 
took place during the reporting period in July 2018.  

Relations  with  North  Macedonia  have  intensified.  Albania  provided  strong  support  to  the 
agreement  with  Greece  for  resolving  the  name  issue.  Albania's  Foreign  Minister  paid  an 
official visit to Skopje in September 2018. A second joint government meeting is expected to 
take place with a focus on strengthening connectivity and mobility between the two countries. 
Albania ratified the protocol for the accession of North Macedonia to NATO. 

The  relationship  with  Serbia  remained  overall  positive.  Regular  exchanges  took  place 
between civil society organisations, youth and media actors. In May 2018, the two countries 
signed an agreement on tourism cooperation. Leaders of both countries regularly meet in the 
framework of regional and international events. Albania also cooperates with Serbia under the 
Albania-Serbia-Italy Trilateral.  

Albania  further  intensified  its  good  relations  with  Turkey.  In  October,  the  Turkish  Foreign 
Minister visited Albania and both countries committed to establish a High-Level Council of 
Cooperation, a cooperation mechanism similar to joint government meetings that Albania has 
with its neighbours in the region. Turkey remains the fifth largest trading partner of Albania 
and the sixth biggest foreign investor in the country. Turkey continued to provide education 
and training for the Albanian Army and security forces. After the coup attempt in July 2016, 
Turkey  has  been  increasing  pressure  on  Albania  to  deliver  on  dismantling  the  so-called 
Gulen/FETO  structures  in  the  country.  The  Marif  Foundation,  established  by  the  Turkish 
government, is taking ownership of schools formerly owned by these structures.  

Relations  with  Greece  remained  generally  positive  but  were  strained  by  an  incident  in  the 
ethnic  Greek  village  of  Bularat.  Progress  on  outstanding  bilateral  issues  continued  with  the 
implementation of the agreement on exhumation and burial of the remains of Greek soldiers 
fallen in Albania during the Second World War, the withdrawal of reservation by Greece on 
Albania’s accession to the Apostille Convention, an agreement on the process for the revision 
of  school  text  books,  and  the  signing  of  an  agreement  on  the  mutual  recognition  of  driving 
licences. The third round of negotiations on maritime delimitation was held in June 2018. The 
two countries' Prime Ministers met in July 2018 and agreed to further continue the bilateral 
dialogue with the aim of concluding a strategic partnership agreement. Such progress should 
continue. 

Relations  with  Italy  remained  very  good.  Political  dialogue  intensified  with  visits  on  both 
sides. Cooperation on justice and home affairs was further strengthened,  in  particular in  the 
fight  against  organised  crime,  drug  trafficking,  trafficking  of  human  beings,  irregular 
migration  and  asylum.  Italy  continued  to  provide  key  support  for  monitoring  the  state  of 
cannabis  cultivation  in  Albania.  Italy  remained  Albania's  first  trading  partner  and  one  of 
Albania’s leading bilateral donors. 

53 

 
 
 
 
5.  

ABILITY TO ASSUME THE OBLIGATIONS OF MEMBERSHIP 

5.1.   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 has some level of preparation/is moderately prepared in the area of free movement 
of  goods.  There  was  some  progress  over  the  reporting  period,  in  particular  in  the  sectoral 
alignment  with  the  ‘new  and  global  approach’  product  legislation  and  the  accreditation  of 
additional  conformity  assessment  bodies.  However,  further  efforts  are  needed  to  ensure 
legislative alignment and to strengthen enforcement.  

In the coming year, the country should in particular: 

→ continue to align its legislation with both the horizontal and sectoral acquis; 

→ further strengthen the enforcement capacity of the Market Surveillance Inspectorate. 

General principles 

There are still measures in place that affect the production, distribution and marketing of 
industrial products, notably related to: (i) price of products; (ii) import licences or permits 
for imported goods; and (iii) the obligation to have storage facilities in specific areas. Further 
efforts  towards  alignment  with  the  acquis  are  set  out  in  the  2016-2020  national  plan  for 
European  integration,  as  well  as  in  the  2020  consumer  protection  and  market  surveillance 
strategy. However, there is no specific strategy on the free movement of goods. 

Non-harmonised area 

Despite the completion of the methodology for comparative analysis of Albanian legislation, 
an action plan on the screening of national technical regulations for compliance with Articles 
34-36 of the Treaty on the Functioning of the European Union is still being prepared. 

Harmonised area: quality infrastructure 

Legislation  in  the  area  of  accreditation  and  market  surveillance  is  partially  aligned  with  the 
EU  acquis.  Administrative  structures  are  in  place  for  dealing  with  technical  regulations, 
standardisation, conformity assessment, metrology, accreditation, and market surveillance as 
subordinate bodies under the Ministry of Finance and Economy and the Ministry of Tourism 
and  Environment.  Recruitment  of  more  specialised  staff  to  the  Market  Surveillance 
Inspectorate is ongoing. Mutual cooperation agreements on accreditation, standardisation and 
conformity assessment are in place with countries in the region and other non-EU countries. 

On  standardisation,  the  General  Directorate  of  Standardisation  (GDS)  is  a  full  member  of 
the  European  Telecommunication  Standards  Institute  (ETSI),  an  affiliate  member  of  the 
European  Committee  for  Standardisation  (CEN)  and  of  the  European  Committee  for 
Electrotechnical  Standardisation  (CENELEC),  and  an  associate  member  of  the  International 
Electrotechnical  Commission  (IEC).  All  national  standards  are  adopted  in  full  conformity 
with European standards (CEN, CENELEC and ETSI standards). During the reporting period, 
1655  European  and  international  standards  were  adopted  (including:  730  CEN,  339 
CENELEC, 216 ETSI, 313 ISO, and 57 IEC). In total, the GDS adopted about 97% of total 
standards issued by CEN and CENELEC. 

The 2014  Law on the accreditation of  conformity assessment bodies is  partly  aligned  with 
the acquis. It regulates the functioning of the General Directorate of Accreditation (GDA), its 
accreditation board, its technical committees and other procedural issues. In 2018 there are 73 

54 

 
 
 
accredited conformity  assessment  bodies (compared to  58 in  the previous reporting period): 
45  laboratories,  19  inspection  bodies  and  9  certification  bodies.  In  April  2018,  the  GDA 
became a signatory of the European Cooperation for Accreditation Multi-Lateral Agreement 
(EA MLA) in the fields of Inspection and Management Systems Certification, and remains an 
EA MLA signatory in the field of testing. Since July 2018, GDA has been  a full member of 
the  International  Laboratory  Accreditation  Organisation  Mutual  Recognition  Agreement 
(ILAC  MRA)  in  the  field  of  inspection  and  a  mutual  recognition  agreement  was  signed 
between ILAC and GDA. Albania launched an electronic system for accreditation procedures 
in  October  2018.  The  General  Directorate  of  Metrology  has  maintained  its  capacity  of  104 
employees.  

The State Inspectorate for Market Surveillance (SIMS) currently has 45 staff, down from 50 
in the previous year. SIMS should significantly increase staff numbers, including inspectors. 
SIMS carried out more than 700 inspections in 2018. As a result, 67 administrative measures 
were taken, out of which 10 were emergency measures related to dangerous products (mainly 
toys and electrical goods), which resulted in these products being withdrawn from the market. 

Harmonised area: sectoral legislation 

For  the  ‘new  and  global  Approach’  product  legislation,  the  Albanian  legal  framework  is 
designed  to  be  fully  aligned  with  the    acquis  in  the  following  sectors:  lifts  (following  a 
decision  by  the  government  adopted  during  the  reporting  period),  machinery,  personal 
protective  equipment,  gas  appliances,  pressure  equipment,  simple  pressure  equipment, 
outdoor  equipment  noise,  toys,  energy  labelling  (following  decision  of  the  government 
adopted during the reporting period), and measuring instruments. However, alignment has not 
yet  started  on  low  voltage  equipment,  cableways,  electromagnetic  compatibility,  radio  and 
telecoms  equipment,  aerosol  dispensers,  explosive  atmospheres  equipment,  construction 
products, recreational craft, eco-design, and non-automatic weighing instruments. 

On civil explosives and pyrotechnic articles, alignment has not started. 

For ‘old Approach’ product legislation, the Law on chemical management is partly aligned 
with the Regulation concerning the Registration, Evaluation, Authorisation and Restriction of 
Chemicals (REACH) and other related parts of the  acquis. National legislation on chemical 
classification,  labelling  and  packaging  is  designed  to  be  aligned  with  the  United  Nations 
Globally Harmonised System of Classification and Labelling of Chemicals.  

On drug precursors, the list of controlled substances complies with the lists in the relevant 
EU  acquis.  There  is  partial  alignment  in  the  area  of  procedural  measures,  notably  on 
firearms, textile labelling and mixtures, and pricing of medicinal products. The legislation on 
defence products and on return of cultural objects unlawfully removed from the territory 
of a Member State is still not aligned with the acquis.  

5.2.   Chapter 2: Free movement of workers 

Citizens of  one Member  State have the right to  work in  another Member State and must  be 
given the same working and social conditions as other workers.  

Albania  is  at  some  level  of  preparation  in  freedom  of  movement  for  workers.  Some 
progress  was  achieved  in  this  area,  in  particular  by  the  conclusion  of  new  social  security 
bilateral agreements.  

In the coming year, Albania should: 

  align its legislation with the EU acquis in the area of freedom of movement for workers; 

  develop the IT system to enable connection to EURES; 

55 

 
 
  negotiate  and  implement  new  bilateral  agreements  on  social  security,  notably  with  EU 

Member States. 

On access to the labour market, EU citizens are eligible to work in Albania without a work 
permit.  This  is  in  line with  pursuant to  provisions of the  Law on foreigners and subsequent 
amendments,  which  provide  that  foreigners  will  not  need  a  work  permit  or  business 
registration  certificate  if  they  are  nationals  of  an  EU  Member  State  or  Schengen  country 
legally  residing  in  Albania.  The  appropriateness  of  social  security  schemes  and  forfeit  of 
occupational  pensions  are  regulated  through  bilateral  agreements.  Immigration  admission 
policies do not place obstacles to the permanent settlement of EU workers’ family members. 
Nevertheless, there are limitations as regards family members of Union citizens who are not 
nationals  of an EU member state, in  terms of being entitled to  take up employment  or self-
employment.  

Regarding  the  preparation  made  for  joining  EURES  (European  network  of  employment 
services), Albania has set-up an integrated database for its employment services system. This 
will  facilitate  exchanges  of  information  between  IT  departments  on  the  civil  status,  the  tax 
system, the compulsory healthcare system and the economic assistance system. A new service 
system still needs to be developed to enable the connection to EURES. 

On the coordination of social security systems, bilateral agreements on social security are in 
place  with  Belgium,  the  Czech  Republic,  Germany,  Luxembourg,  Hungary,  Austria, 
Romania,  North  Macedonia  and  Turkey.  Negotiations  with  Switzerland  and  Canada  have 
been  completed.  The  agreement  with  Kosovo  was  ratified  in  April  2019  is  expected  to 
become active three months later. There have been exchanges on coordinating social security 
schemes  with  Bulgaria,  Spain,  France  and  Croatia.  A  technical  cooperation  agreement  has 
been  set  up  to  continue  negotiations  for  a  bilateral  agreement  on  coordination  of  social 
security schemes with Italy. Negotiation and implementation of new bilateral agreements on 
social security, between Albania and EU Member States remains to be fostered.  

5.3.   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. The postal services market has been opened up to competition 
since 2017. 

Albania  is  moderately  prepared  in  the  right  of  establishment  and  freedom  to  provide 
services.  Indeed,  Albania  demonstrated  good  progress  in  the  alignment  with  the  general 
framework  set  out  in  the  EC  Services  Directive.  There  was  some  progress  during  the 
reporting  period,  especially  in  the  area  of  provision  of  services  in  the  legal  sector.  In  the 
coming year, the country should in particular: 

  finalise  screening  of  the  existing  legislation  to  identify  barriers  to  the  freedom  of 
establishment and free movement of services with a view to further aligning its legislation 
with the Services Directive; 

  continue the test phase for a future fully operational Point of Single Contact; 

  step  up  efforts  to  align  its  legislation  with  the  EU  acquis  and  ensure  appropriate  

institutional capacity in the area of mutual recognition of professional qualifications. 

On  barriers  to  the freedom  of  establishment  or the  free  movement  of  services,  the 
legislation  on  mining,  taxation  and  social  policy  is  broadly  aligned  with  the  Services 
Directive. However, the legislation on the veterinary sector still requires amendments for the 

56 

 
 
licensing  of  private  veterinary  clinics  and  hospitals.  During  the  reporting  period,  some 
progress was achieved in the legal sector with the approval of the Law on the legal profession. 
The  legislation  in  this  area  is  partially  aligned  with  the  EU  acquis,  but  restrictions  exist  in 
particular for public notaries and private bailiffs. The screening process is ongoing for other 
sectors. 

On the freedom to provide cross-border services, the National Business Centre functions as 
a one-stop-shop for registering businesses and issuing licences, authorisations and permits. It 
operates  through  service  windows  throughout  the  country,  as  well  as  the  electronic  service 
window on the e-Albania portal. Albania needs to ensure a fully operational Point of Single 
Contact.  

On  postal  services,  legislation  is  fully  aligned  with  EU  postal  acquis,  apart  from  the 
Regulation  on  cross-border  parcel  delivery  services.  The  postal  market  has  been  open  to 
competition  since 2017. There is  one universal  service provider, Albanian Post  S.A. and 11 
other  postal  service  providers  in  the  market.  The  Electronic  and  Postal  Communication 
Authority (AKEP) is the independent national regulator for the postal market. A new postal 
strategy for 2019-2024 is in a preparatory phase. 

On mutual recognition of professional qualifications, no progress was made during the 
reporting period in the alignment of the professional qualifications framework with the EU 
acquis in the area. The Albanian authorities should strengthen institutional capacity for the 
mutual recognition of professional qualifications. 

5.4. 

 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. 

Albania is moderately prepared in the area of free movement of capital. Some progress was 
made  in  the  reporting  period,  particularly  in  the  area  of  payment  systems,  through  the 
adoption of the policy document "payment and settlement systems" and the preparation of the 
Strategy on Retail Payment System.  

In the coming year, Albania should in particular: 

  swiftly  implement  the  recommendations  of  the  Moneyval  report  and  continue  to  align 

with the EU acquis on anti-money laundering/countering terrorism financing;  

  take short- and medium-term measures to implement the action plan on acquisition of land 

by foreigners, which is a commitment in the SAA that is outstanding since 2016. 

On  capital  movements  and  payments,  the  Law  on  Strategic  Investments  provides  special 
protection to foreign investments. No progress has been made on the adoption of the unified 
Law on  Investments. Acquisition of real  estate by foreigners remains subject to restrictions: 
they  are  not  allowed  to  acquire  agricultural  land,  forests,  meadows  and  pastures.  Albania  is 
late in delivering on its commitment under the 2006 Stabilisation and Association Agreement 
(SAA) to amend the regime for the acquisition of property by EU citizens/entities, which is a 
step due since 2016. Provisions regulating the acquisition of real estate by foreigners remain 
unchanged  and  uncertainties  over  real  estate  ownership  rights  continue  to  discourage 
investment. 

As regards payment systems, foreign banks have the right to open branches and agencies in 
Albania and to offer cross-border payments. Non-cash payments are governed by the Bank of 

57 

 
 
Albania  Regulation  on  the  payment  system  and  instruments.  The  legal  and  regulatory 
framework  for  electronic  payments  in  Albania  is  the  same  for  national  and  cross-border 
payments. In May 2018, the Bank of Albania Supervisory Council adopted the revision of the 
oversight policy document for payment and settlement systems with the objective to align the 
classification  criteria  of  the  payment  systems  according  to  the  EU  definition.  The  National 
Payment  System  Committee  opened  up  its  participation  to  representatives  from  non-bank 
financial  institutions  and  from  the  payment  system  operators  and  presented  the  Strategy  on 
Albania’s National Retail Payments Strategy for 2018-2023.  

As  regards  the  fight  against  money  laundering,  the  mutual  evaluation  report  of  Albania 
discussed  at  Moneyval  in  July  triggered  Albania’s  referral  to  the  International  Cooperation 
Review Group. This development puts Albania at risk of being listed by the Financial Action 
Task  Force  of  February  2020  among  the  jurisdictions  with  strategic  deficiencies  in  their 
regime  of  anti-money  laundering/countering  terrorist  financing.  Albania  should  address 
Moneyval’s  recommendations  by  September  2019.  The  Committee  for  Coordination  on  the 
Fight  against Money  Laundering, chaired by the Prime  Minister, adopted an Action Plan in 
September  2018,  which  attributed  responsibilities  to  all  relevant  ministries  and  services.  In 
implementation,  new  amendments  to  the  Anti  Money  Laundering  Law  are  being  prepared 
which will also  aim at  aligning  with  the latest EU  acquis. Albania is  working on  amending 
three  legal  acts  related  to  the  National  Business  Centre;  assets’  confiscation;  and  tax 
procedures. The  National  Business Centre is  working on an  assessment of best  practices on 
establishment of beneficial ownership register. 

The  General  Directorate  for  the  Prevention  of  Money  Laundering  (the  Albanian  Financial 
Intelligence Unit or FIU) is now fully staffed with 39 staff.  

The number of suspicious transaction reports the FIU collected for the period January  2018-
February 2019 increased to 1,659 compared to 1,384 for 2017. The FIU referred 396 cases to 
law enforcement authorities.  

5.5.   Chapter 5: Public procurement 

EU rules ensure that public procurement of goods, services and works in any Member State is 
transparent  and  open  to  all  EU  companies  on  the  basis  of  non-discrimination  and  equal 
treatment. 

Albania has some level of preparation in public procurement. Some progress was made in 
the  past  year,  in  particular  by  enhancing  the  capacity  of  the  Public  Procurement  Agency. 
Further efforts are needed to improve compliance with procedures and prevent corruption in 
the  procurement  cycle.  The  Commission’s  recommendations  from  2018  were  not  fully 
implemented and remain valid. 

In the coming year, Albania should in particular: 

  ensure further alignment with the 2014 directives on EU public procurement, including in 
the  area  of  utilities  and  concessions,  as  well  as  with  the  EU  Defence  Procurement 
Directive; 

  ensure  adequate  administrative capacity in contracting  authorities and the supreme audit 

institution; 

  adopt  a  public  procurement  strategy  in  line  with  the  overarching  public  financial 

management strategy.  

Institutional set-up and legal alignment 

The legal framework on public procurement is largely in line with: (i) 2004 EU directives on 

58 

 
 
‘classic’ and utilities procurement; and (ii) relevant administrative and budget provisions. The 
Law on public procurement specifies the principles of transparency, equal treatment and non-
discrimination. However, further alignment is needed with the 2014 EU public procurement 
directives,  which  replaced  the  2004  ones  in  the  EU.  The  Law  on  concessions  and  public-
private partnerships is partly aligned with the Directive on the award of concession contracts. 
All  legal  and  financial  instruments  used  in  the  area  of  public  procurement  and  concessions, 
including 
the 
implementation  of  joint  projects,  should    comply  with    the  principles  of  transparency, 
competition,  equal  treatment  and  non-discrimination.  Legislation  in  the  field  of  defence 
procurement remains to be aligned with the relevant EU Directive. 

inter-governmental  agreements  concluded  with 

third  countries 

for 

The mid-term review of the public financial management  strategy was completed in March 
2019. The revised public investment management guidelines approved in March 2018 require 
full  and  effective  implementation.  A  strategic  framework  for  public  procurement  is  being 
prepared but remains to be adopted, according to the public financial management strategy. 

The Public Procurement Agency (PPA) is the central public procurement entity mandated to 
monitor compliance public procurement rules. It provides information, support and guidance 
to  contracting  authorities.  In  2018,  the  PPA  increased  staffing  from  29  to  44  posts,  15  of 
which are vacant.  

Implementation and enforcement capacity 

The planning and preparation of public procurement procedures generally comply with 
transparency  and  efficiency  principles,  and  public  procurement  forecasts  are  routinely 
published.  Following  new  instructions  and  close  monitoring,  the  number  of  negotiated 
procedures without prior publication decreased in 2018 to 531 from 2,234. In terms of volume 
these  procedures  represented  4.1%  of  all  the    awarded  procedures.  The  use  of  framework 
agreements expanded from 61 in 2017 to 627 in 2018. For categories of common use goods 
and services the centralised procurement body in the Ministry of Interior was turned into an 
agency  in  February  2018,  thus  providing  intermediary  functions  following  the  new  EU 
directives. 

Albania  has  a  central  electronic  public  procurement  portal  for  the  publication  of  tender 
and  contract  notices  as  well  as  other  important  information  and  guidance.  The  use  of  the 
portal  is  mandatory,  including  for  low-value  procurement.  Since  January  2018,  standard 
tendering  documents  for  each  type  of  procedure  and  contract  are  published  on  the  PPA 
website, and the procurement forecast register is prepared and submitted online. 

By  the  end  of  2018,  the  concessions  registry  contains  information  on  218  public-private 
partnerships (PPPs), six of which signed in 2018. Although required by law, value-for-money 
analysis is still not systematically carried out before approval of all PPPs. Furthermore, there 
is  no  regular  reporting  on  PPPs.  The  technical  skills  and  capacity  to  design  and  assess 
concessions and PPP projects need to be further developed.  

The PPA has recently strengthened its monitoring  role, and applies a monitoring system to 
assess  procurement  performance  and  procurement  compliance.  The  monitoring  system  is 
based on a variety of performance indicators. There is still a need for: (i) further support to 
contracting  authorities;  (ii)  a  strengthening  of  the  e-procurement  system;  (iii)  monitoring  of 
contract implementation; and (iv) analysis of market trends in public procurement. 

The  contracting  authorities  lack  the  capacity  to  manage  public  procurement  procedures 
effectively.  Compliance  is  still  generally  weak,  especially  in  procedures  that  are  more 
complex. The PPA has already issued instructions on the declaration of conflicts of interest by 
procurement  officials.  In  addition  to  these  instructions,  the  PPA  adopted  and  published  a 

59 

 
 
regulation  on  prevention  of  conflict  of  interest  situations  during  the  exercise  of  the  public 
functions in the PPA. The State Audit Institution reports a substantial number of irregularities 
in public procurement with an estimated financial loss to the state budget of around EUR 3.7 
million in 2018 compared to EUR 12 million in 2017 and, EUR 25.6 million in 2016.  

During  the  reporting  period,  the  Commission  received  a  number  of  complaints  alleging  the 
breach  of  rules  on  public  procurement  laid  down  in  the  SAA.  No  such  a  breach  has  been 
established  in  checks  done  so  far.  Albania  is  expected  to  continue  providing  relevant 
information in the context of the various technical engagements. 

Efficient remedies system   

The right to legal remedy is set out in the Constitution and the Law on public procurement in 
a way that is mostly in line with the Remedies Directive. Provisions on the ineffectiveness of 
contracts,  alternative  punishments  and  ex  ante  voluntary  transparency  notices  are  still  not  
covered  by  Albanian  law.  The  remedy  system  is  easily  accessible  to  economic  operators 
without discrimination. However, the complainant must pay a 0.5% fee of the budget of the 
procurement  procedure  which  is  refunded  once  the  complaint  is  accepted  and  granted.  For 
refused complaints the fee is transferred to the state budget. 

Following  amendments  to  the  Law  on  public  procurement  adopted  in  2017,  which 
strengthened  the  independence  of  the  Public  Procurement  Commission  (PPC),  all  PPC 
members were appointed in June 2018. The PPC carries out administrative reviews of public 
tenders. Most of PPC decisions are corrective. They can be challenged in the Administrative 
Court. 

Most  initial  complaints  lodged  with  the  contracting  authority  that  awarded  the  contract  are 
dismissed,  thus  forcing  the  complainants  to  appeal  to  the  PPC.  Processing  of  complaints 
within  the  legal  time  limit  remains  a  challenge.  Setting  up  an  electronic  database  for  PPC 
judgments would improve the transparency of the review system. 

Although  the  remedy  procedure  is  largely  in  place,  the  capacity  of  the  PPC  and  the 
Administrative Court to deal with the complexity and increasing number of appeals still needs 
to  be greatly increased.  Specialised training courses  on topics related to  public procurement 
are recommended. 

5.6.   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  field  of  company  law.  Some  progress  was  made 
towards alignment with the acquis in the corporate accounting area through the adoption of a 
new accounting law.  

In the coming year, Albania should in particular: 

→ ensure full transparency of company financial statements in the business register; 

→ ensure implementation of the new Law on accounting and financial statements.  

Overall,  some  acquis  alignment  has  been  achieved  in  a  range  of  company  law  areas, 
including  takeovers  and  cross-border  mergers,  albeit  none  during  the  reporting  period.  The 
National  Business  Centre  is  responsible  for  company  registration,  allowing  free  online 
registration  and  online  access  to  data.  The  quality  of  financial  reporting  remains  to  be 
improved. 

60 

 
 
In  the  area  of  corporate  accounting,  the  newly  adopted  Law  on  accounting  and  financial 
statements  aims  at  partial  alignment  with  the  EU  Accounting  Directive  and  defines  new 
thresholds for company size, sets requirements for preparing the activity management report 
including medium sized companies and exempts small entities from the obligation for detailed 
disclosures.  Furthermore, large and public-interest  economic  entities active in  the  extractive 
or  logging  industries  shall  prepare  and  make  public  an  annual  report  on  payments  made  to 
public  institutions.  The  Law  also  strengthens  the  competence  of  the  National  Accounting 
Council to monitor the enforcement of financial reporting and accounting standards.  

On  auditing,  the  Public  Oversight  Board  (POB),  established  as  an  independent  regulatory 
authority  with  its  own  financing  resources,  is  the  competent  authority  that  ensures  quality 
assurance. Regulations were adopted on exam testing and evaluation of statutory auditors and 
certified  accountants  (May  2018),  and  on  defining  the  procedures  and  methodology  for  the 
quality assurance of the statutory audit of public-interest entities (PIE) and non-PIEs (October 
2018).  The  Council  of  Ministers  adopted  secondary  legislation  on  the  definition  of  PIEs  in 
January  2019  to  allow  for  full  implementation  of  the  provision  under  the  Law  on  statutory 
audit.  International  Standards  on  Auditing  are  applied.  Further  efforts  are  required  to  align 
with  the  most  recent  acquis  on  statutory  audit,  and  to  strengthen  the  capacity  of  audit 
oversight structures and the professional independence and objectivity of auditors. 

5.7.   Chapter 7: Intellectual property law 

The EU has harmonised rules for the legal protection of intellectual property rights (IPR) and 
of  copyright  and  related  rights.  Rules  for  the  legal  protection  of  IPRs  cover,  for  instance, 
patents and trademarks, designs, biotechnological inventions and pharmaceuticals. Rules for 
the legal protection of copyright and related rights cover, for instance, books, films, computer 
programmes and broadcasting. 

Albania  has  some  level  of  preparation/is  moderately  prepared  on  intellectual  property 
rights. Some progress was made during the reporting period, in particular, with the legislative 
alignment with the EU acquis in the area of industrial property rights as well as in improving 
the functioning of collective management agencies. Recommendations from the previous year 
were partially met and remain valid. 

In the coming year, Albania should in particular: 

→ intensify the efforts to align its legislation on copyright and neighbouring rights with the 

EU acquis;  

  further  improve  the  functioning  of  collective  management  agencies  and  the  payment  of 

royalties to right holders.  

In the area of copyright and neighbouring rights, the National Copyright Council adopted 
two decisions during the reporting period to further align the legal framework with the acquis 
in  the  area  of  methodology  on  remuneration  tariffs  in  the  collective  management  system. 
Collective management agencies (CMOs) revised their statutory acts to enhance transparency, 
accountability  and  better  distribution  to  the  right  holders.    Furthermore,  to  increase  the 
contributory base and the usability of tariffs collected by CMOs, the SUADA one-stop-shop 
was created during the reporting period. 

The  two  main  entities  responsible  for  intellectual  property  are  the  General  Directorate  of 
Industrial Property in charge of registering, administrating and promoting IP objects and the 
Copyright  Directorate.  In  2018,  a  new  specialised  decision-making  collegial  body  was 
established,  the  National  Copyright  Council,  consisting  of  five  members  appointed  by  the 
Minister of Culture. It is responsible for certifying the methodology for the tariffs. 

61 

 
 
On industrial property  rights, the  government  adopted secondary legislation in  May 2018 
on trademarks and the legal protection of designs. The aim of this legislation was to complete 
the alignment of the legal framework with the EU acquis in these areas. Another government 
decision that was adopted during the reporting period aims at further aligning legislation on 
patents for inventions and utility models with the EU acquis. 

In 2018, the number of applications to register trademarks rose by 24.4% compared to 2017 
and applications for patents and utility models increased by 11.7%. As regards enforcement, 
during the reporting period, the General Directorate of Industrial Property participated in 27 
court proceedings.  

In  2018,  the  copyright  division  of  SIMS    carried  out  401  inspections  in  total.  These 
inspections resulted in 105 administrative measures, made up of 98 fines and seven warnings. 
For the same period, the industrial property division of SIMS carried out  336 inspections in 
total.  These  inspections  resulted  in  76  administrative  measures  (71  were  warnings  and  five 
were fines). 

Furthermore, during the reporting period the customs administration suspended the release of 
the 8 334 products suspected of infringing an intellectual property right. However, there are 
still concerns about the high number of counterfeit products in the country. 

5.8.   Chapter 8: Competition policy 

EU rules protect free competition. They include antitrust rules against restrictive agreements 
between companies and abuse of dominant position, and also include rules on concentrations 
between  companies  which  would  significantly  impede  competition.  EU  rules  also  set  out  a 
system  of  State  aid  control.  Governments  are  only  allowed  to  grant  State  aid  if  restrictive 
conditions are met, with a view to preventing distortion of competition. 

Albania  has  some  level  of  preparation  /  is  moderately  prepared  in  competition  policy. 
There was some progress during the reporting period, in particular on legislative alignment 
with  the  acquis.  However,  significant  efforts  are  needed  to  further  improve  legislative 
alignment  with  the  acquis  and  enforcement  of  State  aid  rules.  In  line  with  previous 
recommendations, the operational independence of the State aid Commission (SAC) has not 
yet been ensured. Furthermore, the SAC needs to redouble efforts to improve its enforcement 
record. 

In the coming year, the country should in particular: 

  significantly  increase  the  administrative  capacity  of  SAC’s  secretariat,  which  currently 

raises serious concerns; 

  ensure the operational independence of the SAC; 

  raise awareness of the SAC with respect to line ministries,  regional and local authorities 
in  order  to  ensure  prior  notification  of  aid  measures    and  strengthen  the  enforcement  of 
State aid rules. 

Antitrust and mergers 

The  legislative  framework  is  broadly  in  line  with  the  acquis  and  the  Stabilisation  and 
Association  Agreement.  The  Law  on  protection  of  competition  is  largely  aligned  with  the 
Treaty  on  the  Functioning  of  the  European  Union’s  (TFEU)  Article  101  on  restrictive 
agreements  and  Article  102  on  abuses  of  dominant  position.  The  Law  on  protection  of 
competition  also  provides  for  prior  control  of  mergers,  in  line  with  the  Merger  Regulation. 
Implementing legislation is broadly in line with the relevant EU regulations and Commission 
guidelines.  In  2018,  the  Albanian  Competition  Authority  (ACA)  approved  guidelines  on 

62 

 
 
restrictions  directly  related  and  necessary  to  concentrations,  implementing  the  related 
Commission  Notice  of  2005.  In  addition,  among  others,  the  ACA  has  recently  adopted 
guidelines relating to the telecommunications sector in accordance with EU competition rules. 

On  the  institutional  framework,  the  ACA  is  responsible  for  implementing  the  Law  on 
protection  of  competition.  Formally,  the  ACA  is  an  operationally  independent  authority 
reporting to Parliament, which appoints its chair and the four board members. The ACA can 
adopt  secondary legislation, impose fines and remedies, prohibit  mergers, or authorise them 
with  or  without  conditions.  It  can  conduct  sector  enquiries  and,  at  its  own  initiative,  issue 
opinions  and  recommendations  on  draft  laws  that  may  affect  competition.  A  leniency 
programme  for  companies  providing  information  on  cartel  cases  is  in  place.  Parties  may 
appeal  the  ACA’s  decisions  before  the  courts.  The  ACA  has  undergone  structural 
reorganizations, as approved by the Albanian Parliament, in 2017 and 2018. 

Regarding administrative capacity, the ACA has an appropriate number of staff. The staff’s 
level  of  expertise  has  been  strengthened  through  trainings.  On  enforcement,  the  ACA 
adopted  57  decisions  during  the  reporting  period.  These  included  six  decisions  on  abuse  of 
dominant position and 22 decisions on concentration control. In addition, ACA adopted three 
decisions  on  the  assessment  of  draft  sectoral  legislation  affecting  competition.  The  total 
amount of fees imposed amounted to 6.5 million lek. The ACA should continue to strengthen 
the enforcement of competition rules. 

State aid 

The legislative framework is broadly in line with the acquis and with the Stabilisation and 
Association Agreement. Amended in 2016, the Law on State aid largely reflects Articles 107 
and 108 of the TFEU. Legislation was adopted on the conditions and procedures for granting 
State aid. This legislation aims to partially align Albania’s legislation with the 2014 General 
Block  Exemption  Regulation.  Further  alignment  with  implementing  EU  legislation  on  State 
aid control is still needed. 

On  institutional  framework,  the  State  Aid  Commission  (SAC)  is  responsible  for 
implementing the Law on State aid. The Ministry of Finance and Economy, which is an aid-
granting institution, continues to determine its organisational set-up. This means that the SAC 
cannot  be  considered  an  operationally  independent  authority,  as  required  by  the  SAA.  The 
Law on State aid provides that new aid measures must be notified to the SAC and found to be 
compatible by it before they can be put in place. The SAC can order the recovery of illegal 
and  incompatible  aid,  even  if  no  recovery  has  been  ordered  so  far.  Its  decisions  can  be 
appealed in court. 

The enforcement capacity of the SAC’s secretariat raises serious concerns, as it is currently 
insufficient and needs to be significantly strengthened. It has yet to be shown that the Law on 
State aid is being implemented effectively. The record of enforcement of State aid control is 
very low. During the reporting period, the SAC assessed 10 State aid schemes, of which four 
were ex-officio cases. No negative decisions were taken. It is important that State aid rules are 
reflected  in  the  public  financial  management  strategy.  It  is  also  important  to  increase  the 
SAC’s  advisory  role  for  line  ministries  and  for  regional  and  local  authorities.  The 
implementation  of the State aid  rules should be further monitored in large projects  between 
Albania  and  other  countries.  Advocacy  among  aid  grantors  must  be  stepped  up  to  achieve 
prior notification of aid measures to the SAC. 

Liberalisation 

The  legal  framework  provided  by  the  Law  on  State  aid  is  applicable  to  all  legal  or  natural 
persons  that  perform  an  economic  activity.  There  has  been  no  investigation  of  State  aid  for 

63 

 
 
public  undertakings  or  undertakings  with  special  or  exclusive  rights.  Albania  needs  to 
demonstrate  more  visibly  its  enforcement  of  the  rules  on  financing  services  of  general 
economic interest. 

5.9.  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 the area of financial services. Some progress was made 
in addressing banking supervision and in further aligning the legislation with the Solvency II 
Directive, as recommended in the 2018 report.  

In the coming year, Albania should: 

  align its legislation with  the EU capital  requirements framework corresponding to  Basel 
III  and  continue  with  the  implementation  of  macro-prudential  policy  and  the  resolution 
framework; 

  ensure the full implementation of the non-performing loan resolution strategy; 

  accelerate  the  adoption  of  the  amendments  to  the  Law  on  compulsory  insurance  in  the 

transport sector. 

As regards banks and financial conglomerates, the Bank of Albania (BoA) has continued to 
further  align  the  banking  regulation  and  supervisory  manual  with  Basel  II  and  Basel  III.  In 
2018,  a  Resolution  Fund  has  been  established  and  is  operational.  Regulations  on  resolution 
plans and on the cooperation between the Supervision Department and Resolution Department 
in  the  BoA  were  adopted.  A  Cooperation  Agreement  between  the  BoA  and  the  Single 
Resolution  Board  has  been  signed.  Guidelines  and  regulations  aiming  at  further  alignment 
with  the  relevant  EU  acquis  on  capital  adequacy,  licensing  and  activity,  risk  management, 
reporting  by  savings  and  loan  associations,  and  transparency  for  banking  and  financial 
product services are in place. Albania has a system of identification of systemically important 
banks in place that is similar to EU practice. The BoA is working on the introduction of the 
Liquidity Coverage Ratio in the liquidity risk management regulatory framework in line with 
Basel  III requirements.  The non-performing loan ratio continued to  decrease from 13.4% in 
January 2018 to 11.3% in January 2019, mainly due to write-offs and some loan restructuring. 
Full  implementation  of  the  Non-performing  Loans  Resolution  Strategy  requires  further 
actions with regards to improvements in credit registry, as well as the full implementation of 
the bankruptcy law. The efficiency of the collateral execution system is currently the subject 
of  court  proceedings.  The  joint  guidance  issued  in  September  by  Ministers  in  charge  of 
finances  and  justice  on  fees  for  bailiff  services  is  challenged  by  the  Chamber  of  Bailiff 
Offices. 

In the area of insurance and occupational pensions, amendments to the Law on Compulsory 
Insurance in the transport sector still need to be adopted. The secondary legislation to further 
align with the Solvency I and Solvency II Directives is in place and the implementation of the 
Strategy  on  consumers  and  investors'  confidence  in  the  supervised  markets  continued.  In 
April 2018, the Albanian Financial Supervisory Authority adopted the 2018-2022 strategy on 
the development of AFSA and the markets under its supervision.  

In the area of financial market infrastructure the Albanian Stock Exchange, a private entity, 
operates only in the field of government securities while the public stock exchange remains 
suspended. A Central Securities Depository (AFISAR) is in place, which supports the process 

64 

 
 
of  settlement  and  registration  of  Government  securities  and  is  operated  by  the  Bank  of 
Albania. The expiry period for privatisation vouchers was extended until December 2020. 

As  regards  the  securities  markets  and  investment  services,  the  issuance  of  bonds  by 
companies  has  been  authorised  for  private  offerings  to  institutional  investors,  their 
shareholders or individuals. Liquidity requirements for investment funds were strengthened.  

5.10. 

 Chapter 10: Information society and media 

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

internal  market 

functioning  of 

the  smooth 

the 

Albania is moderately prepared in the field of information society and audio-visual media. 
Some  progress  was  made  on  the  digital  agenda  strategy  and  e-government  services.  No 
progress  was  achieved  in  the  finalisation  of  the  digital  switchover,  which  remains  to  be 
finalised,  along  with  the  revision  of  the  national  broadband  plan  with  clear  objectives  and 
targets,  as  well  as  in  implementing  the  European  emergency  number  112,  as  already 
recommended in the 2018 report. 

In the coming year, Albania should in particular: 

  adopt  the  necessary  amendments  to  the  Law  on  Electronic  Communication,  in  alignment 
with the new European Electronic Communications Code, and prepare an action plan for the 
digital agenda.   

On electronic communications and information and communications technologies (ICT), 
little  progress  was  made  in  implementing  the  single  European  emergency  number  112  as 
planned in the 2015-2020 public order strategy. The unified 112 emergency number currently 
operates only in the region of Tirana and further efforts are required to extend it to the whole 
country. A new organisational structure for the Authority for Postal and Electronic Research 
has  been  approved  with  an  increase  of  staff  from  73  to  85  employees  (74  are  already 
employed).  Fixed  internet  broadband  penetration  is  low,  with  approximately  38%  of 
households  being  connected.  There  is  a  huge  gap  in  fixed  internet-broadband  penetration 
between urban and rural areas. Rural areas account for 40% of the population but only 1% out 
of  this  is  connected  to  the  internet.  The  mobile  penetration  rate  reached  68%  compared  to 
72% at the end of 2017. In 2018 the number of active users of mobile broadband was about 
1.8 million,  which results in  an  annual  decrease  of about  10.9%. The volume of data usage 
during 2018 has increased by 30% compared with 2017. 

In  the  area  of  information  society  services,  the  cross-sectoral  strategy  on  Albania’s  digital 
agenda  for  2015-2020  and  the  plan  for  broadband  development  are  being  implemented.  A 
new  action  plan  for  information  society  services  for  2018-2020  needs  to  be  approved. 
Revision  of  the  national  broadband  plan  is  scheduled  to  be  completed  by  the  end  of  2019. 
Authorities took part in the preparations of the Regional Roaming Agreement and signed the 
agreement  in  April  2019.  The  Law  on  cyber  security  was  adopted  in  February  2017  and  is 
partly  aligned  with  the  Directive  on  security  of  network  and  information  systems.  The 
Decision  of  Council  of  Ministers  “On  approval  of  the  list  of  critical  information 
infrastructures” was  approved in 2018 together with the necessary secondary legislation. As 
part  of  the  European  Commission’s  mapping  of  ‘digital  innovation  hubs’,  out  of  3  eligible 
hubs  that  were  registered,  2  are  still  operational  while  1  has  been  deactivated  due  to 
institutional restructuring. The national cybersecurity strategy still needs to be adopted.  

In  order  to  monitor  progress  made  by  Albania  towards  the  compliance  with  the  European 
Union rules for electronic communications and information society services and convergence 

65 

 
 
with  the  internal  market,  as  well  as  the  alignment  with  the  Digital  Agenda  for  the  Western 
Balkans, the country needs to improve the collection of statistical data on digital performance 
and digital competitiveness. 

In  the  field  of  audio-visual  policy,  the  digital  switchover  continues  to  be  postponed  with  a 
new  deadline  set  by  Audio-visual  Media  Authority  (AMA)  of  September  2019.  The 
infrastructure  to  access  digital  broadcasting  is  mostly  in  place  already.  However,  the  AMA 
has  postponed  the  deadline  for  the  digital  switchover  in  the  major  districts  of  Tirana  and 
Durres due to the scarcity of DVB-T2 digital decoders in the market and the associated public 
discontent.  These  events  indicated  shortcomings  in  the  AMA's  management  of  the  process 
and lack of public awareness about the digital switchover. The so-called digital dividend (high 
quality radio spectrum that was formerly used by analogue broadcasters) DD 1 is now freed 
from analogue broadcasters. However, digital broadcasters still occupy the frequency. AMA 
must ensure that  the digital  dividend is de facto  freed from other uses. This  will enable the 
government  to  put  on  sale  the  freed  frequencies  to  broadband  services  and  thus  generate 
income.  During  the  reporting  period,  the  AMA’s  financial  and  human  capacities  were 
reinforced.   

5.11.   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. 

Albania  has  some  level  of  preparation  in  agriculture  and  rural  development.  During  the 
reporting period, there was good progress on establishing the structures for the Instrument for 
Pre-accession  Assistance  for  Rural  Development  programme  (IPARD  II).  As  a  result,  the 
Commission  has  fully  entrusted  these  structures  with  budget  implementation  tasks  for  three 
measures in October 2018. There was good progress in reforming the advisory system.  

In the coming year, the Albanian authorities should in particular:  

  develop  the  Integrated  Administration  and  Control  System  (IACS),  including  the 
improvement  of  farm  and  animal  registers,  and  adopt  an  implementation  plan  for  Farm 
Accountancy  Data  Network  (FADN)  registers,  with  the  aim  of  providing  consistent, 
systematic and validated data;  

  ensure  administrative  capacity  required  for  the  entrustment  of  the  remaining  measures 

under IPARD II programme and full absorption of IPARD II programme funding; 

  complete the legal  framework for organic products  and protected designations  of origin, 
geographical  indications  and  traditional  specialities  guaranteed,  as  well  as  on  vineyards 
and wine, and ensure the institutional and administrative capacity for its implementation. 

As regards horizontal issues, the Agricultural and Rural Development Agency (ARDA) is the 
structure  implementing  the  national  support  schemes  in  agriculture  and  rural  development, 
also  entrusted  with  budget  implementation  tasks  under  the  IPARD  II  programme  (2016-
2020).  Continuous  building  of  capacity  of  national  authorities,  including  ARDA,  will  be 
required  to  receive  entrustment  for  implementation  of  new  measures  under  the  IPARD 
programme.  Strong  cooperation  among  responsible  national  authorities  should  be  ensured. 
Preparing  the  entrustment  for  implementation  of  the  measure  on  Technical  Assistance  is 
overdue and should be prioritised as it can provide significant benefits to the authorities for 
the implementation of IPARD II programme.   

66 

 
 
There  has  been  no  progress  related  to  the  building  of  a  Land  Parcel  Identification  System 
(LPIS). Given progress made in the restitution of land, the Albanian authorities should start 
the  process  as  soon  as  possible.  The  Integrated  Administration  and  Control  System  (IACS) 
has yet to be fully implemented, but certain elements of it – such as a farmer register and an 
animal register – have been developed. There is no Farm Accountancy Data Network (FADN) 
in place and preparatory work on setting it up has not started. The Albanian authorities should 
start preparations, e.g. to adopt an implementation plan with a concrete timeline.  

Overall,  direct  payments  in  2018  increased  in  comparison  to  2017.  The  existing  direct 
payments  are  coupled  to  production  and  not  linked  to  cross-compliance  rules;  however,  the 
majority  of  support  is  linked  to  investments.  The  farm  advisory  service  at  regional  level  is 
currently  reorganised  in  four  main  regions.  Five  technology  transfer  centres,  specialised  in 
different agricultural products will remain under the authority of the Ministry of Agriculture 
and Rural Development. The reform of the advisory system should be completed, based on a 
clear strategy. 

Regarding  sector-specific  common  market  organisation  schemes,  market  measures, 
production  quotas  or  export  refunds,  in  2018  the  country  started  the  revision  of  its  laws  on 
vineyards and wines.  

On rural development, the amendments to the Inter-sectorial Strategy for the Agriculture and 
Rural  Development  known  as  "100  villages  programme"  provides  support  to  agro-tourism 
businesses. Significant progress has been recorded on IPARD II programme with full budget 
implementation  entrustment  for  three  measures  in  October  2018.  The  call  related  to  the 
measures (investments in agricultural holdings, processing, and diversification of agricultural 
activities) was launched at the end of November 2018 and finished on 30 January 2019. 188, 
65, and 64 applications have been received, respectively. One of the principal objectives for 
the national authorities will be to avoid de-commitment of IPARD II programme funding at 
the end of 2019. 

As regards quality policy, the law on quality schemes for agricultural products and foodstuffs 
was adopted in February 2019. It  establishes quality schemes and responsible bodies for the 
recognition  and  protection  of  denominations  of  origin,  geographical  indications  and 
traditional specialities guaranteed for agricultural products and foodstuffs.  

On  organic  farming,  alignment  with  the  EU  acquis  remains  low.  The  Commission  for 
Organic Production (COP) is responsible for approving and supervising the control bodies for 
the  certification  of  organic  products.  The  Sector  for  Policies  of  Agricultural  and  Livestock 
Production provides certification, is responsible for developing legislation, registering organic 
operators  and  operating  the  database  containing  information  on  organic  production.  During 
2018,  support  to  organic  farming  has  included  certified  farms  and  farms  transitioning  to 
organic production. The number of beneficiaries and the amount of support under this scheme 
has increased.  

5.12.   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 
seeds, plant protection material, protection against harmful organisms and animal nutrition. 

Albania  has  some  level  of  preparation  in  this  area.  Albania  has  made  some  progress  in 
implementing  relevant  policies  in  the  food  safety  and  veterinary  sectors.  As  regards 
recommendations  from  the 2018 report, Albania  is  still expected to advance alignment with 
the latest EU acquis on official controls, animal health and plant health. Restructuring of the 
veterinary  sector  shall  also  be  completed,  along  with  building  the  necessary  technical  and 

67 

 
 
administrative capacity in the field of food safety and phytosanitary services to cope with the 
requirements of the acquis. 

In the coming year, Albania should in particular:  

  maintain the vaccination programmes until rabies is eradicated;  

  upgrade the system  of controls  of residues and  contaminants in  live animals  and animal 

products;  

  enforce food safety rules through improved official controls, including import conditions 

and controls. 

On general food safety, for the third consecutive year, the National  Food Authority carried 
out official controls under a risk-based plan approved at the beginning of 2017. The standard 
operating  procedures  needed  to  ensure  compliance  with  the  legislation  have  not  yet  been 
endorsed, including those on internal audits. No progress has been made on risk assessment. 
The official controls have been intensified and relevant measures have been applied including 
warnings,  fines,  seizure  and  disposal  of  non-consumable  food,  and  activity  suspension. 
However,  control  staff  is  not  adequately  trained  on  the  assessment  and  implementation  of 
Hazard  Analysis  and  Critical  Control  Points  (HACCP).  The  National  Food  Authority  has 
promptly  reacted  upon  notifications  from  the  Rapid  Alert  System  for  Food  and  Feed 
(RASFF)  taking  the  appropriate  measures  to  control  the  problem.  Conversely,  Albania 
dutifully provided notifications to the system when warranted. 

As  regards  veterinary  policy,  the  Ministry  of  Agriculture  and  Rural  Development  has 
approved relevant disease control strategies for anthrax, brucellosis, bovine tuberculosis and 
lumpy skin disease in 2018. Programmes for the monitoring of brucellosis and tuberculosis in 
cattle have been implemented in herds having more than 10 heads.  Vaccination against rabies 
and  anthrax  has  been  carried  out  satisfactorily,  while  vaccination  for  brucellosis  in  small 
ruminants  has  faced  reluctance  from  farmers  to  pay  for  the  identification  of  animals.  The 
vaccination programme for lumpy skin disease is ongoing and no new case was reported. The 
information on animal identification and registration system has been improved with regard to 
cattle but the system on small ruminants remains inaccurate.  

The  reporting  of  slaughtered  animals  during  2018  has  improved  compared  to  2017  but  the 
number of reported animals remains much lower than the real amount.  

The government has started the re-organisation of the regional veterinary service in four main 
regions. The reform of veterinary service is not yet complete, with tasks and responsibilities 
not established on a clear chain of command and line of communication. The service remains 
understaffed, fragmented and unable to cover other issues related to veterinary policy, animal 
waste  management,  farm  biosecurity  or  fishery  products.  Currently,  there  is  no  distinct 
veterinary  service,  but  veterinary  staff  consisting  of  3  people  (out  of  7  planned  in  the 
organigram) divided in two sectors under the Directorate of Deregulations, Permits, Licences 
and  Monitoring.  Programming  related  to  veterinary  services  is  covered  by  the  sector  of 
programmes  on  food  safety  and  veterinary  under  the  Directorate  of  Programming  in 
Agriculture, Rural Development and Food Safety  

With  regard  to  the  placing  on  the  market  of  food,  feed  and  animal  by-products,  a 
regulation  regarding  the  labelling  of  food  and  information  to  consumer  has  been  approved. 
The annual programmes for monitoring residues of undesired substances covering veterinary 
medicines, bio-toxins and heavy metals have been updated and adjusted in line with technical 
and financial resources. The planning of the monitoring for pesticide residues in food released 

68 

 
 
on the market is not yet systematic. Deficiencies in the controls of residues and contaminants 
in live animals and animal products were noted. 

Concerning food safety rules, the preparation of secondary legislation has continued on the 
exemption of small food operators from  applying HACCP, sampling and analysis of certain 
contaminants in food, implementation rules on planning of official controls, or monitoring of 
raw milk.    

Positive changes made during 2018 on microbiological monitoring of raw milk have further 
improved. A larger number of samples are now taken directly at the farm.  

Besides general rules included in the Food Law, no progress has been made on preparing the 
required legislation on specific rules for feed. 

On phytosanitary policy, following the 2016 Law on Plant Protection, pieces of secondary 
legislation  regarding  registration,  procedures  and  criteria  for  assessing  plant  protection 
products and rules on trading, transport, keeping and storage of plant protection products have 
been approved, along with a number of Ministerial orders related to active substances in plant 
protection products. 

There was no progress on preparing legislation on  genetically modified organisms, and no 
structure has been appointed for this role. 

5.13.   Chapter 13: Fisheries 

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

Albania  is  still  at  an  early  stage  of  preparation.  Albania  made  some  progress  towards 
updating  the  vessel  register  and  landing  statistics.  Albania  has  yet  to  implement  part  of  the 
2018 report’s recommendations including to ensure efficient and effective implementation of 
the  fishery  sector  strategy,  as  well  as  to  improve  inspection  and  control  capacity  to  fight 
illegal fishing.  

In the coming year, Albania should in particular:  

  take  steps  to  ensure  the  appropriate  management  of  fisheries  resources;  in  particular, 
pursue  further  implementation  of  the  recommendations  and  action  plans  of  the  General 
Fisheries  Commission  for  the  Mediterranean  (GFCM),  notably  on  the  emergency 
measures  for  small  pelagic  stocks  in  the  Adriatic  Sea,  as  well  as  the  Regional  Plan  of 
Action for small-scale fisheries; 

  ensure  reliable  data  collection  and  landing  statistics,  including  from  small  fisheries,  to 

better adjust the fishing fleet’s capacity to the available fishing resources;  

  reactivate  the  vessel  monitoring  system  (VMS)  and  strengthen  inspection  and  control  to 

deter illegal, unreported and unregulated fishing. 

Regarding  the  resource  and  fleet  management,  the  vessel  register  is  regularly  updated. 
Pursuant to the regulatory framework regarding the defining of management measures for the 
sustainable exploitation of marine fishery resources, an ordinance on the harvesting of bivalve 
molluscs was approved in June 2018.  

69 

 
 
Inspection  and  control  capacity  has  not  improved.  The  Department  for  Fisheries  Services 
and  Aquaculture  lacks  sufficient  and  qualified  staff  to  ensure  a  24/7  service  to  fight  illegal 
fishing in marine waters and inland waters.  

Fisheries statistics for vessels over 12 m  is collected from  logbooks delivered to  inspectors. 
Albania has not recruited the monitors and observers foreseen by the law. However, by 2019, 
assisted  by  the  AdriaMed  Regional  Project  (Scientific  Cooperation  to  Support  Responsible 
Fisheries in the Adriatic Sea) of the Food and Agriculture Organisation of the United Nations 
(FAO) and the General Fisheries Commission for Mediterranean (GFCM), the fishery service 
will start collecting data on discards giving also a help in the protection of vulnerable species.   

The  fisheries  service  has  not  been  reorganised  in  line  with  the  recommendations  of  the 
Albanian  government’s  sector  strategy  of  2016.  Since  March  2017,  the  vessel  monitoring 
system (VMS) has not been functioning making it difficult for the fishery inspection service 
to detect violations. Albania still needs to update and upgrade the server and install the new 
Mobile  Transceiver  Unit  (MTU).  Consequently,  inspections  and  controls  were  mostly  been 
applied to small fisheries operating in coastal or inland waters.  

Following  approval  of  the  Law  on  Aquaculture  in  2016,  the  licensing  of  new  aquaculture 
farms  will  be  allowed  during  2019  when  the  plan  of  allocated  zones  for  aquaculture  is 
prepared and approved. A register of fish farms is updated regularly. 

Data  collection  and  scientific  advice  on  managing  fish  stocks  is  still  supported  by  the 
AdriaMed Project. Legislations on the collection, management and use of data in the fisheries 
sector and support for scientific advice regarding the common fisheries policy still needs to be 
adopted. 

Albania  needs  to  align  its  structural  actions,  market  policy  and  any  state  aid  measures 
within the scope of this chapter with the relevant acquis. 

As  regards  international  agreements,  Albania,  as  a  contracting  party,  consistently 
participated  in  the  activities  of  the  General  Fisheries  Commission  for  the  Mediterranean 
(GFCM) and is implementing its recommendations, including on small pelagic stocks in the 
Adriatic  Sea.  In  addition,  Albania  fulfilled  the  requirements  in  the  recommendations  of  the 
International Commission for the Conservation of Atlantic Tunas. 

On  fisheries  governance,  Albania  signed  the  Ministerial  Declaration  regarding  the  Regional 
Plan  of  Action  for  Small-Scale  Fisheries  in  the  Mediterranean  and  the  Black  Sea  on  26 
September  2018.  It  is  a  signatory  party  of  the  Ministerial  Declaration  MedFish4Ever, 
implementing the actions agreed therein. 

5.14.   Chapter 14: Transport  

The EU has common rules for technical and safety standards, security, social standards, State 
aid  and  market  liberalisation  in  road  transport,  railways,  inland  waterways,  combined 
transport, aviation and maritime transport.  

Albania has some level of preparation in the area of transport policy, although only limited 
progress was achieved in the past year. The recommendations of last year have been partially 
addressed.  Efforts  to  comply  with  the  requirements  under  the  first  transitional  phase  of  the 
European Common Aviation Area Agreement remain to be made. 

In the coming year, Albania should: 

  adopt and implement the revised national transport plan (ANTP3) and start developing a 

national strategy for intelligent transport systems; 

70 

 
 
  adopt legislation to implement the railway sector reform. 

On  the  general  transport  acquis,  the  national  transport  strategy  and  action  plan  for  2016-
2020  for  all  transport  modes  was  adopted  in  November  2016.  The  strategy  includes  a 
sustainable transport plan, which aims to ensure a sustainable transport network and improve 
energy  efficiency.  In  October  2017,  an  inter-institutional  working  group  was  set  up  for 
monitoring the implementation  of the strategy.  The first  monitoring report  was presented to 
the  public  in  June  2018.  The  second  review  of  the  national  transport  plan  (ANTP3)  is 
expected  to  be  adopted  during  the  second  quarter  of  2019.  Albania  needs  to  make  further 
efforts  to  align  its  transport  policy  with  the  public-service  obligations  and  the  acquis  on 
public-service contracts. Albania signed the Transport Community Treaty in July 2017 at the 
Western Balkans 6 Summit in Trieste and ratified it in February 2018. 

Administrative capacity throughout the transport sector needs to be strengthened, particularly 
in  rail  transport.  The  new  Railway  Code  was  adopted  in  December  2016  and  entered  into 
force  in  January  2018.  Independent  bodies  to  investigate  railway  accidents  and  waterborne 
accidents have not yet been set up. Funding for maintaining road and railway infrastructure is 
insufficient, resulting in its continued deterioration. Further efforts are needed to support the 
rail maintenance plans for 2018-2022. 

Albania has made steady progress in aligning its national legislation on road transport with 
the  acquis.  The  country’s  legislation  is  aligned  with  the  acquis  on  transport  of  dangerous 
goods,  licensing  for  road  hauliers  and  access  to  the  road  transport  market.  The  General 
Directorate  for  Transport  Services,  tasked  with  implementing  the  Law  on  dangerous  goods, 
has  yet  to  adopt  and  apply  rules  and  guidelines  on  training  and  sanctions.  It  has  not  yet 
strengthened  its  inspection  capacity.  Greater  efforts  are  also  needed  to  align  Albania’s 
legislation  on  commercial-vehicle  inspections,  traffic-management  systems,  and  road  safety 
(including  road-safety  education  and  road-safety  enforcement).  Albania  must  continue  its 
efforts to align with the transport safety acquis and develop its enforcement capacity. In 2017, 
Albania  partially  aligned  its  legislation  on  the  qualification  of  road  transport  operators  with 
the EU’s acquis. After the adoption of guidelines and certification for inspectors, road safety 
inspections  (RSI)  and  road  safety  audits  (RSA)  are  now  obligatory.  Pilot  road-safety 
inspections and roads safety audits are now being implemented along the ‘core’ road network, 
and  they  should  be  extended  to  the  entire  network.  Implementation  of  the  legislation  on 
roadside checks of commercial vehicles is at an initial phase. Albania also needs to improve 
the  existing  national  system  for  continuous  road-crash  data  collection,  in  line  with 
recommendations given by technical assistance (Connecta TA). The legislation on intelligent 
transport systems (ITS) is partially aligned with the EU acquis. Albania should follow-up on 
the recommendations of the regional study of November 2018 on a ‘Strategic Framework’ for 
implementation  of  ITS  in  TEN-T  networks  in  WB6  and  continue  with  the  preparation, 
adoption and implementation of the national strategy for ITS.  

The  new  Railway  Code  aims  to  regulate  rail  transport  by  separating  train  operations  from 
infrastructure management, in line with the EU acquis. It only partially transposes the recast 
Directive  on  a  single  European  railway  area  and  EU  safety  and  interoperability  rules.  As  a 
result,  the  unbundling  of  train  operations  from  infrastructure  management  has  not  yet  been 
achieved.  Implementing  legislation  is  being  prepared  for  the  establishment  of  relevant 
structures and  agencies,  in  particular the Railway Regulatory  Authority.  There  are 2 private 
railway  operators  licensed  for  freight  transport,  but  only  1  is  operating.  Further  efforts  are 
needed to draw up the strategic framework for implementing the ITS on the core rail network. 

71 

 
 
On maritime transport, further efforts are needed to follow up on the country’s membership 
application  to  the  Paris  Memorandum  of  Understanding  on  Port  State  Control.  Efforts  to 
improve  flag-state  control  of  Albanian  flagged  vessels  and  port  state  control  must  be 
strengthened  to  reduce  the  detention  rate  of  vessels  under  the  Albanian  flag.  Further  efforts 
are  also  needed  to  draw  up  a  strategic  framework  to  implement  ITS  on  the  core  maritime 
network.  Legislation  on  EU  vessel-traffic  monitoring  and  information  systems  has  not  been 
aligned yet.  

There were no new developments in inland waterway transport. This mode of transport is 
limited to two lakes shared with neighbouring countries and regulated by bilateral agreements.  

On aviation, Albania should be adequately prepared for the assessment visit requested under 
the  European  Common  Aviation  Area  Agreement.  This  agreement,  ensures  proper 
transposition and implementation of the relevant EU acquis, notably in the areas of aviation 
safety,  security  and  economic  regulation.  On  air-traffic  management,  Albania  has  not  yet 
complied  with  the  ‘single  European  Sky’  requirements  for  the  first  transitional  phase  under 
the ‘European Common Aviation sky’ Area Agreement, as the functional use of airspace has 
not  been  implemented  yet.  Albania  should  also  focus  its  efforts  on  the  second  transitional 
phase. 

Even  though  the  national  transport  strategy  includes  some  priority  actions  for  the 
development  of  combined  transport,  there  is  still  no  legislation  regulating  combined 
transport. Albania should increase efforts to implement EU passenger rights legislation in all 
modes of transport. 

5.15.   Chapter 15: Energy 

EU  energy  policy  covers  energy  supply,  infrastructure,  the  internal  energy  market, 
consumers,  renewable  energy,  energy  efficiency,  nuclear  energy  and  nuclear  safety  and 
radiation protection. 

Albania is moderately prepared in this area. There was some progress in the gas sector and 
on  interconnection  lines.  The  new  national  energy  strategy  2018-2030  has  been  adopted. 
However,  the  country  has  delayed  electricity  market  reforms  and  should  accelerate 
implementation  of  the  connectivity  reform  measures,  especially  by  removing  legal  and 
contractual obstacles to the integration of energy markets.  

In the coming year, Albania should in particular: 

  diversify electricity production away from hydropower and promote alternative sources of 
renewable  energy  while  complying  with  environmental  standards,  and  establish  an 
organised day-ahead electricity market;   

  finalise  the  unbundling  of  energy  companies  and  abolish  legal  obstacles  to  the  right  of 

customers to change their electricity supplier;  

  fully  align  its  Energy  Efficiency  Law  with  the  acquis,  set  up  an  energy  efficiency  fund 
and  draft  and  adopt  secondary  legislation  implementing  the  Energy  Performance  of 
Buildings Directive. 

On  security  of  supply,  Albania  is  at  a  moderate  stage  of  preparation.  Albania’s  oil-stock 
legislation  is  not  in  line  with  the  acquis.  There  was  no  progress  in  creating  a  central 
stockholding  body  for  oil.  There  is  an  inter-institutional  working  group  for  analysing  and 
developing a plan for re-designing the emergency stockholding system. This working  group 
has been working for several  years on a model for an emergency oil-stock reserve and on a 
draft law on the minimum  stocks of crude oil required for security of supply.  Albania must 

72 

 
 
complete the alignment with the acquis on minimum oil stocks of crude oil and/or petroleum 
products. It must also amend its emergency oil-stock model. 

Albania’s electricity system has been interconnected with the neighbouring systems of Greece 
and Montenegro since 2014, when the European Network of Transmission System Operators 
(ENTSO-E) approved synchronous operation of the Albanian electricity transmission system 
with  the  continental  European  system.  Electricity  distribution  losses  in  the  Albanian  power 
grid in 2018 were high at 24.4%, although they were lower than in 2017 when they stood at 
27.5%.  

On the internal energy market, Albania has adopted legislation on gas and electricity in line 
with  the  EU’s  third  energy  package.  In  March  2017,  the  Albanian  Energy  Regulator  Entity 
(ERE) approved the certification of OST SA as the transmission system operator, following a 
positive opinion from the Energy Community Secretariat. The ENTSO-E assembly therefore 
admitted OST SA as a full member of the network. However, ERE also imposed conditions 
on  OST  SA  in  the  final  certification  decisions.  These  conditions  concerned  the  transfer  of 
investment  tasks  to  the  new  public  body  owner  of  the  TSO.  These  conditions  have  not  yet 
been met, and the deadline for meeting them has been postponed for three years. 

Some progress has been achieved in the legal unbundling of the distribution-system operator 
OSHEE  SA  from  its  supply  activity.  This  was  achieved  by  the  establishment  of  three  new 
companies,  but  effective  legal  unbundling  is  pending  due  to  delayed  transfer  of  human 
resources to the new companies. Functional unbundling has been postponed by ERE decision 
till  December  2020.  In  January  2018,  the  Energy  Community  Secretariat  initiated  an 
infringement  procedure  for  non-compliance  with  Albania’s  obligations  on  OSHEE’s 
unbundling. 

Electricity  prices  are  still  regulated  but  should  be  gradually  liberalised  once  legislation  is 
implemented.  The  freedom  for  all  customers  to  switch  suppliers  is  effectively  prevented  by 
amendments  to  the Power Sector  Law; implementation  is still lacking since most customers 
connected to 35kV are allowed to by supply of last resort, and all connected to lower voltage 
level  –  by  universal  service  supplier.  The  electricity  market  remains  closed  by  a  regulated 
contract  between  state-owned  generation  and  supply  companies.  This  contract  must  be 
terminated urgently. 

ERE’s legal framework is to a prevailing extent in line with the acquis except for a few but 
central missing competences, namely the right to impose measures to promote competition, to 
require  transmission  and  distribution  system  operators  to  change  their  terms  and  conditions 
and  to  raise  the  penalty  level  ERE  is  entitled  to  impose.  On  the  practical  side  ERE  should 
develop into a well-equipped and skilled independent institution that addresses shortcomings 
in the national energy markets more actively.  

The  Vlora  thermal  power  plant  (built  with  financing  from  the  European  Bank  for 
Reconstruction and Development of EUR 40 million, EIB financing of EUR 40 million, and 
World  Bank  financing  of  EUR  20.5  million)  has  never  been  put  into  operation  since  its 
completion  in  2011.  This  is  due  to  a  failure  in  the  plant’s  cooling  system  that  has  not  been 
repaired. The conversion of the Vlora power plant from oil use to gas use once it is connected 
to the trans-Adriatic pipeline is encouraged. This would stabilise the generation of electricity 
during droughts in the southern part of Albania. 

On  hydrocarbons,  Albania  has  not  aligned  its  legislation  with  the  Hydrocarbons  Licensing 
Directive, but there has been some progress with its secondary legislation. The Directive on 
safety  of  offshore  oil  and  gas  installations  has  not  been  transposed.  In  February  2018,  the 
Albanian  government  adopted  the  ‘gas  master  plan’,  which  assesses  investment  needs  until 

73 

 
 
2040.  In  May  2018,  Albgaz  SA,  the  combined  gas  operator  in  Albania,  was  admitted  as  an 
observer at the European Network of Transmission System Operators for Gas. Albgaz should 
continue  with  permanent  capacity  building  to  be  prepared  for  operation  of  future  gas 
infrastructure. 

The  main  interconnection  line,  the  trans-Adriatic  pipeline,  is  progressing  on  schedule.   (see 
Chapter 21 – Trans-European networks) 

The  regulatory  framework  for  renewable  energy  is  at  an  early  stage.  The  revised  national 
renewable-energy  action  plan  for  2018-2020  envisages  that  38%  of  gross  final  energy 
consumption will come from renewable energy sources, in line with the commitments made 
to  reach  38%  renewable  energy  target  in  2020.  With  the  adoption  of  the  Law  promoting 
renewable  energy  in  2017,  Albania  increased  its  compliance  with  the  acquis.  This  Law 
introduced  schemes  to  support  renewable-energy  producers  above  2  MW  (for  solar  power) 
and 3 MW (for wind power) through a competitive procedure. The procedure is based on the 
support scheme ‘contracts for difference‘ to be paid on top of the market price of electricity. 
The  Law  incorporates  a  net  metering  scheme  for  photovoltaic  (PV)  or  wind  energy  with  a 
capacity  of  up  to  500  kW.  However,  urgent  efforts  are  needed  to  increase  the  share  of 
renewable energy sources other than hydropower.  

Albania depends almost exclusively on hydropower for its electricity generation (98% of its 
electricity  generation  comes  from  hydropower),  making  it  vulnerable  to  unfavourable 
hydrological  conditions  in  the  summer.  In  addition,  electricity  from  hydropower  is  not 
sufficient to meet its needs. Albania is a net importer of electricity and ensuring the security 
of  its  power  supply  is  a  challenge.  Several  investments  in  renewable  energy  (local  and 
foreign)  have  been  made  through  concession  contracts  to  build  and  operate  hydroelectric 
power plants. However, around 20% of the more-than-500 concession contracts are located in 
protected areas, and some plants have had a significant impact on local biodiversity. Plans for 
future  plants  have  generated  debate  and  protests  about  the  need  to  address  ecological  and 
water rights considerations.  

Doubts have been expressed about the quality of strategic environmental assessments (SEAs) 
and  environmental  impact  assessments  (EIAs)  carried  out  on  energy  projects.  Investments 
into  hydropower  should  be  compliant  with  relevant  EU  environmental  acquis.  Hydropower 
plants  in  protected  areas  and  sensitive  locations  should  pass  all  necessary  legal  procedures 
(i.e. they should be subject to public consultations (Aarhus Convention), respect the national 
legislation, and be subject to properly conducted EIAs and SEAs). 

The main target of the energy efficiency action plans for 2017-2020 is a cumulative saving of 
6.8%  of  the  energy  used  in  Albania  by  2020.  The  Energy  Efficiency  Agency  was  set  up  in 
2016  to  implement  energy  efficiency  policies  and  measures,  but  it  is  not  yet  staffed  and 
operational. The agency reports to the minister responsible for energy. A working group has 
been set up within the Ministry of Energy and Infrastructure to prepare the establishment of 
the energy efficiency fund. However, full compliance with the Energy Community acquis has 
still  not  been  achieved  so  the  Energy  Community’s  Ministerial  Council  adopted  a  decision 
stating that Albania was in breach of its obligations. Albania still needs to start amending the 
Energy Efficiency Law to align with the Energy Efficiency Directive (EED). Albania finally 
submitted  the  first  annual  report  under  the  EED  in  March  2018  (after  a  nine-month  delay). 
The second annual report due in June 2018 was finally submitted in March 2019.  A law on 
energy performance in buildings entered into force in 2016.  Albania still needs to adopt the 
necessary legislation to achieve full compliance with the acquis in this area. 

There  has  been  moderate  progress  in  nuclear  energy,  nuclear  safety  and  radiation 
protection. Albania has no nuclear power plant on its territory, nor is it planning to build one. 

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There  is  a  National  Nuclear  Agency  whose  mission  is  to  put  in  place  a  system  to  calculate 
energy demand for the next 20-30 years. Albania has adopted some guidelines and orders on 
policy and strategic steps for safely managing radioactive waste. It has also ratified a number 
of  international  conventions.  Albania  is  not  a  member  of  the  European  Community  Urgent 
Radiological Information Exchange. It has partly aligned with the acquis on controlling radon 
and is preparing a national plan on the issue. The Radiation Protection Commission operates 
as  Albania’s  nuclear  regulatory  authority,  with  the  Radiation  Protection  Office  (with  10 
employees) as the executive body. 

5.16.   Chapter 16: Taxation 

EU rules on taxation cover value added tax and excise duties as well as aspects of corporate 
taxation.  They  also  deal  with  cooperation  between  tax  administrations,  including  the 
exchange of information to prevent tax evasion. 

Albania is moderately prepared in the area of taxation. Some progress was made through 
strengthening the General Directorate of Taxation (GDT) and the establishment of the fiscal 
cadastre  for  buildings.  Revenue  performance  in  2018  was  above  2017  levels  (+4.6%)  but 
below target (-1.9%), largely due to underperformance of VAT and excises.  

In the coming year, the country should in particular: 

  simplify the taxation system, encouraging enhanced tax compliance; 

  ensure that by end 2019 it joins the Inclusive Framework of OECD BEPS (base erosion 

and profit shifting);  

  address systematically the recurrence of delays in VAT refunds and avoid large backlogs.  

Regarding  indirect  taxation,  the  standard  value  added  tax  (VAT)  rate  is  20%.  However, 
there are an increasing number of exemptions and lower rates of 6% and 10%. 

Excise taxation is  partially aligned with  the EU  acquis. Marking of mineral  oils is  done for 
some categories. Tobacco excise duties are set to increase in annual steps, from EUR 48 per 
1,000  cigarettes  as  of  1  January  2019  to  EUR  52  from  1  January  2021.  Favourable  excise 
taxation of some groups of tobacco products of Albanian origin compared to imports persist, 
which is not in line with obligations of Albania under the SAA. Small producers of alcoholic 
beverages  enjoy  reduced  tax  rates.  For  personal  consumption,  amounts  up  to  100  litres  for 
spirits  and  up  to  200  litres  for  wine  are  tax  exempted.  The  excise  law  taxes  all  energy 
products listed in Directive 2003/96/EC.  

Regarding  direct  taxation,  financial  institutions  are  legally  required  to  calculate,  withhold, 
and declare income tax on income from savings. Albania does not provide deferral of taxation 
as provided for in the Merger Directive. Albania has committed to join the OECD Inclusive 
Framework on anti-Base Erosion and Profit Shifting by 2019. 

On  administrative  cooperation  and  mutual  assistance,  Albania  is  yet  to  sign  double 
taxation agreements with Denmark, Cyprus, Lithuania, Portugal, Slovakia and Finland. It has 
not  yet  established  a  central  liaison  office  to  automatically  exchange  financial  account 
information based on the OECD single Global Standard.  

Concerning  operational  capacity  and  computerisation,  the  tax  administration  has  1,569 
posts,  but  the  number  of  vacancies  remained  high  at  206  in  2018.  The  annual  training 
programme is needs-based and was approved by the Director-General of Taxation in January 
2019.  

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Albania  does  not  yet  have  the  technical  capacity  to  facilitate  the  efficient  exchange  of 
information,  nor  does  it  have  the  appropriate  infrastructure  to  apply  EU  IT  standards.  The 
electronic tax administration system continues to be operational since January 2015 but the IT 
department strategy must still adopt its plans to achieve interconnection and interoperability 
with EU systems. 

The legal basis for the fiscal cadastre was approved in 2018 and preparations for putting it in 
place started.  Delays in VAT refunds continue even though the bulk of the backlog concerns 
three  large  economic  operators.  As  of  January  2019  different  thresholds  to  categorise 
economic operations apply for income and VAT, resulting in  a more complicated system to 
administer and likely encouraging tax avoidance and evasion. 

5.17.   Chapter 17: Economic and monetary policy 

EU rules require the independence of central banks and prohibit them from 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, in complying with the rules on debt reduction and budget 
preparation set out in the organic budget law of 2016 and through the adoption of the medium 
term development Strategy of the Central Bank 

As  not  all  recommendations  from  the  2018  Report  were  implemented,  in  the  coming  year, 
Albania should take further measures to: 

  align  with  the  EU  acquis  the  legislation  on  the  Bank  of  Albania  (BoA’s)  independence 

and its accountability to the Parliament; 

  improve  the  government’s  policy  coordination  and  consultation  mechanism  with 
non-governmental stakeholders when formulating sector policies and economic reforms. 

In  the  area  of  monetary  policy,  the  primary  objective  of  the  central  bank,  as  set  out  in  the 
Law on the Bank of Albania is to achieve and maintain price stability. The BoA is financially 
independent  and  has  sufficient  instruments,  competence  and  administrative  capacity  to 
function  effectively  and  to  conduct  an  efficient  monetary  policy.  The  Supervisory  Board  of 
Bank  of  Albania  is  operational  after  the  replacement  of  the  six  members,  whose  mandates 
expired in December 2018. Monetary policy is conducted with a standard set of instruments 
and  within  a  free-floating  exchange  rate  regime.  No  progress  was  made  on  furthering  the 
alignment of the 1997  Law on the Bank of Albania with  the  acquis  as  regards the personal 
independence of the supervisory council members, especially of the governor, and the BoA’s 
accountability to the Parliament. 

In  the  area  of  economic  policy,  further  alignment  with  the  Directive  on  Requirements  for 
Budgetary  Frameworks  is  needed.  Albania  has  complied  with  fiscals  since  its  adoption  in 
2016. Excessive Deficit Procedure notification tables are sent regularly to Eurostat on a best-
effort  basis,  but  they  are  not  complete  and  not  fully  in  line  with  the  European  System  of 
National and Regional Accounts (ESA 2010) requirements. A government instruction on the 
procedures  for  preparation,  presentation  and  reporting  of  annual  financial  statements  in 
government units was adopted in March 2018, aiming at improving public sector accounting. 
With  the  reform  of  the  public  sector  accounting  system,  measures  have  been  identified  to 
move to using the international public sector accounting standards.   

The  Economic  Reform  Programme  2019-2021  was  submitted  on  time.  Albania  needs  to 
strengthen  its  administrative  capacities,  including  adequate  human  resources,  for  designing 

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and coordinating the economic policy and for monitoring the implementation  and impact  of 
structural reforms and regulations in consultation with local stakeholders  

5.18.   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 is moderately prepared on statistics. Some progress was made in many statistical 
areas  and  by  adopting  the  amended  Law  on  Official  Statistics.  The  role  of  the  National 
Statistical  System (INSTAT) was strengthened, however methods of data  collection need to 
be modernised and statistical production processes should be improved. 

In the coming year, Albania should in particular: 

  reinforce INSTAT’s resources by filling the vacant posts; 

  implement  the  amended  Law  on  Official  Statistics  and  expand  the  scope  of  official 

statistics in line with the EU acquis; 

  improve communication with users and other stakeholders. 

Regarding  statistical  infrastructure,  the  legal  framework  is  in  line  with  the  European 
Statistics  Code  of  Practice  and  classifications  are  in  line  with  EU  standards.  The  amended 
Law on Official Statistics came into force in May 2018, changing the legal status of INSTAT 
to that of an independent institution reporting directly to Parliament. It strengthened the role 
and functions of the national statistical system, improved coordination and changed the role 
and composition of the Statistical Council. However, the scope of official statistics should be 
redefined  to  include  all  European  statistics  and  to  improve  access  to  the  additional  official 
statistics. The five-year programme on the official statistics for 2017-2021 should be adapted 
according  to  the  new  statistical  law.  19  employees  have  been  recruited  in  2018,  while  22 
vacancies are yet to be filled. INSTAT’s budget and staffing continued to be insufficient for 
fully implementing the EU acquis in the field of statistics. 

Additional  memoranda  of  understanding  were  signed  during  2018  with  data  custodians  on 
access to statistics. According to the new law on official statistics, producers of statistics have 
a stronger mandate to access and use administrative data for statistical production purposes. 
This law prevails over any other provision that might be an obstacle for administrative data 
transmission for statistical purposes or to ensure statistical confidentiality. However, there is 
still a need for modernising methods of data  collection and improving  statistical  production 
processes, setting targets for timeliness and measuring the response burden. 

On  macroeconomic  statistics,  annual  and  quarterly  GDP  data  is  produced  based  on  the 
production  and  expenditure  approach,  in  current  and  constant  prices.  Supply  and  use  tables 
and derived input-output tables are harmonised with the definitions of the European System of 
National and Regional Accounts (ESA 2010). Excessive deficit procedure notification tables 
are  sent  regularly  to  Eurostat  on  a  best-effort  basis,  but  they  are  not  complete.  Further 
improvements are needed in Government Finance Statistics.  INSTAT produces and publishes 
the Harmonised Index of Consumer Prices. 

As  regards  structural  business  statistics,  data  collection  and  production  have  further 
improved.  In  2018,  INSTAT  started  transmitting  to  EUROSTAT  short-term  statistics 
indicators. Starting from the first quarter 2018, INSTAT regularly conducts quarterly surveys 
of  Service  Producer  Price  Index.  INSTAT  has  good  relationships  with  respondents,  and 
achieves quite high response rates in both business and household surveys.  

77 

 
 
including  producers, 

including  major  stakeholders, 

On  social  statistics  INSTAT  should  further  improve  communication  and  consultation  with 
users, 
the  media,  representative 
organisations, and the research community. Such groups would provide feedback on products 
and services, informing users about developments, plans, and information needs. The Labour 
Force Survey is conducted regularly and micro-data is provided to Eurostat. INSTAT does not 
produce  Job  Vacancy  Statistics  yet.  Labour  cost  statistics  are  calculated  on  the  basis  of  a 
Labour  Cost  Survey,  which  is  conducted  every  four  years  (last  in  2017).  The  data  and  the 
quality report are transmitted in timely manner to Eurostat. INSTAT conducted the full third 
wave of survey of Income and Living Conditions (SILC) in the period between April and July 
2018 and data is still not finalised.  

Statistics on external  migration and asylum  are  partially  aligned with  EU legislation. Crime 
statistics  are  published  quarterly.  INSTAT  has  started  the  preparatory  work  regarding  the 
2020 Population and Housing Census.  

Agricultural statistics are partially aligned with the EU acquis. It is essential to improve the 
quality of the data of the administrative registers, such as the farm register, individual register 
of animals  and the animal  holding registers, among others.   The Farm Structure Survey has 
not  been  finalised.  The  next  census  of  agriculture  holdings  is  planned  for  2022.  INSTAT 
should  start  the  preparation  of  the  strategic  document  for  that  census,  including  a 
corresponding action plan and the budget.  

Environmental and energy statistics are in line with the EU acquis to a very limited extent. 
INSTAT  produces  the  Balance  of  Electricity  twice  per  year  and  publishes  the  General 
Balance of Energy produced by the National Agency of Natural Resources. Short-term energy 
statistics are still produced as volume data for electricity only. Detailed data on urban waste 
statistics  are  in  line  with  the  EU  acquis.  Air  emission  accounts  are  partially  in  compliance 
with the EU requirements. Environmental-related taxes by economic activity were published 
on INSTAT’s website in July 2018 for the years 2010-2016, while the data for the year 2017 
are expected to be published in July 2019. 

5.19.   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 non-discrimination. They also promote social dialogue at European level. 

Albania  has  some  level  of  preparation  on  social  policy  and  employment.  Some  progress 
was  made  on  increasing  labour  market  participation  and  on  improving  the  quality  and 
effectiveness of labour market institutions and services. Albania has continued to restructure 
its employment governance system, as stipulated in the new law on vocational education and 
training. 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: 

  adopt  necessary  secondary  legislation  and  restructure  the  employment  and  VET 

governance, upon the adoption  of the employment promotion law;  

  intensify  efforts  to  implement  the  2015-2020  social  protection  strategy,  with  a  special 
focus on vulnerable groups, strengthening the capacity and resource of local government 
to assess social care needs in their territory; 

  establish clear representativeness criteria for membership in the National Labour Council 

and adopt them by law. 

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On  labour  law,  the  amended  Labour  Code  is  being  implemented.  Monitoring  of  the 
implementation  of  the  Labour  Code  amendments  still  requires    strengthening  of  data 
collection  and  better  instruments  for  processing  disaggregated  data.  Labour  inspectorate 
capacity and performance need to further be strengthened and the labour inspectorates should 
develop effective training of inspectors. Child labour remains a concern, with more effective 
measures  needed  to  prevent  it.  There  is  also  a  need  to  strengthen  the  system  of  monitoring 
child labour. 

Regarding health and safety at work, the 2016-2020 occupational, safety and health policy 
document  and  its  action  plan  are  under  implementation.  Between  2013  and  2017,  Albania 
adopted laws transposing 19 EU directives linked to the Framework Directive on Health and 
Safety  at  Work.  In  2018,  Albania  concentrated  on  implementation,  but  low  financial  and 
human capacities are  a limitation  on the way towards an effective implementation  of health 
and safety at work legislation. Reported accidents at work increased from 107 in 2016-2017 to 
222 in  2017-2018, and fatalities at  work increased from  13 to  33 in  the same timeframe. A 
total  of  265  workers  suffered  accidents  in  2017-2018,  of  which  153  in  2018.  Most  of  the 
accidents (around 60%) occurred in the mining (23%), manufacturing (23%) and construction 
(15%) sectors. Statistical data on health and safety remains to be improved. 

Social dialogue remains weak in both the private and public sector. Regarding tripartite social 
dialogue, the mandate of the National Labour Council was renewed in April 2018. However, 
clear  representativeness  criteria  are  still  under  discussion  and  have  not  yet  been  set  in  law. 
Significant efforts are still needed to transform the National Labour Council into an effective 
social dialogue forum, aiming at improving collective bargaining. Intensification of bipartite 
social dialogue, in particular at local and company level is also needed across the country. At 
regional  level,  the  decision  on  a  tripartite  Regional  Consultative  Council,  consisting  of 
representatives  of  employers’  organizations,  trade  unions  and  representatives  of  state 
structures,  expected  to  be  established  by  the  second  quarter  of  2018,  is  still  to  be  adopted. 
Also, the amicable labour disputes resolution system needs further consolidation.  

On  employment  policy,  the  administrative  reform  and  the  reduction  in  human  capacities 
continues  to  affect  the  design,  implementation  and  monitoring  of  employment  policies  and 
measures. While there has been improvement in the labour market, there are issues as regards 
alignment  of  education  (including  adult  education)  to  the  needs  of  the  labour  market.  The 
employment  and  labour  market  participation  rates  continued  to  grow  in  2018  and  are  high 
compared  to  the  region.  These  figures  however  hide  a  high  underemployment.  At  the 
beginning of 2018, job creation has been identified as 1 of 5 major cross-sectoral priorities of 
the  current  government.  A  mid-term  review  of  the  national  employment  and  skills  strategy 
(NESS) was completed. The revised action plan of the strategy will cover the period between 
2019  and  2022,  and  has  still  to  be  adopted  during  the  first  semester  2019.  The  secondary 
legislation implementing the Vocational Education and Training (VET) Law has been drafted 
but is yet to be adopted. No progress was made in extending employment and VET services to 
rural  areas.  The revised  Albanian Qualification  Framework  Law was  adopted in  May  2018, 
but  significant  efforts  should  be  made  to  operationalise  it.  The  Law  on  employment 
promotion was adopted in March 2019. The National Agency for Employment and Skills is 
expected to be set up a by June 2019 and secondary legislation still needs to be adopted. Little 
progress  was  made  in  linking  the  reform  of  social  assistance  to  the  employment  and  skills 
development programmes available. (Ex)-beneficiaries of economic assistance received more 
activation  support  during  2018  through  job  mediation  and  attendance  in  vocational  training 
courses.  Attendance  in  the  latter  was  newly  supported  through  a  specific  employment 
promotion programme approved in 2018. Activation support to this category is still low and 
not well tailored to the particular needs of the target group. 

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Public employment services were strengthened and the image and outreach of Labour Offices 
have improved with the restructuring of 13 additional labour offices throughout the country, 
during  2018.  Further  efforts  should  be  made  to  finalise  the  reorganisation  of  the  remaining 
employment offices.  

In 2018, there were 74 686 unemployed jobseekers (52.4% women) registered in employment 
offices  and 34,669 (51% women) found  a job  through labour offices (LOs). The number of 
vacancies  announced  in  LOs  reached  61  391  (over  30%  more  than  the  previous  year), 
showing an increased dynamism in the offices.  

The unemployment rate remains high, particularly among women,  young people, Roma and 
Egyptians, and people with disabilities. In 2018, the unemployment rate (15-64) fell to 12.8% 
(12.3% for women, LFS, INSTAT data 2018), 1.3 percentage points below the level for the 
same period in 2017. The official youth unemployment rate (15-29) is 23.1%. It decreased by 
2.8 percentage points as compared to 2017. Long-term unemployment remains a challenge to 
be  addressed  through  more  flexible  and  tailored  policy  interventions.  During  2018,  1  580 
undeclared  workers  have  were  identified  by  the  State  Labour  Inspectorate  (out  of  which 
29.6% females) and 855 urgent measures imposed. There were 12 297 inspections carried out 
in  2018  showing  that  26%  of  employees  are  declared  as  paid  at  the  minimum  wage.  The 
Institute of Statistics has sufficient resources to contribute to policies with comprehensive and 
reliable  data,  but  the  wage  gap  methodology  still  needs  to  be  aligned  with  Eurostat 
requirements.  Special  focus  should  be  placed  on  urban/rural  ratios  in  all  labour-related 
statistics.  

There were no developments on use of the European Social Fund. 

On social inclusion and protection, the national strategy on social protection for 2015-2020 
is  being  implemented.  Efforts  should  be  increased  up  to  ensure  implementation  and 
appropriate allocation of financial resources to support the already adopted Law on social care 
services, the Law on the rights and protection of the child, and the 2017-2020 national agenda 
for  children’s  rights.  In  2018,  Albania  adopted  the  decision  “on  the  functioning  of  social 
fund”.  This  decision  stipulates  that  sources  of  funding  for  the  social  care  services  must  be 
provided  from  the  state  budget,  municipal  budgets,  donations  and  other  sources.  Still  the 
social  fund  mechanism  remains  to  become  functional  at  local  and  central  level.  Social  care 
services  are  currently  undeveloped,  underinvested  and  lacking  in  many  areas.  Local 
government  units  are  expected  to  assess  needs  in  their  territory  and  to  prepare  social  care 
plans, but they lack capacities and resources to deliver on this task. In January 2018, the new 
economic  aid  scheme  began  being  implemented  all  over  the  country,  after  being  piloted  in 
three main regions: Tirana, Durres and Elbasan. There is a lack of analysis on whether one of 
the  objectives  of  the  reform,  i.e.  an  improved  targeting  of  those  most  in  need,  is  being 
achieved. The Ministry of Health and Social Protection should analyse this based on existing 
administrative  data  and  where  necessary  to  collect  additional  data.  Some  progress  has  been 
achieved  by  using  the  management  information  system  for  disabled  beneficiaries,  which  is 
still in the pilot phase. However, there is a need to increase the efforts in the creation of social 
and  reintegration  services  for  people  with  disabilities.  The  process  of  transitioning  from 
residential institutional care to community-based care for vulnerable groups is being piloted in 
Durres,  Shkoder  and  Saranda.  This  process  has  now  been  extended  to  all  nine  public 
residential  institutions for children under 18. Foster care and other forms of alternative care 
are  promoted  by  the  state  social  services.  However,  these  care  services  require  further 
financial support and the adequate allocation of human resources from the state.   

As  regards  the  cross-sectoral  document  on  social  inclusion  policy  for  2016-2020,  little 
progress  has  been  made  in  setting  up  the  necessary  structures  at  central  level  or  clarifying 

80 

 
 
arrangements  for  implementing  the  policy.  The  government  should  increase  its  efforts  to 
ensure there is a comprehensive plan for building the capacity of all line ministries and local 
governments to implement the actions outlined in the document. Poverty data produced by the 
EU  –  SILC  (statistics  on  income  and  living  conditions)  are  not  yet  published.  To  address 
many of Albania’s shortcomings identified by international bodies in the field of housing and 
forced  eviction,  the  Council  of  Ministers  approved  a  fully-fledged  Social  Housing  Law  in 
2018. However, there are financial gaps to ensure proper implementation of the law.  

On non-discrimination in employment and social policy, legislative amendments have been 
adopted on the employment  and  workplace  environment for  women, defining  and reversing 
the burden of proof in cases of sexual harassment. 

As regards equality between women and men in employment and social policy, according 
to  INSTAT data the gender  gap in  employment  stood at  14.3 percentage points  and did  not 
show  any  sign  of  improvement  over  the  recent  years.  The  2018  World  Economic  Forum’s 
gender gap index report showed Albania improved compared to its 2017 (rising from 38 to 34 
out  of  149  countries).  However,  the  country  does  not  have  enough  kindergarten  and  early 
childhood  education  and  care  facilities  to  enable  parents,  especially  women,  to  work.  The 
changes  to  the  Labour  Code  introduced  more  measures  to  support  work-life  balance  for 
working parents but there is no monitoring of the implementation of these changes. According 
to INSTAT the 2018 report, 42% of women in the labour force are employed in paid positions 
while 23.0% of them engage in unpaid work in the family business. For employed men, these 
figures are 37.0% and 12.0% respectively. 36% of men in the labour force are self-employed, 
compared  to  23.0%  of  women.  In  rural  areas,  in  2016  women  were  more  likely  to  be 
contributing  family  members  than  men.  In  the  third  quarter  of  2017,  agriculture  employed 
35% of employed males and 42% of employed females. Concerns remain over the proportion 
of  women  in  the  informal  labour  market,  especially  the  textile  and  shoe  industries,  without 
appropriate  labour  and  social  protection.  There  are  also  concerns  over  the  lack  of 
disaggregated data on the number of working women in the informal economy. 

5.20.   Chapter 20: Enterprise and industrial policy 

industrial  policy  strengthens  competitiveness, 

EU 
facilitates  structural  change  and 
encourages  a  business-friendly  environment  that  stimulates  small  and  medium-sized 
enterprises (SMEs). 

Albania  is  moderately  prepared  in  the  area  of  enterprise  and  industrial  policy.  Some 
progress  was  made  by  introducing  incentives  to  stimulate  investment  in  the  tourism  sector 
and implementing an innovation support program.  

In the coming year, Albania should in particular: 

  effectively implement  the triple-helix action plan; 

  accelerate the full alignment of its legislation with the Late Payment Directive; 

  address  the  main  challenges  to  the  business  environment,  notably  reducing  regulatory 

burden more vigorously. 

The  2014-2020  business  and  investment  development  strategy  sets  the  strategic  framework 
for Albania’s  enterprise and industrial policy. Albania continues implementing the South-
East  Europe  2020  regional  initiative.  The  business  and  investment  development  strategy 
covering business development, including SMEs and increased skills, developing innovation, 
promoting  sustainable  growth,  and  creating  the  conditions  for  attracting  foreign  investment, 
needs  to  be  revised  to  reflect  future  country  priorities  beyond  2020.  The  implementation  of 

81 

 
 
the  action  plan  based  on  a  ‘triple  helix’  model  that  incorporates  measures  requiring  the 
involvement  of  the  public  and  private  sectors  together  with  universities  is  behind  schedule. 
The  national  Strategy  on  Innovation  and  Technology  adopted  in  2017  still  needs  to  be 
implemented. A donor-funded innovation programme has started in February 2019, aiming to 
support innovation and start-ups with EUR 7.5 million budget. 

Albania follows the implementation of the Small Business Act. Despite some improvement in 
the  business  environment,  SMEs  continue to  identify  their  main  challenges  as:  the  informal 
economy  (notably  in  the  tourism  sector),  lack  of  transparency  in  public  procurement 
especially  related  to  Public  Private  Partnerships  (PPPs),  need  for  stable  state  institutions, 
unclear ownership of property titles, and issues regarding the enforcement of the rule of law. 
Concerning  the  combating  of  informal  economy,  measures  to  expand  the  taxpayer  bases 
implemented  in  2018  and  to  enforce  implementation,  contribute  to  creating  a  level-playing 
field  for  economic  operators.  Privatisation  of  State  assets  continued  during  2018,  partly 
through  privatisation  vouchers.  A  Law  on  the  Establishment  and  Operation  of  Economic 
Zones exists but no development can be reported regarding their establishment. A technology 
industrial  park,  not  subject  to  the  law,  is  under  development  since  July  2017  in  Rushbull, 
Durres. 

In  the  area  of  enterprise  and  industry  policy  instruments,  the  Albanian  Investment 
Development  Agency  offers  funding  instruments  to  stimulate  entrepreneurship  in  tourism, 
handicrafts and innovation and to support toll manufacturing under inward processing regime 
and  competitiveness.  However,  the  implementation  is  not  proceeding  successfully  or  is 
limited. Access to finance remains a serious challenge for businesses. Albanian legislation is 
partially  aligned  with  the  2011  Late  Payment  Directive  and  full  alignment  should  be 
accelerated. Albania has partly aligned its definition of SMEs with the EU Recommendation. 

Albania  participates  in  the  EU’s  COSME  programme  for  SMEs  and  the  Enterprise  Europe 
Network  through  a  consortium  led  by  the  Investment  Development  Agency.  The  second 
European Enterprise Network (EEN) project was completed by the end of 2018 and in 2019 
the same consortium started the third EEN project. 53 companies have registered their profiles 
in the European Enterprise Network database and only five partnership agreements have been 
signed.  Level  of  absorption  of  information  and  participation  under  COSME  financial 
instrument remains low and no contract has been signed yet.  

Regarding sector policies, a fiscal incentive package was adopted in 2018 for 4-5 star hotels 
and will remain in place in 2019. Incentives were introduced to the agro-processing industry. 
A strategic policy paper for non-food industry and a strategy on tourism and its action plan, 
remain  in  the  drafting  phase  and  are  expected  to  be  adopted  in  2019.  The  adoption  of  the 
Tourism Strategy faces delays. 

5.21.   Chapter 21: Trans-European networks 

transport, 
The  EU  promotes 
telecommunications  and  energy  to  strengthen  the  internal  market  and  contribute  to  growth 
and employment. 

trans-European  networks 

the  areas  of 

(TEN) 

in 

Albania  has  some  level  of  preparation  in  the  area  of  trans-European  networks.  Some 
progress  was  made in  developing transport and  energy networks. Some progress  was made 
on its gas interconnection with the implementation of the trans-Adriatic pipeline project. 

In the coming year, Albania should in particular: 

82 

 
 
  continue  development  of  the  core  transport  and  energy  networks  in  line  with:  (i)  the 
national strategies for transport and energy; (ii) the infrastructure investment prioritisation 
under the single project pipeline; and (iii) the connectivity agenda; 

  harmonise the legal framework with the EU acquis and the regulations on TEN-T (trans-
European  transport  networks)  and  TEN-E  (trans-European  energy  networks),  including 
transposition  of  Regulation  (EU)  347/2013  on  guidelines  for  trans-European  energy 
infrastructure; 

  implement  connectivity  reform  measures  and  strengthen  the  institutional framework  and 

administrative capacity to develop and monitor TENs. 

Albania  is  making  progress  in  setting  up  the  country’s  strategic  framework  for  transport 
networks.  Albania  intends  to  harmonise  its  legal  and  institutional  framework  with  the  EU 
TEN-T  Regulation  and  the  Transport  Community  Treaty,  which  it  signed  in  June  2017  and 
ratified  in  February  2018.  Albania  participates  actively  in  the  South-east  Europe  Transport 
Observatory (which was replaced by the Transport Community Treaty in January 2019) and 
Western Balkans 6 (WB6) processes, focusing on improving connectivity within the WB6 and 
with  the  EU.  The  national  transport  strategy  and  action  plan  for  2016-2020  envisages  an 
extension of the TEN-T Comprehensive and Core Networks to Albania and an alignment with 
TEN-T  guidelines  and  EU  standards  and  regulations.  There  was  progress  in  drafting  the 
second  review  of  the  Albanian  national  transport  plan  (ANTP3),  which  was  completed  in 
January 2019. It is expected to be adopted in the second quarter of 2019. 

Albania has made progress in repairing its road infrastructure in the core network. Albania is 
progressing with the preparation of road and rail infrastructure projects, especially along the 
Adriatic-Ionian corridor and corridor VIII. Upgrading of the railway from Durres to Tirana is 
planned to start by mid of 2019. Albania needs to ensure that its transport network projects are 
implemented in line with the TEN-T regulatory framework. Future infrastructure investments 
need to  be implemented in compliance with  EU standards on public procurement, state aid, 
and  EIAs.  Projects  should  be  channelled  through  a  single  project  pipeline,  confirming  the 
country’s strategic orientation towards TENs. Further efforts are needed on road safety. More 
serious  measures  should  be  taken  to  fix  ‘blackspots’  along  sections  of  roads  with  high 
accident  rates.  Adoption  of  the  multiannual  maintenance  plans  for  the  entire  core  network 
(rail and road) remains a challenge. 

Albania is partially aligned with the acquis on a single European railway area, railway system 
interoperability and rail freight corridors for competitive freight. Further efforts are needed to 
(i)  align  the  country  with  the  Directive  on  intelligent  transport  systems,  (ii)  develop  the 
national strategy for intelligent transport systems (ITS); and (iii) prepare for implementation 
of that strategy.  

On energy networks, the national energy strategy 2018-2030 was adopted in 2018. The gas 
master  plan  was  adopted  by  the  government  in  February  2018.  Further  efforts  need  to  be 
made to adopt the SEA and project identification plan related to the gas master plan. Adoption 
of  this  SEA  and  plan  will  help  the  development  of  TEN-E  projects.  Progress  was  made  on 
improving  the  infrastructure  for  power  transmission.  The  trans-Adriatic  pipeline  is 
progressing  on  schedule,  with  84.1%  of  the  project  completed  by  the  end  of  2018.  The 
pipeline is expected to be operational in 2020. Major gas interconnector projects are provided 
for under the gas master plan.  

However,  Albania  failed  to  transpose  and  implement  the  Regulation  (EU)  347/2013  on 
guidelines for trans-European energy infrastructure by 1 January 2017, and in November 2018 

83 

 
 
the Ministerial Council of the Energy Community adopted a decision establishing a breach of 
Albania’s obligations under the Energy Community Treaty. 

Albania has functional power interconnection lines with Greece and Montenegro. It also has a 
technically functional  power interconnection line with  Kosovo. The 400  kV interconnection 
line between Albania and Kosovo was completed in June 2016, but it has not been possible to 
use it so far. The inability to use this interconnection is a huge financial drain for Albania and 
Kosovo.  OST  SA  and  KOST  SA,  the  Albanian  and  Kosovo  transmission  system  operators, 
have  officially  requested  the  assistance  of  the  Energy  Community  Secretariat  and  the 
European Commission to start the operation of the line. 

The  construction  of  the  400  kV  line  between  Elbasan  in  Albania  and  Bitola  in  North 
Macedonia  was  approved  in  June  2016  by  the  government.  The  tendering  procedure  for 
project  preparation  and  implementation  was  launched  in  April  2018.  This  procedure  is  still 
ongoing.  The  line  is  projected  to  cost  EUR  70  million.  The  project  is  scheduled  for 
completion in 2021. 

Albania  also  participates  in  the  EU’s  macro-regional  strategy  for  the  Adriatic  and  Ionian 
region  (EUSAIR),  for  which  the  improvement  of  connectivity  (transport  and  energy 
networks) is a main priority. 

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

Regional  policy  is  the  EU’s  main  tool  for  investing  in  sustainable  and  inclusive  economic 
growth.  Member  States  bear  responsibility  for  its  implementation,  which  requires  adequate 
administrative capacity and sound financial management of project design and execution. 

Albania is moderately prepared in the area of regional policy and coordination of structural 
instruments.  Limited  progress  was  made,  in  particular  with  the  signature  of  the  Financing 
Agreement  for  the  2017  IPA  national  programme  and  the  completion  of  the  IPA  2018 
programme.  

In the coming year, the country should in particular:  

  strengthen its administrative capacity, especially the Central Finance and Contracting Unit 
(CFCU)  of  the  Ministry  of  Finance  and  Economy,  the  National  Authorising  Officer’s 
Support  Office  and  the  Audit  Authority  as  well  as  the  Ministry  for  Europe  and  Foreign 
Affairs; 

  accelerate the preparation of project documentation to avoid delays in the use of EU funds 
and difficulties in meeting contracting deadlines, as observed in the 2013, 2014, 2015 and 
2016 programmes; 

  increase  programming  capacity  in  line  with  the  sectoral  approach  and  sectoral  policies, 

and improve the design of mature sector project pipelines. 

On  the  legislative  framework,  the  national  strategy  for  development  and  integration  and 
several sectoral reform strategies have been  adopted and are being implemented. A national 
medium-term  budget  plan  has  been  drafted.  Adequate  co-financing  capacity  for  EU 
programmes at national and local level has yet to be established. 

Regarding the institutional framework, the sector coordination and monitoring mechanisms 
with integrated policy management groups and sector steering committees have been formally 
reconfirmed by Order of the Prime Minister. The government’s Strategic Planning Committee 
has  been  reactivated.  Further  efforts  are  needed  to  make  the  structures  operational. 
Coordination  on  EU  integration  and  EU  assistance  needs  to  be  ensured  between  national 

84 

 
 
administrations such as the Ministry for Europe and Foreign Affairs, the Ministry of Finance 
and Economy, the Prime Minister’s Office and line ministries. 

On  administrative  capacity,  the  staff  of  the  Audit  Authority  (including  new  recruits)  has 
received  further  training.  Further  capacity-building  measures  are  in  the  process  of  being 
undertaken for the CFCU, notably in order to speed up the public procurement process, and 
for  the  management  structure.  A  proper  retention  strategy  needs  to  be  developed  for  all 
indirect  management  structures.  The  administrative  capacity  for  sector  reform  coordination 
and  monitoring  through  the  integrated  policy  management  groups  and  sector  steering 
committees need to be improved. Staffing of the relevant secretariats needs to be confirmed. 
The involvement of development partners, local governments and civil society organisations 
in sectoral dialogue should be improved. 

Further efforts are still needed to upgrade the administrative capacity for multiannual sector 
programming  in  line  with  the  sectoral  approach  under  the  IPA  framework  for  2014-2020. 
Albanian  authorities  provided  input  to  the  revised  indicative  strategy  paper  for  IPA.  The 
national project pipeline of investments, including those for regional development, is not yet 
fully aligned with the medium-term budget programme and the planning and management of 
nationwide public investment. 

On monitoring and evaluation, there is some progress toward formally setting up the Sector 
Monitoring Committees (for IPA II). These  committees ensure the proper monitoring of EU 
pre-accession assistance and should meet regularly. The legal basis for these committees was 
laid  down  via  a  decision  of  the  Prime  Minister  adopted  in  October  2018.  The  process  for 
establishing the Sector Monitoring Committees should now be swiftly finalised. 

On financial management, control and audit, the Audit Authority has started demonstrating 
its ability to produce valuable findings, which need to be followed up by indirect management 
bodies. The Audit Authority is in the process of improving its contradictory procedure. The 
self-assessment  of  the  National  Authorising  Officer’s  Support  Office  on  management  and 
control systems needs to be improved. 

Regarding  regional  policy,  the  key  implementing  agencies  are  the  Regional  Development 
Agencies  (RDAs),  the  Agency  for  Regional  Economic  Development  (ARED),  the  Albanian 
Development Fund (ADF), and the National Agency for Regional Development (NARD). A 
decision  of  the  Council  of  Ministers  of  July  2018  has  transferred  the  functions  of  NARD, 
ARED, and RDAs to the ADF. The latter is expected to be the only implementing agency for 
regional  development,  at  national  and  regional  level.  It  is  also  expected  to  take  overall 
responsibilities  and  fulfil  functions  of  managing  authority  for  regional  development.  The 
decision has however not yet been implemented.  

A  draft  law  on  regional  development  and  cohesion  policy  has  been  designed  by  Albanian 
authorities  after  consultation  with  relevant  public  institutions  and  non-governmental 
stakeholders. Although announced to be adopted by the Parliament in July 2018, the draft law 
has still not been submitted for adoption. 

5.25.   Chapter 25: Science and research 

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

Albania  is  at  an  early  stage  in  the  area  of  science  and  research.  Some  progress  was  made 
over  the  reporting  period,  especially  with  the  implementation  of  the  national  strategy  for 
scientific  research,  technology  and  innovation  for  2017-2022  and  the  launching  of  the 

85 

 
 
mapping  phase  of  the  Smart  Specialisation  Strategy.  However,  last  year  recommendations 
have not been fully addressed. 

In the coming year, the country should in particular: 

  increase investment in research, in line with its own commitments and European research 

area priorities; 

  adopt the smart specialisation strategy; 

  ensure higher participation in Horizon 2020.  

On research and innovation policy, the 2017-2022 national strategy for scientific research, 
technology  and  innovation  is  being  implemented.  A  decision  on  the  methodology  for 
assessing research activity in higher education institutions  was adopted in March 2018. Some 
progress was made on the creation of the national research database, which will be managed 
by  the  National  Agency  of  Scientific  Research  and  Innovation  (NASRI).  Now  that  the 
Albanian National Research and Education Network is connected to GEANT, national efforts 
should be made in the fields of open access and open data. 

In  January  2017,  the  government  approved  the  2017-2021  action  plan  to  support  the 
development  of  innovative  policies.  This  action  plan  aims  to  promote  better  links  between 
academia, industry and government, but no progress was made on implementing the plan in 
2018. A new draft on law scientific research in the Republic of Albania has been finalised. It 
is scheduled to be presented in the Parliament in 2019 together with the new draft law on the 
Academy of Science.  

In response to students requests, in December 2018 the Council of Ministers approved some 
decisions  on  reductions  in  fees,  monitoring  of  the  performance  of  lecturers,  transparency  in 
the financial administration of universities, access to online virtual libraries, digital  archives 
of lecturers’ publications and representation issues.    

Investments in research and other measures to strengthen research and innovation capacity at 
national  level  need  to  be  stepped  up.  Albania  does  not  currently  have  neither  a  clear 
methodology to establish clear funding for research and science, nor does it have a national 
roadmap for research infrastructure. Despite the fact that the aim to increase investments for 
Scientific Research, Technology and Innovation up to 1% of GDP by 2022 is written down in 
the strategy, the share of public spending for scientific research in 2018 only reaches 0.06% of 
GDP.  Albania  has  no  national  roadmap  for  research  infrastructure,  whose  mapping  is 
expected  to  be  completed  by  July  2019.  In  September  2017,  the  development  of  a  smart 
specialisation  strategy  (S3)  started  under  the  lead  of  the  Ministry  of  Education,  Sports  and 
Youth, in cooperation with the European Commission. However, the strategy still needs to be 
adopted. A road map for the S3 process  has been drafted  and the mapping process  is  being 
prepared  with  a  TAIEX  support.  The  mapping  phase  of  the  strategy  is  expected  to  be 
completed  during  2019.    As  regards  EU  framework  programmes,  Albania  participates  in 
Horizon 2020 as an associated country. Albania is by far the least successful performer of all 
countries associated to Horizon 2020, with a success rate of 7.8% overall so far (compared to 
the average success rate of 15.3%) despite a high application rate. Private sector participation 
in the programme remains particularly low.   

On  integration  into  the  European  research  area,  Albania  should  be  more  active  in  all  six 
priority  areas  of  the  European  research  area,  and  should  improve  its  networking  with 
European partners to engage in international cooperative research.  

On  Innovation  Union,  the  government  adopted  decisions  to  set  up  four  programmes 
managed by the Albanian Investment Development Agency for 2018: the Creative Economy 

86 

 
 
Fund,  the  Start-up  Fund,  the  Competitiveness  Fund  and  the  Innovation  Fund.  The  objective 
should be to participate in the European Innovation Scoreboard. 

5.26. 

 Chapter 26: Education and culture 

The EU supports cooperation in education and culture through funding programmes and the 
coordination of Member State policy through the open method of coordination. The EU and 
the Member States must also prevent discrimination and ensure quality education for children 
of migrant workers, including those from disadvantaged backgrounds. 

Albania  is  moderately  prepared  in  the  field  of  education  and  culture.  Some  progress  was 
made in this area, especially by improving the online application for recognition of diplomas, 
the curricular framework for pre-school education and standards of development and learning 
for  children  aged  3  to  6  years,  and  monitoring  the  framework  for  assessment  of  pre-school 
education.  Some  progress  was  also  registered  overall  in  the  education  and  training  system 
with  the  adoption  of  the  revised  Albanian  Qualification  Framework  Law  in  May  2018.  No 
progress was achieved in adopting the secondary legislation of VET Law and the strategy on 
culture for 2019-2023.                                                                                                                                                                                      

In the coming year, Albania should in particular: 

  implement  the pre-university education strategy  and the higher education reform,  with  a 
focus  on  ensuring  inclusive  and  quality  education  at  all  levels  both  in  urban  and  rural 
areas; 

  finalise the secondary legislation for the implementation of VET Law;  

  adopt and implement the national strategy on culture for 2019-2023 to preserve Albania’s 

cultural heritage. 

On education and training, where the level of public expenditure remains at 3.1% of GDP, 
progress was made with the implementation of curricular and legislative frameworks. For the 
implementation of the new curricula for early childhood education, around 1,300 teachers and 
kindergarten directors were trained. The level of enrolment in early childhood education was 
80.3% in 2018.  Adult (25-64) participation in formal or non-formal education and training is 
extremely  low  (in  2017  -  0.9%  -  according  to  the  labour  force  survey’s  methodology,  and 
9.2% - according to the adult education survey’s methodology) compared to the EU average 
(10.9% in 2017, respectively 45.1% in 2016, using the same methodologies).  

Although  their  enrolment  rates  remain  very  low  overall,  the  participation  of  Roma  and 
Egyptians  in  early  childhood  education  increased  by  5%  in  elementary  schools,  by  25%  in 
middle school, 27% in high school and in pre university education by 22%. Nevertheless, the 
gap in access to education between Roma/Egyptian children and non-Roma children living in 
the same areas remains very large. The measures planned to facilitate access to universities, 
quota system and university fee waiver, are in general not implemented.  

Following the curricular reform for grades 1 to 9, teachers received basic training before the 
introduction  of  a  new  curriculum  for  each  grade.  However,  the  new  curricula  require  skills 
current  teachers  did  not  learn  at  university  and  further  training,  adequate  mentoring  and 
ongoing  support  are  missing.  Such  support  should  be  set  up  to  ensure  an  effective 
implementation of the curricular reform. The review of the content and structure of curricula 
for initial teacher training in higher education institutions has started, and their introduction is 
expected in the academic year 2019-2020. 

Due to  resource and capacity limitations quality  in  education is  an issue across the country. 
Schools  in  rural,  mountainous  and  isolated  areas  face  additional  problems,  one  of  which  is 

87 

 
 
that  they  cannot  attract  qualified  teachers.  In  general,  the  education  budget  should  be 
increased  and  its  use  should  be  more  transparent,  including  for  private  higher-education 
institutions. 

The secondary legislation of the new VET Law of February 2017 has not yet been adopted. 
Qualification  standards  and  framework  curricula  for  most  VET  programmes  are  being 
modernised, even though some Albanian schools lack the teaching skills and equipment to put 
them into practice. Participation in VET is increasing, mainly through promotion of the VET 
services.  The  government  plans  to  expand  the  responsibilities  of  the  National  Agency  for 
VET  and  Qualifications  to  include  VET  teacher  training  and  non-formal  training.  Albania 
should  also  make  progress  in  ensuring  that  VET  is  inclusive.  It  can  achieve  this  through 
targeted measures for rural  women, people with  disabilities, Roma and Egyptian minorities, 
and other populations at risk of exclusion, especially in rural and remote areas.   

A  strategy  on  education  (including  higher  education)  for  the  coming  years  is  still  to  be 
prepared by the authorities.  

The creation of the Teachers for Albania internet portal was one of the major areas of reform 
in  2018.  The  portal  offers  an  online  platform,  where  people  who  wish  to  become  school 
teachers  and  pre-school  teachers  can  register  their  interest  and  be  selected,  ensuring 
transparency in recruitment.  

Albania  now  offers  the  service  of  application  for  diploma  recognition  (since  January  2017) 
and has reduced the number of requested documents for recognition. The country continues to 
participate  actively  in  EU  programmes,  notably  the  Erasmus+  programme,  through  which 
there have been a total of 3 500 mobilities of staff and students from Albania since 2015 and 
23 Capacity  Building projects  in  the field  of Higher Education involving local  beneficiaries 
are currently being implemented.   

Albania  participated  in  the  OECD  Programme  for  International  Student  Assessment  (PISA) 
2018,  with  results  due  to  be  published  in  December  2019.  Despite  constant  improvements 
over the last three testing rounds (2009, 2012 and 2015), Albania continues to perform poorly 
in  PISA  tests.  Half  (50.3%)  of  the  15-year  olds  perform  poorly  in  reading  and  even  more 
(53.3%) perform poorly in mathematics.  Preparations are ongoing for Albania’s participation 
in  PISA  2021.  The  country  will  also  participate  in  the  Trends  in  International  Mathematics 
and  Science  Study  (TIMMS)  2019  and  Progress  in  International  Reading  Literacy  Study 
(PIRLS) 2021 international assessments.  

On  the  culture  sector,  the  national  strategy  for  culture  for  2019-2023  is  expected  to  be 
adopted in May 2019.  The Law on cultural heritage and museums was adopted in May 2018. 
The aim of the Law is to preserve, protect, evaluate and administer Albania’s national cultural 
heritage,  including  museums.  In  addition,  the  Law  sets  up  rules  on  the  international 
movement of cultural assets, partially aligned with the EU acquis. 

Albania  adopted  the  Law  on  the  Protection  of  National  Minorities  in  October  2017,  in  line 
with  the  2005  UNESCO  Convention  on  the  Protection  and  Promotion  of  the  Diversity  of 
Cultural Expressions.  The secondary legislation for the implementation of the Law are still to 
be adopted. A draft-decision ‘On determining the strategies, programmes and action plans to 
create the necessary  conditions  for national minorities to  preserve and develop  their distinct 
identity in the Republic of Albania’ is under preparation by the Ministry of Culture. It will be 
implemented jointly with the Ministry of Education, Sports and Youth. Albania has continued 
to participate in the EU Creative Europe programme with good results over the years. Since 
January  2018,  the  Ministry  of  Culture  is  in  charge  of  managing  the  ‘Europe  for  citizens 

88 

 
 
programme’. In 2017, Albania benefited of nine projects under this programme, and last year 
the Ministry organised two information sessions about the programme.  

The Ministry of Education, Sports and Youth is preparing a draft law on  youth. This law is 
expected  to  enhance  the  role  of  youth  organizations  in  decision-making  and  ensure  the 
efficiency of state institutions working on issues related to young people. During 2018, three 
youth centres have been established in the cities of Lac, Lushnja and Elbasan but further steps 
need  to  be  taken  to  establish  the  remaining  youth  centres.  Regional  Youth  Centres  will 
provide information to young people in the mentioned cities. In the Capacity Building Youth 
action of the Erasmus+ Programme, the interest from Albanian organisations in the 2018 call 
was high:  26% of the total submitted applications came  from  Albanian organisations out  of 
which  7  Albanian  projects  coordinated  by  Albanian  organisations  were  selected.  The 
Regional Youth Cooperation Office’s (RYCO) has its headquarters in Tirana and the country 
participated actively in their first call for projects.  

Albania  has  developed  and  implemented  a  programme  called  ‘Sexuality  education  for  life 
skills’ for 10 to  18-year-old  students.  Since 2015, about  3,000 public schools  teachers have 
been trained to teach this programme. The programme seeks to go  beyond improving sexual 
health.  It  also  aims  to  prevent  and  reduce  gender-based  and  intimate  partner  violence  and 
discrimination; to increase gender equitable norms, self-efficacy and confidence; and to build 
stronger  and  healthier  relationships.  Albania  participated  for  the  first  time  in  the  European 
Week of Sports by organising as large number of sport activities in the country.    

5.27.   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 shows some level of preparation in this area. Limited progress was made in further 
aligning  the  policies  and  legislation  with  the  acquis,  in  areas  such  as  water  management. 
However, significant efforts are needed on implementation and enforcement, especially in the 
water sector and on climate change.  

In the coming year, Albania should in particular: 

  align  with  key  water  directives  and  accelerate  the  capacity  development  of  the  national 
agencies  for  Water  Resource  Management  and  for  Water  Supply,  Sewerage  and  Waste 
Infrastructure; 

  take  immediate  measures  to  review  and  improve  environmental  and  strategic  impact 
assessments  on  existing  and  planned  projects,  plans  and  programmes,  especially  in  the 
hydropower, construction, tourism, and mining sectors; 

  start implementing the Paris Agreement by adopting a national strategy and legislation on 
climate change, and by starting to develop integrated National Energy and Climate Plans 
in line with Energy Community obligation. 

Environment 

As  regards  horizontal  issues,  further  progress  is  needed  to  achieve  full  alignment  and 
implementation.  The  implementation  of  the  Environmental  Impact  Assessment  Directive 
(EIA) needs to be strengthened, especially in the hydropower and mining sectors. Permits for 
the construction of several new hydropower plants and tourist resorts in protected areas have 
been issued, with concerns pertaining to the quality of EIAs and public participation. Albania 

89 

 
 
has  aligned  to  some  extent  with  the  Directive  on  establishing  an  infrastructure  for  spatial 
information  (INSPIRE).  More  effort  is  needed  to  achieve  effective  public  participation  and 
consultation in the decision-making process, particularly at the local level. Further progress is 
needed to  achieve full compliance with the remaining cross-cutting aspects of the directives 
on environmental liability, environmental crime and environmental inspection. The lack of a 
secondary  legal  framework  is  hampering  the  establishment  of  an  adequate  process  and 
assessment of environmental liability  for damage to  the environment.  Staff  replacement has 
weakened  the  competences  of  inspectorates  to  carry  out  their  functions.  Further  alignment 
with the directive on environmental crime still needs to be done. 

More  efforts  are  needed  to  further  align  the  legislation  on  air  quality  with  the  acquis.  The 
national strategy for air quality has not been adopted. Despite full alignment with the directive 
on ambient air quality and cleaner air for Europe, the law on ambient air quality needs to be 
properly enforced and the current air quality monitoring network and practices to be aligned 
with EU standards. The environment agency should conduct regular monitoring of industries 
and installations which potentially emit large quantities of pollutants in the air. Further effort 
is needed to reduce the sulphur content of certain liquid fuels.  

The legal framework for waste management is partially aligned. The draft National Strategy 
for Integrated Waste Management is in the consultation phase.  Further efforts are needed to 
close the over 199 non-compliant landfills and dumpsites, and to start implementing separate 
collection  of  waste  streams,  increase  recycling  and  reuse,  and  start  composting  bio-waste. 
Only  65%  of  waste  is  collected  and  there  is  no  recycling  of  demolition  waste.  Economic 
instruments  to  promote  recycling  and  prevent  waste  generation  remain  limited.  The 
construction of an incinerator in Elbasan and the starting of procedures for the construction of 
two  more  incinerators  in  Tirana  and  Fier  pose  concerns  in  terms  of  compliance  with  EU 
Directives  on  Waste,  the  waste  hierarchy  principle  with  incineration  as  the  least  preferred 
waste management option, and with the EU targets for recycling.  

On  water  quality,  the  level  of  alignment  remains  unchanged  and  partial,  with  important 
directives  still  not  aligned.  The  National  Agency  for  Water  Supply,  Sewerage  and  Waste 
Infrastructure  has  been  given  additional  competences,  but  has  to  increase  its  capacity. 
Municipal utilities have to increase performance and sustainability. The existing waste water 
treatment plants face operation and maintenance issues. There is a strong need to extend the 
sewage networks and build new treatment plants, notably in urban, coastal and touristic areas. 
The integrated water resource management strategy has been adopted, and a new agency for 
water  resource  management  has  been  created  which  has  to  rapidly  build  its  capacities 
especially  for  river  basin  management.  River  basin  management  plans  elaborated  should  be 
adopted promptly. The number of water quality monitoring points slightly increased, but the 
monitoring and reporting system has to  develop further. The National  Environment  Agency 
should be urgently strengthened for this purpose.  

Alignment  with  the  acquis  in  the  field  of  nature  protection,  in  particular  the  Habitats  and 
Birds  Directives,  is  well  advanced.  The  law  on  protected  areas  was  amended  in  2018  to 
emphasise the planning  and development  of protected  areas. The 2016 Strategic  Investment 
law  raises  concerns  for  the  protection  of  biodiversity,  as  it  can  allow  large  tourism  and 
industrial investments in protected areas, namely in the Divjaka-Karavasta National Park and 
in  the  Vjosa-Narta  Protected  Landscape,  in  contradiction  with  existing  national  laws  and 
international conventions on biodiversity protection that Albania has ratified. Capacities and 
financial instruments for National Protected Areas Agency remain very limited, with the law 
forbidding its financial autonomy. 

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Enforcement  of  the  laws  needs  to  be  guaranteed  in  case  of  deforestation  and  logging,  and 
culprits need to be prosecuted. Investments in hydropower need to comply with national and 
international nature protection and water management obligations, ensure public participation 
and consultation, and guarantee high quality EIA reports that include impact assessments on 
nature and biodiversity. 

Alignment with the EU legislation on industrial pollution and risk management is still at 
an  early  stage.  Capacity  constraints  are  hampering  progress  in  implementing  legislation  on 
prevention  of  major  accidents  involving  dangerous  chemicals.  Permitting  is  not  fully 
compliant  with  all  legal  requirements  and  there  is  no  independent  monitoring  of  industrial 
pollution.  The  limited  data  on  industrial  pollution  relies  on  companies’  self-monitoring  and 
declaration. The enforcement capacity of the environment inspectorate is very limited. 

On chemicals, some positive steps have been taken towards aligning with the EU Regulation 
on registration, evaluation, authorisation and restriction of chemicals (REACH). However, the 
adoption  of  the  implementing  legislation  and  the  establishment  of  adequate  administrative 
structures are still needed. 

Administrative  capacity  for  preparing  strategic  noise  maps  and  action  plans  needs  to  be 
strengthened. 

No civil protection strategy is in place. The existing civil emergencies law and national plan 
are outdated and do not take into account recent institutional and organisational changes. The 
new  civil  protection  law  under  elaboration  is  not  yet  finalised.  There  is  very  limited 
administrative  capacity,  and  the  envisaged  creation  of  a  civil  protection  agency  has  not 
materialised.  Floods  remain  a  major  hazard;  however  no  progress  has  been  made  on  the 
transposition  of  the  floods  directive.  The  early  warning  system  and  hydrometric  and 
meteorological system still need to be regulated. Albania is not yet a participating State of the 
Union  Civil  Protection  Mechanism  and  is  not  linked  to  the  Common  Emergency 
Communication and Information System (CECIS) yet. In view of their future participation in 
the  Union  Civil  Protection  Mechanism,  Albania  needs  to  establish  relevant  Secure  Trans 
European  Services  for  Telematics  between  Administrations  (sTESTA)  connections  as  a 
precondition to connect to CECIS. 

Climate change 

Albania has achieved some level of preparation to climate change, but alignment with the EU 
acquis  is  still  limited.  Some  progress  was  made  by  ratifying  the  Kigali  Amendment  to  the 
Montreal  Protocol.  A  national  strategy  on  climate  change  consistent  with  the  EU  2030 
framework  on  climate  and  energy  policies  needs  to  be  adopted  and  a  National  Energy  and 
Climate  Plan  in  line  with  Energy  Community  recommendation  has  to  be  developed.  No 
specific administrative structure for handling climate change issues is in place. 

Regarding  its  reporting  obligation  under  the  United  Nations  Framework  Convention  on 
Climate  Change,  Albania  is  preparing  its  Fourth  National  Communication  and  its  First 
Biennial Update Report. 

The law on climate change and accompanying decisions, partly transposing provisions the EU 
Emissions  Trading  Directive,  still  need  to  be  adopted.  Further  efforts  should  be  made  on 
emission standards for new cars  and vans and related consumer information.  Similar efforts 
are needed regarding effort sharing, geological storage of CO2, and greenhouse gas emissions 
from  land  use,  land  use  change,  and  forestry.  Considerable  strengthening  of  administrative 
capacity, allocation of the necessary financial resources as well as awareness-raising activities 
are needed. 

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5.28.   Chapter 28: Consumer and health protection 

EU rules protect consumers’ economic interests and in relation to product safety, dangerous 
imitations and liability for defective products. The EU also ensures high common standards 
for tobacco control, blood, tissues, cells and organs, and medicines for human and veterinary 
use.  The  EU  also  ensures  high  common  standards  for  upholding  patients’  rights  in  cross-
border healthcare and tackling serious cross-border health threats  including  communicable 
diseases. 

Preparations are at an early stage in the area of consumer and health protection. There was 
some  progress  over  the  last  year,  notably  on  non-safety-related  issues  through  further 
aligning legislation with the EU acquis, and strengthening the effectiveness of the Consumer 
Protection  Commission  (CPC).  There  was  also  progress  on  last  year’s  recommendation  to 
improve  access  to  services  for  vulnerable  populations,  through  the  adoption  of  the  National 
Programme for Community Health Care. However, significant progress needs to be made to 
ensure everyone in Albania has healthcare coverage.  

In the coming year, the country should in particular: 

  further  align  its  legislation  with  the  acquis  on  substances  of  human  origin  and  on 

medicines for human and veterinary use; 

  continue  to  improve  access  to  services  for  vulnerable  populations,  including:  women; 
Roma and Egyptian minorities; people with disabilities; and populations in rural or remote 
areas.  

Consumer protection 

On  horizontal  aspects,  the  capacity  of  the  CPC  and  of  other  consumer  protection  bodies 
continued to be strengthened through training on EU legislation and on enforcement practices. 
On product safety, the Market Surveillance Inspectorate needs to be better staffed. National 
legislation  is  partly  aligned  with  the  EU  acquis.  On  non-safety-related  issues,  during  the 
reporting  period  amendments  to  the  Law  on  consumer  protection  were  adopted  during  the 
reporting period. These amendments aim at further alignment with the EU acquis in the area 
of consumer rights and alternative dispute resolution. Awareness-raising materials were made 
available on the CPC’s website.  

Public health 

On  horizontal  aspects,  the  2016-2020  national  health  strategy,  adopted  in  2017,  seeks  to 
achieve  universal  healthcare  coverage.  However,  efforts  are  needed  to  strengthen  the 
governance of public hospitals and healthcare quality. Albania should ensure that appropriate 
funding  and  staffing  are  allocated  to  fully  implement  the  strategy  at  both  central  and  local 
level.  

National  legislation  on  patients’  rights  in  cross-border  healthcare  has  yet  to  be  aligned 
with  the EU acquis.  The Ministry of Health and  Social Protection and the National Agency 
for the Information Society are the authorities responsible for e-health.  

In the field  of  serious cross-border health  threats  including communicable diseases, the 
legal basis on communicable disease prevention and control is in place and is designed to be 
in  line  with  the  acquis.  However,  its  implementation  through  secondary  legislation  is  still 
lacking.  There  is  a  national  alert,  response  and  surveillance  system  for  communicable 
diseases.  However,  no  national  plan  for  implementing  international  health  regulations  has 
been put in place yet. Albania does not yet have an antimicrobial resistance action plan. 

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On blood, tissues, cells and organs, the relevant legislation is still not fully aligned with the 
acquis on blood safety. On tobacco control, the Law to protect public health against tobacco 
products, which is designed to be aligned to the acquis, is being full implemented. 

Legislation on medicines for human and veterinary use is not aligned with the acquis. On 
health  promotion  for  non-communicable  diseases,  there  is  a  national  cancer  control  plan. 
Appropriate structures for cancer screening services were also put in place, especially in the 
main urban areas, but a cancer registry is yet to be set up. Some developments can be reported 
in the area of mental health with the establishment of two specialised mental health services 
that will become fully operational in 2019. On nutrition and physical activity, malnutrition 
is  a  critical  issue,  especially  for  children  and  pregnant  women.  Albania  is  encouraged  to 
develop  a nutrition  plan and increase awareness  in  school  and community centres about  the 
risks of malnutrition. The national legislation on pricing of medical devices is designed to be 
partly aligned with the acquis. 

On  drug  abuse  prevention  and  harm  reduction,  prevention  activities  have  taken  place 
sporadically,  mainly  initiated  by  the  Department  of  Health  Promotion  and  the  Institute  of 
Public Health.  

On  health  inequalities,  in  January  2018  the  Ministry  of  Health  and  Social  Protection 
launched  the  National  Programme  of  Community  Health  Care,  which  mainly  aims  at 
providing  health  care  for  marginalised  Roma  and  Egyptian  minorities.  Further  efforts  are 
necessary to improve access to services for vulnerable populations, including: women; Roma 
and Egyptian minorities; people with disabilities; and populations in rural or remote areas. 

Although sexual and reproductive health services are available, the use of condoms continues 
to be very low. This exacerbates the increase in the number of diagnosed sexually transmitted 
infections,  most  significantly  among  women.  Low  diagnosis  levels  among  the  male 
population  are  because  men  take  medical  check-ups  less  frequently  and  have  limited 
awareness  of  their  reproductive  health  needs.  A  national  programme  on  breast  and  cervical 
cancer screening is lacking. Protocols for breast cancer and cervical cancer have been drawn 
up, but still need to be approved and implemented.   

5.29.   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,  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 by improving online customs procedures, shortening the time for processing of 
customs declarations and use of risk assessment.  

In the coming year, the country should in particular: 

→ approve legal provisions and develop the New Computerised Transit System;  

→ advance the registration of authorised economic operators; 

→ pursue the fight against smuggling, corruption and imports of counterfeit products. 

As  regards  customs  legislation,  the  Customs  Code  is  broadly  aligned  with  the  acquis.  The 
country’s system for customs debt and guarantees is harmonised with EU rules. However, the 
customs declaration ‘scanning fees’ continue to contravene the Stabilisation and Association 
Agreement  which  prohibits  customs  duties  or  charges  having  equivalent  effect  on  trade 
between  the  EU  and  Albania.  The  adoption  by  Parliament  of  national  legislation  and 
procedures  aiming  to  implement  the  Common  Transit  is  still  pending.  Albania  is 

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implementing its new  Authorized Economic Operator program.  Awareness raising  activities 
regarding the benefits, procedures and programs are taking place, while capacity development 
is still needed. 

Tariff  suspensions  and  tariff  ceilings  are  not  planned  at  the  moment.  Binding  tariff 
information and explanatory notes are published by the Albanian Customs Authority (ACA), 
and  anonymised  decisions  on  administrative  appeals  by  the  respective  court.  Rules  of  non-
preferential origin are included in the Customs Code. The Regional Convention on Pan-Euro-
Mediterranean preferential rules of origin is applied in Albania. 

The  Customs  Code's  rules  on  valuation  are  aligned  with  EU  rules.  The  risk  management 
system is automated. It compares import, export and transit data against active risk profiles. 
The legislation on customs enforcement of intellectual property rights is harmonised with the 
acquis.  The  customs  control  system  for  drug  precursors,  dangerous  chemical  products  and 
‘controlled substances’ is harmonised with the 1988 UN Convention against Illicit Traffic in 
Narcotic  Drugs  and  Psychotropic  Substances.  Differences  between  the  acquis  and  national 
rules  on  cash  and  goods  transported  in  travellers’  baggage  remain,  regarding  amounts  to  be 
declared and the declaration form. The ACA does not impose sanctions for non-declarations 
or  misdeclarations,  but  confiscates  the  cash  and  passes  it  on  to  the  police  or  Attorney 
General’s office for criminal prosecution. 

On  administrative  and  operational  capacity,  the  Business  Strategy  of  the  Customs 
Administration  comprises  the  mission  and  strategic  objectives  for  the  period  between  2017 
and  2021,  including  an  objective  to  improve  IT  systems  and  platforms.  Electronic  local 
customs  clearance  is  functioning,  but  IT  systems  are  only  fully  interconnected  with  the 
Directorate  General  of  Taxation  and  the  Directorate  General  of  Road  Transport,  while 
conditions  for  direct  access  are  created  to  police  and  prosecution.  In  2018,  online  customs 
procedures improved. 

5.30.   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. Some progress was made 
in  improving  the  capacity  for  coordinating  and  facilitating  trade  policy  and  through  the 
ratification of Additional Protocol 5 to the Central European Free Trade Agreement (CEFTA).  

In the coming year, Albania should in particular: 

  continue  to  implement  the  national  action  plan  on  trade  policy  coordination  and 

facilitation; 

  adopt the relevant legislation in the field of export control of dual-use goods;  

  strengthen the overall administrative capacity of the team in the Ministry of Finance and 

Economy dealing with trade with the EU and CEFTA);  

  implement actions under the multi-annual action plan for the development of a Regional 
Economic Area, in particular implement CEFTA Protocol 5 on Trade Facilitation, adopt 
and  implement  the  pending  CEFTA  Protocol  6  on  Trade  in  Services  and  negotiate  and 
ensure a swift adoption of CEFTA Protocol 7 on Dispute Settlement. 

On the common commercial policy, Albania continued to coordinate its positions and align 
its policies closely with those of the EU, including within the WTO. It has ratified the WTO 
Trade  Facilitation  Agreement  and  notified  its  list  of  commitments,  which  now  need  to  be 

94 

 
 
reviewed  in  order  to  speed  up  implementation.  In  addition,  Albania  needs  to  submit  the 
notifications  required  under  Articles  1.4,  10.6.2  and  12.2.2  of  the  WTO  Trade  Facilitation 
Agreement.  

There was some progress in the area of dual-use goods with the adoption in July 2018 of the 
law  on  state  control  over  international  transfer  of  military  items  and  dual-use  goods  and 
technologies, aiming at  partial alignment with the related EU  acquis. Further approximation 
of legislation on the control of exports, transfer, brokering and transit of dual-use items and on 
the Common Military List of the European Union (EU Regulation 2017/2268) was followed 
through the February Government Decision. Albania has already adopted its national control 
list  of  dual-use  goods  in  line  with  EU  Regulations.  Further  alignment  with  the  acquis  on 
export controls  of dual-use goods  remains to  be  completed. A specific sector on Dangerous 
Goods,  Dual  Use  and  Illegal  Trafficking  is  established  as  part  of  the  anti-trafficking 
directorate  in  the  General  Directorate  of  Customs.  There  has  been  no  progress  towards 
Albania’s participation in the multilateral export control regimes. Albania has not transposed 
the legislation related to the EU regulation concerning trade in certain goods, which could be 
used  for  capital  punishment,  torture  or  other  cruel,  inhuman  or  degrading  treatment  or 
punishment.  

As concerns bilateral agreements with third countries, during the reporting period Albania 
signed  12  new  agreements  on  economic/trade/technical  cooperation.  In  total,  it  now  has  36 
such agreements in place, including 13 with EU Member States. An agreement on economic 
cooperation between the governments of Albania and Bosnia and Herzegovina was adopted in 
principle  in  December  2018.  Albania  has  in  place  Bilateral  Investment  Treaties    with  45 
countries and 6 more are under negotiation with Slovakia, Iran, Canada, Morocco,  Lebanon 
and  Iceland.  Negotiations  for  amending  the  free  trade  agreement  with  Turkey  continue, 
focusing  on  the  inclusion  of  specifications  related  to  trade  in  services  and  investments. 
Expression  of  interest  for  establishing  a  joint  committee/economic  cooperation  agreement 
have  been  bilaterally  exchanged  with  Algeria,  Egypt,  Cuba,  India,  Norway,  Georgia,  and 
Ukraine.  

In 2019, Albania holds the chairmanship in office of CEFTA. In addition, it made important 
commitments at the WB6 summits in Trieste, London and Durres to implement a multiannual 
action  plan  for  developing  a  Regional  Economic  Area  (REA)  in  the  Western  Balkans. 
Implementing the action plan will deepen and widen economic integration within the region, 
based on EU rules and standards. The government of Albania has established a mechanism for 
implementing and monitoring the REA. In April 2018, Albania adopted and ratified the law 
on adoption of additional Protocol 5 of the agreement with CEFTA countries. 

Administrative and operational capacity needs to be strengthened: following the restructuring 
of the Ministry of Finance and Economy, organisational units in charge of trade with the EU, 
CEFTA and WTO were covered by an ad hoc working group composed of 4 experts until the 
beginning of 2018. A structure on trade issues composed of 2 specialists and 1 chief of sector 
is  under  establishment.  Currently  the  tasks  are  performed  by  the  staff  of  the  Directorate  of 
Economic Policies in the Ministry, covering also the functions of the Technical Secretariat for 
the  National  Committee  for  Trade  Policy  and  Facilitation.  A  permanent  stable  structure 
dealing with trade-related issues should be operational.  

Albania  has  no  development  policy  framework  for  cooperation/aid  or  agency  for 
development  cooperation  with  third  countries.  The  2001  Law  on  Non-Profit  Organisations 
recognises the potential activities of such organisations in the field of humanitarian aid and 
entitles  them  to  carry  out  development  and  humanitarian  aid  activities  inside  and  outside 
Albania. 

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5.31.   Chapter 31: Foreign, security and defence policy 

Member  States  must  be  able  to  conduct  political  dialogue  under  EU  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.  Some  progress  was  made  through  the  ongoing 
security upgrade of storage facilities for armaments and ammunition. A virtual firearms focal 
point was set up in in the Albanian State Police. Albania continued to participate in military 
crisis-management missions and to fully align with EU positions.  

In the coming year, the country should in particular: 

  finalise the establishment of a firearms focal point in the Albanian State Police, implement 
the newly adopted strategy on small arms and light weapons, and improve the security of 
storage facilities for armaments and ammunition. 

The  political  dialogue  between  the  EU  and  Albania  on  foreign  and  security  policy  issues 
continued.  A  political  dialogue  between  the  EU  and  Albania  on  UN  issues  took  place  in 
October 2018. (For more information  on relations with  other enlargement  countries and EU 
Member States, see Political criteria — Regional issues and international obligations). 

Albania’s Ministry of Foreign Affairs and Ministry of Defence have appropriate structures to 
participate in the common foreign and security policy and the common security and defence 
policy.  On  the  common  foreign  and  security  policy  (CFSP),  Albania  supports  the  global 
strategy for the EU’s foreign and security policy. When it was invited, Albania aligned with 
all  relevant  Council  decisions  and  High-Representative  declarations  on  behalf  of  the  EU 
(100% alignment). 

Albania  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.  As 
mentioned in the previous reports, Albania needs to align with the EU position. 

Albania adopted in February 2019 a new national strategy on small arms and light weapons 
for the period 2019-2024. It also adopted a corresponding action plan for 2019-2021. Albania 
signed the regional ‘Roadmap for a sustainable solution to the illegal possession, misuse and 
trafficking of small arms and light weapons and their ammunition in the Western Balkans by 
2024’ at a London summit in July 2018. 

Albania  made  further  progress  in  improving  the  security  of  storage  facilities  for  armaments 
and ammunition. The security upgrade of the Albanian State Police’s central armament store 
in  Mullet  was  completed  in  September.  The  security  upgrade  of  two  evidence  rooms  in  the 
police directorates in  Tirana and  Durres was  also  completed. Security upgrades of the State 
Police’s tunnel-storage in Mullet and of the Ministry of Defence’s ammunition and armament 
storages  in  Miraka  and  Zall-Herr  are  planned  for  2019.  Albania  made  further  progress  in 
implementing  the  action  plan  for  destroying  surplus  weaponry.  Clearance  of  hotspots 
contaminated with unexploded ammunition continues. 

A  virtual  firearms  focal  point  was  set  up  in  the  Albanian  State  Police  in  May  2018.  Its 
incorporation into the department’s structure is expected in the first half of 2019. Members of 
the firearms focal point received training, and in November the focal point was equipped with 
the required software tools  for sharing data and  analysis on firearms.  This  will improve the 
ability of law enforcement and the judiciary to analyse and coordinate actions against firearms 

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misuse and trafficking. A national electronic registry for weapons was set up in 2015, and is 
now fully functional. 

Albania  continued  to  actively  participate  in  regional  and  international  processes  for  the 
exchange of information and good practices in the field of small arms and light weapons. It 
continued  to  participate  in  some,  but  not  all,  international  export  control  arrangements  and 
instruments on non-proliferation. The next step would be for Albania to start complying with 
the  Wassenaar  Arrangement.  Albania  continued  to  engage  actively  with  international 
organisations.  It  maintained  a  robust  presence  in  a  number  of  NATO  missions,  including 
some  of  strategic  importance  for  the  EU  (such  as  NATO’s  Maritime  Group  in  the  Aegean 
Sea). Albania will hold the chair of the Organisation for Security and Cooperation in Europe 
2020 and is a candidate for a non-permanent seat in the United Nations Security Council in 
2022/2023. 

On security measures, negotiations are continuing on the arrangements for implementing the 
agreement  on  security  procedures  for  exchanging  and  protecting  classified  information, 
signed between the EU and Albania in  March 2016. Concluding the negotiations will allow 
the agreement to  enter into force. Albania continued to actively participate in military crisis 
management  missions  under  the  common  security  and  defence  policy  (CSDP),  notably 
EUFOR  Althea  in  Bosnia  and  Herzegovina  and  EUTM  Mali.  The  country  also  offered  to 
contribute to the EU battle groups in 2024. 

In November 2018, Albania officially applied to participate in the EU’s Hybrid Risk Survey. 
Its goal in participating was to identify its key vulnerabilities and use EU instruments to get 
assistance to build capacity, thus strengthening its resilience against hybrid threats. In January 
2019, the survey was launched with the Ministry of Foreign Affairs. 

5.32.   Chapter 32: Financial control 

The  EU  promotes  the  reform  of  national  governance  systems  to  enhance  managerial 
accountability, sound financial management of income and expenditure, and external audit of 
public funds. The financial  control  rules further protect  the EU’s financial interests against 
fraud in the management of EU funds and the Euro against counterfeiting. 

Albania is moderately prepared in this area. Some progress was made during the reporting 
period with the legal adoption of a mechanism for coordination, monitoring and reporting of 
key  reforms  on  good  governance, including on public internal  financial control (PIFC), and 
with  the  adoption  of  a  risk-based  external  audit  approach.  However,  Albania  has  not  yet 
adopted, a comprehensive PIFC policy paper, focusing on managerial  accountability and all 
required legislative changes, remains to be adopted. The proper and effective functioning of 
internal control  is not yet ensured across all budget entities and the timely implementation of 
internal  and  external  audit recommendations should  be improved.  Since  only  partial  progress  was  made 
with the Commission’s 2018 recommendations, these remain valid. 

In the coming year, Albania should in particular: 

  adopt and start implementing a comprehensive PIFC policy paper with the specific focus 
on the definition and implementation of managerial accountability and ensure coordinated 
monitoring and reporting of all related reforms; 

  ensure effective follow-up to the annual PIFC report by addressing systemic weaknesses;  

  ensure more systematic and timely implementation of external audit recommendations. 

97 

 
 
Public internal financial control  

A  strategic  framework  for  PIFC  is  partially  in  place.  A  comprehensive  policy  on  internal 
control  with  a  specific  focus  on  the  definition  and  implementation  of  managerial 
accountability  needs  still  to  be  developed.  A  number  of  enabling  conditions  for  PIFC 
implementation are addressed in the public administration reform strategy and its action plan, 
while  basic  internal  control  and  audit  reform  requirements  are  addressed  in  the  2014-2020 
public  financial  management  reform  strategy  and  its  action  plan.  In  October  2018  the 
government set up an Integrated Policy Management Group for Good Governance to improve 
coordination,  monitoring  and  reporting  of  the  public  administration,  public  financial 
management  and  PIFC  reforms,  but  the  mechanism  is  yet  to  become  fully  operational  to 
ensure an integrated monitoring and reporting system.  

Managerial  accountability  is  not  yet  well  embedded  in  the  administrative  culture.  The 
financial  management  and  control  law  defines  accountability  only  in  relation  to  financial 
management. Decision-making in the institutions is centralised to the minister with very little 
delegation to senior and middle management. Following the 2017 restructuring, all ministries 
now have managerial structures broadly aligned with the budget structure. Accountability and 
reporting lines  between  agencies and their parent  institutions are unclear. The  Law on State 
Administration,  Law  on  civil  servants  and  relevant  laws  on  policy  planning  and  Budget 
System Law need to be assessed. If necessary, these laws should be amended, to ensure that 
they  provide  a  consistent  basis  for  implementation  of  delegated  managerial  accountability. 
(See Public administration reform). 

The legislation on internal control is largely in line with international standards. Although an 
estimated  95%  of  Albanian  state  institutions  have  internal  control  procedures  in  place, 
implementation is not systematic in all institutions. Risk management is still at an early stage, 
although about two thirds of institutions have prepared risk registers and corresponding action 
plans.  Local  governments  have  made  the  least  progress  in  preparing  risk  registers. 
Declarations of assurance are systematically signed by senior management, but in the absence 
of  a  delegation  framework,  this  remains  more  of  a  formal  exercise.  A  centralised  budget 
inspection function exists within the Ministry of Finance.  

The legislation on internal audit practice is in line with international standards. In 2018, the 
number of certified auditors in the public sector increased. Internal audit still focuses mainly 
internal  audit 
on  reviewing  financial  compliance.  The 
recommendations should improve. 

implementation  of 

timely 

The  Central  Harmonisation  Unit  (CHU)  provides  methodological  guidance  and  monitors 
implementation  on  the  basis  of  internal  control  reviews  and  by  analysing  self-assessment 
reports  that  it  receives  from  institutions.  In  2018,  the  CHU  developed  a  methodology  for 
internal control quality reviews and started to undertake such reviews. The annual PIFC report 
is presented to the Council of Ministers and discussed in the Parliament. The government still 
needs to ensure a more systematic follow-up to the findings of the report. 

External audit 

Albania’s constitutional and legal framework provides for independence of the State Audit 
Institution (SAI) in line with the standards of the International Organisation of Supreme Audit 
Institutions (INTOSAI). However full implementation of the legal framework still needs to be 
ensured.  

The  large  quantity  of  annual  audit  reports  produced  by  the  SAI  impacts  its  institutional 
capacity.  In  recent  years  the  SAI  has  taken  measures  to  improve  the  professional 

98 

 
 
development  of  its  audit  staff.  The  SAI  is  implementing  the  2018-22  strategic  development 
plan and the 2017-19 communication strategy. 

The  quality  of  audit  work  needs  to  be  further  improved,  as  the  audit  activities  do  not  yet 
fully  comply  with  the  INTOSAI  standards.  The  SAI  continues  to  focus  on  compliance  and 
regularity audits determining economic damage  and violation of rules, rather than on  audits 
that  could  help  prevent  such  damage  in  the  first  place.  Financial  audits  do  not  yet  result  in 
professional and qualified audit opinions, even though in 2018 SAI issued for the first time an 
opinion on the execution of the 2017 state budget. In June 2018, the SAI adopted a risk-based 
external  audit  approach.  The  number  of  performance  audits  increased  to  18  in  2018,  in 
comparison to 15 in 2017.  

is 

limited,  and 

impact  of  audit  work 

implementation  of  audit 
The 
recommendations should be improved. Audit reports are summarised quarterly and published 
on a regular basis on the SAI website. The 2017 Memorandum of Understanding between SAI 
and  Ministry  of  Finance  on  monitoring  the  follow-up  of  audit  recommendations  resulted  in 
the  creation  of  a  technical  secretariat  with  representatives  of  both  parties.  The  first  meeting 
was held in December 2018 to elect its Chairman and to agree upon its regulation and action 
plan 2019. 

timely 

the 

Protection of the EU’s financial interests  

Albania has ensured some level of acquis alignment. The national anti-fraud coordination 
service  (AFCOS)  is  a  unit  within  the  Directorate  of  Financial  Inspection  in  the  Ministry  of 
Finance and Economy. An AFCOS network, involving other relevant authorities, has been set 
up and it meets  regularly. A manual  for the management of  irregularities  in  EU  funds  was 
adopted  during  the  reporting period.  Albania cooperates with  the European Commission 
during  investigations  and  reports  to  the  Commission  on  irregularities  and  suspected  fraud 
cases. Albania has not reported any cases via an online Irregularity Management System in 
2018.  So  far,  only  one  case  has  been  reported  through  the  system  in  2015.  There  is  no 
national anti-fraud strategy yet in place. Albania still needs to develop  a solid track record 
in investigations and reporting on irregularities. 

Protection of the euro against counterfeiting 

Albania  has  not  yet  ratified  the  1929  International  Convention  for  the  Suppression  of 
Counterfeiting Currency. Albania is partially aligned with the acquis regarding the definition 
of  counterfeiting  banknotes  and  coins,  as  well  as  the  procedures  for  gathering,  storing  and 
withdrawing  them  from  circulation.  Technical  analysis  is  performed  by  the  National 
Analysis Centre of the Bank of Albania. Cooperation at the national and international level is 
ongoing.  In  August  2018,  the  Bank  of  Albania  joined  the  Europol  Platform  for  Experts.  A 
cooperation  agreement  with  the  European  Commission  on  coins  is  in  place,  while  an 
agreement on banknotes with the European Central Bank is pending. Albania participates in 
the actions of the Pericles 2020 programme. 

5.33.   Chapter 33: Financial and budgetary provisions 

This  chapter  covers  the  rules  governing  the  funding  of  the  EU  budget  (‘own  resources’). 
These  resources  mainly  consist  of:  (i)  contributions  based  on  the  gross  national  income  of 
each  Member  State;  (ii)  customs  duties;  and  (iii)  a  resource  based  on  value-added  tax. 
Member  States  must  have  the  appropriate  administrative  capacity  to  adequately  coordinate 
and ensure the correct calculation, collection, payment and control of own resources.  

Albania  has  some  level  of  preparation  in  this  area.  Some  progress  was  made  in  the 
underlying  policy  areas  that  affect  the  functioning  of  the  EU  funding  system,  through  the 

99 

 
 
progress  in  implementation  of  the  2016  Organic  Budget  Law,  the  fiscal  rule  and  the 
continuation of the public finance management reform.  

Albania needs to make further progress on last year’s recommendations and should therefore 
make efforts to: 

  align  its  relevant  legislation  with  the  requirements  of  the  European  System  of  National 

and Regional Accounts (ESA 2010); 

  align its legislation with the EU provisions on VAT and customs duties; 

  set up solid coordination structures, implementing rules and working procedures to ensure 
that it will be able to collect, control, manage and report on its own resources in line with 
the EU acquis. 

There  was  some  progress  on  the  underlying  policy  areas  affecting  indirectly  the  own 
resources  system  (see  chapters  16-Taxation,  18-Statistics,  29-Customs  union  and  32–
Financial control). 

Albania has structures in place for levying customs duties at the point of import. It operates a 
national VAT system. VAT tax base was increased in 2018 by lowering the VAT registration 
threshold.  

Concerning  the  Gross  National  Income  (GNI)  resource,  some  progress  was  made  on  the 
alignment  with  ESA  2010  standards,  in  methodological  improvements,  faster  publication  of 
statistics  and  increased  number  of  statistical  tables  reported  to  Eurostat.  Excessive  Deficit 
Procedure  tables  under  the  Government  Finance  Statistics  (GFS)  methodology  were 
transmitted  to  Eurostat  in  April  2018  for  the  years  2013-2017.  National  Accounts  data, 
estimates  of  GDP  and  Gross  National  Income  (GNI)  indicators  are  submitted  to  Eurostat 
through the ESA 2010 transmission program. However, they are only partially based on ESA 
2010  standards.  Considerable  efforts  remain  necessary  to  ensure  the  exhaustiveness  of 
national accounts and GNI calculations.  

Preparations for improving the estimation of Non-Observed Economy in Albania started and 
the  first  results  are  expected  in  2019.  Additional  efforts  are  needed  to  ensure  that  effective 
measures  are  taken  to  formalise  the  grey  economy  and  combat  fiscal  evasion  and  customs 
duty fraud. 

On  administrative  infrastructure,  the  Ministry  of  Finance  and  Economy  has  overall 
responsibility for financial and budgetary issues. Albania will need to work on setting up the 
relevant  institutions  involved  in  the  own  resources  system,  a  coordination  body  and 
implementing rules. These are needed to ensure that from accession it will be able to correctly 
calculate, forecast, account for, collect, pay, control and report to the EU on own resources in 
line with the acquis. 

100 

 
 
 
 
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. The European Council of June 2014 endorsed the decision of the General Affairs 
Council  granting  Albania  candidate  status.  In  November  2016  in  view  of  the  progress  in 
meeting the five key priorities, the Commission recommended opening accession negotiations 
with  Albania  subject  to  credible  and  tangible  progress  in  the  implementation  of  the  justice 
reform,  in  particular  the  re-evaluation  of  judges  and  prosecutors  (vetting).  In  April  2018, 
having  positively  assessed  the  additional  progress,  the  Commission  then  recommended 
unconditionally that the Council decides that accession negotiations be opened with Albania, 
at  the same time encouraging Albania to  maintain and deepen the reform momentum in the 
key field of the rule of law.  

In  the  reporting  period,  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  ninth  meeting  of  the  SAA  Committee  was  held  in  October  2018  in  Tirana.  The  SAA 
Council  gathered  in  November  2018  in  Brussels.  Meetings  of  subcommittees  and  of  the 
special group on public administration reform were also regularly held. The Stabilisation and 
Association Parliamentary Committee gathered in Tirana in February 2018 and in Brussels in 
November 2018.  

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, 
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  the  European  Border  and 
Coast Guard Agency (EBCGA).  

A  readmission  agreement  between  the  EU  and  Albania  has  been  in  force  since  2006.  On  1 
May  2019  the  status  agreement  for  operational  cooperation  with  EBCGA  has  entered  into 
force; this will enable the deployment of EBCG teams on the Albanian territory and ensure a 
better  management  of  irregular  migration.  In  March  2019,  Albania  signed  a  working 
arrangement with the EMCDDA, which will facilitate information exchange between the EU 
and Albania, the implementation of capacity building activities, and the development of data 
collection and reporting related to drugs. 

The  EU  provided  financial  assistance  to  Albania  under  the  Instrument  for  Pre-accession 
Assistance (IPA I) in 2007-2013 with a total allocation of EUR 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 2012 and 2013 national programmes. Under IPA II (2014-2020), Albania benefits, in line 
with the priorities set out in the indicative strategy paper, from pre-accession assistance with a 
total  indicative  allocation  of  EUR  649.4  million.  The  Framework  Agreement  for  IPA  II 
entered into force in April 2015. The 2014-2017 action programmes for Albania provide EUR 
170 million to promote reforms in key sectors such as democracy and governance and rule of 
law  and  fundamental  rights  and  provide  EUR  113  million  to  invest  in  competitiveness  and 
growth.  For  the  2018  action  programme  for  Albania,  EUR  64  million  for  rule  of  law  and 
justice  reform,  and  EUR  30  million  for  environment  protection  and  economic  development 
have  been  earmarked.  They 
include  budget  support  operations  for  public  finance 
management, public administration and justice reform, employment and vocational education 

101 

 
 
 
and training, home affairs and transport as well as an EU integration facility. Albania benefits 
from support under the IPA multi-country programme and it participates 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 with IPA support in 
the  EU  programmes  Erasmus+,  Creative  Europe  (Culture  and  Media  strands),  Employment 
and  Social  Innovation,  Horizon  2020,  Customs  2020,  Fiscalis  2020,  Competitiveness  of 
Enterprises and Small and Medium-Sized Enterprises Programme (COSME) and Europe for 
Citizens. 

102 

 
 
 
ANNEX II – STATISTICAL ANNEX 

STATISTICAL DATA (as of 29.04.2019) 

Albania 

Basic data 

Population (thousand) 

Note  2006 

2013 

2014 

2015 

2016 

2017 

3 003.3 

2 897.8 

2 892.4 

2 885.8 

2 875.6 

2 876.6 

Total area of the country (km²) 

28 750 

28 750 

28 750 

28 750 

28 750 

28 750 

National accounts 

Note  2006 

2013 

2014 

2015 

2016 

2017 

Gross domestic product (GDP) (million national currency) 

Gross domestic product (GDP) (million euro) 

GDP (euro per capita) 

GDP per capita (in purchasing power standards (PPS)) 

GDP per capita (in PPS), relative to the EU average (EU-28 = 100) 

Real  GDP  growth  rate:  change  on  previous  year  of  GDP  volume 
(%) 

Employment  growth  (national  accounts  data),  relative  to  the 
previous year (%) 

Labour  productivity  growth:  growth  in  GDP  (in  volume)  per 
person employed, relative to the previous year (%) 

872 735 

1 350 05
3 

1 395 30
5 

1 434 30
7 

1 472 47
9 

1 551 28
1p 

7 091 

2 400 

5 400 

22 

5.9 

: 

: 

9 625 

3 300 

7 800 

29 

1.0 

: 

: 

9 969 

3 500 

8 300 

30 

1.8 

: 

: 

10 264 

10 720 

11 564p 

3 600 

8 800 

30 

2.2 

: 

: 

3 700 

8 600 

30 

3.3 

: 

: 

4 000p 

9 100p 

30p 

3.8p 

: 

: 

103 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unit labour cost growth, relative to the previous year (%) 

**3  year  change  (T/T-3)  in  the  nominal  unit  labour  cost  growth 
index (2010 = 100) 

Labour  productivity  per  person  employed:  GDP  (in  PPS)  per 
person employed relative to EU average (EU-28 = 100) 

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 (%) 

Gross fixed capital formation by the general government sector, as 
a percentage of GDP (%) 

: 

: 

: 

20.5 

11.2 

18.1 

50.2 

88.2 

38.1 

: 

25.2 

49.1 

: 

: 

: 

: 

22.4 

14.6 

11.8 

51.2 

91.1b 

26.1b 

2.0b 

28.9b 

47.0b 

: 

: 

: 

: 

22.9 

14.8 

9.9 

52.4 

92.2 

24.2 

1.5 

28.2 

47.2 

: 

: 

: 

: 

22.5 

14.6 

10.1 

52.8 

91.8 

24.4 

1.4 

27.3 

44.5 

: 

: 

: 

: 

22.6 

14.0 

10.2 

53.2 

92.2 

24.4 

0.9 

29.0 

45.8 

: 

: 

: 

: 

21.8p 

12.8p 

10.5p 

54.9p 

91.2p 

24.5p 

0.5p 

31.6p 

46.6p 

: 

Business 

Industrial production volume index (2010 = 100) 

Note  2006 

55.4 

2013 

176.5 

2014 

179.1 

2015 

175.3 

2016 

143.8 

2017 

142.9 

Number of active enterprises (number) 

1) 

53 869 

78 950 

78 920 

95 184 

98 262 

: 

Birth  rate:  number  of  enterprise  births  in  the  reference  period  (t) 
divided by the number of enterprises active in t (%) 

18.2 

10.9 

15.4 

: 

19.5 

15.3 

104 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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) 

: 

: 

: 

: 

: 

2) 

81.1 

81.0 

80.1 

81.7 

81.4 

2) 

937 

1 867 

1 949 

2 083 

2 276 

2) 

1 493 

2 803 

2 871 

3 124 

3 388 

: 

: 

: 

: 

Inflation rate and house prices 

Note  2006 

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

**Annual change in the deflated house price index (2010 = 100) 

2.4 

: 

2013 

1.9 

2014 

1.6 

2015 

1.9 

2016 

1.3 

2017 

2.0 

: 

: 

: 

: 

: 

Balance of payments 

Note  2006 

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  balance  for  primary 
income (million euro) 

Balance  of  payments  current  account:  net  balance  for  secondary 
income (million euro) 

Net  balance  for  primary  and  secondary  income:  of  which 
government transfers (million euro) 

3) 

3) 

3) 

3) 

2013 

-891 

2014 

-1 076 

2015 

-884 

2016 

-812 

2017 

-866 

-471 

-1 659 

-1 963 

-2 216 

-2 299 

-2 603 

-2 824 

-32 

209 

226 

166 

323 

91 

525 

122 

797 

174 

1 082 

29 

3) 

1 011 

680 

725 

768 

821 

848 

3) 

50 

17 

9 

6 

48 

70 

105 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
**3 year backward moving average of the current account balance 
relative to GDP (%) 

**Five year change in share of world exports of goods and services 
(%) 

: 

: 

-10.8 

-10.1 

-9.6 

-9.0p 

-7.9p 

: 

: 

: 

: 

: 

Net balance (inward - outward) of 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 (%) 

250.3 

923.2 

811.5 

818.4 

936.5 

993.8 

8.3 

: 

30.0 

25.1 

34.0 

: 

: 

: 

57.9 

9.9 

23.2 

: 

258.6 

953.2 

836.6 

852.4 

994.4 

1 017.0 

: 

: 

259.5 

272.7 

319.5 

242.3 

474.3 

: 

-42.9 

-43.2 

-44.3 

-47.1 

16.1 

-18.9 

8.0 

1.2 

0.9 

1.0 

Public finance 

Note  2006 

2013 

2014 

2015 

2016 

2017 

***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 (%) 

-3.4 

53.8 

26.3 

29.7 

-5.0 

61.7 

24.2 

29.2 

-5.2 

66.1 

26.3 

31.5 

-4.1 

68.8 

26.4 

30.5 

-1.8 

68.6 

27.6 

29.4 

-2.0 

66.8 

27.7 

29.7 

106 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Financial indicators 

Note  2006 

Gross external debt of the whole economy, relative to GDP (%) 

Gross external 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) 

3) 

3) 

2013 

66.2 

2014 

69.5 

2015 

74.4 

26.6 

105.7 

228.8 

246.3 

272.7 

2016 

73.4p 

253.5 

2017 

68.7 

217.6 

1 969 

2 109 

2 524 

2 749 

3 170 

3 441 

3 879 

4 942 

5 161 

5 174 

5 365 

5 504 

Money supply: M3 (M2 plus marketable instruments, million euro) 

5 415 

8 192 

8 538 

8 703 

9 198 

9 438 

Total  credit  by  monetary  financial  institutions  to  residents 
(consolidated) (million euro) 

**Annual change in financial sector liabilities (%) 

**Private credit flow, consolidated, relative to GDP (%) 

**Private debt, consolidated, relative to GDP (%) 

Interest rates: day-to-day money rate, per annum (%) 

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, 42 countries (2005 
= 100) 

**3 year change (T/T-3) in the trade-weighted effective exchange 
rate index, 42 countries (2005 = 100) 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

4) 

5) 

6) 

4.37 

12.93 

5.23 

3.80 

9.52 

4.17 

2.92 

7.66 

1.92 

2.26 

7.77 

1.35 

1.49 

5.89 

0.80 

1.34 

5.98 

0.75 

123.08 

140.26 

139.97 

139.74 

137.36 

134.15 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

Value of reserve assets (including gold) (million euro) 

1 368 

2 015 

2 192 

2 880 

2 945 

2 996 

107 

 
 
 
 
 
 
 
 
 
 
 
 
 
External trade in goods 

Value of imports: all goods, all partners (million euro) 

Value of exports: all goods, all partners (million euro) 

Note  2006 

2 431 

182 

2013 

3 699 

1 761 

2014 

3 941 

1 827 

2015 

3 882 

1 728 

2016 

4 169 

1 771 

2017 

4 648 

2 026 

Trade balance: all goods, all partners (million euro) 

-1 803 

-1 938 

-2 114 

-2 154 

-2 399 

-2 622 

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 
(%) 

124 

119 

119 

120 

116 

119 

66.5 

66.9 

76.7 

64.3 

77.4 

61.1 

75.4 

61.8 

77.9 

63.1 

77.2 

61.7 

Demography 

Note  2006 

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) 

6.4 

7.4 

: 

: 

Labour market 

Note  2006 

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 (%) 

: 

: 

108 

2013 

5.3 

2014 

5.2 

2015 

3.6 

2016 

3.6 

2017 

3.0 

7.9 

7.9 

7.1 

8.7 

8.0 

76.0 

80.1 

76.4 

80.1 

2013 

67.6e 

2014 

68.6e 

76.2e 

79.7e 

2015 

71.3e 

77.1 

80.1 

2016 

73.3e 

77.1 

80.1 

2017 

73.9 

56.7e 

56.6e 

59.3e 

62.1e 

63.9 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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 (%) 

: 

: 

: 

: 

: 

: 

: 

: 

: 

7) 

64.8e 

49.3e 

51.1e 

44.0e 

9.7e 

7.1e 

39.2e 

17.8e 

65.2e 

48.5e 

51.2e 

42.7e 

11.0e 

6.4e 

39.9e 

17.5e 

68.1e 

50.7e 

53.6e 

41.3e 

11.6e 

6.9e 

40.2e 

16.7e 

69.4e 

55.0e 

54.8e 

40.2e 

12.8e 

6.5e 

40.5e 

15.6e 

72.1 

55.6 

55.5e 

38.2e 

12.5e 

6.9e 

42.4e 

16.4e 

82.2e 

82.5e 

83.3e 

84.4e 

83.6e 

8) 

13.8 

15.9e 

17.5e 

17.1e 

15.2e 

13.7e 

Male unemployment rate (%) 

Female unemployment rate (%) 

8) 

8) 

11.8 

16.8 

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 levels 0-2) (%) 

: 

: 

: 

17.8e 

13.5e 

31.4e 

19.2e 

15.2e 

39.0e 

17.1e 

17.1e 

39.8e 

15.9e 

14.4e 

36.5e 

14.6e 

12.6e 

31.9e 

11.5e 

11.2e 

11.3e 

10.1e 

8.9e 

13.6e 

13.4e 

12.0e 

11.8e 

11.2 

109 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unemployment  rate  for  persons  (aged  25–64)  having  completed 
tertiary education (ISCED levels 5-8) (%) 

: 

: 

: 

: 

13.3e 

11.7e 

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) (2010 = 100) 

Note  2006 

2013 

2014 

2015 

2016 

2017 

9) 

9) 

28 822 

52 150 

53 025 

54 000 

54 488 

59 812 

85.8 

111.1 

111.2 

111.1 

110.7 

118.8 

GINI coefficient 

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 (%) 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

30.6e 

26.0e 

21.3e 

19.6e 

19.6 

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) 

Note  2006 

75.0 

2013 

117.7 

2014 

130.7 

2015 

139.9 

2016 

151.6 

2017 

146.7 

640.7e 

1 822.9 

1 704.1 

1 655.7 

1 794.4 

1 874.8 

Mobile broadband penetration (per 100 inhabitants) 

Fixed broadband penetration (per 100 inhabitants) 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

Infrastructure 

Density of railway network (lines in operation per thousand km²) 

15.7 

12.6 

12.6 

13.8 

12.2 

12.2 

Note  2006 

2013 

2014 

2015 

2016 

2017 

110 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Length of motorways (kilometres) 

: 

: 

: 

: 

: 

: 

Innovation and research 

Note  2006 

Public expenditure on education relative to GDP (%) 

*Gross domestic expenditure on R&D relative to GDP (%) 

Government  budget  appropriations  or  outlays  on  R&D 
(GBAORD), as a percentage of GDP (%) 

Percentage of households who have internet access at home (%) 

3.2 

: 

: 

: 

2013 

3.3 

: 

: 

: 

2014 

3.3 

: 

: 

2015 

3.1 

: 

: 

2016 

3.1p 

: 

: 

2017 

3.1p 

: 

: 

23.8 

25.0 

29.4 

30.2 

Environment 

Note  2006 

2013 

2014 

2015 

2016 

2017 

*Index of greenhouse gas emissions,  CO2 equivalent (1990 = 100) 

94 

: 

: 

: 

: 

: 

Energy  intensity  of  the  economy  (kg  of  oil  equivalent  per  1 000 
euro GDP at 2010 constant prices) 

Electricity  generated  from  renewable  sources  relative  to  gross 
electricity consumption (%) 

296.2 

250.3 

244.9 

223.7 

221.6 

224.6 

90.0 

75.0 

60.6 

80.8 

100.5 

60.8 

Road share of inland freight transport (based on tonne-km) (%) 

: 

: 

: 

: 

: 

: 

Energy 

Note  2006 

Primary production of all energy products (thousand TOE) 

Primary production of crude oil (thousand TOE) 

Primary production of solid fuels (thousand TOE) 

Primary production of gas (thousand TOE) 

Net imports of all energy products (thousand TOE) 

1 219 

500 

11 

9 

881 

111 

2013 

2 034 

1 207 

1 

15 

604 

2014 

2 013 

1 368 

0 

25 

682 

2015 

2 073 

1 279 

34 

27 

280 

2016 

1 943 

1 056 

2 

35 

461 

2017 

1 634 

959 

68 

37 

920 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Gross inland energy consumption (thousand TOE) 

Gross electricity generation (GWh) 

2 182 

5 524 

2 365 

6 959 

2 355 

4 724 

2 199 

5 895 

2 250 

7 782 

2 368 

4 526 

Agriculture 

Note  2006 

2013 

2014 

2015 

2016 

2017 

Agricultural  production  volume  index  of  goods  and  services  (at 
producer prices) (2010 = 100) 

: 

: 

: 

: 

: 

: 

Utilised agricultural area (thousand hectares) 

1 120 

1 190 

1 178 

1 175 

1 174 

1 174 

Livestock  numbers:  live  bovine  animals  (thousand  heads,  end  of 
period) 

634 

498 

500 

504 

492 

475 

Livestock numbers: live swine (thousand heads, end of period) 

152 

152 

172 

171 

181 

180 

Livestock numbers: live sheep and live goats (thousand heads, end 
of period) 

2 770 

2 723 

2 800 

2 751 

2 913 

2 859 

Raw milk available on farms (thousand tonnes) 

1 102 

1 131 

1 133 

1 131 

1 145 

1 156 

Harvested  crop  production:  cereals  (including  rice)  (thousand 
tonnes) 

10) 

508 

703 

700 

696 

698 

702 

Harvested crop production: sugar beet (thousand tonnes) 

Harvested crop production: vegetables (thousand tonnes) 

0 

688 

0 

924 

0 

950 

0 

0 

0 

1 030 

1 129 

1 152 

: = not available 
b = break in series 
e = estimated value 
p = provisional 
s = Eurostat estimate 
* = Europe 2020 indicator 
** = Macroeconomic Imbalance Procedure (MIP) indicator 

112 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
*** = 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) 

2) 

The  Albanian  Government  is  implementing  an  action  plan  to  reduce  the  informal 
economy. As result, 56 787 active enterprises were registered for the first time in the 
statistical business register in 2015. Most of them are not new entities for 2015. 
2006: based on NACE Rev. 1.1; coverage is Divisions 10 to 74. 2013-2016: based on 
NACE Rev. 2; coverage is Divisions 05 to 82 and 95. 
3) 
2006: based on balance of payments manual edition 5 (BPM5). 
4)  Annual average of the Tribor rate – interbank rate for overnight loans. 
5)  Average weighted rate applied on new 12-month loans over the respective month, on 

12-month maturity. 

6)  Deposit interest rate represents the average weighted rate for newly accepted deposits 

7) 

over the respective month, on 12-month maturity. 
2013  and  2014:  including  persons  who  have  not  or  could  not  be  classified  to  a 
particular activity. 
2006: administrative data. 
Public sector. 

8) 
9) 
10)  Excluding rice. 

113