COMMISSION STAFF WORKING DOCUMENT Albania 2021 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 2021 Communication on EU Enlargement Policy
Date: 2021-10-19
Institutions: Directorate-General for Neighbourhood and Enlargement Negotiations, European Commission
Subjects: Albania, accession criteria, accession negotiations, pre-accession strategy, regional cooperation

EN 

  EN 

   EUROPEAN COMMISSION  Strasbourg, 19.10.2021  SWD(2021) 289 final  COMMISSION STAFF WORKING DOCUMENT Albania 2021 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  2021 Communication on EU Enlargement Policy       {COM(2021) 644 final} - {SWD(2021) 288 final} - {SWD(2021) 290 final} - {SWD(2021) 291 final} - {SWD(2021) 292 final} - {SWD(2021) 293 final} - {SWD(2021) 294 final}  
 
 
TABLE OF CONTENTS 

1. 

Introduction .................................................................................................................................... 3 

1.1. 

Context .................................................................................................................................... 3 

1.2. 

Summary of the report ............................................................................................................ 3 

2.  Cluster 1: The Fundamentals of the Accession Process .................................................................. 8 

2.1. 

Functioning of democratic institutions and Public Administration Reform ............................ 8 

2.1.1   Democracy ......................................................................................................................... 8 

2.1.2.  Public administration reform ........................................................................................... 14 

2.2. Rule of law and fundamental rights ........................................................................................... 18 

2.2.1.  Chapter 23: Judiciary and fundamental rights ................................................................. 18 

2.2.2.  Chapter 24: Justice, freedom and security ...................................................................... 35 

2.3. Economic criteria ....................................................................................................................... 50 

2.3.1. The existence of a functioning market economy ................................................................ 50 

2.3.2. The capacity to cope with competitive pressure and market forces within the Union ..... 57 

2.4. Public procurement, statistics, financial control ....................................................................... 60 

Chapter 5: Public procurement ..................................................................................................... 60 

Chapter 18: Statistics .................................................................................................................... 62 

Chapter 32: Financial control ........................................................................................................ 64 

3.  Good neighbourly relations and regional cooperation ................................................................. 67 

4.  Ability to assume the obligations of membership ........................................................................ 70 

Cluster 2: Internal Market ................................................................................................................. 70 

Chapter 1: Free movement of goods ............................................................................................ 70 

Chapter 2: Freedom of movement of workers ............................................................................. 72 

Chapter 3: Right of establishment and freedom to provide services ........................................... 73 

Chapter 4: Free movement of capital ........................................................................................... 74 

Chapter 6: Company law ............................................................................................................... 76 

Chapter 7: Intellectual property law ............................................................................................. 77 

Chapter 8: Competition policy ...................................................................................................... 78 

Chapter 9: Financial services ......................................................................................................... 79 

Chapter 28: Consumer and health protection .............................................................................. 81 

Cluster 3: Competitiveness and inclusive growth ............................................................................. 84 

Chapter 10: Information society and media ................................................................................. 85 

Chapter 16: Taxation ..................................................................................................................... 86 

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Chapter 17: Economic and monetary policy ................................................................................. 87 

Chapter 19: Social policy and employment .................................................................................. 89 

Chapter 20: Enterprise and industrial policy ................................................................................ 95 

Chapter 25: Science and research ................................................................................................. 98 

Chapter 26: Education and culture ............................................................................................... 99 

Chapter 29: Customs union ........................................................................................................ 103 

Cluster 4: The Green agenda and sustainable connectivity ............................................................ 104 

Chapter 14: Transport ................................................................................................................. 104 

Chapter 15: Energy ...................................................................................................................... 107 

Chapter 21: Trans-European networks ....................................................................................... 110 

Chapter 27: Environment and climate change ........................................................................... 112 

Environment................................................................................................................................ 113 

Cluster 5: Resources, agriculture and cohesion .............................................................................. 116 

Chapter 11: Agriculture and rural development ......................................................................... 116 

Chapter 12: Food safety, veterinary and phytosanitary policy ................................................... 118 

Chapter 13: Fisheries .................................................................................................................. 120 

Chapter 22: Regional policy and coordination of structural instruments .................................. 121 

Chapter 33: Financial and budgetary provisions ........................................................................ 123 

Cluster 6: External relations ............................................................................................................ 124 

Chapter 30: External relations .................................................................................................... 124 

Chapter 31: Foreign, security and defence policy ...................................................................... 127 

Annex I – Relations between the EU and Albania ............................................................................... 129 

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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.  

On  25  March  2020,  the  Council  decided  –  and  the  members  of  the  European  Council 
endorsed this decision1 – to open accession negotiations with Albania. The Council tasked the 
Commission  to  report  on  a  number  of  issues  to  be  addressed  by  Albania  prior  to  the  first 
Inter-governmental Conference on accession negotiations.  

Overall, and despite the challenges posed by the COVID-19 pandemic, Albania has continued 
to  show  its  commitment  to  EU  oriented  reforms  and  delivered  tangible  and  sustainable 
results. It has fulfilled all the conditions set out in the Council Conclusions of March 2020 for 
the first Inter-governmental Conference.  
In  October  2020,  the  Commission  adopted  the  enlargement  package2  and  assessed  that  the 
condition related to the functioning of the Constitutional Court was close to being met, while 
all  the  other  conditions  to  be  fulfilled  prior  to  the  holding  of  the  first  Inter-Governmental 
Conference  on  accession  negotiations  were  met.  The  Constitutional  Court  regained 
functionality  in  December  2020.  Meanwhile,  Albania  has  continued  to  meet  all  other 
conditions  and  has  made  further  considerable,  steady  progress  in  addressing  the  other 
priorities highlighted by the Council. 

The COVID-19 pandemic continued throughout the reporting period. By early October 2021, 
Albania had recorded 171,794 cases and over 2,710 deaths due to the COVID-19 pandemic. 
The  Commission  has  redirected  EUR  50.6  million  in  grants  to  meet  the  most  immediate 
needs  and  provide  a  socio-economic  response  to  the  pandemic.  The  Commission  also 
provided macro-financial assistance of EUR 180 million through a very favourable loan; the 
first instalment (EUR 90 million) was disbursed in March 2021. 

Together  with  the  donation  of  medical  equipment,  the  continued  delivery  of  EU-funded 
vaccines is a tangible sign of EU solidarity. Albania has a countrywide vaccination strategy. 
Around 26% of the population was fully vaccinated by early September. It received 143,910 
Pfizer/BioNTech  doses  from  the  EU  between  May  and  August  2021,  facilitated  by  Austria 
and funded by the EU4Health grant, and EU Member States delivered 310,000 doses by end 
September 2021. The EU supported COVAX initiative also delivered over 143,400 doses to 
Albania in the same period.  

1.2. 

SUMMARY OF THE REPORT3 4 

As regards the political criteria, general elections were held on 25 April 2021, following the 
cross-party agreement of 5 June 2020 that led to a wide-ranging electoral reform, in line with 

1 https://data.consilium.europa.eu/doc/document/ST-7002-2020-INIT/en/pdf and 
https://www.consilium.europa.eu/en/meetings/european-council/2020/03/26/ 
2 COM(2020)660final of 6.10.2020 and SWD(2020)354final of 6.10.2020 
3  This  report  covers  the  period  from  June  2020  to  June  2021.  It  is  based  on  input  from  a  variety  of  sources, 
including contributions from the government of  Albania, the EU Member States, European Parliament reports 
and information  from various international and non-governmental organisations.  It also includes the results of 
comparative assessments and indices produced by other stakeholders, in particular in the area of rule of law. 
4 For the  state of play the report uses the  following assessment scales: early stage, some level of preparation, 
moderately  prepared,  good  level  of  preparation  and  well  advanced.  For  progress  made  during  the  reporting 
period,  the  following  scale  has  been  used:  backsliding,  no  progress,  limited  progress,  some  progress,  good 
progress and very good progress. Where appropriate, also interim steps have been used. 

3 

 
 
 
                                                           
OSCE/ODIHR  recommendations.  Electronic  identification  of  voters  was  implemented  in 
97% of polling stations, while e-voting and e-counting was piloted successfully in 32 polling 
stations  in  Tirana.  The  OSCE/ODIHR  final  assessment  found  that  elections  were  generally 
well  organised.  The  new  electoral  administration  gained  the  trust  of  most  stakeholders. 
Concerns  remained  related  to  the  misuse  of  public  resources  or  official  functions,  to 
allegations of vote buying, and to the leaking of sensitive personal data covering the political 
preferences  of  citizens.  These  cases  are  being  investigated.  Parliament  continued  to  work 
under the restrictions brought  in  due to  the pandemic. With regard to  EU oriented reforms, 
Parliament adopted a number of significant pieces of legislation, in areas such as asylum, the 
population  census,  and the efficiency of the judiciary. Throughout  the reporting period, the 
government maintained a focus on reforms required for the country’s path towards the EU, 
despite the challenge of addressing the negative social and economic impact of the COVID-
19  pandemic.  In  the  new  legislature,  the  majority  and  the  opposition  will  need  to  improve 
political  dialogue  and  work  together  with  all  parts  of  society  to  further  advance  the  EU 
reform agenda and accession negotiations. Coordination within the administration needs to be 
improved, notably regarding EU integration. The territorial administrative reform should be 
further  consolidated  as  part  of  the  wider  decentralisation  agenda.  This  is  particularly 
necessary  to  guarantee  local  fiscal  autonomy  and  empower  municipalities  to  provide  good 
quality  public  services.  Limited  progress  has  been  made  to  implement  the  roadmap  on 
creating  an  enabling  environment  for  civil  society.  Nonetheless,  Albanian  civil  society  has 
been able to provide support and services to most vulnerable people affected by the COVID-
19 pandemic.   

Albania is moderately prepared with the reform of its public administration. Some progress 
was made in building capacity in line ministries to implement regulatory impact assessments, 
adopting  guidelines  for  public  consultations,  setting  up  the  IT  systems  for  integrated 
planning,  increasing  the  implementation  rate  of  the  National  European  Integration  Plan, 
increasing the number of e-services, and completing the testing phase to automate the payroll 
system. Implementation of the 2015-2022 public administration reform (PAR) and the 2014-
2022 public financial management (PFM) reform strategies has continued despite the impact 
of the pandemic.  

Albania’s judicial system is also moderately prepared. Albania has continued to implement 
the  comprehensive  justice  reform,  resulting  in  good  progress.  In  particular,  it  reached  an 
important  milestone  at  the  end  of  2020,  with  the  appointment  of  three  new  judges  to  the 
Constitutional  Court.  With  seven  judges  in  office,  the  Constitutional  Court  regained  its 
necessary  quorum  of  minimum  six  members  to  hold  plenary  sessions,  thus  being  fully 
operational and meeting the related outstanding condition for the first IGC, which continues 
to be fulfilled. The Constitutional Court has started to fully exercise its functions, including 
by  adjudicating  on  constitutional  disputes  between  state  institutions  about  respective 
competences. Progress also continued on High Court appointments.  The High Court regained 
its  quorum  in  March  2020.  With  the  promotion  by  the  High  Judicial  Council  of  six  new 
judges  in  March  and  July  2021  it  has  reached  nine  sitting  judges,  which  make  it  fully 
operational  -  a  condition  for  the  first  IGC,  which  continues  to  be  fulfilled.  Further 
appointments  to  the  High  Court  are  expected.  The  Parliament  adopted  amendments  to  ten 
laws  aiming  to  further  strengthen  the  efficiency  of  the  judicial  system  and  its  capacity  to 
tackle corruption and organised crime. 

The  temporary  re-evaluation  of  all  judges  and  prosecutors  (vetting  process)  has  advanced 
steadily, continuing to deliver tangible results - a condition for the first IGC, which continues 
to  be  fulfilled.  Under  the  aegis  of  the  European  Commission,  the  International  Monitoring 
Operation  has  continued  to  oversee  the  process.  As  of  15  September  2021  the  vetting 

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institutions had completed 437 cases at first instance, including all priority files. Of the 437 
decisions, 298 are final (i.e. after appeal). Overall, 62 % of the vetting files processed so far 
have resulted in dismissals and terminations largely due to resignations by the assessees. The 
vetting  institutions  are  expected  to  continue  to  refer  to  the  prosecution  services  all  cases 
where there are indications of criminal offences. 

the  Special  Prosecution  Office  (SPO)  and 

The  Specialised  Structure  for  Anti-Corruption  and  Organised  Crime  (SPAK), 
comprising 
the  National  Bureau  of 
Investigation  (NBI),  are  operational  -  a  condition  for  the  first  IGC,  which  continues  to  be 
fulfilled.  While  the  2021  budget  foresees  the  appointment  of  20  prosecutors,  the  SPO  has 
reached  the  first  target  of  15  prosecutors,  including  the  Chief  Special  Prosecutor.  The  first 
round  of  recruitment  for  NBI  investigators  resulted  in  the  appointment  of  28  investigators, 
who, after an intense training programme, are now operational. A second round to recruit an 
additional 32 investigators was opened in April 2021 and is expected to be concluded before 
the end of the year.  

Albania  has  some  level  of  preparation  in  the  fight  against  corruption.  It  made  some 
progress  in  strengthening the  fight  against corruption  - a condition  for  the first IGC, which 
continues  to  be  fulfilled.  Overall,  the  implementation  of  the  Inter-sectoral  Strategy  against 
Corruption  is  on  track.  Although  the  vetting  of  the  members  of  the  judiciary  is  an 
administrative  process,  it  is  yielding  results  in  the  fight  against  corruption  as  judges  and 
prosecutors dismissed, as a result of vetting, are brought to justice. Albania has made further 
efforts  to  create  a  solid  track  record  in  the  fight  against  corruption,  although  it  remains  an 
objective that requires political will and further structured and consistent actions. Convictions 
in  cases  involving  high-level  officials  still  remain  limited,  fostering  a  culture  of  impunity 
within the higher levels of the State. The specialised structures against anti-corruption (SPAK 
and  the  anti-corruption  and  organised  crime  courts)  should  significantly  strengthen  the 
country’s  overall  capacity  to  investigate  and  prosecute  corruption.  Overall,  corruption  is 
prevalent in many areas of public and business life and remains an issue of serious concern.  

Albania  has  some  level  of  preparation  in  the  fight  against  organised  crime.  It  made  good 
progress to meet last year’s recommendations. It achieved tangible results in the fight against 
organised crime, including by stepping up cooperation with EU Members States and Europol 
-  a  condition  for  the  first  IGC,  which  continues  to  be  fulfilled.  The  country  continued  to 
implement the Financial Action Task Force (FATF) Action Plan to improve effectiveness in 
the  field  of  anti-money  laundering  and  the  package  of  temporary  preventive  measures  to 
boost its capacity to counter criminal organisations (Operation Force of Law) throughout the 
year. Exchange of qualitative information and joint police operations involving international 
partners  further  intensified.  Albania  has  continued  to  show  its  commitment  to  counter  the 
production and trafficking of drugs, as air monitoring by EU member state law enforcement 
services has continued.  The new specialised system  against organised crime and corruption 
enables  reinforced  cooperation  between  police  and  prosecution  services.  Financial 
investigations  need  to  accompany  systematically  criminal  proceedings.  Efforts  need  to 
continue  to  increase  the  number  of  prosecutions  and  final  convictions,  especially  at  high-
level.  Albania  adopted  a  new  national  cross-sector  counter-terrorism  strategy  and  action 
plan  in  December  2020  and  made  very  good  progress  in  implementing  the  bilateral 
arrangement with the EU on operationalising the Joint Action Plan on counter-terrorism for 
the  Western  Balkans.  More  efforts  are  needed  to  tackle  cybercrime,  trafficking  in  human 
beings and money laundering cases.  

On fundamental rights, Albania complies with  international  human rights  instruments  and 
has  ratified  most  international  conventions  related  to  the  protection  of  fundamental  rights. 

5 

 
 
Albania  has  pursued  efforts  to  meet  its  obligations  under  these  instruments.  As  regards  the 
adoption of the remaining implementing legislation related to the 2017 framework law on the 
protection  of  national  minorities,  it  adopted  an  additional  by-law  on  minority  education  in 
December  2020,  which  brought  the  number  of  adopted  by-laws  to  eight.  The  remaining 
implementing legislation, including on self-identification and use of minority languages, has 
yet to be adopted. Efforts are ongoing to implement a comprehensive land sector reform and 
to consolidate property rights. A population census law was adopted. Albania has some level 
of preparation / is moderately prepared in the area of freedom of expression. There was no 
progress over the reporting period. The atmosphere of verbal attacks, smear campaigns and 
acts  of  intimidation  against  journalists  has  not  improved.  Tensions  between  political  actors 
and  journalists  have  increased  during  the  COVID-19  crisis  and  in  the  context  of  the 
parliamentary elections. The reported attacks against journalists have not resulted in any final 
convictions.  Self-regulation  in  online  media  needs  to  be  ensured.  Steps  to  make  the  audio-
visual  regulatory  authority  fully  operational  need  to  be  taken  in  a  way  that  ensures  its 
independence  and  legitimacy.  The  public  service  broadcaster’s  independence,  professional 
standards  and  financial  sustainability  need  to  be  strengthened.  Following  the  unfavourable 
opinion of the Venice Commission and wide criticism on draft amendments to the media law 
aimed  at  regulating  online  media  and  some  aspects  of  defamation,  representatives  from  the 
ruling majority publicly committed to ensure that any new legislation on media would be in 
line with the Venice Commission recommendations and submitted to consultation with media 
organisations. The government reconsidered the matter and the Assembly did not revert to the 
issue. The parliament and government resulting from the 25 April elections must uphold the 
commitment to ensure that any possible changes to the media law would be in line with the 
Venice Commission Opinion and submitted to proper consultations. On gender equality, the 
implementation  of  the  national  strategy  and  action  plan  2016-2020  on  gender  equality  was 
hampered  by  a  persistent  funding  gap.    A  new  strategy  on  gender  equality  2021-2030  was 
adopted  in  June  2021.  Albania  should  make  efforts  to  ensure  adequate  state  funding  to 
implement  it at  central  and local  levels.  Efforts  are  also  required to ensure that  all national 
strategies  at  central  and  local  level  are  gender  mainstreamed  and  apply  gender  responsive 
budgeting. 

On migration, the legal framework on migration is  largely aligned with the EU  acquis but 
needs updating in line with recent developments. In February 2021, Albania adopted a new 
law  on  asylum.  Strategies  on  an  integrated  border  management  and  on  the  diaspora  were 
adopted in 2020.  Implementation of the national migration strategy and action plan for 2019-
2022  as  continued,  providing  a  clear  framework  for  managing  and  coordinating  migration 
flows and the Commission has issued four monitoring reports. Despite border closure during 
March-May  2020,  Albania  continued  to  experience  a  growing  influx  of  irregular  migrants, 
mostly from Greece and leaving Albania after a few days, on the way to other EU countries. 
The  number  of  irregular  migrants  apprehended  in  Albania  in  2020  increased  by  13% 
compared with 2019.  

The number of Albanian citizens lodging asylum requests in EU Member States decreased 
by 66% in 2020 compared to 2019, from 20,415 to 6,935 applications, according to Eurostat 
data. The COVID-19 pandemic contributed in large part to this sharp decrease, but it can be 
noted that the average decrease of applications from the rest of the world to the EU is much 
smaller  (-33%).  The  ‘recognition  rate’  in  2020  was  around  4.4%  compared  with  5.3%  in 
2019. Since applications peaked in 2017 in the most affected Member State, the number of 
applications has fallen from 12,130 in 2017 to 2,985 in 2020. Three Albanian police liaison 
officers are deployed in the EU and a liaison officer from the EU works in Tirana to help with 
exit  checks.  The  issue  of  Albanian  nationals  making  unfounded  asylum  applications  to  EU 

6 

 
 
Member  States  and  Schengen-associated  countries  still  requires  substantial  efforts  from  the 
Albanian  authorities.  In  addition  to  information  campaigns,  thorough  border  checks, 
awareness-raising  on  rights  and  obligations  under  the  visa-free  regime,  identifying  and 
addressing the underlying reasons, dialogue and cooperation with the countries most affected 
have  continued.  The  Commission  is  monitoring  the  trend  very  closely  in  the  framework  of 
the post-visa liberalisation monitoring mechanism. 

As regards the economic criteria, Albania made some progress and is moderately prepared 
in  terms  of  developing  a  functioning  market  economy.  Hit  by  the  double  shock  from  the 
earthquake  of  November  2019  and  the  COVID-19  pandemic,  GDP  contracted  in  2020, 
although  by  less  than  initially  expected.  The  pandemic-related  domestic  lockdown  and 
international  travel  restrictions  caused  significant  losses  for  the  tourism  and  manufacturing 
sectors, but the economy started to rebound in the second half of the year. Within the limited 
fiscal  and monetary policy space  available, the  government  and the central  bank took  swift 
and appropriate actions to support business, households and the health sector. This cushioned 
the impact on the labour market and maintained macroeconomic and financial sector stability. 
It also pushed up the public debt and deficit ratios and increased the country’s vulnerability to 
external shocks. Dealing with the double shock stretched the capacity of the administration, 
but it largely maintained business continuity, and work continued on most ongoing reforms 
and legislative initiatives.   

Albania made some progress and has some level of preparation in its capacity to cope with 
competitive  pressure  and  market  forces  within  the  EU.  It  has  made  improvements  on 
energy  and  transport  infrastructure,  the  use  of  digital  communication  and  on  education 
outcomes,  but  significant  gaps  remain  in  comparison  to  its  regional  and  European  peers. 
Albania’s competitiveness is hindered by a lack of entrepreneurial and technological know-
how, significant levels of informality, unmet investment needs in human and physical capital, 
and  low  spending  on  R&D.  Pre-existing  and  significant  gaps  in  skills  and  education  have 
probably  widened due  to COVID-19 related lockdowns and distance learning, which is  not 
accessible  to  all.  Regional  integration  and  exports  increased,  but  remained  below  potential. 
The  lack  of  product  and  geographical  diversification  in  Albania’s  exports  compound  its 
vulnerability to external shocks. 

On public procurement, where Albania is moderately prepared, the country has made good 
progress, in particular by adopting the new law on public procurement. On statistics, where 
Albania  is  also  moderately  prepared,  it  made  some  progress  on  aligning  with  ESA  2010 
standards,  faster  publication,  and  the  adoption  of  the  Population  Census  Law.  Albania  is 
moderately  prepared  in  most  areas  on  financial  control,  where  the  country  made  some 
progress, notably on public internal financial control and external audit. 

Albania is moderately prepared in most of the areas of the internal market, namely the free 
movement of goods, services and capital,  competition policy, and financial services.   It has 
made some progress in particular by adopting a law on compulsory insurance in transport and 
in  further  aligning  its  banking  legislation,  but  the  State  Aid  Commission  needs  to  be  made 
independent  and  sufficiently  resourced.  Preparations  are  at  an  early  stage  on  consumer  and 
health protection, as the country made no progress on health outside its COVID-19 response. 
Albania needs to implement the One Health approach and to ensure that everyone has quality 
healthcare  coverage.  This  policy  cluster  is  key  for  Albania’s  preparations  to  meet  the 
requirements  of the EU’s  internal  market  and is  of high  relevance  for  early integration  and 
the development of the Common Regional Market. 

Albania  has  achieved  a  moderate 
to 
competitiveness  and  inclusive  growth,  namely  information  society  and  media,  taxation, 

level  of  preparation 

in  many  areas 

linked 

7 

 
 
economic  and  monetary  policy,  enterprise  and  industrial  policy,  education  and  culture,  and 
the  customs  union.  The  country  has  some  level  of  preparation  in  social  policy  and 
employment, and in science and research. Albania has made some progress in particular with 
the  Smart  Specialisation  Strategy  and  in  its  participation  in  the  Horizon  2020  research 
programme, but progress was limited on economic and monetary policy and customs union 
during  the  reporting  period.  Socio-economic  reforms  must  be  pursued  to  help  address  the 
existing structural weaknesses, low competitiveness, high unemployment, and the impact of 
the pandemic.  

Albania is moderately prepared in most areas related to the Green Agenda and sustainable 
connectivity,  namely  the  trans-European  networks,  energy,  and  environment  and  climate 
change. It has some level of preparation in the area of transport policy. The country has made 
some  progress  in  most  areas  in  particular  through  revised  transport  planning  and  energy 
connectivity.  More  efforts  are  needed  to  improve  the  performance  of  ships  under  the 
Albanian flag and to enforce energy and environmental legislation, not least in the protected 
areas.  The  green  transition  and  sustainable  connectivity  are  key  to  economic  integration 
within  the  region  and  with  the  European  Union,  facilitating  cross-border  trade  within  the 
region  and  creating  real  benefits  for  businesses  and  citizens.  This  cluster  and  the  reforms 
concerned  have  significant 
the 
Commission’s  Economic  and  Investment  Plan  and  the  Green  Agenda  for  the  Western 
Balkans endorsed by Albania in December 2020.  

to  Albania’s  Economic  Reform  Programme, 

links 

Albania  has  some  level  of  preparation  in  most  areas  linked  to  resources,  agriculture  and 
cohesion,  namely  agriculture  and  rural  development,  food  safety,  veterinary  and 
phytosanitary  policy,  fisheries,  and  financial  and  budgetary  provisions.  It  is  moderately 
prepared  as  regards  regional  policy  and  coordination  of  structural  instruments.  Albania  has 
made good progress in the area of fisheries, having reactivated the vessel monitoring system 
(VMS). It has made some progress on financial and budgetary provisions, on agriculture and 
rural development, and food safety, veterinary and phytosanitary policy, but the farm register 
needs to  be set  up.  It  has made limited progress  on regional policy  and the coordination of 
structural  funding  instruments.  In  this  respect,  inter-agency  coordination  for  pre-accession 
assistance needs improvement, and issues need to be addressed as regards strategic planning, 
implementation  and  monitoring  capacity  of  infrastructure  projects  under  the  Economic  and 
Investment Plan.  

Albania  has  reached  a  good  level  of  preparation  as  regards  external  relations,  foreign 
security  and  defence.    As  regards  the  external  relations  chapter  of  negotiations,  Albania 
made  good  progress  and  reached  a  good  level  of  preparation,  not  least  by  adopting  and 
ratifying  additional  protocols  to  the  Central  European  Free  Trade  Agreement  and  by 
certifying first authorised economic operators (AEO). It has worked on extending the Green 
Lanes/Corridors with EU Member States. The country has also delivered policy measures on 
humanitarian  aid  and  on  development  aid.  The  country  held  a  successful  chairmanship  of 
CEFTA. As regards the EU’s Common Foreign and Security Policy, it continued to maintain 
full alignment with all relevant EU decisions and declarations. The country held the OSCE’s 
chairmanship-in-office  in  2020,  demonstrating  its  commitment  to  multilateral  cooperation. 
Albania continued to participate in EU crisis-management missions and operations. 

2. 

2.1. 

CLUSTER 1: THE FUNDAMENTALS OF THE ACCESSION PROCESS 

FUNCTIONING  OF  DEMOCRATIC  INSTITUTIONS  AND  PUBLIC  ADMINISTRATION 
REFORM 

2.1.1   Democracy 

8 

 
 
General elections were held on 25 April 2021, following the cross-party agreement of 5 June 
2020  that  led  to  a  wide-ranging  electoral  reform.  Electronic  identification  of  voters  was 
implemented  in  97%  of  polling  stations,  while  e-voting  and  e-counting  was  piloted 
successfully in 32 polling stations in Tirana. The OSCE/ODIHR final assessment found that 
elections were generally well organised. The new electoral administration gained the trust of 
most  stakeholders.  Concerns  remained  related  to  the  misuse  of  public  resources  and 
functions, to allegations of vote buying, and to the leaking of sensitive personal data covering 
political preferences of citizens. These are being investigated.  

Parliament work continued under restrictions imposed by COVID-19 pandemic. With regard 
to  EU  oriented  reforms,  Parliament  adopted  a  number  of  significant  pieces  of  legislation, 
amongst  others  on  asylum,  the  population  census,  or  the  efficiency  of  the  judiciary.  The 
Albanian  government  maintained  a  focus  on  reforms  on  the  country’s  EU  path,  despite  the 
challenge of addressing the negative social and economic impact of the COVID-19 crisis and 
the consequences of November 2019 earthquake. The majority and the opposition will need 
to  improve political  dialogue and work together with  all parts of society  to  further advance 
the EU reform agenda and accession negotiations. 

Elections 

On 6 September 2020, the President of the Republic decreed 25 April 2021 as the date of the 
next General Parliamentary Elections. Elections took place in the aftermath of Electoral Code 
amendments  adopted  on  23  July  2020  codifying  the  wide,  cross-party  agreement  of  5  June 
2020,  in  line  with  OSCE/ODIHR  recommendations5  -  a  condition  for  the  first  IGC,  which 
continues to be fulfilled.  

On 30 July 2020, Parliament passed additional amendments to the Constitution, to allow for 
preferential  voting.  These  changes,  unrelated  to  OSCE/ODIHR  recommendations,  required 
further amendments to the Electoral Code, which were eventually passed on 5 October 2020. 
Political parties discussed the second set of amendments in the Political Council, but without 
reaching  consensus  before  Parliament  voted  on  them.  The  extra-parliamentary  opposition 
decried these amendments as unilateral. The President questioned their constitutionality and 
addressed  the  Venice  Commission  for  an  urgent  opinion.  The  Venice  Commission  rejected 
the urgency of the request and on December issued a joint opinion with OSCE/ODIHR. The 
joint  opinion  concluded  that  there  was  no  ground  to  challenge  the  validity  of  30  July 
amendments and the subsequent changes to the Electoral Code, albeit considering the process 
hasty and underscoring the importance of more comprehensive consultations.  

On  5  October  2020,  the  election  management  body  was  also  reformed  in  line  with  5  June 
agreement,  consisting  of  a  State  Election  Commissioner,  a  Regulatory  Commission  and  a 
Complaints and Sanctions Commission. 

In November 2020, Parliament adopted amendments to the law on Political Parties to bring it 
in  line  with  the  Electoral  Code.  These  provisions  regulate  public  funding  to  parties 
participating  in  elections  and  electoral  campaigns,  the  handling  of  private  donations  and 
loans, and prohibit the use of public resources to support electoral subjects. Provisions also 
address  reporting  and  disclosure  procedures,  the  auditing  of  campaign  funds  and  expenses, 
and sanctions. Further technical amendments pursuant to the 5 June Agreement were adopted 
in  December  2020.  The  Central  Election  Commission  issued  by-laws  complementing  this 
legal  framework.  A  broader  reform  on  political  party  financing,  which  is  not  part  of  the 

5  OSCE/ODIHR  specified  on  26/04/2021  that  the  areas  in  which  recommendations  remained  outstanding 
included:  suffrage  rights  of  people  with  intellectual  or  psychosocial  disabilities;  criminal  liability  for 
defamation; use of party campaign materials in the news; and equal rights of party and citizen observers. 

9 

 
 
                                                           
OSCE/ODIHR  recommendations  on  electoral  reform,  should  be  carried  out  during  the  new 
legislature. 

Following  a  tense  electoral  campaign,  the  elections  were  held  on  25  April  2021, 
implementing  the  new  electoral  framework,  which  is  in  line  with  the  recommendations  of 
OSCE/ODIHR. Restrictions were imposed by the pandemic, including on suffrage rights. The 
Albanian  authorities  further  followed  up  on  all  key  aspects  covered  by  the  OSCE/ODIHR 
recommendations.  For  the  first  time,  electronic  identification  of  votes  was  used  in  all  5199 
polling  stations,  with  less  than  150  polling  stations  having  to  rely  on  paper-based 
identification. In addition, an e-voting and e-counting project was successfully tested in one 
constituency with 32 polling stations in Tirana and did not encounter any significant hurdle. 
The implementation of out of country vote was not possible, mostly due to the limited time 
available.  

In  its  final  assessment  of  the  electoral  process,  the  OSCE/ODIHR  Limited  Election 
Observation Mission (LEOM) acknowledged that the elections were generally well organised 
by  the  election  administration.  Stakeholders  had  sufficient  confidence  to  participate  in  the 
elections and the reformed Central Election Commission (CEC) oversaw the election process 
in  an  organised  and  transparent  manner.  According  to  OSCE/ODIHR,  there  remained 
concerns related to the misuse of State resource and functions by the ruling party and other 
public  figures,  including  pervasive  allegations  of  vote  buying  and  the  leaking  of  sensitive 
personal data covering political preferences of citizens. The CEC’ Sanctions and Complaints 
Committee reviewed a number of cases of alleged electoral irregularities. Electoral results for 
nine constituencies were challenged in front of the Electoral College for a final review, which 
has  ruled  in  all  cases  upholding  the  preliminary  results.  Separately,  the  prosecution  offices 
have  initiated  criminal  proceedings  in  more  than  50  cases  notably  for  pressure  on  electoral 
subjects,  falsification  of  election  material  or  results,  and  breach  of  secrecy  of  the  vote.  38 
cases are directly handled by the special anti-corruption structures, and the data leak case by 
the  Public  Data  Commissioner  (see  Chapter  23  –  Judiciary  and  Fundamental  Rights).  The 
LEOM  also  noted  that  the  main  parties  all  attempted  to  augment  the  role  and  visibility  of 
women as candidates in the campaign, and the mandatory 30% quotas in candidate lists were 
respected  and,  in  most  cases,  exceeded.  CEC  data  confirm  that  of  the  elected  members  of 
parliament 92 are men  (65.7%) and 48  women (34.2%). Of the 1871 candidates registered, 
732 were women. The electoral legislation needs to further clarify the sequencing of women 
candidates  in  lists  to  enhance  their  presence  in  winning  positions  and  the  representation  of 
women  in  the  election  administration  remains  insufficient,  with  only  3  of  the  12  CEC 
members. The new Parliament elected a woman as its Speaker on 10 September.  

Regarding the allegations of vote buying and offences committed in previous elections, four 
defendants  were  found  guilty  of  electoral  offences  committed  in  the  context  of  the  general 
elections of 2017, four defendants were found guilty of falsification of election material and 
election results in the local elections of 2019, and punished by imprisonment. In June 2021, 
21 polling station workers were sentenced to imprisonment for electoral crimes committed in 
2017. 

Parliament 

The Parliament continued working under restrictions imposed by COVID-19 pandemic. Most 
committee work took place virtually, while plenary sessions were conducted in person. The 
work of the parliamentary committees was livestreamed through a dedicated TV channel and 
on social media. During the reporting period, Parliament adopted a total of 280 legal acts, out 

10 

 
 
of  which  149  laws  -  mainly  in  view  of  April  2021  elections  -  and  rejected  21  presidential 
decrees returning laws for review.      

As  regards  its  role  in  EU  integration,  16  of  the  laws  passed  in  Parliament  were  aimed  at 
alignment  with  the  acquis.  The  National  Council  for  European  Integration  still  has  to 
consolidate  its  role  and  guarantee  its  broader  involvement  in  EU  integration  issues.  With 
regard  to  EU  oriented  reforms,  Parliament  adopted  on  23  March  2020  a  broad  set  of 
amendments aimed at increasing the efficiency of the judiciary. 

With  regard  to  Parliament’s  oversight  function,  members  of  parliament  made  use  of  the 
instruments at the disposal of the opposition, tabling 18 ‘interpellations’, of which three were 
responded by the Prime Minister, showing an increasing trend from previous year.  

During the reporting period, Parliament appointed a new Head of the Supreme State Audit in 
July 2020, and two members of the Constitutional  Court.  In  addition,  Parliament appointed 
members of the Competition Authority, Financial Supervisory Authority, and filled vacancies 
on the steering board of the public broadcaster. 

On  transparency  and  accountability,  Parliament  attempted  to  restrict  physical  access  of 
reporters  in  the  meetings  of  standing  committees,  and  revised  that  decision  later,  following 
consultation  with  journalists.  Parliamentary  documentation,  such  as  minutes  of  plenary 
sessions  and  committee  meetings,  leaves  room  for  greater  transparency.  In  addition, 
Parliament  established  a  platform  for  the  consultation  of  draft  laws.  Nevertheless,  public 
consultation with civil society and interest groups remained formal and limited in its impact.  

implementing 
The  administration’s  performance 
recommendations from the Ombudsman, showing a decreasing trend in the reporting period. 
(see more under Public Administration Reform) 

is  still  poor  when 

it  comes 

to 

Governance 

The Albanian Government maintained a focus on reforms on the country’s EU path, despite 
the challenge of addressing the negative social and economic impact of the COVID-19 crisis 
and the consequences of November 2019 earthquake. Coordination within the administration 
needs  to  be  improved,  especially  regarding  their  involvement  in  EU  integration  processes. 
The  territorial  administrative  reform  should  be  further  consolidated  as  part  of  the  wider 
decentralisation agenda. This is particularly necessary to guarantee local fiscal autonomy and 
empower municipalities to provide good standard quality public services. 

In  September  2020,  the  Prime  Minister  replaced  the  Minister  for  Education,  Youth  and 
Sports,  while  in  December  2020,  two  waves  of  government  reshuffle  took  place  leading  to 
the replacement of four ministers, including the Minister for Europe and Foreign Affairs. On 
18  September  2021,  a  new  government  was  sworn  in  following  the  25  April  elections.  It 
comprises  12  women  out  of  17  members.  Six  of  the  ministers  did  not  seat  in  the  previous 
government. 

In February 2021, the government adopted the National Plan for European Integration (NPEI) 
2021-2023,  currently  under  implementation.  Greater  efforts  have  been  made  in  achieving  a 
higher implementation rate of the NPEI during the reporting period, thanks to dedicated and 
effective  steering  and  monitoring  from  the  central  government.  However,  EU  integration 
features  lower  in  the  priorities  set  out  in  new  government’s  programme  presented  in 
September  2021.Consultations  and  stock  taking  on  EU  related  matters  continued  between 
governmental  and  parliamentary  actors  with  relevant  stakeholders,  including  civil  society 
organisations,  under  the  framework  of  the  National  Council  for  European  Integration,  but 
the  overall  governance 
remain  unsystematic.  Despite  recent  attempts 

improve 

to 

11 

 
 
arrangements on public consultations, the consultation on policies and legislation need to be 
more  substantive  so  as  to  further  enhance  the  inclusiveness  and  transparency  of  the  reform 
process,  in  particular  on  issues  related  to  EU  oriented  reforms  (see  Public  Administration 
reform). 

In the reporting period a Chief Negotiator for negotiations with the EU assumed a novel role 
in  the  country’s  EU  related  structures.  Additional  efforts  are  needed  to  improve  further  the 
coordination  and  streamlining  between  the  EU  negotiations  structures,  responsible  for 
country’s preparation for accession negotiations, and other bodies. This concerns the roles of 
the  team  of  the  Chief  Negotiator,  the  Ministry  for  Europe  and  Foreign  Affairs,  and  their 
cooperation  with  structures  responsible  for  sectoral  policy  planning,  EU  assistance,  and 
monitoring.  For  the  conduct  of  accession  negotiations  with  the  EU,  the  country  needs  to 
increase dedicated human and financial resources on EU accession across the administration 
and more importantly on the communication on the EU. A methodology should be in place to 
ensure  that  the  EU  is  systematically  consulted  by  the  relevant  authorities  when  drafting 
legislation in the remit of the EU acquis.  

The territorial administrative reform needs to be further consolidated as part of the wider 
decentralisation agenda. A systematic monitoring and evaluation of the implementation of the 
national  cross-cutting  decentralisation  and  local  governance  strategy  2015-2022  is  needed. 
The last such exercise was the strategy’s mid-term review including the period until 2018.  

While municipalities have been given greater policy making powers, local government units 
(LGUs) still lack sufficient financial resources and administrative capacity to exercise them 
effectively.  Women  representation  in  local  government  needs  improvement.  Although 
44  per  cent  of  local  councillors'  seats  were  won  by  women  in the last local elections, 
only    eight  of  the  61  municipalities  are  run  by  women.  Municipalities  need  continued 
capacity building for their staff. LGUs’ fiscal autonomy is at risk, as most of their budget is 
dependent on national transfers. As a result, although the municipalities are getting better at 
collecting  own  revenues,  the  overall  ability  of  local  institutions  to  deliver  quality  public 
services remains limited. Their financial situation has been made ever more complicated by 
the pandemic, with resources available to LGUs further shrinking. 

Implementation  of  the  Civil  Service  Law  remains  to  be  improved  at  the  local  level. 
Temporary  contracts  for  civil  service  positions,  although  decreasing,  continue  to  be  rather 
frequent  in  the  LGUs.  70  court  rulings  were  issued  during  2020  for  reinstating  of  civil 
servants,  bringing the total  up to  222, with the percentage of decisions  enforced decreasing 
from  59%  in  2019  to  49.1%  in  2020.  The  career  development  mechanism  such  as  lateral 
transfer and promotion show for the first time signs of improvement.   

Despite the pandemic, municipalities have encouraged public participation in their decision-
making through organising online Council meetings open to the public and other innovative 
means.  However, the institutional  framework for effective and inclusive participation  needs 
further strengthening. Local-level implementation of the Law on public consultation remains 
unsatisfactory. On transparency, some improvement is noted as all 61 municipalities are now 
publishing online their Council’s decisions.  

Five  municipalities  have  adopted  and  piloted  integrity  plans  with  measures  to  combat 
corruption at local level. Their implementation should be closely monitored and adoption of 
integrity plans in other municipalities encouraged. 

The  Consultative  Council  operated  as  the  main  forum  for  institutional  dialogue  and 
coordination between central and local governments. The efficiency and effectiveness of its 
work needs  to  be strengthened. The process  of implementing the Prime  Minister's order on 

12 

 
 
‘matrix of competences’ which looks at  responsibilities between level of governance while 
addressing the gaps or overlaps, is ongoing. No clear track record is available to date.  

The  network  of  EU  local  coordinators  has  strengthened  the  LGUs’  involvement  in  the  EU 
accession process, raising awareness of EU policies, the EU acquis, funds and programmes. 
60 municipalities have implemented the Decision of the Council of Ministers from July 2018 
institutionalising and upgrading the municipal "EU desks" into "EU Units".  

The  Ministry  of  Europe  and  Foreign  Affairs  and  the  Ministry  of  Finance  and  Economy 
drafted  a  Decision  of  the  Council  of  Ministers  to  ensure  co-financing  and  avoid  other 
obstacles  for  Albanian  municipalities  to  access  funding  from  the  Instrument  for  Pre-
Accession (IPA); it is yet to be approved. 

On territorial planning, the pandemic as well as the November 2019 earthquake raised the 
need to revise local plans to account in particular for civil protection elements. Coordination 
of the national sectoral strategies with local plans is weak. 

Civil society 

Limited  progress  has  been  made  on  the  implementation  of  the  roadmap  on  an  enabling 
environment  for  civil  society.  The  adoption  of  the  Law  on  registration  of  Non  Profit 
Organisations  brings  some  improvements.  The  National  Council  for  Civil  Society  remains 
weak and should be reformed to provide for appropriate representation of the Albanian civil 
society. Substantial efforts are needed to ensure meaningful and systematic consultations with 
civil  society  as  part  of  an  inclusive  policy  dialogue  for  reforms.  The  COVID-19  pandemic 
has  further  weakened  the  financial  stability  of  the  civil  society,  already  weak  due  to 
unfavourable  legal  and  fiscal  framework.  Despite  this  challenge,  Albanian  civil  society  has 
provided  support  and  services  to  most  vulnerable  people  affected  by  the  COVID-19 
pandemic, complementing or sometimes replacing state interventions.   

Albania’s  legal  and  regulatory  framework  on  the  right  to  freedom  of  assembly  and 
association is generally in line with international standards. However, since the beginning of 
the  COVID-19  pandemic,  temporary  rules  and  protocols  aimed  at  preventing  the  spread  of 
the infection brought limitations to the freedom of assembly.  

The  law  on  registration  of  Non-Profit  Organisations,  adopted  in  June  2021  aims  at 
introducing  an  electronic  register,  which  will  ease  the  registration  process  and  increase 
transparency and accuracy of the register of non governmental organisations (NGOs). It also 
aims at fulfilling the FATF Action Plan (see Chapter 24 – Justice, Freedom and Security).   

The  roadmap  on  an  enabling  environment  for  civil  society  remains  strongly  dependent  on 
donors’ support. The implementation of its measures is slow and no impact on the sector has 
been  noticed  so  far.  Additional  efforts  and  resources  are  required  to  accelerate  its 
implementation,  in  order  to  create  a  more  conducive  environment  for  the  civil  society  to 
operate and to contribute to the adoption of sound policies and laws. While the 2014 Law on 
public  consultation,  laying  down  the  procedural  norms  for  transparency  and  public 
participation in decision-making, is generally in line with European standards, consultations 
often  remain  artificial  exercises.  In  addition,  the  scope  of  the  law  needs  to  be  extended  to 
government  decisions.  The  guidelines  and  monitoring  framework  for  public  consultation 
adopted in January aim to improve governance arrangements for a better implementation of 
the law (see also Public Administration reform).  

The  ability  of  the  National  Council  for  Civil  Society  to  voice  priorities  of  civil  society 
organisations  (CSOs)  in  policy-making  processes  is  still  weak.  The  Law  on  the  National 
Council has not been amended to reflect changes in ministerial portfolios and representation 

13 

 
 
in the Council, and to improve its functioning. The Agency for the Support of Civil Society 
remains the main public body providing financial support for civil society, but its budget was 
reduced  by  40%  in  2020,  making  public  funding  insufficient  to  sustain  CSOs’  activity,  in 
particular in social services.  

There is yet no evidence of successful VAT refund with regard to the implementation of the 
instruction  on  VAT  reimbursement  for  CSO  beneficiaries  of  EU  funding  and  other  donor 
grants. Tax incentives for corporate donations do not promote donations to CSOs and there 
are no tax incentives 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 delivering on last year’s report recommendation by building capacity 
of line ministries to implement regulatory impact assessments, adopting guidelines for public 
consultations,  establishing  the  IT  systems  for  the  integrated  planning,  increasing  the 
implementation rate of the National European  Integration Plan, increasing the number of e-
services,  and  completing  the  testing  phase  of  the  automation  of  the  payroll  system. 
Implementation of the public administration reform and public financial management reform 
strategies has continued despite the impact of the COVID-19 pandemic. Some progress was 
made on all the Commission’s 2020 recommendations, which remain partially valid.  

In the coming year, Albania should in particular: 

  upgrade  the  regulatory  framework  on  integrated  policy  planning  and  increase  the 
capacities for policy planning and monitoring, by rolling out the integrated policy-making 
system; 

  activate  the  mechanism  foreseen  in  the  law  on  the  Organisation  and  Functioning  of  the 
State Administration by preparing the monitoring report on the status of the subordinated 
institutions; 

  Encourage the merit-based implementation of the civil service law at all levels, especially 
at  the  local  level  where  de-politicisation  of  civil  service  and  also  better  training  are 
needed,  and  adopt  a  salary  policy  for  civil  servants  and  extend  the  automation  of  the 
payroll system through the human-resource-management information system. 

Strategic framework for public administration reform 
Throughout 2020, the government continued to monitor the implementation of the 2015-2022 
public  administration  reform  (PAR)  strategy  and  the  2014-2022  public  financial 
management  (PFM)  reform  strategy.  Despite  the  COVID-19  crisis,  Albanian  institutions 
have  done  substantive  efforts  in  maintaining  a  good  implementation  record  of  the  public 
administration reform strategy. More needs to be done to achieve results-oriented monitoring, 
including analysis of performance. Political responsibility for PAR is assigned to the Deputy 
Prime Minister and technical support continues to be provided by the Department of Public 
Administration  and  the  Department  on  Good  Governance.  However,  the  link  between 
technical  and  political  support  for  PAR  needs  to  be  strengthened.  Financial  sustainability 
needs  to  be  improved,  as  the  overall  reform  of  public  administration  depends  on  external 
donor funding. 

Policy development and coordination 

The legal basis and the institutional set-up for a coherent policy making system are partially 
in place. Progress was  made in rolling out the IT tool for an Integrated Planning System to 
automate the link between strategic policy planning and budgeting and increased number of 

14 

 
 
trainings  and  trained  civil  servants  in  the  area  of  strategic  planning  from  previous  year. 
Strengthened  monitoring  of  and  reporting  on  the  annual  analytical  plan  show  an  improved 
rate of implementation compared to the previous year. However, full integration and use of 
the  IT  pillars  require  further  training  and  improvement  of  data  collection  and  processing. 
Authorities  need  to  upgrade  the  existing  regulatory  framework  on  medium-term  policy 
planning,  improve  coherence  between  policy  planning  and  budgeting,  establish  a  dedicated 
central  quality  control  function  for  policy  planning  and  implementation.  The  quality  of 
performance,  relevance,  inclusiveness  and  regularity  of  the  integrated  policy  management 
groups  mechanism  varies  across  sectors  and  their  role  in  policy  coordination  needs 
improvement. 

Further efforts are needed to upgrade the administrative capacity in both line ministries and 
the  Prime  Minister’s  Office  as  well  as  to  better  define  and  implement  policy  planning  and 
monitoring  functions  (see  Chapter  32  Financial  control).  The  Prime  Minister’s  Office 
rulebook remains to be adopted.  

In 2020, substantial progress was made in monitoring the execution of the National Plan for 
European Integration and the timely approval of the new plan for 2021-2022. The  National 
Plan  for  European  Integration  implementation  rate  has  improved  to  87%  from  60%  in  the 
previous  year.  Stronger  coordination  between  the  Prime  Minister’s  Office,  Ministry  of 
Europe  and  Foreign  Affairs  and  Ministry  of  Finance  and  Economy  is  needed  to  further 
support line ministries in the process of planning and costing more credibly the National Plan 
for European Integration and alignment with the annual analytical plan.  

On  inclusive  and  evidence-based  policy  and  legislative  development,  the  administration 
needs  to  strengthen its capacity.  Further progress was  achieved in  increasing the usage and 
monitoring of regulatory impact assessments for legislative proposals and increased trainings 
in  this  area  across  the  administration.  The  government  needs  to  continue  efforts  in  the 
institutionalisation of regulatory impact assessments, while also improving the central quality 
control function. 

Regarding  public  consultation,  the  electronic  web-portal  is  operational  and  the  regulatory 
framework  improved  through  adoption  of  guidelines  for  preparing  annual  plans  as  well  as 
reports  in  January.  The  number  of  legal  acts  passing  public  consultation  and  usage  of 
electronic register has increased. The quality control function on public consultation needs to 
be strengthened to focus more on the content rather than on the process.  

Public scrutiny of government work remains limited.  The role of parliamentary oversight 
of government performance, including sub-ordinated agencies, remains ad-hoc and needs to 
be  increased.  Most  government  policy  reports  continue  to  present  implemented  activities 
rather  than  results.  Communication  to  the  citizens  of  the  ongoing  reforms  needs  to  be 
enhanced.  

Public financial management 

The  Ministry  of  Finance  and  Economy  leads  the  public  financial  management  reform. 
Several posts remain unfilled in the Ministry. The extended PFM strategy for 2019-2022 was 
revised to address the impact of the pandemic and to gradually return, in the medium-term, to 
the  original  reform  path.  The  revised  strategy  was  approved  and  published  in  March  2021. 
The PFM monitoring report for 2020 is pending approval and publication. 

During the reporting period,  the medium-term  budget  programme 2021-2023 was prepared, 
using  the  newly  developed  Albanian  financial  management  information  system,  and  duly 
adopted. The 2021 budget and the execution of the 2020 budget were in line with the revised 
Organic  Budget  Law.  The  draft  medium-term  revenue  strategy  is  pending  finalisation. 

15 

 
 
Following public consultations, in November the first-ever public procurement strategy 2020-
2023  and  in  December,  a  new  public  procurement  law  were  adopted.  All  arrears  are  now 
recorded  in  a  specific  treasury  account,  and  arrears  reports  are  produced  directly  from  the 
system. The Albanian supreme audit institution and the public procurement commission have 
newly appointed chair persons. (See also Chapters 5, 16, 29 and 32).  

Budget transparency remains satisfactory with the publication of all key budget documents, 
such  as  the  annual  budget,  the  citizens’  budget,  and  a  list  of  public  investments,  including 
public-private partnerships (PPPs), under the medium-term budget programme. More timely 
publication of the budget execution reports, in particular reporting on arrears. Transparency 
across  government  continues  to  show  varying  levels.  Public  participation  in  the  budget 
process needs to be further strengthened. 

Public service and human resources management 

Progress  so  far  in  merit-based  recruitment,  promotion  and  dismissal  needs  to  be 
consolidated, in particular by addressing the fragmentation of the legislative framework, and 
applying uniform standards across the entire public administration. All the planned vacancies 
in 2020 were filled compared to 95% in 2019. However, line ministries need to report more 
accurately and timely on any open vacancies to the Department of Public Administration, for 
their inclusion in the overall annual recruitment plans. 

Better  compliance  is  needed  with  the  legal  provisions  regulating  the  organisation  of 
recruitment  procedures  and  the  merit  principle  regarding  for  senior  ranks  and  pooled 
recruitment for entry positions. Across the administration, job descriptions remain to be fully 
harmonised  in  accordance  with  the  categories  set  out  in  the  civil  service  law.  Ad-hoc 
selection procedures continue to be used to hire young graduates in the public administration. 
Proper implementation of the civil service law requires more efforts, particularly at the local 
level. In 2020, the number of dismissals of civil servants decreased to 635 from 896 in 2019, 
but most continue to be justified by restructuring of institutions or reclassifying personnel as 
no longer part of the civil service. In the reporting period, the backlog in implementing  court 
decisions confirming dismissal of civil servants as unlawful has been further reduced. 

The human resources management information system continues to be filled, but does not 
cover  the  entire  public  sector  yet  and  remains  to  be  extended  to  the  local  level.  The 
government  is  putting  measures  in  place  for  a  coordination  mechanism  for  the  monitoring 
and  evaluation  of  human  resource  management  between  central  and  local  level.  The 
Commissioner  for  Oversight  of  the  Civil  Service  monitors  the  implementation  of  the  civil 
service law  at  central and local  level,  but  would  need more staff  and financial resources to 
better fulfil its oversight responsibilities. 

The  remuneration  system  is  based  on  a  job  classification  system  that  requires  further 
reform.  The  lack  of  a  salary  policy  based  on  clear  criteria  for  pay  supplements  and  salary 
increases  impairs  the  fairness  and  coherence  of  the  system.  The  automation  of  the  payroll 
system  through  human  resources  management  information  system  needs  to  go  beyond  the 
testing phase and cover the entire public sector. 

The  Albanian  School  of  Public  Administration  training  programmes  continued  to  adapt  the 
training programmes related to professional development of civil servants to the restrictions 
linked  to  the  pandemic,  resulting  in  an  increase  of  training  courses  to  previous  year.  The 
quality  management  cycle  of  the  training  offer  remains  to  be  established.  The  professional 
administrative capacity of local-level civil servants needs to be strengthened. The regulatory 
framework is in place to prevent corruption and to ensure the integrity of public officials and 

16 

 
 
civil  servants,  but  the  institutional  capacity  for  verifying  assets  and  assessing  conflict  of 
interest declarations should be reinforced (see also Chapters 23 and 24). 

Accountability of the administration 

The  legal  framework  for  the  organisation  of  the  central  administration  does  not  establish 
coherent  accountability  lines  and  governance  arrangements  between  supervisory  and 
subordinated bodies. In recent years, subordinated bodies have been created without strategic 
planning,  and  led  to  the  transfer  of  civil  servants  into  employment  under  the  labour  code. 
Given the insufficient monitoring on status of subordinated agencies, the Department of the 
Public  Administration  should  activate  the  mechanism  foreseen  by  the  Law  on  the 
Organisation  and  Functioning  of  the  State  Administration  for  preparing  regular  monitoring 
reports on the status of subordinated institutions.  Additionally, policy making institutions do 
not  always  monitor  policy  implementation  by  their  subordinated  agencies  and  the  latter  do 
not always report on their performance. Future legal changes should improve the definition of 
functions in policy making and include requirements for planning and performance reporting 
by  subordinated  bodies  and  supervisory  ministries.  State  administration  workflow  and 
decision making processes need to be improved. Managerial accountability within institutions 
is  still  focused  on  processes  rather  than  the  achievement  of  results,  and  not  much 
decision-making is delegated from top to middle management. 

Citizens’  right  to  good  administration  needs  enhancement.  The  implementation  rate  of 
Ombudsman  recommendations  has  slightly  decreased  in  the  reporting  period  from  62%  to 
55%  and  the  Assembly  needs  to  strengthen  efforts  in  supporting  the  activities  of  the 
Ombudsman and of other public independent institutions with an oversight role. The Law on 
the  Right  to  Information  regulates  citizens’  right  to  access  public  information.  An 
increasing  number  of  public  authorities  have  adopted  and  published  their  transparency 
programmes.  The  role  of  the  coordinators  for  the  right  to  information  within  the  public 
authorities  should  be  strengthened  by  appointing  senior  officials  in  this  role.  In  2020,  the 
number of public authorities having installed the electronic register of requests and responses 
doubled compared to the previous year. 

A legislative framework is in place for the right to administrative justice. The capacity of 
both the administrative court system and of the appeal panels to deal with the cases is limited, 
leading  in  2020  to  an  increased  time  needed  to  solve  the  cases  and  increased  backlog, 
respectively. Legislation is in place for protecting the right of citizens to seek compensation 
and is applied in practice in judicial cases. A lack of data collection makes it very difficult to 
assess the effectiveness of the liability regime. 

Service delivery to citizens and businesses 

Institutions  and  laws  on  public  service  delivery  are  in  place  to  ensure  user-oriented 
administration.  In 2020, the number of one-stop-shops and e-services increased, even if at 
different  levels  of  automation,  and  information  to  citizens  on  public  services  became  more 
accessible. The roll-out of “front desks” delivering administrative services at local level now 
covers  59  of  the  61  municipalities,  and  activities  started  to  expand  front  desks  to 
administrative units. National minimum standards for services still have to be established. An 
overall policy should be elaborated to guide the extension and integration of on-line and face-
to-face services.  Citizens’ data should be protected, following the highest  standards of data 
protection.  

The  Code  of  Administrative  Procedures  provides  the  legislative  framework  for  simplifying 
administrative  procedures  in  line  with  international  standards.  An  action  plan  for 
implementation of the Code is in place. Despite higher training in civil service on the Code, 

17 

 
 
legal  uncertainty  for  citizens  and  businesses  persists,  as  there  were  delays  in  harmonising 
sectoral laws and by-laws with the Code.  

2.2. RULE OF LAW AND FUNDAMENTAL RIGHTS  

2.2.1.  Chapter 23: Judiciary and fundamental rights 

Albania  has  some  level  of  preparation/is  moderately  prepared  in  implementing  the  EU 
acquis and European standards in this area. Good progress was made, in particular through 
continued implementation of the comprehensive justice reform. The Constitutional Court has 
regained  full  functionality  with  the  appointment  of  three  new  judges.  The  High  Court  has 
increased  its  efficiency  with  the  appointment  of  six  additional  judges.  The  vetting  process 
continued to deliver tangible results. The legislative framework has been further strengthened 
to  ensure  a  more  efficient  delivery  of  justice.  Operational  efforts  against  corruption  are 
bringing  some  results.  Additional  efforts  are  needed  to  further  increase  seizure  and 
confiscation of assets stemming from corruption, and to develop the track record in high-level 
cases. Regarding fundamental rights, there was progress in most areas, albeit efforts should 
continue  on  implementation.  On  property  rights,  progress  should  be  made  on  further  first 
registration of properties and transitional ownership processes, in a transparent and inclusive 
manner. As regards the protection of persons belonging to national minorities, Albania needs 
to adopt the remaining implementing legislation related to the 2017 Framework Law. 

Functioning of the judiciary 

Albania  is  moderately  prepared  on  the  functioning  of  the  judiciary.  Good  progress  was 
made,  with  the  continued  implementation  of  justice  reform  and  the  vetting  process,  which 
advanced  steadily,  despite  the  impact  of  the  COVID-19  pandemic.  An  important  milestone 
was  reached  at  the  end  of  2020,  with  the  appointment  of  three  new  judges  to  the 
Constitutional  Court. With  seven  judges  in  office,  the  Constitutional  Court  has  regained  its 
necessary  quorum  of  minimum  six  members  to  hold  plenary  sessions,  thus  being  fully 
functional  and  meeting  the  related  condition  for  the  first  IGC.  Progress  also  continued  on 
High Court appointments, with the promotion by the High Judicial Council of six new judges 
in  March and July 2021. The Parliament adopted amendments  to  10 laws aiming to  further 
strengthen  the  efficiency  of  the  judicial  system  and  its  capacity  to  tackle  corruption  and 
organised  crime.  The  vetting  process  has  continued  to  deliver  concrete  results,  under  the 
thorough supervision of the International Monitoring Operation (IMO). To date, 62% of the 
vetting  dossiers  processed  have  resulted  in  dismissals,  resignations  or  termination  of 
mandate.  Magistrates  dismissed  by  the  vetting  bodies  are  being  prosecuted  by  the  Special 
Prosecutor Office. The SPAK Court has seized assets of a former Prosecutor General as well 
as  of  two  former  Constitutional  Court  and  one  former  High  Court  judges.  The  self-
governance bodies of the judiciary have continued to fulfil their mandates. Limited progress 
was made on the recommendation to  improve the case management system,  which remains 
outstanding.  

Recommendations for the coming year: 

  further advance the process of re-evaluating judges and prosecutors; 

  continue  to  consolidate  the  capacity  of  the  judicial  system  and  the  governance 
institutions,  including  by  further  strengthening  the  legal  education  system  and  by 
finalising and implementing the new judicial map; 

  take decisive steps towards a roll-out of a new integrated case management system, and 
ensure  its  inter-operability  across  the  entire  justice  system,  in  line  with  European 
Commission for the Efficiency of Justice (CEPEJ) methodology. 

18 

 
 
The comprehensive transitional re-evaluation of all judges and prosecutors (vetting) advanced 
steadily  and  delivered  tangible  results  despite  the  challenges  posed  by  the  COVID-19 
pandemic.  The  International  Monitoring  Operation  (IMO),  deployed  under  the  aegis  of  the 
European Commission, continued to exercise independent oversight.  

As  of  15  September  2021  the  vetting  institutions  have  completed  437  vetting  cases  at  first 
instance, including all priority files. Of the 437 decisions,  298 decisions are final  (i.e. after 
appeal).  Overall,  about  62  %  of  the  vetting  dossiers  processed  so  far  have  resulted  in 
dismissals  and  termination  due  to  resignations  by  the  assessees  or  reaching  the  retirement 
age. The breakdown of first instance decisions is as follows: 176 dismissals, mostly for issues 
relating to unjustified assets; 161 confirmations in office; 96 decisions on termination of the 
vetting  proceedings;  2  decisions  to  suspend  the  assessees,  with  an  obligation  to  attend 
training. The first-instance vetting body (IQC) has formally initiated investigations in all 766 
pending  vetting  cases.  The  International  Monitoring  Operation  (IMO)  has  continued  to 
perform  its  oversight  role  in  the  vetting  process  and  issued  opinions  on  first-instance 
assessments,  including  18  recommendations  for  appeal  and  two  dissenting  opinions.  The 
vetting institution of Public Commissioners has followed all recommendations for appeal. 

In  March  2021,  12  additional  legal  advisors  were  appointed  to  the  IQC  and  six  additional 
legal officers to the Special Chamber of Appeals, which has had a positive impact on the pace 
of  proceedings.  The  continuity  and  completion  of  the  vetting  process  by  the  vetting  bodies 
must be ensured, in  the light  of the constitutional  mandate of the  IQC members and Public 
Commissioners. 

On 9 February 2021 the European Court of Human Rights (ECtHR) has ruled in the case of 
Xhoxhaj v. Albania, finding that the vetting process against the former Constitutional Court 
judge  had  been  in  line  with  the  general  principles  and  rights  enshrined  by  the  European 
Convention on Human Rights (ECHR) and overall proportionate. The ruling became final on 
31 May 2021. 

The vetting institutions are expected to continue to refer to prosecution services cases where 
there are indications of criminal offences. To date 23 files have been submitted to the Special 
Prosecution Office (SPO), including 10 cases involving former judges of the High Court and 
the Constitutional Court. Out of the 23 cases, 21 investigations are ongoing, one investigation 
has been closed and one has resulted in a conviction. 10 additional cases have been referred 
to  the  competent  district  prosecutors’  offices.  Asset  investigations  are  underway  in  all 
ongoing cases. 

Strategic documents 

The cross-sectoral 2017-2020 justice strategy and action plan have been updated and remain 
in  force  until  the  end  of  2021.  The  Ministry  of  Justice  has  established  the  necessary  inter-
institutional  coordination  structures  to  support  the  implementation  of  the  reform.  The 
Strategy and its Action Plan 2021-2025 need to be adopted timely.  

Coordination  mechanisms  across  the  justice  institutions,  communication  and  transparency 
should be further enhanced. 

New specialised bodies 

he Specialised Structure  for  Anti-Corruption  and  Organised Crime (SPAK), comprising the 
Special  Prosecution  Office  (SPO)  and  the  National  Bureau  of  Investigation  (NBI),  are 
established and operational. The 2021 budget foresees an increase to a total of 20 prosecutors 
for  the  SPO.  The  first  round  of  a  transparent  and  merit-based  recruitment  process  for  NBI 
investigators  resulted  in  the  appointment  of  28  investigators,  who  after  an  intensive  three-

19 

 
 
month  training,  are  operational.  A  second  call  for  recruitment  of  an  additional  32 
investigators  was  opened  on  6  April  2021  and  is  well  under  way.  As  foreseen  by  law,  the 
development of the NBI continues to be followed by an International Commission comprised 
of two criminal justice experts nominated by the EU and two by the U.S. Government.  

On  23  March  2021,  the  Parliament  adopted  amendments,  as  part  of  a  set  of  legislation  on 
judicial efficiency, extending SPAK jurisdiction to all terrorist offences and removing petty 
corruption  from  their  remit.  Amendments  on  remuneration  for  staff  of  the  NBI  were  also 
adopted. The first and second Instance Special Anti-corruption and Organised Crime Courts 
(SPAK Courts) continued hearing cases prosecuted by the SPO.  

Judicial governance institutions 

The institutions for the self-governance of the judiciary, continued to be fully functional and 
operated  effectively  throughout  the  reporting  period,  including  the  High  Judicial  Council 
(HJC), High Prosecutorial Council (HPC) and the Justice Appointment Council (JAC). The 
HJC  progressed  with  the  appointments  of  judges  in  vacant  positions  created  by  the  vetting 
process  across  the  Courts  and  approved  a  considerable  number  of  by-laws  regulating 
activities of the judicial system and courts. The  HPC has continued with the promotions of 
district prosecutors. The HJC needs to ensure the adoption of detailed regulatory acts and the 
HPC  should  ensure  close  cooperation  with  the  General  Prosecution  in  a  more  transparent 
manner.  

Independence and impartiality 

The legal and institutional framework put in place by the 2016 justice reform ensures strong 
independence and impartiality guarantees for magistrates.  

However, attempted internal  and  external  interference  with  the judicial system continues to 
remain an issue of concern. Integrity and judge-craft should continue to remain the focus of 
training of magistrates.  

The random allocation of cases within the prosecution system still remains to be implemented 
as a matter of priority. Decisive and swift steps need to be taken towards the rollout of a new 
integrated case management system, to increase the efficiency and transparency of the justice 
system.  

Accountability 

The High Justice Inspector (HJI) has been fully performing its functions during the reporting 
period,  notably  by  initiating  and  conducting  disciplinary  investigations  against  magistrates. 
Additional staff, premises and an increased budget has been allocated to HJI. The recruitment 
of additional inspectors is still required, as well as targeted measures to address the backlog 
of cases and allow the HJI to perform regular thematic inspections.   

During the reporting period, HJI has received 3 054 complaints of which 1 347 were inherited 
from  the  previous  Inspectorate.  HJI  has  handled  173  complaints  and  started  eight 
investigations.  

The HJC and the HPC are responsible for approving and monitoring the ethics rules and code 
of  conduct.  The  HJC  has  improved  evaluation  forms  and  adapted  them  to  the  new  legal 
standards. It is important that evaluations be regularly conducted and the backlog is steadily 
reduced. The HJC dismissed two judges on the basis of HJI investigations and requests. The 
HPC should swiftly finalise the rules and procedures for evaluation of prosecutors. The HJI’s 
request to dismiss one prosecutor has been rejected by the HPC. 

20 

 
 
HPC, HJC and HJI have regularly published their decisions and the minutes of their plenary 
meetings. Open access to reasoned court decision must be ensured, in compliance with data 
protection rules.  

Professionalism and competence 

The  system  for  recruiting,  selecting,  appointing,  transferring  and  dismissing  judges  and 
prosecutors  is  managed  exclusively  by  the  self-governing  institutions  of  the  judiciary. 
Constitutional  and  legal  changes  have  reduced  political  influence  during  the  appointment 
process, ensuring a merit-based career system.  

An important milestone was reached at the end of 2020, with the appointment of three new 
judges to the Constitutional Court. With seven judges in office, the Constitutional Court has 
regained its necessary quorum of minimum six members to hold plenary sessions, thus being 
fully functional and meeting the related condition for the first IGC. The appointments process 
for the remaining Constitutional Court positions is ongoing, and is expected to be finalised as soon as 
half of the High Court judges will have been appointed. From December 2020 until mid-June 
2021,  the  Constitutional  Court  has  adopted  27  decisions  following  plenary  sessions,  out  of 
which  14  applications  of  non-constitutionality  were  accepted  and  13  applications  were 
rejected.  The  Court  has  started  to  fully  exercise  its  functions,  including  by  adjudicating  on 
pending constitutional disputes of competence between state powers and institutions.  

Progress continued on High Court appointments, with the promotion by the HJC of six new 
judges in  March  and July  2021.  With nine judges in  office, the  High Court disposes of the 
necessary  quorum  to  perform  its  jurisdictional  functions,  including  by  ruling  on  recourses 
against  the  decisions  of  Anti-Corruption  and  Organised  Crime  Specialised  Courts  and  on 
unification of case law. Filing of the remaining10 judicial vacancies at the High Court should 
continue with outmost urgency.  

The  quality  of  initial  and  continuous  training  at  the  School  of  Magistrates  (SoM)  has 
improved.  The  HPC  and  HJC,  in  cooperation  with  the  SoM,  have  approved  the  training 
calendar for the academic year 2020-2021. The periodic evaluation of judges and prosecutors 
takes into account the continuous training of judges and prosecutors and includes assessments 
provided  by  the  SoM.  The  SoM  should  simplify  the  application  process  for  its  continuous 
training activities. Further efforts are needed from the SoM to reinforce its academic staff and 
to  ensure  competitive  and  transparent  recruitment  procedures.  The  SoM  should  focus  on 
further improvements to the quality of methodology and diversity of the substance of initial 
and continuous training. The SoM continued to be hosted in provisional premises. The SoM 
should take a more pro-active role in coordination of donors and CSOs’ assistance. In 2020, 
19  judges,  two  prosecutors  and  12  legal  assistants  graduated  the  SoM.  The  SoM  is  an 
observer  of  the  European  Judicial  Training  Network  (EJTN).  It  should  benefit  more 
proactively of the EJTNs activities and from the expertise within the network. 

Quality of justice 

Albania had 307 full-time judges (10.8 per 100,000 inhabitants) and 300 full-time prosecutors 
(10.5  per  100,000  inhabitants)  in  2020.  According  to  the  European  Commission  for  the 
Efficiency  of  Justice  (CEPEJ),  the  European  averages  are  21  judges/12  prosecutors  per 
100,000  inhabitants.  The  2020  budgetary  allocation  for  the  judicial  system  was  EUR  44 
million.  This  amounts  to  EUR  14.5  per  inhabitant.  The  self-governance  justice  institutions 
and  the  vetting  process  are  supported  by  a  EUR  12  million  budgetary  plan.  Court 
infrastructure remains poor overall and future budget allocations need to address the pressing 
needs  of  the  judicial  institutions  with  more  determination.  Between  2018  and  2020,  the 

21 

 
 
average  salary  of  judges  and  of  prosecutors  increased  significantly  by  40%  and  73% 
respectively, which is a very positive development.  

Court activity is monitored through quarterly reporting of the courts and data is made public 
in the annual reports of HPC and HJC.  

Efficiency 

On  23  March  2021,  the  Assembly  adopted  amendments  to  10  laws  aimed  to  further 
strengthen the efficiency of the justice system and facilitate a better functioning of the courts, 
in  line  with  EU  standards.  In  particular,  the  legislative  amendments  provide  for  specific 
measures to facilitate the backlog reduction, speed up judicial proceedings, and strengthen the 
capacity of the new specialised bodies in the area of anti-corruption and organised crime to 
focus  on  high  level  corruption  and  serious  crime.    The  quorum  provisions  for  High  Court 
appointments  of  Constitutional  Court  members  was  also  amended,  in  consistency  with  the 
guidance of the Venice Commission.  

Efficiency  of  the  judicial  system  has  been  affected  by  the  length  of  proceedings,  low 
clearance  rate  and  high  backlog.  Appeal  courts  have  a  high  number  of  inherited  cases  and 
judicial vacancies, with only 40 out of 78 appeal judges in office. A new judicial map must 
be urgently adopted and implemented to re-distribute judges and resources within the judicial 
system. The average lengths for a case at appeal level is 998 days for criminal cases and 1742 
for civil and commercial cases.  

The  Courts  with  the  highest  backlog  are  the  High  Court  and  the  Administrative  Court  of 
Appeal. The latter has 15 178 cases of which 7 463 are older than two years. The clearance 
rate is 37%. The High Court has the highest backlog of 36 288 cases of which 27 843 older 
than  two  years  (77%).  However,  following  the  new  appointments  to  the  High  Court,  the 
clearance rate increased considerably by 46% compared to the last year. The High Court has 
delivered  3690  decisions  since  it  regained  its  functionality  in  March  2020  until  June  2021. 
During  the  first  quarter  of  2021,  the  High  Court  has  delivered  647  final  decisions,  out  of 
which:  145  adopted  by  the  administrative  college,  241  by  the  civil  college  and  261  by  the 
criminal  college.  In  July  2020,  the  High  Court  adopted  guidelines  for  the  reduction  of 
backlog  and  increase  of  efficiency  for  the  High  Court.  Among  the  key  measures  are  the 
recruitment of new administrative and legal research staff, improvement of working methods 
and increase of communication and transparency. 

The  collection  and  reporting  of  judicial  statistical  data  has  improved  but  further  efforts  are 
required.  Decisive  policy,  planning  and  budgetary  efforts  are  urgently  needed  to  roll-out  a 
new  integrated  case  management  system,  and  ensure  its  inter-operability  across  the  entire 
justice system, in line with CEPEJ methodology.  

The  HJC  has  made  progress  on  measurement  of  court  efficiency  by  adoption  of  necessary 
regulation in 2021 and statistical charts for evaluation of the performance of the magistrates 
on the basis of CEPEJ indicators. HJC approved the guidelines on the collection of statistical 
data for courts and  a pilot  web-based satisfaction surveys. Standard rules and indicators on 
efficiency must be approved promptly by the HJC.  

There  are  29  cases  pending  before  the  Council  of  Europe  Committee  of  Ministers  for 
supervision of execution of final judgements of the European Court of Human Rights. 

The  use  of  alternative  dispute  resolution  continues  to  be  limited  and  needs  to  be  further 
strengthened. Awareness of the citizens about the alternative dispute resolution service is low 
and needs to be enhanced.  

 Fight against corruption 

22 

 
 
Albania has some level of preparation in the fight against corruption.  Some progress was 
made in strengthening the fight against corruption. The implementation of the Inter-sectoral 
Strategy against Corruption is overall on track. The vetting of members of the judiciary  are 
bringing results in the fight against corruption. The Anti-corruption Task Force has over the 
past year been less effective and needs to be re-activated. The concrete impact of the recently 
established  Anti-corruption  Directorate  in  the  Ministry  of  Justice  on  investigating, 
prosecuting and trying high-level corruption is  yet to be seen. The creation of a network of 
anti-corruption coordinators in 17 institutions is a positive step in the fight against corruption. 
The recommendations of the last annual report were only partially implemented. Efforts and 
political will should increase towards consolidating a track record of seizure and confiscation 
of criminal assets, as well as establishing a solid track record in the fight against corruption. 
The  Special  Anti-Corruption  and  Organised  Crime  Structure  (SPAK)  contributed  to  an 
improvement  in  the  seizure  and  confiscation  of  criminal  assets  in  corruption-related  cases. 
Overall,  corruption  is  prevalent  in  many  areas  of  public  and  business  life  and  remains  an 
issue of serious concern. Convictions in cases involving high-level officials remain limited, 
still fostering a culture of impunity within the higher levels of the State. 

Recommendations for the coming year: 

  continue to strengthen the fight against corruption; further progress towards establishing a 
solid  track  record  of  investigations,  prosecution,  and  adjudication  of  corruption  cases, 
seizure  and  confiscation/recovery  of  criminal  assets  resulting  from  corruption-related 
offences; 

  ensure  that  the  Special  structure  for  Anti-Corruption  and  Organised  Crime  (SPAK),  i.e. 
the Special Prosecutor's Office (SPO) and the National Bureau of Investigation (NBI), as 
well  as  the  SPAK  Courts,  effectively  address  high-level  corruption;  ensure  adequate 
resources,  skills  and  cooperation  between  these  new  structures  and  other  prosecutorial 
and judicial entities; 

  ensure  that  criminal  proceedings  are  consistently  and  systematically  initiated  against 
judges and prosecutors accused of criminal conduct during the re-evaluation process; 

  effectively  address  the  recommendations  of  GRECO  and  implement  the  related  action 

plan within the given timeframe.  

Track record 

Further  efforts  were  made  as  regards  the  track  record  of  investigations,  prosecutions  and 
convictions  in  the  fight  against  corruption,  although  it  remains  an  objective  that  requires 
political  will  and  further  structured  and  consistent  actions.  The  number  of  corruption  cases 
sent to court was 413 in 2020 (643 in 2019), including 53 by the SPO. 270 persons (mid and 
high-ranking  officials)  were  convicted  at  first-instance  (262  in  2019)  and  87  at  appeal  and 
final  level  in  2020  (246  in  2019).  The  overall  number  of  referrals  to  the  prosecution 
decreased slightly to 3 016 in 2020 (3 167 in 2019). 

On convictions of high-level state officials, 73 cases were opened against high-level officials 
in 2020 (98 in 2019) and 11 indictments were issued involving 20 persons (compared to three 
indictments involving 10 persons in 2019). One defendant involved in high-level corruption 
was convicted  with  final prison sentence by the  anti-corruption and organised crime courts. 
SPAK conducted criminal  proceedings in  several high-profile cases (one  former Prosecutor 
General,  nine  former  judges  of  the  High  Court  and  the  Constitutional  Court,  one  former 
Judge of the Special Appeals Chamber, a Deputy Chief of the State Police’s Power of Law 
Operation,  20  election  commissioners  accused  of  electoral  crimes  during  the  elections  of 

23 

 
 
2017  and  a  former  Minister  of  Defence).  Investigations  have  so  far  not  resulted  in  a 
substantial  number  of  final  convictions  of  high-ranking  state  officials.  Sustained  efforts  are 
needed to tackle the culture of impunity within the higher levels of the State. 

The  vetting  of  members  of  the  judiciary  continued  to  have  a  positive  impact  on  the  fight 
against corruption. To date, 62 % of the vetting dossiers processed have resulted in dismissals 
and  resignations.  Among  the  high-ranking  magistrates,  10  former  high-level  judges  of  the 
High  Court  and  the  Constitutional  Court  have  been  dismissed  through  the  vetting  or  have 
resigned.  The  SPO  has  started  criminal  proceedings  against  10  former  High  Court  and 
Constitutional Court judges and referred 10 other cases (not involving high-level judges) to 
the  competent  district  prosecution  offices.  45  out  of  300  high  level  officials  of  the  State 
Police, Guard of the Republic and Service for Internal Affairs and Complaints (SIAC) were 
vetted, leading so far to one dismissal and one resignation. The vetting process and its results 
remain crucial to restore public trust in the judiciary and law enforcement bodies of the State.  

Reaching final convictions in high-level corruption cases remains an important priority. The 
data collection methodology for both corruption and organised crime cases should be further 
improved.  A  unified  case  management  system  for  investigations,  prosecutions  and 
convictions is needed. Ensuring efficient operation of SPAK and NBI work remains of key 
importance  to  minimise  the  backlog  of  sensitive/high-level  cases.  District  law  enforcement 
authorities must be strengthened to efficiently deal with cases not covered by the SPAK and 
NBI mandates.  

On  asset  declarations  by  high-level  state  officials,  12  cases  were  referred  by  the  High 
Inspectorate for the Declaration and Audit of Assets and Conflicts of Interest (HIDAACI) to 
the prosecution in  2020, none of which resulted  in  a conviction.  In 2019, there were seven 
cases referred to prosecution that resulted in a conviction and a dismissal. In total, HIDAACI 
referred  six  low-  and  mid-ranking  officials  to  prosecution  services  in  2020.  No  final 
convictions occurred. In 2019, there were 12 referrals and 12 final convictions. Investigation 
of 33 Conflict of Interest cases were performed in 2020, compared to 42 in 2019. 

Seizure  and  confiscation  of  criminal  assets  are  ordered  and  carried  out  more  coherently  in 
corruption-related  cases  since the  establishment  of SPAK. Risk  assessments  have increased 
within  the  central  administration  and  a  corruption  risk  assessment  methodology  has  been 
approved.  

Some  progress  was  made  in  setting  up  an  interface  between  the  different  electronic  case 
management systems of the police, prosecution and courts. A system to manage the follow-
up of denunciations of corruption is being set-up by the Ministry of Justice.  

Implementation of the Law on whistle-blowing and whistle-blower protection continued. In 
2020, nine external reporting cases were registered and investigated by HIDAACI, compared 
to 14 in 2019.  

On internal control mechanisms, the Anti-corruption Task Force was less effective in 2020. 
In 2020, 214 cases including 317 officials were referred to the prosecution compared to 250 
cases involving 474 officials in 2019. The State Supreme Audit Institution referred 8 cases in 
2020  involving  12  executives  to  the  prosecution  (compared  to  28  cases  involving  40 
executives  in  2019).  The  rate  of  implementation  of  the  State  Supreme  Audit  Institution’s 
general recommendations by public institutions needs to improve. (see also Chapter 32 ) 

On access to information, a revised model for the institutional Transparency Programme as 
well  as  for  the  Register  of  Requests  and  Responses  was  approved  in  2020.    The 
Commissioner  for  Information  and  Data  Protection  received  715  complaints  and  issued  23 
decisions,  while  786  complaints  were  received  in  2019.  A  system  was  established  and 

24 

 
 
installed in 59 public institutions to record the overall number of requests made and to enable 
citizens to submit online requests for public information. Transparency has increased with all 
Ministries  having  approved  and  published  their  transparency  programme.  (see  also  Public 
Administration reform) 

The  impact  of  anti-corruption  measures  in  particularly  vulnerable  areas  (customs,  tax 
administration,  education,  health,  public  procurement,  PPP  contracts  etc.)  remains  limited. 
Internal checks and inspection mechanisms within the public administration remain weak and 
ineffective.  

Institutional framework 

Prevention of corruption 

Effective  inter-institutional  coordination  should  be  ensured  between  the  new  governmental 
structures  involved  in  fight  against  corruption.  The  impact  of  anti-corruption  structures  on 
preventing  public  sector  corruption  remains  difficult  to  measure.  The  institutional  and 
operational capacity of the anti-corruption network in line ministries, at local level and in the 
Office of the National Coordinator against Corruption (NCAC) in the Ministry of Justice has 
slightly increased. The recruitment of staff in the separate Directorate for Anti-corruption in 
the Ministry of Justice has not been completed. The regulatory framework of the network of 
Anti-corruption coordinators in 17 institutions established to prevent and tackle corruption in 
state administration remains weak. Effective coordination should be ensured between the new 
structures  at  the  Ministry  of  Justice,  the  Unit  for  Transparency  and  Anti-Corruption  at  the 
Prime  Minister’s  office,  the  Special  Unit  for  Anti-Corruption  and  Anti-Evasion  established 
also at the Prime Minister’s office, as well as the Integrated Policy Management Group for 
PAR and Good Governance.  

The  role  of  HIDAACI  in  detecting  conflicts  of  interest  and  checking  asset  declarations 
was  reinforced  through  the  adoption  of  the  Law  on  whistle-blowing  and  whistle-blower 
protection  and  the  implementation  of  the  vetting  process.  Human  resources  were  not 
strengthened in the past two years.  

The role of the State Supreme Audit Institution in the overall anti-corruption framework is 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)  concluded  in  the 
addendum to its Second Compliance Report (fourth round) on Albania of October 2020 that 
Albania  had  dealt  satisfactorily  with  nine  of  the  10  recommendations  while  one  has  been 
partially  implemented.  In  the  first  report  of  the  fifth  round,  dealing  with  the  prevention  of 
corruption and promoting integrity in central governments (top executive functions) and law 
enforcement agencies, published in December 2020, GRECO found that the legal framework 
for preventing corruption of members of the Council of Ministers and their political advisers, 
and of the police, is comprehensive, but overly complex.  

Integrity-related  secondary  legislation  is  in  place  but  an  overall  integrity  risk-management 
system has yet to be established. Integrity plans have been approved in 2020 for the Ministry 
of  Justice  and  the  Albanian  State  Police,  together  with  a  corruption  risk  assessment 
methodology. 

In 2020, 29 817 complaints were registered on the online portal to promote “co-governance” 
with  citizens  and  businesses.  1  083  complaints  related  to  corruption  received  on  the  online 
portal  were  transmitted  to  the  Police  but  none  resulted  in  criminal  proceedings.  34 

25 

 
 
administrative  measures  were  taken.  In  2019,  the  portal  had  received  a  total  of  23  605 
complaints related to  public administration of which 22 423 were addressed leading to  171 
administrative  measures  and  20  cases  to  the  Anti-Corruption  Task  Force.  The  number  of 
electronic services on administrative matters increased to 1 021 in 2020 compared to 601 in 
2019.  

Law enforcement 

Specialised  bodies  in  charge  of  investigating,  prosecuting  and  adjudicating  complex 
corruption  cases  –  the  Anti-Corruption  and  Organised  Crime  courts  and  the  SPAK, 
comprising  the  Special  Prosecution  Office  (SPO)  and  the  National  Bureau  of  Investigation 
(NBI) – are now fully operational.  

Legal framework 

Albania  is  a  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.  

Further  amendments  to  the  Law  on  political  party  financing  and  the  Electoral  Code  were 
adopted  by  the  Parliament  on  23  July  2020  (see  also  section  2.1.1  Democracy).  All  the 
secondary legislation for the regulatory framework on integrity is in place but remains highly 
complex  and  fragmented,  and  effective  implementation  is  lacking.  Outstanding  EU 
recommendations on the improvement of Political Party Financing and the Electoral Reform, 
which  are  not  part  of  the  OSCE/ODIHR  recommendations,  still  need  to  be  addressed. 
Incidents, which occurred during the election campaign, in particular related to vote-buying, 
have shown that there is a need of transparent political party finances.   

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,  improve  proper  budgeting  of  the  strategy’s  activities.  A 
new action plan for 2020-2023 for the implementation of the extended strategy was adopted 
in  July  2020.  A  mid-term  review  of  the  Strategy  has  been  undertaken.  Consultations  with 
relevant stakeholders before the approval of the reports have improved, including the use of 
the public consultation platform.  

Fundamental rights  

Albania  complies  overall  with  international  human  rights  instruments  and  has  ratified  most 
international conventions related to the protection of fundamental rights. During the reporting 
period,  there  was  progress  on  property  rights  as  regards  the  registration,  digitisation  and 
implementation  of  the  compensation  scheme.  On  minority  rights,  an  additional  by-law  was 
adopted  on  minority  education  but  remaining  by-laws  are  still  pending  adoption.  The 
population  census  law  was  adopted.  The  legal  framework  on  anti-discrimination  further 
improved but  the case-law has  not  yet  substantially developed. Progress  was  made in  other 
aspects of fundamental rights, for instance on the enforcement of the rights of persons with 
disabilities  and  on  gender  equality.  In  particular  there  was  progress  in  ensuring  adequate 
funding  for  the  implementation  of  the  dedicated  strategy,  and  a  new  strategy  on  gender 
equality 2021-2030 was adopted in June. By-laws linked to the Law on Social Housing were 
adopted. Recommendations from last year have partially delivered on. 

Recommendations for the coming year: 

26 

 
 
  adopt  pending by-laws on minority  rights,  in  particular on self-identification and use of 
minority  languages  and  increase  the  capacities  of  the  State  Committee  on  National 
Minorities;  

  continue the first registration of immovable properties and the implementation of the law 
on finalising transitional ownership processes, in a transparent and inclusive manner; 

  upgrade the security, and restrict access to and use of personal data stored in state-owned 

databases. 

Albania complies overall with international human rights instruments and has ratified most 
international  conventions.  The  signature  of  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  is  pending  since  2019.  Assessing  the  level  of 
implementation of human rights legislation, policies, and strategies remains a challenge due 
to  the  absence  of  comprehensive  monitoring  and  data.  Albania  has  submitted  its  Fifth 
National  Periodic  Report  on  the  implementation  of  Convention  on  the  Elimination  of  all 
Forms  of  Discrimination  against  Women  to  the  Committee  on  the  Elimination  of 
Discrimination against Women (CEDAW Committee).  

Following  the  adoption  of  the  Universal  Periodic  Review  by  the  Human  Rights  Council 
(September  2019),  national 
in  a  dialogue  on  human  rights 
implementation in order to better integrate human rights in strategic and development policies 
and to  identify  focus areas.  In December 2020 Albania appointed an Observer, an  alternate 
Observer  and  a  National  Liaison  Officer  to  the  European  Union  Agency  for  Fundamental 
Rights.  

institutions  engaged 

Albania continues to ensure good cooperation with the European Court of Human Rights. 
As  of  1  January  2021,  there  were  563  cases  pending  (104  communicated  cases)  before  the 
ECtHR,  many  of  which  are  related  to  property  and  due  legal  process  in  property  related 
cases. In 2020 the Court delivered three judgments, all finding breaches of the ECHR.  

The  re-accreditation  of  the  Ombudsman  by  the  Global  Alliance  of  National  Human  Rights 
Institutions  (GANHRI)  with  “Status  A”  in  December  2020,  is  a  positive  step.  In  2020,  the 
total  of  256  recommendations  submitted  by  the  Ombudsman  remained  stable  of  which  69 
were accepted, 24 were rejected, 34 went without response, and 49 are still being processed.  

The  Ombudsman  significantly  increased  the  number  of  cases  handled  ex-officio,  and  an 
increased  number  of  recommendations  were  addressed  to  central  and  local  governments  to 
take  concrete  measures  to  respect  fundamental  rights  and  freedoms  during  the  COVID-19 
pandemic, in particular for vulnerable groups. 

During  the  pandemic  restrictions,  the  Ombudsman  recommended  to  allow  protests  to  take 
place while respecting COVID-19 protocols, which has been disregarded by the authorities. 
However,  the  request  by  the  Ombudsman,  to  provide  written  information  on  the  measures 
taken  in  the  prisons  and  on  the  respect  of  fundamental  rights  of  prisoners,  was  generally 
observed.  The  Commissioner  for  Protection  from  Discriminations  (CDP)  issued  three  main 
recommendations  responding  to  COVID-19  situation:  two  for  the  expansion  of  the  list  of 
specific categories in need and one for proposed amendments to the Criminal Code related to 
domestic violence, disobedience to COVID-19 measures and violation of quarantine rules.   

The  effective  implementation  of  the  Ombudsman’s  recommendations  by  public  authorities 
has not improved enough to enhance public institutional accountability. The role of the CPD 
was strengthened through amendments to the law regulating its function and its organisation. 
For the second year in a row, the budget of the Ombudsman was lowered, 

27 

 
 
Concerning the right to life, in July 2020, the Albanian Parliament adopted amendments to 
the  law  on  the  Right  to  Information  about  the  former  State  Security  Documents  of  the 
Socialist  People’s  Republic  of  Albania.  The  implementing  legislation  related  to  these 
amendments needs to be adopted. During the reporting period, the Prosecutor’s offices failed 
to conduct any ‘ex officio’ investigation on missing persons cases during the communist era. 
The resolution of cases has remained low partly due to the lack of capacities and  resources. 
Political  will  is  needed  to  establish  an  efficient  cooperation  mechanism  among  relevant 
institutions and to enhance public awareness on this matter. 

On  the  prevention  of  torture  and  ill-treatment,  the  National  Preventive  Mechanism 
conducted  monitoring  inspection  visits  in  10  Institutions  of  Execution  of  the  Criminal 
Decisions, a marked decrease from the previous year due to COVID-19 pandemic. Out of the 
85  recommendations  from  the  Ombudsman  aiming  at  improving  prisons  conditions  and 
treatment of prisoners, 52 have been fully implemented, 22 are partly implemented and 11 are 
under implementation. 

Following the Committee for the Prevention of Torture and Inhuman or Degrading Treatment 
or Punishment (CPT) recommendations, further improvements are needed in the functioning 
of detention facilities.  

The  renovation  of  Lezha  prison,  as  an  intermediary  facility  to  treat  people  with  mandatory 
medical  treatment,  progressed.  However,  the  conditions  in  Zaharia  medical  facility  remain 
inadequate. 

The  action  plan  for  the  development  of  the  prison  system  (2019-2022)  is  in  place.  The 
penitentiary legal package was approved by the Albanian Parliament and entered into force in 
August  2020.  Six  manuals  for  education  staff  for  rehabilitation  programmes  for  prisoners 
have  been  approved  in  2020.  From  June  2020  to  March  2021,  782  staff  from  the  prison 
system have been trained.  

The  use  of  alternatives  to  custody  continued  to  increase  in  2020.  The  establishment  and 
functioning  of  the  Probation  Service,  as  part  of  the  reform  in  the  system  of  execution  of 
criminal sentences, has significantly improved restorative justice in Albania since 2019. This 
service  is  fully  operational  all  over  the  country  and  foresees  alternative  to  imprisonment 
including for juvenile offenders. The increase in numbers of alternative sentences contributed 
to a reduction in prison overcrowding. 

Across the country, the number of inmates is now under the capacity of the prison system by 
19.4%.  The  use  of  electronic  monitoring  remains  suspended  since  2017  because  of  an 
unresolved legal dispute. 

On the protection of personal data, efforts are ongoing to align the personal data protection 
legislation  with  the  General  Data  Protection  Regulation  2016/679  and  the  Police  Directive 
2016/680.  In  December,  a  Decision  of  the  Council  of  Ministers  approved  in  principle  the 
2018  Protocol  amending  the  Convention  for  the  Protection  of  Individuals  with  regard  to 
Automatic  Processing  of  Personal  Data,  which  paved  the  way  for  its  signature.  Seven 
additional  staff  have  been  hired  at  the  office  of  the  Information  and  Data  Protection 
Commissioner (IDP) in 2020. Additional staff needs to be allocated to the Commissioner in 
order for it to fulfil the increased duties foreseen in the legislation on personal data protection 
expected to be adopted in the next reporting period. In 2020, the Commissioner received 308 
complaints  from  data  subjects  which  is  a  comparable  level  to  2019.  The  Commissioner 
carried  out  60  inspections  and  issued  20  recommendations,  18  decisions  and  37 
administrative  sanctions.  This  represents  a  decrease  of  activity,  which  can  be  explained  by 
the  COVID-19  pandemic.  The  IDP  launched  an  ex-officio  administrative  inquiry  after  the 

28 

 
 
leaking  of  sensitive  personal  data  including  political  preferences  emerged  during  the 
campaign  for  the  25  April  general  elections.    The  IDP  released  its  report,  which  includes 
findings of breach of data protection rules. The IDP addressed recommendations to relevant 
authorities  on  updating  security  protocols,  and  limiting  access  to  and  use  of  personal  data 
stored  in  state-owned  databases.  One  decision  was  issued  imposing  a  sanction  to  the  tax 
authorities  for  non-cooperation.  These  recommendations  need  to  be  swiftly  followed  up, 
without  prejudice  to  other  proceedings  by  competent  authorities  aimed  at  assessing  the 
integrity of the election process.    

Freedom of thought, conscience and religion was generally upheld. Despite the economic 
restrains  related  to  COVID-19  crisis  and  to  the  earthquake  aftermath,  the  government 
maintained  the  same  level  of  financial  support  to  religious  communities  in  the  country.  In 
June  2020,  it  allocated  EUR  884,000  to  the  five  official  religious  communities  with  a  core 
support  dedicated  to  religious  education  Ahead  of  the  25  April  elections,  religious  leaders 
called on the population to distance themselves from vote buying practices. The restitution of 
properties belonging to religious groups and taken by the state during Communism remains 
an unresolved issue.  

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

Freedom of expression 

The country has some level of preparation / is moderately prepared in the area of freedom 
of expression. There was no progress over the reporting period. Following an unfavourable 
opinion  of  the  Venice  Commission  and  criticism  from  local  and  international  media 
organisations on draft amendments to the Media Law, the government indicated that they had 
reconsidered  the  adoption  of  the  draft  amendments  and  the  Assembly  did  not  revert  to  the 
issue.  It  is  essential  that  any  possible  change  to  the  Media  Law  should  be  in  line  with  the 
Venice Commission Opinion and submitted to proper consultation with media organisations. 
The  atmosphere  of  verbal  attacks,  smear  campaigns  and  acts  of  intimidation  against 
journalists has not improved over the reporting period. Tensions between political actors and 
journalists  have  increased  during  the  pandemic  and  in  the  context  of  the  parliamentary 
elections.  Steps  to  make  the  audio-visual  regulatory  authority  fully  operational  need  to  be 
taken in a way that ensures its independence and legitimacy. 

In the coming year, Albania should: 

  ensure a policy of zero tolerance for intimidation and attacks against journalists, as well 
as  for  threats  against  the  media,  including  in  political  discourse  and  in  the  margins  of 
demonstrations; 

  ensuring that the legal requirements for transparency of media ownership and financing, 
and  its  limitations thereto,  as  well  as  requirements  on  public  advertising,  are  aligned  to 
international standards; 

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

journalists’ labour and social rights. 

Intimidation of journalists 

Serious concern persists  among media freedom  organisations over political  pressure, use of 
intimidating language, threats and violence against journalists. The reporting period also saw 
an increased number of defamation lawsuits or strategic lawsuits against public participation 
against  media  outlets  or  individual  journalists,  coming  from  powerful  companies  and 
politicians  intended  to  censor  and  intimidate  critical  media.  As  of  August  2020,  there  were 

29 

 
 
more  than  20  lawsuits  against  journalists,  mainly  for  defamation.  In  October  2020,  an 
explosive charge detonated in front of a local journalist’s house, causing material damage. A 
criminal proceeding was registered, but the case remains pending. 

In December 2020, police exerted unwarranted excessive force and detained two journalists 
who were covering protests that erupted in Tirana following the death of a 25-year-old man 
shot by police enforcing a COVID-linked curfew.  

In April 2021, the ECtHR issued an interim decision imposing a security measure to prevent 
the  seizure  of  servers  and  computer  data  of  an  online  media  outlet,  which  had  disclosed  a 
database  containing  the  personal  information  of  more  than  910,000  voters  in  the  Tirana 
electoral  region,  allegedly  created by the Socialist Party  for electoral  purposes,. Questioned 
by the Special Anticorruption Prosecutor’s Office (SPAK), the two owners of the news portal 
Lapsi.al  refused  to  share  the  source  of  their  information  and  the  database  itself  with  the 
SPAK.  Following  the  ECtHR  interim  decision, in  May  2021,  the  Special  Court  of  Appeals 
repealed a first instance court decision for the seizure of servers, computers and telephones of 
the Lapsi.al journalists.   

Legislative environment 

The ruling majority pledged to reconsider the adoption of the amendments to the media law, 
aiming  to  regulate  online  media  and  some  aspects  of  defamation.  The  amendments  were 
adopted by the Parliament in December 2019, but returned back to the Parliament for review 
by  a  presidential  decree.  Representatives  from  the  ruling  majority  publicly  committed  to 
follow up on the guidance of the Venice Commission Opinion on the amendments adopted in 
June 2020. The parliament and government resulting from the 25 April elections must uphold 
the commitment to ensure that any possible changes to the media law would be in line with 
the  Venice  Commission  Opinion  and  submitted  to  proper  consultations  with  media 
organisations. 

Defamation  remains  a  criminal  offence  which  does  not  carry  prison  sentence.  Albania  still 
needs  to  introduce  legislation  to  strengthen  transparency  in  public  advertising.  Access  to 
information  about  procurement  contracts,  audits  and  salaries  of  officials  still  needs  to  be 
strengthened. Decisions of the Commissioner on the Right to Information are not-binding on 
public administration officials. 

Implementation of legislation/institutions 

Marking  a  positive  and  a  long  expected  step,  the  Audio-visual  Media  Authority  (AMA) 
announced having concluded the digital switchover at the end of 2020.  

As  a  national  audio-visual  regulator,  AMA  is  currently  operating  with  limited  human 
resources. All positions of its steering board, with the exception of the Chairperson, became 
vacant between 2019 and 2021. In accordance with the audiovisual media law, the members 
with an expired mandate will remain in office until the Parliament fills the vacancies. In July 
2021,  Parliament  elected  the  new  Chairperson  of  the  institution.  Local  and  international 
media  organisations  and  opposition  have  raised  concerns  over  the  appointment  process  as 
well as regarding the political impartiality of the newly elected head of the regulatory body.  
The new Parliament needs to fill these vacancies and make AMA fully operational. In doing 
so, it is important that the new appointments ensure the independence and legitimacy  of the 
regulatory authority. 

The government established in September 2021 an Agency for Media and Information. In this 
respect,  it  is  important  to  ensure  the  media’s  direct  and  transparent  access  to  governmental 
institutions and their activities as well as to non-partisan public information. 

30 

 
 
Public service broadcaster 

From December 2020 to May 2021, the Parliament replaced all board members of the public 
broadcaster  whose  mandates  had  expired,  including  the  Chair,  thus  making  the  body  fully 
functional.  In  May,  through  a  rather  hasty  process,  the  steering  board  dismissed  the 
incumbent director whose mandate expired earlier the same month, without launching the call 
for the new director, as required by law.  

Economic factors  

The strong influence of politics and business over the media remains a key source of concern 
for  freedom  of  expression  in  the  country.  The  map  of  the  media  landscape  continues  to 
indicate further market and audience concentration in the hands of few owners, who use their 
media channels to push their economic interests and political agendas forward. Transparency 
of  media  funding  remains  a  key  objective  to  improve  media  freedom  in  the  country. 
Economic  insecurity  due  to  a  lack  of  enforceable  labour  contracts  leads  many  Albanian 
journalists to resort to self-censorship, severely harming their independence. The COVID-19 
pandemic resulted in the worsening of the economic situation of media, which were hit by a 
critical reduction of advertising revenues.   

Internet 

Media  freedom  organisations  reports  indicate  that  political  actors  increasingly  use  social 
media  networks  to  communicate  with  voters,  while  restricting  access  to  reporters  and 
bypassing critical media – reducing the role of public watchdogs holding power accountable.  

Freedom of artistic expression 

Due  to  COVID-19  related  pandemic,  the  government  banned  all  the  cultural  activities 
including  theatre,  opera,  ballet,  exhibitions,  biennials  and  festivals  as  well  as  cultural 
activities in open spaces, cultural activities for children, visits in museums, parks and cultural 
heritage sites.  

Professional organisations and working conditions 

The  already  precarious  economic  situation  of  journalists  suffered  significantly  due  to 
COVID-19  outbreak,  putting  them  at  risk  of  self-censorship  and  owner  interference.  The 
government  did  not  provide  for  any  support  scheme  for  media  workers  hit  by  economic 
burdens during the COVID-19 crisis, although the Albanian Journalists’ Union called for the 
media sector to be included in a financial relief package for businesses. Due to pressure from 
the unions, the government included field reporters in the priority vaccination scheme.  

Albanian  media  increased  their  efforts  to  self-regulate,  through  the  creation  of  the  Alliance 
for  the  Ethical  Journalism,  a  self-regulating  mechanism  that  has  united  actors  pledging  to 
comply with the Code of Ethics, especially those online.  

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

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  OSCE/ODIHR,  still  needs  to  be  amended  to  address  the  right  to 
spontaneous  assemblies  and  counter–assemblies.  Following  a  decision  of  the  Constitutional 
Court  in  May  2021,  a  prior  authorisation  for  the  organisation  of  gatherings  is  no  longer 
required  and,  therefore,  it  no  longer  constitute  a  criminal  offence.  During  the  reporting 
period,  due  to  the  COVID-19  pandemic,  freedom  of  assembly  was  temporarily  limited  to 
prevent  the  spread  of  the  infection.  During  the  pandemic  restrictions,  the  police  broke  up 

31 

 
 
dozens of protests and hundreds of citizens criminally charged for organising or participating 
in protests, including members of the press. 

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

On  property  rights,  there  was  progress  as  regards  the  registration,  digitisation  and 
compensation. Following the entry into force of the Law on finalising transitional ownership 
processes  in  Albania  in  May  2020,  the  State  Cadastre  Agency  initiated  the  process  of  first 
registration  for  eight  cadastral  zones  in  the  Himara  municipality.  The  process  has  been 
facilitated through  a public information  campaign  and with  the  establishment of three local 
offices  where  citizens,  in  addition  to  being  informed,  may  submit  documentation.  First 
registration is also ongoing in other parts of the country. Out of the total of 3 057 cadastral 
zones comprising around 4 million properties, first registration has been completed in 2 717 
cadastral zones comprising around 3 540 000 properties. In 2020 and during the first half of 
2021 registration has continued with an average of around 2000 properties per month.  As of 
April 2021 just under 1 783 000 files had been digitised. 

The  Agency  for  the  Treatment  of  Property  (ATP)  continued  assessing  requests  and 
distributing  funds  for  compensation  of  properties.  It  registered  122  new  applications  and 
executed  106  decisions  resulting  in  the  distribution  of  around  EUR  6.9  million  from  the 
financial fund and an area of around 100 hectares from the land fund (value of approximately 
EUR  1.6  million).  At  the  beginning  of  the  year,  second,  third  and  fourth  instalments  were 
distributed for 148 applications from the years 2016–2019.  

introduced  a  number  of 

On  non-discrimination,  the  legal  and  policy  framework  is  generally  aligned  with  EU 
standards  and  was  further  improved  with  amendments  to  the  Law  on  protection  against 
discrimination.  The  amendments 
including 
terminology  used,  the  categories  of  discrimination  to  be  mentioned  and  procedures.  The 
implementation  of  the  anti-discrimination  legal  framework  still  needs  to  be  further 
strengthened through the provision of specialised training to judges and prosecutors. In 2020, 
the  Commissioner  for  Protection  from  Discrimination  (CPD)  continued  to  handle  a  stable 
number of cases of alleged discrimination, mostly in the areas of employment and services. 
Laws  on  hate  speech  are  in  line  with  international  standards.  Wider  awareness  raising  is 
needed to eliminate hate speech, particularly in rural and remote areas.  

improvements, 

Gender equality  

The new strategy on Gender Equality 2021-2030 was adopted in June 2021. Albania pursue 
its  efforts  to  ensure  adequate  state  funding  to  effectively  implement  the  new  strategy  at 
central and local level. Efforts are required to ensure that all national strategies at central and 
local level are gender mainstreamed and apply gender responsive budgeting.  

The  overall  Gender  Equality  Index  for  the  Republic  of  Albania  published  in  2020  reached 
60.4, indicating a gender gap of 7.4 points below the EU average (67.4). The largest gaps in 
comparison  with  the  EU  average  are  in  the  domains  of  knowledge,  money  and  time,  while 
scores  are  similar  in  the  domains  of  work  and  health.  The  second  EU  Gender  Index  is 
planned to be published during the second half of 2021. 

The Law on Reproductive Health still lacks to foresee referral mechanisms between different 
levels  of  care;  training  for  health  care  providers;  youth  friendly  services;  and  outreach  to 
vulnerable groups.  

32 

 
 
Efforts to strengthen the legislation that addresses gender-biased sex selective abortion have 
been taken by the Ministry of Health and Social Protection. Efforts should continue to ensure 
monitoring of the practice 

Regarding gender-based violence, during the period January-December 2020, 4 701 cases of 
domestic  violence  were  identified  and  processed.  Among  these,  1505  cases  have  been 
referred  to  the  Prosecution  office,  535  perpetrators  have  been  arrested.  In2020,  there  were 
seven murders in family relationships, six out of seven were women.  

In 2020, efforts were made to increase public funding  for victims of domestic violence  with 
the  creation  of  four  shelters  and  of  the  national  helpline  for  victims  of  domestic  violence. 
Specialised and reintegration services  for victims should be provided and the  work on  case 
management should be further strengthened.  

Local referral mechanisms for reporting gender-based violence have now been established in 
all 61 municipalities compared to 52 in previous year.  

The  COVID  19  crisis  has  disproportionately  increased  the  burden  of  unpaid  domestic  and 
care work for women, especially the most vulnerable. To mitigate the effects of the pandemic 
on  vulnerable  groups  the  government  has  doubled  unemployment  benefits  and  cash 
assistance and relief packages for categories in need.  

Albania  has  advanced  in  setting  up  a  legal  framework  governing  the  rights  of  the  child. 
Institutional  capacities  have  been  strengthened  to  address  difficulties  in  the  implementation 
of  child  rights.  However,  the  lack  of  implementation  and  means  of  appropriate  redress  for 
rights violations remain of concerns. 

During the year 2020, the Child Protection Units managed 2 193 cases of children in need of 
protection. In Albania, 60% of all sexual abuse cases are committed against children. Refugee 
and  migrant  children,  and  children  with  disabilities  are  extremely  vulnerable  to  violence, 
exploitation, stigmatization and abuse. Currently, there are only 223 child protection workers 
(52% of the planned number and a decrease from last year). The adoption in September 2020 
of  the  National  Action  Plan  on  De-Institutionalisation  of  children  from  residential  care  is  a 
positive step.  

The  adoption  of  Law  on  ‘Rights  and  Protection of  the  Child’  and  changes  to  the  Domestic 
Violence Law in 2020 improved the protection for children. The practice of child marriage is 
still present in Albania, particularly in the Roma, Egyptian and rural communities. There is a 
critical lack of data and reporting on child poverty. 

Increasing  evidence  of  risks  of  abuse  and  exploitation  due  to  the  use  of  the  internet  by 
children  is  of  serious  concern.  One  in  10  children  reported  at  least  one  unwanted  sexual 
experience through the internet.  

The  policy  framework  and  institutional  capacities  to  improve  juvenile  justice  remained 
largely insufficient in 2020 despite some progresses to set up dedicated free legal aid centres. 

The legal framework of the Juvenile Code and the Juvenile Justice Strategy 2018-2021 is in 
place,  however  much  remains  to  be  done  to  harmonise  and  effectively  implement  the 
legislation.  The  justice  system  (rules,  procedures,  services,  capacities,  standards)  is  not  yet 
friendly  nor  accessible  to  children.  There  is  a  critical  lack  of  services  (psychologist, 
mediation/restorative  justice),  including  coordination  and  training  of  the  professionals 
engaged in juvenile justice services)  

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. Further steps 

33 

 
 
need  to  be  taken  to  further  align  in  the  last  year.  Albania  still  has  not  ratified  the  Optional 
Protocol to the Convention on the Rights of Persons with Disabilities. The implementation of 
the  National  Action  Plan  for  people  with  disabilities  2016-2020  has  not  produced  much 
visible impact.  A new national plan for people with disabilities 2021- 2025 was adopted in 
May  2021.  Persons  with  disabilities  were  among  the  most  impacted  by  the  COVID-19 
pandemic. During the April 2021 elections, persons with disabilities encountered barriers and 
difficulties  to  vote.  Further  efforts  are  needed,  to  address  violence  against  persons  with 
disabilities,  improve  overall  accessibility  (including  services  and  information),  to  promote 
employment,  and  to  collect  statistical  data  on  their  situation.  Children  with  disabilities  are 
still  placed  in  residential  care  centres.  The  quality  of  education  for  disabled  children, 
especially  deaf  children,  remains  a  cause  for  concern.  The  number  of  assistant  teachers  for 
children with disabilities in the pre-university education system increased by 21% in the past 
year.  Additional efforts are needed to provide training on inclusive education approaches for 
all teachers and on early detection.  

Discrimination against lesbian, gay, bisexual, transgender, intersex and queer (LGBTIQ) 
persons remains pervasive and dominant in the Albanian society, especially regarding access 
to  health  care,  education,  justice,  employment  and  housing.  Cases  of  physical  aggression 
against  members  of  the  community  still  occur  and  hate  speech  continues,  particularly  in 
social media, Albania does not have legislation recognising civil cohabitation and same-sex 
marriage, which would require amendments to the family code. The national action plan for 
LGBTIQ persons, which came to end in 2020, did not produce visible results, due to the lack 
of financial resources and political will. 

However, the inter-ministerial team  responsible for monitoring the action plan has not  held 
any  meeting  since  May  2019.  Police  officers,  prosecutors  and  gender  ‘focal  points’  in  line 
ministries  continued  receiving  training  on  preventing  discrimination  on  the  basis  of  sexual 
orientation  and  gender  identity.  The  shelter  for  LGBTIQ  persons  has  continued  to  provide 
care, support and advocacy to homeless LGBTIQ individuals. The support from state budget 
has  increased,  covering  up  to  40%  of  the  core  budget  of  the  shelter,  but  continued 
dependence on donors creates uncertainty on the continuation of services. Public awareness 
and acceptance of LGBTIQ persons remain low, particularly in rural areas. Hate speech and 
discriminatory language continue to be a problem in the media, especially online media, and 
from politicians. Violence and discrimination against members of the trans-community is still 
a worrying phenomenon in the country.  

On procedural rights, two additional by-laws were adopted in August 2020 on free legal aid, 
completing the set of by-laws foreseen in the free legal aid law of 2018. Additional staff were 
recruited in the free legal aid Directorate of the Ministry of Justice and two more centres have 
opened  in  the  country  acting  as  direct  free  legal  aid  providers,  bringing  the  total  to  seven 
operational  centres.  Free  legal  aid  assistance  remains  however  predominantly  delivered  by 
civil society organisations. Efforts should continue to make available an effective free legal 
aid  and  ensure  quality  control  of  the  support  provided.  Awareness  campaigns  on  the  free 
legal  need  to  be  developed.  Concerning  other  procedural  rights,  clearer  guidance  and 
standards for interviewing children in conflict with the law need to be developed. On the right 
to  information  in  criminal  proceedings,  the  refusal  or  failure  to  grant  access  to  a  case  file 
should be subject to judicial review, with effective remedies. On access to a lawyer, courts, 
prosecutors’  offices  and  the  police  should  ensure  that  there  are  adequate  facilities  for 
confidential client-lawyer consultations. On the presumption of innocence, there should be a 
clear legal prohibition on public references to guilt made by public authorities.  

34 

 
 
As  regards  the  adoption  of  the  remaining  implementing  legislation  related  to  the  2017 
framework law on the protection of national minorities, an additional by-law on minority 
education was adopted in December 2020, which brought the number of adopted by-laws to 
eight.  The  remaining  implementing  legislation,  including  on  self-identification  and  use  of 
minority  languages  has  yet  to  be  adopted.  The  implementation  of  all  the  implementing 
legislation  will  require  strengthening  the  capacity  of  the  State  Committee  on  National 
Minorities  and  providing  sufficient  financial  resources.  In  November  2020,  the  Population 
Census  Law  was  adopted  in  line  with  international  standards,  including  on  the  self-
identification  of  ethnic  minorities.  The  census  questionnaire  has  been  published  for 
consultations. With regards to concerns raised by the Greek minority in relation to property 
rights in the southern coastal region, the initial registration of properties started in May 2020  
is ongoing. 

The 2016-2020 national action plan for the integration of Roma and Egyptians came to end, 
While overall, the progress was very limited, some positive results were noticed in the areas 
of civil registration, housing, education and employment. The new action plan, covering the 
period  2021-2025  was  prepared,  following  consultation  with  civil  society  and  relevant 
stakeholders,  and  in  line  with  the  Declaration  of  Western  Balkans  Partners  on  Roma 
Integration  (Poznan  Declaration)  and  with  the  EU  Strategic  Framework  for  Roma  2020  - 
20306.  A  new  chapter  on  anti-gypsism  was  introduced  to  address  this  increasing 
phenomenon. Additional efforts and resources are required to accelerate integration of Roma 
and reduce the gap with the rest of the population. Following the endorsement of the Poznan 
Declaration, the first regional ministerial meeting was held in Tirana in October 2020, hosted 
by the Ministry of Health and Social Protection. The structure of the Ministry of Health and 
Social  Protection,  in  charge  of  the  coordination  of  Roma-related  policies  needs  to  be 
strengthened. The overall positive trend of the past years regarding the participation of Roma 
and Egyptian children in the education system was negatively affected by distant learning and 
quarantine measures imposed during they COVID-19 pandemic. As a result, the gap between 
Roma/Egyptians  and  other  non-Roma  children  living  in  the  same  areas  has  remained  very 
large.  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  already  very  low,  was  further 
worsened by the COVID-19 crisis. Health insurance coverage for Roma in Albania remains 
low preventing in some case the members of the community to benefit from necessary care in 
the  COVID  crisis  context.  Regarding  the  implementation  of  the  Law  on  Social  Housing, 
Roma and Egyptians continue benefitting from the 5% quota foreseen by the law.  

On citizenship rights, a provision of the Law on Citizenship adopted in July 2020 may still 
lead  to  the  establishment  of  an  investors’  citizenship  scheme.  Such  schemes  pose  risks  as 
regards  security,  money  laundering,  tax  evasion,  terrorist  financing,  corruption  and 
infiltration  by  organised  crime  and  are  incompatible  with  the  EU  acquis.  As  a  candidate 
country, Albania should refrain from developing such a scheme. 

2.2.2.  Chapter 24: Justice, freedom and security 

The  EU  has  common  rules  for  border  control,  visas,  residence  and  work  permits,  external  
migration  and  asylum.  Schengen  cooperation  entails  lifting  border  controls  inside  the  EU. 
EU  Member  States  also  cooperate  with  Albania  in  the  fight  against  organised  crime  and 
terrorism,  and  in  judicial,  police  and  custom  matters  and  are  supported  by  the  EU  Justice 

6  In  line  with  the  terminology  of  European  institutions  the  umbrella  term  ‘Roma’  is  used  here  to  refer  to  a 
number of different groups (e.g. Roma, Sinti, Kale, Gypsies, Romanichels, Boyash, Ashkali, Egyptians, Yenish, 
Dom, Lom, Rom, Abdal…) without denying the specificities of these groups. 

35 

 
 
                                                           
and Home Affairs Agencies. 

Albania  has  some  level  of  preparation/is  moderately  prepared  to  implement  the  EU 
acquis in this area. Some progress was made as the Special Prosecution Office and National 
Bureau of Investigation started operating and the Albanian State Police increased their staff. 
Financial  investigations  should  be  to  further  developed  when  tackling  organised  crime. 
Albania  has  continued  to  increase  its  engagement  with  all  EU  justice  and  home  affairs 
agencies.  Referrals  to  asylum  procedure  and  return  procedures  should  follow  the  legal 
framework  in  place.  The  issue  of  unfounded  asylum  applications  lodged  by  Albanian 
nationals in EU Member States and Schengen-associated countries requires continuous and 
sustained  efforts.  Albania  should  keep  addressing  the  phenomenon  of  unaccompanied 
minors. Albanian visa policy should be aligned with the EU’s. 

In the coming year, Albania should in particular: 

  further increase the systematic use of parallel financial investigations when dealing with 
organised  crime,  illicit  trafficking,  terrorism,  and  money  laundering  and  continue 
building the track record of final convictions in the cases of organised crime, corruption, 
trafficking and money-laundering; 

  complete  the  implementation  of  the  action  plan  agreed  with  the  Financial  Action  Task 

Force on preventing money laundering and countering terrorism financing; 

  implement  the  new  asylum  law  and  resume  referrals  to  asylum  procedure;  align  return 
procedures  with  existing  legal  framework;  continue  to  address  the  issue  of  unfounded 
asylum applications. 

Fight against organised crime 

The  country  has  some  level  of  preparation  in  implementing  the  EU  acquis  in  this  area. 
Good  progress  was  made  in  meeting  last  year’s  recommendations.  Tangible  results  were 
achieved  in  the  fight  against  organised  crime,  including  through  an  increased  cooperation 
with  EU  Members  States,  Europol  and  Eurojust.  Exchange  of  qualitative  information  and 
joint  police operations  involving international  partners  have further intensified. Albania has 
continued to  show commitment  to  counter the  production and trafficking of drugs. Albania 
has  allowed  air  monitoring  by  EU  member  state  law  enforcement  services  to  detect  the 
production of narcotics.  Efforts  need to  continue to  ensure increased prosecutions and final 
convictions, especially at high-level. More efforts are needed to tackle cybercrime, trafficking 
in human beings and money laundering cases.  The phenomenon of child sexual abuse online 
remains a concern. 

In the coming year, Albania should in particular: 

  keep strengthening the fight against organised crime, including through cooperation with 
EU Member States, as well as EU Agencies, including Europol and Eurojust; the number 
of  Albanian  law  enforcement  agencies  that  have  access  to  SIENA  should  be  further 
expanded; 

  establish without delay 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, as foreseen by 
national legislation;  

  strengthen  effective  law-enforcement  response  on  cybercrime  to  increase  detection, 

investigation and prosecution.  

36 

 
 
 
Institutional set-up and legal alignment 

The Albanian State Police (ASP) has a total of 11 802 employees, equivalent to 260 officers 
per 100 000 inhabitants,  compared with  an EU average of 326 (Eurostat, 2017).  In 2020,  a 
significant increase of 587 police officers was added to the staff of the ASP to strengthen its 
operational capacities, while in 2021 the increase was 157 police officers. Staff rotations are 
frequent, affecting the ASP operational capacity. Following the establishment of the SPAK at 
the end of 2019 and the transfer of some of the former Serious Crime Prosecution Office’s 
competences  to  local  prosecution  offices,  judicial  police  officers  are  in  need  of  further 
training to investigate in particular financial crime, money laundering and serious trafficking 
offences. Albania should provide the relevant institutions with adequate resources in order to 
ensure continuity in the fight against organised crime.  

The  Special  Anti-corruption  and  Organised  Crime  Structure  (SPAK)  comprising  the  Special 
Prosecution  Office  (SPO),  and  the  National  Bureau  of  Investigation  (NBI),  as  well  as  the  First  and 
Second  Instance  Anti-Corruption  and  Organised  Crime  Courts  (SPAK  Courts)  are  operational.  In 
March 2021, the Assembly adopted amendments to the SPAK law, extending its jurisdiction 
to  all  terrorism  offences,  reinforcing  its  focus  on  high-level  corruption  and  introducing 
targeted career development measures 

The legal framework was further aligned with the EU acquis. A law on beneficial ownership 
register entered into force in September 2020. Business and non-governmental organisations 
had to register by the end of June 2021. Sanctions areapplied for those who have not done so. 
In  December  the  law  on  the  central  register  of  bank  accounts  was  adopted  and  the  register 
became  operational  at  the  end  of  July  2021.  The  implementation  of  the  special  package 
introducing temporary preventive measures to  enhance its capacity to  fight organised crime 
and  terrorism  (referred  to  as  the  anti  “grab-what-you-can”  package,  or  operation  Force  of 
Law)  adopted  in  January  2020  continued.  The  measures  include  targeting  assets  through 
seizure and confiscation, limiting the movements of suspected criminals, and restricting their 
economic  activities.  In  January  2021  some  of  the  structures  established  under  the  special 
package were replaced by the new Investigative Directorate within the ASP. A memorandum 
of  cooperation  between  the  General  Prosecution  Office  and  the  Minister  of  Interior  was 
adopted to increase the effectiveness of investigations related to money laundering, terrorist 
financing  and  financial  crimes  as  well  as  the  seizure  and  confiscation  of  criminal  assets.  A 
register  of  track  records  for  money  laundering  offences  has  been  set  up  by  the  General 
Prosecutor’s Office and connected to the ASP to support the district prosecution offices and 
regional and district police offices. 

Albania  has  a  robust  legal  framework  for  confiscating  criminal  proceeds.  The  Law  on  the 
administration  of  seized  and  confiscated  assets,  adopted  in  2019,  provides  for  an  asset 
recovery office (ARO) to be set up, as required by the EU acquis. At the end of 2020, a new 
structure  and  all  necessary  implementing  acts  for  the  Agency  were  approved  and  an 
electronic system for sequestrated and confiscated assets was conceived. However, the ARO 
in charge of identifying and tracking criminal assets, as provided for in the recently adopted 
legislation and in line with the EU acquis remains to be set up. In May 2021, a working group 
for the evaluation and establishment of the ARO was set up and meets regularly. 

Albania  still  needs  to  adopt  legislation  targeting  unjustified  wealth,  for  example  by 
introducing  the  measure  of  extended  confiscation  and  by  introducing  financial  ceilings  for 
cash transactions. Albania should further allow ‘suspicious transactions reports’ as evidence 
in court.  

37 

 
 
The Law on weapons is partially aligned with EU provisions. Albania further amended this 
law  in  December  2020,  transposing  part  of  the  EU  regulatory  framework  into  its  national 
legislation. 

As regards the strategic framework, Albania adopted a new Strategy against Organised and 
Serious  Crimes  for  2021-2025  and  its  Action  Plan  for  2021-2022  as  well  as  a  new  Cross-
cutting  Anti-Corruption  Strategy  for  2015-2023  and  its  Action  Plan  for  2020-2023. 
Furthermore  an  Action  Plan  on  the  Prevention  and  crackdown  on  criminal  activity  for 
cultivation of narcotic plants for 2021 was adopted. 

Implementation and enforcement capacity 

Albania pursued its efforts towards building a track record on fighting organised crime. In 
2020  there  were  22  new  cases  referred  to  prosecution  (compared  to  79  in  2019);  15 
indictments  for  a  structured  criminal  group  in  2020  (compared  to  13  in  2019)  and  five 
successful cases were closed with 13 persons convicted at appeal level (compared to one case 
in 2019).  

Notable  progress  was  made  in  the  fight  against  organised  crime,  including  through 
cooperation with EU Members States, and through the implementation of the action plan to 
address  the  FATF  recommendations.  The  implementation  of  the  package  of  temporary 
preventive  measures  to  enhance  Albania’s  capacity  to  counter  criminal  organisations 
(Operation Force of Law continued throughout the year. In 2020, this resulted in 181 police 
operations involving  802 suspects  (of  whom 630 were  arrested/detained,  82 wanted and 85 
investigated at large). 35 criminal groups were dismantled (an increase of 46% compared to 
2019), 125 members of criminal groups were arrested and almost 15 million EUR worth of 
assets  and  bank  accounts  were  seized.  The  Special  Prosecution  Office  (SPO)  initiated  200 
criminal proceedings – 42 for organised crime and 158 for corruption – in 2020. During the 
same  period,  39  criminal  procedures  for  corruption  and  16  procedures  for  organised  crime 
were sent to trial. 

As regards the track record for serious crimes, there was an increase in 2020 with 2 785 new 
cases referred to prosecution, compared to 2 323 in 2019; 66 cases on trafficking in human 
beings,  417  cases  on  money  laundering  and  2  086  cases  on  drugs  production  (compared  to 
1 805 in 2019). Of the total referrals for serious crimes, 577 cases resulted in indictments in 
2020, compared to 507 in 2019. As for case with final convictions, there were 188 in 2020 (in 
addition  to  185  convictions  at  first  instance),  compared  to  308  in  2019.  Narcotics  related 
cases accounted for 81% of the total in 2020 compared to 68% in 2019, followed by money 
laundering,  trafficking  in  vehicles,  money  counterfeiting  and  forgery,  and  trafficking  in 
human beings.  

Albania has taken further steps to strengthen international police cooperation. The Europol 
liaison  officer  deployed  in  Tirana  since  June  2019,  the  only  one  to  operate  in  the  Western 
Balkan  region,  has  helped  to  strengthen  cooperation  between  Albania  and  EU  Member 
States’ police forces in  the fight  against organised crime, including drug  trafficking,  and to 
enhance  the  police’s  capacity  to  assess  the  main  organised  crime  threats.  During  2020  119 
police  operations  have  been  carried  out  in  cooperation  with  international  partners,  which 
represents a 27% increase compared to 2019. 95 operations were related to narcotics. 25 of 
these  operations  involved  Europol,  compared  to  5  in  2019.  Since  the  deployment  of  the 
Europol  Liaison  Officer,  Albania  joined  five  additional  Europol  analysis  projects  (APs), 
bringing  its  participation  to  a  total  of  16  APs.  Albania  has  a  liaison  officer  posted  at 
Europol’s headquarters in The Hague.  

38 

 
 
Albania is sharing more and more information with EU Member States and Europol through 
the  secure  information  exchange  network  application  (SIENA).  The  quality  of  the 
information improved. In January 2021 an agreement was signed between the Albanian State 
Police  and  the  General  Directorate  of  Customs  which  should  allow  the  latter  to  also  have 
access to SIENA in due course. In June 2021, the Ministry of Interior agreed with Europol to 
add the Special Prosecutor Office and the National Bureau of Investigation in the Annex to 
the  Europol  Cooperation  Agreement  listing  entities  which  can  access  SIENA.  The  General 
Directorate of Taxation and the Financial Intelligence Unit should take the necessary steps to 
also be granted access. 

Albania  participates  in  six  EMPACT  priority  activities  under  the  EU  policy  cycle  and  was 
appointed  national  coordinator  for  the  organised  property  crime  priority.  Albania  should 
appoint a National EMPACT Coordinator. 

Albania’s participation in joint investigation teams (JITs) has increased. In 2020,  Albania 
participated  in  7  JITs  supported  by  Eurojust  related  to  drug  trafficking  (7)  and  organised 
crime (5).  Albania has yet to step up the use of special investigation techniques and proactive 
investigations.  The  cooperation  with  Interpol  has  continued  to  be  yield  positive  results,  in 
terms  of  information  exchanged  and  operations  to  execute  extradition  arrest  warrants. 
Cooperation between Albania (the Albanian Security Academy) and the EU Agency for Law 
Enforcement Training (CEPOL) is well established and based on a working arrangement. A 
dedicated  contact  point  is  in  place.  Albania  has  full  access  to  the  CEPOL  Exchange 
Programme as well as to the free of charge electronic learning system of CEPOL. As regards 
the  Security  Academy,  which  is  supported  by  an  EU  twinning  project,  the  recent 
development  bringing  the  Academy  back  under  the  Albanian  State  Police  and  limiting  the 
academic independence, are of concern. 

On  domestic  operational  capacity,  legal  and  institutional  reforms  have  strengthened  the 
capacities of the ASP’s Operational Directorate, which is responsible for special investigative 
measures throughout the country. During 2020 proactive investigations were conducted using 
special investigative tools in  the framework of 630 proceedings for trafficking of narcotics, 
persons, weapons and ammunition, including also money laundering and other related crimes 
under the competence of the district prosecution offices, resulting in i.a., arrests/detention of 
709  suspected  persons.  To  further  increase  the  efficiency  of  investigation  a  cooperation 
agreement between the Special Prosecution Office and the Prosecutor General was signed in 
December  2020,  with  view  to  unify  some  inter-institutional  administrative  and  procedural 
activities.  Albania  should  continue  to  use  and  develop  the  use  of  special  investigation 
techniques and proactive investigations. 

In  September  2020,  special  sections  for  the  investigation  of  money  laundering,  financial 
crime,  and  property  investigations  were  established  in  seven  prosecution  offices  of  general 
jurisdiction  with  a  section  headed  by  prosecutors  and  officers  of  judicial  police.  All 
prosecution  offices  have  either  a  special  section  or  a  prosecutor  appointed  for  money 
laundering,  financial  crime,  and  property  investigations.  The  appointed  prosecutors  have  a 
minimum of four years of experience in investigating financial crimes and they are working 
in coordination with the judicial police officers of the services in the special structures of the 
State Police.  

Law enforcement authorities’ response to organised crime, notably the investigation of large 
criminal networks, needs to be more proactive and systematic. Special task force police and 
prosecutors  have  access  to  40  national  registers,  but  they  still  lack  direct  access  to  the 
electronic  register  of  mobile  phone  subscribers  and  IP  addresses  from  internet  service 
providers.  An  instruction  of  the  Prosecutor  General  foresees  the  technical  modalities  for 

39 

 
 
using  currently  connected  registers  databases  and  connecting  further  law  enforcement 
agencies  in future.  

Financial investigations are not systematically accompanying criminal proceedings from the 
start,  and  their  effectiveness  remains  limited.  Some  progress  was  noted  in  2020  with  133 
referrals  with  141  subjects  for  property  investigations,  compared  to  123  referrals  in  2019. 
Financial investigation techniques of police and prosecutors still needs improvement. Albania 
reported  estimated  seizures  of  criminal  assets  worth  about  EUR  4.8  million  under  the  anti-
mafia law in 2020, compared to about EUR 56.1 million in 2019. Assets worth about EUR 
150  000  (estimated)  were  confiscated  in  criminal  proceedings  under  the  same  law  in  2020, 
compared to only about EUR 780 000 in 2019. 

There  is  no  strategic  or  systematic  approach  to  identifying  and  confiscating  criminal  assets 
located  abroad  or  not  reachable.  In  addition  to  the  tools  for  freezing,  managing  and 
confiscating  criminal  assets  under  the  anti-mafia  law,  Albania  should  adopt  and  implement 
rules  on  the  extended  confiscation  and  precautionary  freezing  of  assets.  It  should  also 
urgently improve its capacity to manage frozen or confiscated assets so that they do not lose 
economic value.  

Albania  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 to 
neighbouring  countries  and  EU  Member  States.  The  Prosecutor’s  Office  registered  28  new 
criminal proceedings for trafficking in human beings in 2020, compared to  25 in 2019. The 
number  of  cases  with  final  convictions  remained  very  low  with  two  cases  with  three  final 
convictions, compared to three cases with five final convictions in 2019. The national referral 
mechanism  for  (potential)  victims  of  trafficking  remained  functional.  Assistance  was 
provided on all cases. In 2020, 86 victims were identified and assisted, compared with 92 in 
2019. The National action plan against trafficking in persons 2021 – 2023 should be adopted, 
adequately funded and implemented. NGO-run shelters remain underfunded. Victim-centred 
investigations  and  prosecutions  are  not  conducted  consistently.  Albania  should  increase 
efforts  on  the  early  identification  of  victims  and  potential  victims  in  particular  in  mixed 
migration  flows  and  intensify  cross-border  cooperation  with  neighbouring  countries  and 
international cooperation. Successful reintegration remains difficult because core protection, 
care and social services from the state are insufficient.  

Dedicated awareness raising campaigns should be developed to target communities at risk of 
trafficking in human beings. The hotline 116 006 for victims of trafficking should be made 
functional.  The  improved  legislative  framework  for  victims,  including  amendments  to  the 
Criminal Procedural Code, has yet to be implemented. Police, prosecutors and judges should 
receive  dedicated  training  on  these  changes  and  the  rights  of  victims.  A  new  law  on  the 
protection  of  victims  of  trafficking  introducing  in  particular  a  state-funded  compensation 
scheme would be needed. 

On illicit trafficking in firearms, large numbers of firearms are available in Albania. These 
are  used  by  Albanian  criminal  groups  and  trafficked,  primarily  to  neighbouring  countries. 
Albania  is  both  a  destination  and  a  transit  country  for  light  firearms.  There  were  14  new 
criminal cases registered at the Prosecutor’s Office in 2020, compared to 12 in 2019 and 16 
cases  with  18  final  convictions  in  2020,  compared  to  13  cases  and  16  cases  with  final 
convictions in 2019. Albania actively participated in EU Policy Cycle/EMPACT operational 
action plan on firearms. It adopted an action plan 2019-2021 on small arms and light weapons 
and  explosives  control  and  appointed  a  firearms  focal  point.  It  should  adopt  standard 
procedures  and  mechanisms  to  counter  the  illicit  trade  of  small  arms  and  light  weapons  by 

40 

 
 
air. The criminal law framework remains to be fully aligned with the requirements of the UN 
Firearms Protocol. 

The  Central  Firearms  Unit  (CFU)  is  composed  of  6  members  (experts)  from  all  the  State 
Police departments and is headed by an official from the Criminal Police. The CFU enables 
the  administration,  collection,  analysis,  registration,  exchange  and  use  of  information 
(criminal and ballistic) regarding firearms and their trafficking.  

The track record on fighting cybercrime and internet fraud in 2020 remains limited with 
52  cases  referred  to  the  Prosecutor’s  Office  compared  to  47  in  2019.  There  were  three 
convictions at first instance level in 2019 and four in 2020. In 2020, Albania adopted a new 
strategy  on  cyber  security  and  an  action  plan  for  2020-2025,  which  cover  the  relevant 
priorities  in  the  field.  Albania  should  establish  a  more  effective  law  enforcement  response 
focusing  on  the  detection,  traceability  and  prosecution  of  cyber  criminals.  Albania  should 
raise  awareness  among  the  prosecutors  to  enhance  the  use  of  the  24/7  points  of  contact 
network established by the Council of Europe Convention on Cybercrime.  The ASP should 
increase  its  capacity  to  deal  with  such  cases.  In  the  last  years,  the  ASP  has  received  every 
years  between  5.000  and  20.000  referrals  for  online  child  sexual  abuse  materials  from 
international law enforcement agencies. However only 12 cases have been investigated by the 
police in the last three  years. The legislative amendments to criminalise all forms of online 
child sexual abuse remain to be adopted.  

Albania  has  a  large  informal  sector  and  its  economy  is  primarily  cash-based.  Crimes  that 
generate  large  amounts  of  money  include  drug  trafficking,  tax  evasion,  smuggling  and 
trafficking  in  human  beings.  As  regards  money  laundering,  Albania  is  on  the  Financial 
Action  Task  Force  (FATF)  list  of  jurisdictions  under  increased  monitoring  since  February 
2020  (see  chapter  4  for  more  details  on  this  and  on  amendments  to  the  law  on  money-
laundering).  Albania  continues  to  implement  timely  the  commitments  by  the  set  deadlines, 
despite  the  COVID-19  pandemic.  In  July  2020  a  memorandum  of  cooperation  was  signed 
among  the  General  Prosecutor  Office,  the  Ministry  of  Interior  and  the  Ministry  of  Finance 
and Economy “On increasing the effectiveness of investigations related to money laundering, 
terrorist financing, financial crimes, seizure and confiscation of criminal assets.  

As  also  reported  on  in  Chapter  4,  amendments  to  the  law  on  money-laundering  to  align  it 
legislation on anti-money laundering with the EU acquis have been prepared by the Council 
of Ministers. The beneficial ownership register has been set-up and is in the process of being 
populated with data from businesses and non-governmental organisations. A centralised bank 
account register has also been established and is operational since July 2021. Both registers 
will  provide  increased  transparency  and  useful  tools  in  the  hand  of  law  enforcement 
authorities  to  track  down  money-launderers.  The  law  regulating  virtual  assets  should  be 
amended  to  ensure  adequate  supervision  of  all  virtual  assets  service  providers.  A  proper 
supervision system regulating real estate agents remains to be adopted and enforced. In 2020, 
280  cases  of  money  laundering  were  referred  to  prosecutors,  against  232  in  2019.  The 
number of persons with  final  convictions for money laundering remains low (eight  in  2019 
and four in  2020).  During 2020, the Counter-Terrorism Directorate (CTD), whose financial 
investigation  unit  became  fully  operational  in  2020,  referred  2  cases  for  "Terrorism 
Financing", provided by Article 230/a of the Criminal Code. 

The  ASP’s  witness  protection  programme  has  worked  satisfactorily.  In  2020,  19  witness 
protection operations were performed, compared to 20 in 2019. 

41 

 
 
Cooperation in the fight against drugs 

Institutional set-up and legal alignment 

The  Ministry  of  the  Interior  and  the  Ministry  of  Health  and  Social  Protection/Institute  of 
Public  Health  are  the  main  lead  bodies  in  the  fight  against  drug  trafficking  and  drug  abuse 
respectively. Part of the 2021-2025 Strategy against Organised Crime adopted in December 
2020  covers  activities  against  drug  trafficking  and  drug  abuse.  The  strategy  foresees  to 
improve  the  legislation  on  psychoactive  substances  and  precursors  and  to  update  the  list  of 
prohibited psychoactive substances by 2022. Despite a Council of Ministers’ Decision from 
2011,  which  requires  the  establishment  of  a  National  Centre  of  Information  on  Drugs 
(National Drug Observatory), such an institution is yet to be established. Equally, Albania has 
not  yet  established  an  Early  Warning  System  on  the  information  exchange  about  new 
psychoactive  substances  (NEWS).  Albania  works  together  with  the  European  Monitoring 
Centre  for  Drugs  and  Drug  Addiction (EMCDDA) on  increasing  its  reporting  capacity  on 
drug-related issues and to bring it in line with EMCDDA guidelines/protocols. It will have to 
make  the  necessary  efforts  to  secure  sufficient  national  funding  to  maintain  on-going  data 
collection for all drug-related indicators. A new national drug control plan (2019-2023) and 
action plan still need to be adopted.  

Implementation and enforcement capacity 

Albania continued to build track record on fighting drugs in 2020, as the police referred 2 
086  cases  of  drug  production,  cultivation  and  trafficking  to  prosecutors,  involving  3  205 
alleged offenders with a slight increase in the number of referrals (5%) but quite a significant 
increase in the number of alleged offenders (+18,5%). Of the 2 086 cases, 1 802 (86%) were 
registered by the prosecutors. There  were  499 indictments  and 218 offenders received  final 
convictions at appeal level (290 in 2019). As in previous years, none of the cases referred to 
prosecutors  concerned  the  production  and  manufacture  of  narcotic  and  psychotropic 
substances. 

The Albanian authorities continued their fight against cannabis cultivation and trafficking in 
2020.  Increased  cooperation  with  EU  Member  States’  law  enforcement  authorities  brought 
tangible results. 233 police operations against narcotics were conducted in 2020 of which 95 
in  cooperation  with  international  partners.  143  police  operations  against  illegal  trafficking 
were also led, including 21 with international partners.  

Albania  is  the  only  country  in  the  region  that  allows  monitoring  by  another  country:  since 
2013,  Italy’s  Ministry  of  Economy  and  Finance  Enforcement  Agency  (Guardia  di  Finanza) 
has  carried  out  aerial  surveys  to  detect  and  monitor  cannabis  plantations  in  Albania.  In 
addition, ASP started monitoring by drones. The quantity of cannabis seized in Albania fell 
from about 6.3 tons in 2019 to 4.3 tons in 2020. There was almost no hashish seized in 2020. 
Since 2021, with EU support, some municipalities started providing financial support to offer 
alternatives to cannabis related activities to local communities. 

The lack of secure storage for drugs and drug precursors prior to destruction remains an issue 
of  concern.  The  practice  of  keeping  only  a  small  sample  as  material  evidence  for  court 
proceedings  (instead  of  the  entire  quantity  seized)  is  not  yet  established.  Albania  needs  to 
establish the legal base for an appropriate process for the destruction of precursors.  

Albania carried out some law enforcement operations in relation to the trafficking of cocaine 
and heroin, some in cooperation with police authorities from neighbouring countries. Overall, 
cocaine  seizures  fell  from  almost  145  kg  in  2019  to  6  kg  in  2020,  while  the  heroin  seized 
increased  from  38.1  kg  to  51.6  kg.  Large  seizures  of  narcotics  occurred  in  2021.  In  April 
2021, 200 kg of cocaine were seized in the port of Durres in banana containers coming from 

42 

 
 
Ecuador.  In May, 400 kg of cannabis were seized on a speedboat on its way from Vlora to 
Italy. These operations took place in the framework of the joint operation operation with the 
European Border and Coast Guard Agency (Frontex) “Albania Sea 2021”, launched in March 
2021. In June, 300 kg of cocaine were seized in a truck in Durres port.  

Cooperation continued with the European Monitoring Centre for Drugs and Drug Addiction, 
in  the  framework  of  the  working  arrangement  the  Centre  and  Albania,  which  gives  the 
Albanian  authorities  access  to  crucial  expertise  and  supports  further  approximation  of 
Albanian law and policies on drug-related issues with those of the EU.  

Fight against terrorism 

Institutional set-up and legal alignment 

Albania has a comprehensive legal framework for preventing and combatting the financing 
of  terrorism  and  is  fairly  advanced  in  aligning  with  the  main  building  blocks  of  the  EU 
acquis. It is a party to all Council of Europe counter-terrorism conventions, including those 
covering the seizure and confiscation of the proceeds of crime and the financing of terrorism. 
The  authorities  should  ensure  effective  implementation  of  targeted  financial  sanctions 
mandated by the UN Security Council by enhancing the involvement of financial institutions 
and other relevant actors and through effective inspections, in line with the FATF action plan. 
The work on terrorism financing in the NGO sector has started with a risk assessment of all 
NGOs by the general tax authority, and now needs to be taken up by other services (see also 
Civil Society, under Democracy).  

The government adopted a new national cross-sector counter-terrorism strategy and action 
plan  in  December  2020.  The  national  action  plan  on  countering  violent  extremism  has 
expired and a new strategy and action plan should be adopted. Albania has made very good 
progress in implementing the bilateral arrangement with the EU on operationalising the Joint 
Action Plan on counter-terrorism for the Western Balkans. In February 2021, it submitted its 
second interim report on the implementation of the arrangement. 

The  ASP’s  Counter-Terrorism  Directorate  is  the  lead  body  on  counter-terrorism.  Other 
agencies active in the field are the State Intelligence Service and the Defence Intelligence and 
Security  Agency.  In  addition,  the  ASP’s  community  policing  personnel  are  involved  in 
preventing  and  countering  radicalisation  leading  to  violent  extremism  and  terrorism.  The 
jurisdiction for all terrorist offences was again  centralised at  the level  of the SPAK Special 
Prosecution  Office  and  Special  Courts  in  March  2021.  The  Coordination  Centre  for 
Countering Violent Extremism  (CVE), headed by  the national  CVE coordinator, is  charged 
with  capacity-building,  coordinating  CVE  activities  across  government  institutions  and 
overseeing the implementation of the national CVE strategy.  

Implementation and enforcement capacity 

In 2020, there were 12 investigations into allegations of terrorist activity, compared to 16 in 
2019. One person received a final conviction. The authorities repatriated six adult women and 
18  minors  from  the  camps  in  Syria  in  October  2020  and  August  2021.  Their  return, 
reintegration and rehabilitation have been prepared and accompanied by an inter-institutional 
working group, with leading roles for the CVE Coordination Centre and the ASP’s Counter-
Terrorism Directorate. All relevant information has been shared with Europol. Around 50-60 
Albanian nationals are estimated to remain in Syria, 68 returned to Albania and at least 45 are 
believed to have died in the conflict zone. No Albanians left for Syria in the reporting period. 

43 

 
 
 
The authorities continue to seek to return the remaining women and children from the camps 
in Syria. 

The  Counter-Terrorism  Directorate  has  proven  to  be  an  effective  police  force,  but  its 
operational and logistical capacity remain limited and should be strengthened. During 2020, it 
referred  18  criminal  offences  to  the  Special  Prosecution  Office  against  Corruption  and 
Organised  Crime  (SPAK)  and  the  Judicial  District  Prosecutions,  of  which  six  offences  for 
terrorist  purposes.  The  CVE  Coordination  Centre  has  engaged  with  several  institutions  at 
local  level  for  raising  awareness  on  the  PCVE  and  assessed  the  work  done  by  the  relevant 
municipalities in establishing and operating the Local Safety Councils (LSC), which include 
front-line  actors,  such  as  teachers,  psychologists,  sociologists,  community  policing  officers, 
religious  communities,  etc.  It  expanded  its  outreach  to  prisons’  staff  and  individuals  under 
probation.  Albanian  authorities  have  enhanced  efforts  to  address  online  radicalization, 
through  a  “whole  of  society”  approach.  The  CVE  Coordination  Centre  put  in  place  a 
proactive  usage  of  Europol’s  tools  and  its  European  Counter-Terrorism  Centre.  The  CVE 
Coordination Centre should be given sufficient funding, staff and political support to fulfil its 
tasks, which have further increased with the returns from Syria.  

Regional  cooperation  and  the  exchange  of  sensitive  information  with  international  partners 
remains  satisfactory.  In  cooperation  with  Interpol  and  the  Italian  police,  the  Albanian 
authorities  arrested  an  Albanian  national  and  extradited  him  to  Italy  on  charges  of 
participation  in  a  terrorist  organisation  in  2020.  While  progress  was  made,  Albania  should 
make  more  proactive  use  of 
the  Europol  European  Counter-Terrorism  Centre’s 
communication  platforms  products,  services  and  capabilities.  It  should  continue  to 
collaborate  with  the  Europol  Internet  Referral  Unit.  Albania  should  also  continue  to 
investigate  links  between  organised  crime  and  terrorism.  It  actively  participated  in  the 
implementation of the Western Balkan counter-terrorism initiative.  

Legal and irregular migration  

Institutional set-up and legal alignment 

The Ministry of the Interior is the main actor in the field of migration. The main bodies under 
its supervision responsible for implementing migration policies are the Department of Border 
and  Migration  in  the  ASP  General  Directorate  and  the  Directorate  of  Anti-Trafficking  and 
Migration at the Ministry of Interior. The National Agency for Employment and Skills and its 
regional  directorates  also  covers  services,  employment  programmes  and  vocational  training 
programmes for foreigners, stateless persons and refugees.  

The legal framework on migration is largely aligned with the EU acquis but needs updating 
in line with recent developments on the EU side. Albania has readmission agreement with the 
EU  and  readmission  protocols  in  place  with  12 Member  States.  A  draft  additional  protocol 
was  sent  to  the  Greek  authorities  in  July  2020  for  their  consideration.  Negotiations  on 
readmission agreements  (to return migrants  with  no right to  stay to  their  country  of origin) 
are  ongoing  with  Russia,  while  new  draft  agreements  were  submitted  to  the  authorities  in 
Algeria India and Pakistan. 

The  implementation  of  the  national  migration  strategy  and  action  plan  for  2019-2022, 
providing  a  clear  framework  for  managing  and  coordinating  migration  flows  continues  and 
four  monitoring  reports  have  been  issued.  A  renewed  2021-2025  national  diaspora  strategy 
was adopted in July 2020.  

44 

 
 
Implementation and enforcement capacity 

Despite border closure during March-May 2020, Albania continued to experience a growing 
influx  of  migrants  irregularly  crossing  the  border,  mostly  coming  from  Greece  and  leaving 
Albania after a few days, on the way to other EU countries. The number of irregular migrants 
apprehended  in  Albania  in  2020  increased  by  13%  compared  with  2019  (11,970  in  2020 
compared  to  10,557  in  20197).  The  nationalities  represented  most  were  Syrian,  Afghan, 
Moroccan and Iraqi.  

The migrant reception capacity increased slightly in 2019 and 2020 with 18 additional beds 
added in Kakavija border crossing point by the International Organisation for Migration with 
EU  support.  However,  the  poor  condition  of  the  National  Centre  for  Asylum  Seekers  in 
Tirana,  after  years  of  poor  maintenance,  has  remained  unaddressed.  Only  30  beds  are 
available  out  of  180  places.  As  of  20  August  2020,  Albanian  reception  facilities  hosted  20 
persons.    The  only  closed  reception  centre  for  irregular  migrants  in  Karreç,  with  a  total 
capacity  of  100  beds,  also  requires  refurbishment.  Albania  has  a  total  capacity  of 
approximately 500 beds. Albania does not have separate facilities for unaccompanied minors. 
Albania  should  adopt  a  contingency  plan  for  a  possible  substantial  number  of  arrivals  of 
migrants and asylum seekers, with a budget and clear modalities for its triggering.  

The  overall  staffing  of  the  ASP’s  Department  for  Border  and  Migration  is  limited  (1  638 
employees) and needs to be increased. Comprehensive training and joint exercises have been 
organised  for  key  border  officials  and  frontline  officers.  However,  permanent  training 
structures  should  be  established  in  compliance  with  basic  training  standards  for  EU  border 
guards.  The  high  turnover  of  officers  continues  and  should  be  addressed.  Border  and 
Migration  Police  officers  should  increase  their  capacities  to  identify  migrants  with  specific 
needs.  Coordination  with  child  protection  and  anti-trafficking  departments  should  also 
improve. In 2020, there was one case of voluntary return of a Libyan citizen, assisted by the 
IOM.  Reports  of  migrants  being  returned  to  Greece  outside  a  legal  and/or  procedural 
framework, without pre-screening, have continued over the reporting period. Albania should 
apply return procedures in compliance with the Law on foreigners and ensure that its return 
mechanism for irregular migrants is in line with the EU acquis including the fully respecting 
fundamental rights.   

The  readmission  agreement  with  the  EU  is  functioning  well,  with  Albania  swiftly 
honouring requests from Member States for the readmission of both its own and third country 
nationals. In 2020, 9 760 Albanian nationals were returned from an EU Member State out of 
2  3150  who  were  ordered  to  leave  (a  return  rate  of  42%).  Since  EU  Member  States  report 
good cooperation, this decrease may be due to the processing of exceptionally large volumes 
of  decisions,  a  backlog  in  previous  years  and  possibly  secondary  movements.  Cooperation 
between Albania and Frontex on return operations is very good. In 2019, Frontex coordinated 
73 return operations, returning 2 414 Albanian citizens. About 1 565 Albanian citizens were 
readmitted  and  returned  in  January  and  February  2020.  Albania  should  train  more  police 
officers to escort returnees to Albania, step up its efforts to provide reintegration support for 
returned  nationals  and  improve  the  training  of  staff  working  at  the  migration  desks  and 
regional employment offices.  

In  August  2021,  Albania  started  temporarily  hosting  evacuees/refugees  from  Afghanistan. 
Following a Council of Ministers decision adopted on 25 August 2021 under the asylum law 
as  of  end  September  close  to  1150  were  granted  protection  for  one  year  pending  security 
screening.  They  are  hosted  in  open  facilities  in  various  locations  in  Albania,  with  the 

7 UNHCR data 

45 

 
 
                                                           
understanding that they would further be resettled in the United States under a specific visa 
regime. 

Asylum 

Institutional set-up and legal alignment 

A new law on Asylum was adopted in February 2021, bringing the legislation closer to the 
EU  acquis.  The  law  introduces  an  accelerated  procedure  for  relevant  cases  and  offers 
additional  safeguards  for  vulnerable  groups.  Efforts  should  now  focus  on  a  swift  and 
comprehensive  implementation  of  the  new  law.  Internal  guidelines  should  be  adopted  to 
guide competent authorities and additional capacity building should be provided.  

Albania  has  the  necessary  institutions  in  place  to  handle  asylum  claims.  Appeals  may  be 
lodged  with  the  National  Commission  for  Refugees  and  Asylum,  which  was  reactivated  in 
2020 and has since taken four decisions. Judicial appeals may be lodged at the administrative 
courts. Resources should be allocated for full-time qualified interpreters during and after pre-
screening. Although the law on asylum provides refugees rights to access public services at 
the same level as Albanian citizens, lack of coordination with other legislation prevent their 
effective access.   

Implementation and enforcement capacity 

In 2020, 2 102 persons made a claim for asylum with the Border and Migration Police, which 
represents  a  very  substantial  drop  compared  to  6  677  in  20198,  while  the  number  of 
apprehended  migrants  increased.  After  the  reopening  of  borders  in  June,  only  50  asylum 
referrals  were  recorded  until  the  end  of  2020.  Access  to  asylum  procedures  should  be 
improved.  

As  most  asylum  seekers  leave  the  country  after  a  few  days,  most  asylum  claims  are  not 
pursued.  In  2020,  17  applications  were  formally  lodged.  No  applicant  was  granted  refugee 
status but four were granted subsidiary protection. 

On asylum procedure the capacities of the Border and Migration Police to identify persons 
with specific needs remain insufficient. The Directorate for Asylum and Migration also needs 
capacity and training assessing individual claims, particularly the information on country of 
origin  and  cases  involving  vulnerable  people.  A  database  for  managing  registrations  and 
allowing  for  follow-up  of  individual  cases  became  operational  in  2019.  Data  management 
still needs to be strengthened, especially to connect the register of foreigners with the national 
registry in order to provide a personal ID number to refugees.  

Shortcomings have been noted in the use of pre-screening form and return procedures at the 
border  with  Greece.  The  new  pre-screening  instruction  should  be  swiftly  approved  by  the 
Ministry  of  Interior  and  implemented  and  asylum  procedures  improved  The  European 
Asylum Support Office agreed on a Roadmap for cooperation with Albania in January 2021. 

The  increased  monitoring  by  the  Ombudsperson’s  Office  in  border  areas  and  their 
engagement  with  the  Border  and  Migration  Police  on  their  findings  reinforces  Albania’s 
rights-based approach towards asylum seekers.  

The  status  of  about  2 700  Iranians  (from  the  People’s  Mujahedeen  of  Iran)  relocated  to 
Albania  in  2015  and  2016  has  yet  to  be  decided.  They  currently  hold  temporary  residence 
permits on humanitarian grounds. 

8 UNHCR data 

46 

 
 
                                                           
Visa policy 

The  Commission’s  August  2021  fourth  report  under  the  visa  suspension  mechanism 
concluded  that  Albania  continues  to  meet  the  visa  liberalisation  requirements9.  However, 
Albania’s  visa  policy  is  not  fully  aligned  with  the  EU’s,  as  regards  the  lists  of  countries 
whose  nationals  require  an  entry  visa,  and  has  further  deviated  in  the  reporting  period. 
Albania  has  visa-free  arrangements  with  Armenia,  Azerbaijan,  Belarus,  China,  Guyana, 
Kazakhstan,  Kuwait,  and  Turkey,  which  are  not  on  the  EU’s  visa-free  list.  In  addition,  in 
March, Albania granted a visa exemption to foreign citizens who have a valid permit of stay 
in the United Arab Emirates. The application of visa free regimes with Belarus and Guyana 
entered  into  force  in  2020.  In  addition,  Albania  lifted  its  visa  requirement  for  nationals  of 
Bahrain, Egypt, India, Oman, Qatar, Russia, Saudi Arabia and Thailand, from April until the 
end  of  2021.  Egypt  and  India  are  new  countries  in  this  list,  and  the  period  is  extended 
compared  to  previous  practice  limited  to  the  touristic  season,  from  April  to  October.  This 
temporary  lifting  of  visa  requirement  is  not  in  line  with  the  EU  acquis.  Albania  needs  to 
ensure full alignment with EU visa policy. Albania has launched  an e-visa system which is 
used  to  register  all  foreign  nationals  applying  for  a  visa  when  entering  Albania.  Albania 
should refrain from adopting an investor citizenship scheme on the basis of the new Law on 
Citizenship. 

Albania  stepped  up  actions  to  tackle  irregular  migration  and  continued  to  strengthen 
operational  cooperation  with  the  Member  States  most  affected  by  irregular  migration  from 
Albania.  It  also  strengthened  efforts  to  raise  awareness  among  the  population  on  the  rights 
and obligations of the visa-free regime as well as penalties for their violations. 

The issue of Albanian nationals making unfounded asylum applications to EU Member States 
and  Schengen-associated  countries  still  requires  substantial  efforts  from  the  Albanian 
authorities. In addition to information campaigns, thorough border checks, awareness-raising 
on  rights  and  obligations  under  the  visa-free  regime  and  identifying  and  addressing  the 
underlying reasons, dialogue and cooperation with the countries most affected by the issue of 
unfounded asylum applications lodged by Albanian nationals.. Three Albanian police liaison 
officers are deployed in the EU and a liaison officer from the EU works in Tirana to help with 
exit  checks.  The  Commission  is  monitoring  the  trend  very  closely  in  the  framework  of  the 
post-visa liberalisation monitoring mechanism. 

According to Eurostat data, the number of Albanian citizens lodging asylum requests in EU 
Member  States  decreased  by  66%  in  2020  compared  to  2019,  from  20,415  to  6,935 
applications. The COVID-19 pandemic contributed in large part to this sharp decrease, but it 
can be noted that the average decrease of applications from the rest of the world to the EU is 
much  smaller  (-33%).  The  ‘recognition  rate’10  in  2020  was  around  4.4%  compared  with  5.3%  in 
2019. Since a marked peak of applications in 2017 in the most affected Member States, the 
number of applications has been divided by four, from 12,130 applications in 2017 to 2,985 
in 2020.    

In  2020,  6,180  Albanian  nationals  were  refused  permission  to  exit  Albanian  territory  at 
border crossings compared with 14,224 in 2019 (a reduction of about 56%). This is due to the 
COVID-19 pandemic but is also to the measures put in place by the Albanian authorities and 
the awareness raising campaigns rolled-out on the rights and obligations associated with visa-
free travel in the Schengen area.  

9 COM(2021) 602 final and SWD(2021)206 final 
10  Recognition  rate  refers  here  to  the  proportion  of  successful  applications,  i.e.  of  first  instance  decisions 
granting refugee and subsidiary protection status, on all first instance decisions issued; source: EASO 

47 

 
 
                                                           
There  was  a  sharp  increase  in  the  number  of  seized  forged  documents,  including  EU 
passports, used mostly by Albanian nationals to reach destinations in the EU. Unaccompanied 
minors  travelling  from  Albania  to  EU  Member  States  remain  a  source  of  concern.  The 
Albanian authorities should continue to work closely with the Member States most affected. 
Greater attention should be given to the successful reintegration of returnees, especially the 
most vulnerable, such as Roma and Egyptians. The reintegration of returnees should improve 
with clear attributions of responsibilities among national and local actors. Little data exist on 
the number of returnees in Albania.   

Schengen and external borders 

Institutional set-up and legal alignment 

The  amendments  to  the  Law  on  border  control  on  Advance  Passenger  Information  and 
Passenger Name Record (PNR) made in March 2020 were not in line with the EU acquis. In 
December  2020,  Albania  adopted  two  related  by-laws  to  mitigate  the  consequences  of  the 
amendments  departing  from  the  acquis.  The  implementation  of  the  memorandum  of 
cooperation on PNR with the US, signed in May 2020, requires further analysis as regards its 
implications for Albania's alignment with the EU acquis.  The legislative framework for the 
management  of  Albania’s  external  borders  is  not  yet  fully  in  line  with  EU  standards.  In 
December 2020, Albania adopted a new integrated border management strategy (2021-2027) 
and action plan (2021-2023) which are broadly in line with European standards.  

Implementation and enforcement capacity 

The  integrated  radar  system  for  the  surveillance  of  the  ‘blue’  (sea)  border  is  operational. 
Albania plans to invest significant resources in cooperation with the EU to modernise border 
infrastructure  and  improve  surveillance  of  the  ‘green’  (land)  and  ‘blue’  borders.  The  total 
information  management  system  (TIMS)  database  system  is  connected  with  Interpol’s 
system, enabling the border police to identify internationally wanted persons, stolen vehicles 
and lost/stolen travel documents. Albania should establish a risk-analysis system based on the 
Common Integrated Risk Analysis model (CIRAM) developed by Frontex. It participates in 
the Western Balkan Risk-Analysis Network. 

to  be  strengthened, 

Inter-agency  cooperation  improved.  The  Navy,  Coast  Guard  and  Border  and  Migration 
Police  conducted  regular  joint,  integrated  ‘blue’  border  patrols.  Cooperation  between  the 
Border and Migration Police and customs should be formalised in an agreement providing for 
structured  information  exchanges  and  mutual  access  to  databases.  The  border  police’s 
investigative  powers  need 
to  detect  cases  of 
people-smuggling and trafficking in human beings. Albania is the first of the Western Balkan 
countries  to  have  signed  a  Status  Agreement  with  the  European  Union  allowing  the 
deployment of teams of the European Border and Coast Guard standing corps  with executive 
powers.  In  March  2021,  Frontex  and  Albania  concluded  a  new  working  arrangement.  In 
January 2021, a second Frontex liaison officer to the Western Balkans was deployed with a 
base  in  Tirana  and  a  mandate  covering  Albania,  Kosovo,  and  North  Macedonia.  Another 
liaison  officer  is  based  in  Belgrade,  Serbia,  since  2017.    The  Frontex  joint  operation  at  the 
Greek-Albanian  border,  which  was  the  first  joint  operation  launched  outside  of  the  EU  in 
May 2019, continued to prove successful in strengthening border controls, enhancing security 
at the EU’s external borders and combating migrant smuggling. In March 2021 a sea border 

in  particular 

 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. 

48 

 
 
                                                           
operation  near  Durres  was  added  to  this  joint  operation.  In  March  2021  a  new  working 
arrangement was signed with FRONTEX and will last until January 2022.  

Albania  participated  actively  in  the  Western  Balkan  risk-analysis  network.  Operational 
cooperation with neighbouring countries continued to be good, although it should step up 
its  efforts  to  improve  bilateral  cooperation.  In  January  2021  Albania  signed  an  agreement 
with Greece on the establishment of a police and customs cooperation centre. Albania has to 
ensure that the US -sponsored PISCES system for personal identification is operated in line 
with  the  EU  acquis  on  personal  data  protection.  In  2020,  the  Department  for  Border  and 
Migration  issued  10  serious  disciplinary  measures  against  border  police  for  corruption  and 
abuse of office including at very senior level. Seven officers were relieved of duties.   

Judicial cooperation in criminal and civil matters 

The  deployment  of  an  Albanian  Liaison  Prosecutor  to  Eurojust  in  January  2021  further 
facilitated the implementation of Albania’s cooperation agreement. This is an important step 
to  ease  judicial  cooperation  between  EU  and  Albanian  practitioners  in  fighting  against 
transnational organised crime. 

The law on judicial cooperation in criminal matters with foreign jurisdictionswas amended in 
July  2021  to    simplify  procedures  for  rogatory  letters,  allows  for  direct  Court  to  Court 
relations and accelerate mutual legal assistance with foreign jurisdictions.  

On  judicial  cooperation  in  civil  matters,  in  2020  Albania  received  262  requests  for  mutual 
legal assistance and sent out 97 requests, compared to 250 and 124 respectively in 2019. On 
judicial cooperation in criminal matters, in 2019 it received 981 requests and sent out 1,182 
requests (774 and 770 in 2019).  

Albania should finalise the internal  procedures for acceding to  the 2005  Hague Convention 
on  Choice  of  Court  Agreements  and  the  2007  Protocol  on  the  Law  Applicable  to 
Maintenance  Obligations.  It  should  further  improve  international  cooperation,  the  timely 
implementation  of multilateral  instruments,  and its  institutional capacity. Further efforts are 
needed to align legislation with the EU acquis and promote the exchange of best practices in 
judicial cooperation.  

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

49 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
2.3. ECONOMIC CRITERIA  

'In  line  with  the  conclusions  of  the  European  Council  in  Copenhagen  in  June  1993,  EU 
accession requires the existence of  a functioning market  economy and the capacity to  cope 
with competitive pressure and market forces within the Union. 

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

2.3.1. The existence of a functioning market economy 

Albania has made some progress and is moderately prepared for developing a functioning 
market  economy.  Hit  by  the  double  shock  from  the  earthquake  of  November  2019  and  the 
COVID-19  pandemic,  GDP  contracted  in  2020,  although  by  less  than  initially  expected. 
Pandemic-related domestic lockdown and international travel restrictions caused large losses 
to tourism and manufacturing, but economic conditions started to improve in the second half 
of  the  year.  Within  the  limited  fiscal  and  monetary  policy  space,  the  government  and  the 
central bank took swift and appropriate actions to support business, households and the health 
sector.  This  cushioned  the  impact  on  the  labour  market  and  preserved  macroeconomic  and 
financial sector stability. It also pushed up the public-debt and deficit ratios and increased the 
country’s  vulnerability  to  external  shocks.  Dealing  with  the  double  shock  stretched  the 
capacity of the administration, but it largely ensured business continuity and continued work 
on most ongoing reforms. As last year’s recommendations to improve the functioning of the 

50 

201820192020Albania - Key economic figuresGDP per capita (% of EU-27 in PPS)1)30303131Real GDP growth 2.34.02.1-3.8Economic activity rate of the population aged 15-64 (%), total63.968.369.669.1      female54.859.761.761.2      male73.276.977.677.1Unemployment rate of the population aged 15-64 (%), total15.912.812.012.2      female14.412.311.812.4      male17.013.212.212.1Employment of the population aged 15-64 (annual growth %)2.52.12.4-1.9Nominal wages (annual growth %)2)2.5*3.13.82.7Consumer price index (annual growth %)1.82.01.41.6Exchange rate against EUR138.45127.57123.01123.77Current account balance (% of GDP)-9.0-6.8-8.0-8.8Net foreign direct investment, FDI (% of GDP)8.38.07.56.9General government balance (% of GDP)-3.6-1.6-1.9-6.9General government debt (% of GDP)68.967.765.876.1Notes: 1) Eurostat2) average gross monthly wages, average of 2015-2017 Source: national sources2012-17 average 
 
 
market economy were partly addressed, in the coming year Albania should in particular: 

  foresee in the medium-term fiscal plan a gradual reduction of the public debt ratio starting 
in 2022 and the return to a positive primary balance as of 2023, and begin implementing 
the medium-term revenue strategy;  

  implement the reform of public investment management procedures; 

  develop  a  comprehensive  strategy  to  tackle  all  aspects  of  informality  and  establish  a 

regular monitoring of informality and of the strategy’s implementation.  

Economic governance  

Albania’s public debt and deficit increased sharply due  to the COVID-19 pandemic in 
2020 and are set to remain at elevated levels in 2021. In response to the double shock from 
the November 2019 earthquake and the pandemic, the 2020 budget was amended four times 
and resulted in a large increase of debt and deficit. In 2020, the government declared a state 
of  emergency  and  applied  the  escape  clause  of  the  organic  budget  law11,  to  allow  for  an 
increase of the debt-to-GDP ratio and the deficit. In July 2021, the government amended the 
2021 budget for the 3rd time by normative act to increase mainly capital expenditure and the 
deficit, extended the application of the escape clause to 2021 without extension of the state of 
emergency and postponed the new primary balance rule to 2024.  

To  cover  the  increased  external  and  budgetary  financing  needs,  including  the  swift  but 
moderate  pandemic-related  support  to  business  and  households,  the  government  requested 
and  received  financial  support  from  the  IMF  (EUR  174  million  from  the  Rapid  Financing 
Instrument) and from the EU. The EU disbursed the first EUR 90 million instalment of the 
EUR 180 million of macro-financial assistance on 31 March 2021 (the second instalment can 
be  requested  upon  fulfilment  of  policy  conditions  before  November  2021).  In  addition, 
Albania issued a EUR 650 million Eurobond in June 2020 and is preparing the placement of 
another  EUR  500  million  Eurobond  in  2021.  Albania  has  partially  implemented  the  policy 
guidance jointly agreed at the May 2020 Economic and Financial Dialogue between the EU 
and the Western Balkans and Turkey.  

Macroeconomic stability  

The economy contracted by 3.84% in 2020 in the wake of the COVID-19 crisis, less than 
initially  projected.  Economic  growth  averaged  3.1%  in  2015-2019,  driven  by  exports  -  in 
particular  tourism,  and  by  private  consumption,  propelled  by  employment  growth  in  the 
thriving  services  sector,  but  also  in  manufacturing.  In  2020,  the  pandemic  hit  these  growth 
drivers and private consumption fell by 2.3%. Exports and imports dropped significantly by 
25.6%  and  20  %  respectively,  mainly  because  international  travel  restrictions  caused  large 
losses  in  tourism.  Nevertheless,  the  economy  proved  more  resilient  than  initially  expected 
because  of  the  growth  of  agriculture,  post-earthquake  reconstruction  and  increased  role  of 
regional tourism, as well as timely support to business and households. A moderate recovery 
which  began  in  the  second  half  of  2020,  strengthened  in  2021  to  5.5%  GDP  growth  in  the 
first quarter, supported by high hydro-electricity production, construction and a recovery of 
manufacturing.  Short-term  indicators  signal  that  a  rebound  of  tourism-related  services  in 
response to strong demand from regional and domestic tourists reinforced the recovery in the 
second quarter.   

11 The  organic  budget  law  requires  under  normal  circumstances  an  annual  reduction  of  the  debt  to  GDP ratio 
until it reaches 45%. 

51 

 
 
 
                                                           
Fiscal  and  monetary  policy  support 
limited  the  social  and  economic  impact 
of  the  COVID-19  pandemic,  and  post-
earthquake  reconstruction  expenditure 
has  helped  the  economic  recovery  since 
the  second  half  of  2020.  The  government 
and  the  central  bank  took  swift  actions, 
including  financial  and  liquidity  support 
equivalent  to  2.65%  of  GDP,  to  support 
business, households and the health sector, 
which  cushioned 
labour  market  and  preserved 
macroeconomic and financial sector stability. The Bank of Albania (BoA) lowered its record-
low policy rate from 1% to 0.5% in March 2020, and provided liquidity to the economy. A 
moderate  recovery  took  hold  in  the  second  half  of  2020,  supported  by  increasing  public 
expenditure on reconstruction and recovering exports. Per-capita GDP (at purchasing power 
parity) increased from 29% of the EU average in 2016 to 31% in 2019. This still represents a 
very slow rate of convergence.  

impact  of  COVID-19  on 

the 

the 

The drop of services exports and remittances widened the already high current-account 
deficit significantly in 2020, which was partly financed by portfolio investment inflows. 
In  2015-2019,  rising  service  exports  and  remittances  helped  the  current-account  deficit  to 
narrow from an average  10.9% of GDP in  the five-year period 2010-2015 to  an average of 
7.6% in the 2015-2019 period. Following the drop in services  exports (i.e. tourism), falling 
income of short-term workers abroad and lower remittances from non-residents, it widened to 
8.9% of GDP in 2020 and 9.5% of GDP in 
the  first  quarter  of  2021.  Foreign  direct 
investment  (FDI)  inflows  already  started 
to  decrease  from  their  peak  above  8%  of 
GDP  in  the  2013-2018  period  to  7.5%  of 
GDP  in  2019  due  to  the  completion  of  a 
few large energy projects, before they fell 
to  6.9%  of  GDP  in  2020.  In  the  last  five 
years,  FDI  fully  financed  the  current 
account deficit, but in 2020, debt-creating 
capital inflows (incl. the EUR 650 million 
sovereign  Eurobond  issued  in  June  2020) 

contributed to its financing.   

External debt increased, but foreign exchange reserves provided a sufficient safeguard 
and  the  exchange  rate  remained  stable.  External  debt,  mostly  consisting  of  long-term 
government debt climbed from 60% to 65.8% of GDP in 2020, and is set to increase again as 
the  government  is  preparing  a  new  EUR  500  million  placement  in  2021  and  announced 
annual  placements  of  Eurobonds  in  future.  Foreign  exchange  reserves  decreased  slightly  to 
EUR 3.9 billion in June 2021, equivalent to 7.5 months of imports, and continued to provide 
an  adequate  safeguard  against  adverse  shocks.  Despite  a  short-lived  depreciation  at  the 
beginning  of  the  COVID-19  pandemic,  which  triggered  a  temporary  intervention  by  the 
central bank, the exchange rate of the Albanian lek lost only about 0.6% of its value against 
the  euro  in  2020,  but  returned  in  the  second  quarter  of  2021  to  its  pre-2020  trend  of 
continuous appreciation since 2016. 

Inflation rose slightly, but remained far below target and the central bank kept its very 
accommodative  policy  stance,  unchanged  since  March  2020.  Annual  inflation  averaged 

52 

 
 
1.7 % over the last five years but rose slightly from 1.4% in 2019 to 1.6% in 2020, mainly 
due to rising food prices, but declined again in the first half of 2021 to 1.4%. The monetary 
and  exchange  rate  policy  framework  has  not  changed.  The  BoA,  which  operates  under  an 
inflation-targeting regime (currently 3%) coupled with a floating exchange rate, kept its very 
relaxed  policy  stance  unchanged  since  March  2020  in  view  of  the  continuing  economic 
impact of the pandemic and the large gap to the inflation target.  

High revenue loss and extraordinary expenditure led to rising fiscal deficit and public 
debt ratios in 2020, erasing the gains of several  years of fiscal  consolidation efforts.  In 
2020, high capital expenditure on post-earthquake reconstruction and on other infrastructure 
projects (+35.9% year-on-year) in addition to the pandemic-related support measures, pushed 
the expenditure ratio from the average 
29% of GDP between 2015 and 2019 
to  33.2%  of  GDP.  Tax  revenue12 
performed  well  from  2016  to  2018, 
but  its  growth  had  already  stalled  in 
2019, before it dropped by 6.5% year-
on-year  in  2020,  which  led  the  tax 
revenue  ratio  to  drop  to  24.6%  of 
GDP, down from an average of 25.4% 
of  GDP  in  2016-2019.  The  fiscal 
deficit remained below 2% of GDP in 
increasing 
2016-19,  supported  by 
revenue and decreasing interest expenditure. The public debt ratio decreased moderately but 
continuously, from 72.7% in 2015 to 65.8% at the end of 2019.  

Plans  for  fiscal  consolidation  and  the  recommended  broadening  of  the  tax  base  have 
been postponed. In 2020, the fiscal deficit climbed to 6.8% of GDP and, coupled with public 
guarantees of 3.1% of GDP, pushed the debt-ratio to 76.1% of GDP. The declining trend in 
public external debt also reversed as it rose to 36.1% of GDP in 2020 from 30.4% in 2019. In 
the  first  half  of  2021,  the  rebounding  tax  revenue  by  20%  helped  to  decelerate  debt  and 
deficit growth, despite expenditure growth of 10% compared with the first half of 2020. The 
2021-2023  medium-term  fiscal  framework,  which  was  first  submitted  in  October  2020, 
originally foresaw a significant debt and deficit reduction starting in 2022, underpinned by a 
new  fiscal  rule  requiring  the  primary  balance  to  be  zero  or  positive  with  effect  from  2023. 
However, due to the budget amendment of July 2021, which increased the deficit target for 
the year and postponed the application of the primary balance rule to 2024, the medium-term 
fiscal  consolidation  plan  may  have  become  obsolete,  though  it  was  not  updated.  The  long 
foreseen  medium-term  revenue  strategy  was  postponed  and  the  raising  of  the  VAT 
registration threshold as of 2021 narrows the tax base instead of broadening it.   

Fiscal  risks  persist,  but  their  monitoring  improved,  whereas  reforms  of  public 
investment  management  stalled.  Since  2019,  a  fiscal  risk  statement  has  accompanied  the 
budget proposal. Its scope was gradually expanded to also cover public private partnerships 
(PPPs).  However,  despite  continuing  training  and  assistance  to  improve  public  investment 
management,  long-agreed  institutional  reforms  like  the  unification  of  the  selection  and 
approval process of public investment projects were not implemented. As a result, some areas 
of public investment, including reconstruction funds, are not subject to the usual evaluation 
criteria and procurement rules. The necessary increase of staffing in the Ministry of Finance 

12 Including social insurance contributions 

53 

020406080-8-404201520162017201820192020Graph 3: Albania -Fiscal developmentsPrimary balance (lhs)Interest (lhs)GG balance (lhs)Public Debt (rhs)Source: National sources% ofGDP 
 
                                                           
and  Economy  in  order  to  implement  these  important  tasks  is  still  pending  and  overall  the 
efficiency of the strongly increasing public investment expenditure shows little improvement. 

Considering the limited fiscal and monetary policy space, the macroeconomic policy mix 
in  response  to  the  double  shock  has  been  appropriate.  The  expenditure  increase  was 
timely  and  prudent,  but  the  high  level  of  debt  severely  limits  the  fiscal  space  to  deal  with 
shocks in the near future. The BoA’s further relaxation of the already loose monetary policy 
stance  in  March  2020  was  appropriate  in  view  of  the  weak  economic  activity  and  the 
persistently  below-target  inflation  rate.  Its  provision  of  liquidity  and  its  temporary  money 
market intervention supported financial and external stability. The macro-fiscal policy mix in 
response  to  the  pandemic  and  the  post-earthquake  reconstruction  needs  has  been  generally 
appropriate and supportive to economic stability. 

Functioning of product markets  

Business environment  

The increasing digitalisation of public services helps to lower the administrative burden 
on  businesses  as  well  as  corruption  and  informality.  Albania  has  continued  to  facilitate 
business  registration  procedures  and  licensing  through  the  e-government  portal.  Online  tax 
payments reduced opportunities for corruption e.g. by having less face-to-face meetings with 
tax  officials.  The  Bank  of  Albania  waived  fees  for  home  banking  transactions  and  the 
government  paid  the  crisis  assistance  funds  preferably  on  bank  accounts  in  order  to  reduce 
movement  and  contacts  during  the  pandemic.  Both  led  to  an  increase  of  online  financial 
.  The 
services  and  financial  inclusion,  which  usually  help  to  reduce  informality. 
implementation of electronic invoicing (“Fiscalisation”) in 2021 reinforces this development. 
Nevertheless, the informal economy remains large – it is estimated to account for about one 
third of GDP13.  

Progress  on  improving  legal  certainty  for  businesses  has  been  mixed,  while  concerns 
about the effective implementation of legislation and strategies persist. The adoption of 
the  new  Unified  Law  on  Investment,  which  has  been  postponed  from  2020  to  2021,  meant 
that  the  expected  improvement  of  legal  security  of  investors  has  been  delayed.  The 
implementing legislation for the  Bankruptcy  Law was completed in  2020, and the National 
Bankruptcy  Agency  is  fully  operational.  The  implementation  of  the  previous  business 
investment development strategy (BIDS), which ran until 2020, progressed only slowly and 
most  business  surveys  indicate  that  reforms  have  slowed  down  in  the  past  2-3  years.  The 
Ministry  of  Finance  and  Economy  is  developing  a  new  BIDS  for  2021-2025,  which  is  to 
provide  the  basis  for  the  government’s  support  to  SMEs  and  investment.  Businesses 
highlighted problems14 in finding skilled staff and still considered corruption and informality 
(despite the latter’s perceived decline) to be widespread. Other major concerns raised by the 
business community include a failure to implement legislation effectively, ad hoc regulatory 
and  taxation  changes,  and  the  controversial  use  of  public  procurement  procedures.  The 
increased pace of VAT refunds by the tax administration help the liquidity position of small 
businesses,  but  the  payment  of  large  VAT  refunds  in  instalments,  without  interest, 
undermines the credibility of the revenue administration.  

13 IMF 2019, WP 19/278, “Explaining the Shadow Economy in Europe: Size, Causes and Policy Options” 
estimates on shadow economy in 2016 in Albania between 28% and 30% depending on the model. 
14   Albania – enterprise survey 2019; www.enterprisesurvey.org  

54 

 
 
 
 
                                                           
State influence on product markets  

To address the impact of COVID-19, the government provided about 2.6% of GDP to 
support  businesses,  households  and  the  healthcare  sector  in  2020.  This  included 
minimum wages disbursed to 38 993 small businesses and self-employed, affected by the 3-
month  lockdown,  lump-sum  grants  to  172  890  retrenched  workers  of  small  businesses  in 
sectors affected by  continuing mobility  restrictions (e.g. tourism)  and double benefits  to  60 
788  recipient  households  of  economic  assistance  or  unemployed  registered    prior  to  the 
lockdown measures. The government encouraged informally employed people to register in 
order  to  receive  support  by  active  labour  market  policies.    .  The  government  also  provided 
liquidity to businesses in the form of sovereign guarantees under which the equivalent of 1% 
of GDP was contracted by March 2021 through 850 loans via the 12 banks in Albania. The 
government also granted postponement or relief of profit and corporate income tax payments 
for affected business in 2020. The Ministry of Finance and Economy published the eligibility 
conditions for the support and the progress of disbursement. Applications were processed via 
established  institutional  channels  and  non-affected  business  and  high-income  individuals 
were excluded from the support.   

The state’s footprint in the economy and reported state aid levels are relatively low but 
incomplete reporting makes it difficult to evaluate effects on competition. According to 
newly  established  sector  accounts,  the  public  sector’s  share  of  gross  value  added  of  the 
economy was about 11% in 2017. Public sector employment15 decreased from 16.3% of total 
employment  in 2014 to 14.3% in 2017 and increased again from then on to a 15.8% in June 
2021.  In  2019,  Albania  reported  state  aid  increasing  to  0.3%  of  GDP.  This  is  probably 
underreported,  given  the  lack  of  capacity  and  independence  of  the  State  Aid  Commission. 
Most  of  the  support  targeted  employment  promotion,  tourism  and  research  in  form  of  tax 
exemption, tax deferral, tax rate reduction and deduction of social security contribution. The 
Albanian  Investment  Corporation,  which  is  owned  and  funded  by  the  state  to  develop 
investment projects of public interest, was established in July 2020.  

Privatisation and restructuring  

There are about 170  extra-budgetary units and public corporations that lack  effective 
oversight  and  their  reliance  on  state  funding  pose  fiscal  risks.  Using  ESA 2010 
methodology, the Institute of Statistics distinguishes between 154 extra-budgetary units of the 
central  and  local  government  (regulators,  universities,  football  clubs,  about  24  goods 
producers,  water  supply,  sewerage  and  waste  disposal  companies)  and  16  non-financial 
public corporations (4 in the energy and mining sector, the post, ports and fruit markets) and 
1 public financial corporation. Albania has extended its improved monitoring of fiscal risks 
from state-owned enterprises in the energy sector to the water and sewerage utilities of local 
governments.  In  accordance  with  the  national  privatisation  plan  2017-2020,  12  assets  were 
privatised  for  a  total  value  of  about  EUR  5.7  million  in  2020,  through  public  auction 
procedures, giving the former landowners priority to purchase the assets.  

Functioning of the financial market  

Financial stability 

Liquidity injections and regulatory forbearance supported the stability of the financial 
sector  during  the  crisis.  In  view  of  the  impact  of  the  COVID-19  pandemic,  the  BoA 
temporarily facilitated the deferral of loan instalments between March and August 2020, and 
extended  the use of relaxed provisioning and loan restructuring rules so far until mid 2021. 

15     As share of total employment of the 15-64 year old acc. to LFS (INSTAT) 

55 

 
 
                                                           
These rules are also applicable by the small but growing non-bank financial sector of about 
32  institutions16.  The  ratio  of  NPLs  to  total  loans  remained  stable  in  2020  and  slightly 
declined  to  7.8%  in  May  2021,  but  it  remains  influenced  by  the  regulatory  exemptions. 
Overall, the banking sector closed 2020 with 15% lower profits than 2019 (return on equity 
fell to 10.7%), and the banking sector’s capital adequacy and liquidity ratios dropped by 1pp 
to 18.1% and 3.5pps to 12%, respectively, in the first quarter 2021 compared with 2020. The 
BoA’s  stress  tests  of  end  2020  confirmed  the  banking  sector’s  resilience  against 
macroeconomic and liquidity shocks for 2021/22, but the banks’ relatively large exposure to 
government  securities  (averaging  25%  of  their  assets)  and  to  loans  and  deposits  in  euro 
(though  decreasing  to  just  below  50%  of  the  total),  continue  to  pose  risks  to  the  banking 
sector.  

Access to finance 

Favourable financing conditions, improving payment systems and growing trust in the 
banking  sector  improved  access  to  finance.  Lending  to  the  private  sector17  grew  7.7% in 
both 2019 and 2020, increasing the average credit-to-GDP ratio from 34% in 2019 to a still 
low  37.8%  in  2020,  partly  on  account  of  the  lower  GDP  denominator.  In  addition  to 
favourable financing conditions and the relaxed loan provisioning and restructuring rules, the 
sovereign  guarantee  schemes,  the  increasing  share  of  domestically  owned  banks  in  total 
banking system capital18, and the growing public trust in the financial system have helped the 
lending  performance.  Albania  has  continued  to  align  its  legislation  with  EU  Directives  on 
financial instruments, payment systems, and anti-money-laundering (see chapter 4). The new 
capital market law, adopted in May 2020 (see chapter 9), contributes to the development and 
integrity  of  the  very  small  capital  market,  which  does  not  yet  offer  alternative  financing 
channels to business.  

Functioning of the labour market  

improvements 

After  years  of  continuous 
in  participation,  employment  and 
unemployment  rates,  all  labour  market  indicators  deteriorated  in  2020,  but  remained 
better than 2018 levels. Solid employment growth averaging 3.7% in the 2015-2019 period 
helped  lower  the  unemployment  rate  (15-64) 
from  17.5%  to  a  record-low  12%.  Rising 
labour-force  participation  (from  64.2% 
in 
2015  to  69.6%  in  2019  for  the  age  group  15-
64)  has  driven  growth  in  labour  supply, 
despite  a  decreasing  working-age  population 
due  to  lower  fertility  rates  and  emigration. 
Since  2018,  the  decrease  of  the  working  age 
population  accelerated  reaching  almost  1%  in 
2020 while total population declined by 0.6%. 
In  the  wake  of  the  COVID-19  pandemic,  the  unemployment  rate  increased  only  slightly  in 
2020,  by  0.2  pps  year-on-year,  partly  because  of  the  government’s  support  measures  and 
partly  because    the  1.9%  fall  in  employment  was  coupled  with  lower  participation  in  the 
labour  (15-24)  market  due  to  the  higher  number  of  discouraged  workers.  After  a  strong 

16   Including  11  insurance  companies,  5  investment  funds  and  3  pension  funds  with  a  share  in  total  financial 

sector assets of 7.5 % in 2019. 

17   Annual average growth adjusted for written-off loans and exchange rate impacts 
18   Domestic banks’ share of capital in total banking  sector assets increased  from 21.6 % in 2019 to 31 % in 
February 2021, partly because the share of EU banks in the market further decreased with the departure of 
the last Greek bank in the country (Alpha bank). 

56 

 
 
                                                           
increase in the first quarter of 2021, the unemployment rate recovered to 12.1% in the second 
quarter  supported  by  strong  growth  of  public  employment.  Compared  with  2019, 
employment  decreased  by  2.8%  in  agriculture,  5.3%  in  services,  and  0.5%  in  industry  in 
2020.726.5%. The gap between the participation rates of men and women remained in 2020 
unchanged from 2019 at 15.9 pps  but slightly increased in the first half of 2021.  

Nominal  wage  growth  in  2020  decelerated  by  1  pp.  to  2.7%,  as  wage  indices  of  most 
sectors  dropped (though data might be influenced by informal  practices).  The nominal 
wage growth decelerated more strongly from the third quarter of 2020 on, and annual average 
real wage growth fell to 1.1%, less than half of the 2019 growth rate. The practice of under-
stating  wages  in  the  contracts  has  seemingly  increased  in  recent  years,  according  to  a 
survey19, in which almost half of Albanian respondents either had no written contract or had a 
lower wage in their official contract than what they actually receive. Informal employment is 
estimated  at  32.2%  of  non-agricultural  employment20  but  the  low  capacity  of  the  labour 
inspection directorates only allowed for an inspection of about 7% of companies and only 5% 
of those were fined in 201921.  

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

Albania has made some progress and has some level of preparation in its capacity to cope 
with  competitive  pressure  and  market  forces  within  the  EU.  Energy  and  transport 
infrastructure,  the  use  of  digital  communication  as  well  as  education  outcomes  have 
improved,  but  significant  gaps  to  regional  and  European  levels  remain.  Albania’s 
competitiveness  is  hindered  by  a  lack  of  entrepreneurial  and  technological  know-how, 
significant  levels  of  informality,  unmet  investment  needs  in  human  and  physical  capital, 
and  low  spending  on  R&D.  The  pre-existing  significant  skills  and  education  gaps  have 
probably widened due to the COVID-19 related lockdowns and distance learning. Regional 
integration  and  exports  increased  but  remained  below  potential.  The  lack  of  product  and 
geographical diversification of exports add to Albania’s vulnerability to external shocks.  

As  2019  recommendations  to  improve  competitiveness  and  to  sustain  long-term  growth 
have only been partly implemented, in the coming year Albania should in particular: 

  develop a Youth Guarantee Implementation Plan and institutionalised tools to monitor 

skills needs in the labour market; 

  establish  effective  consultation  mechanisms  with  businesses  and  social  partners  and 
enhance  business  support  services  to  improve  access  to  finance  and  entrepreneurial 
know-how;  

  re-orient  public  expenditure  composition  towards  development  of  human  capital  and 

innovation, and incentivise the link between innovative businesses and academia. 

Education and innovation  

The  number  of  higher  education  graduates  increased,  but  progress  on  vocational 
training is  limited and funding for education and research remained low.  The share of 
university  graduates  among  the  25-29  age  group  increased  hugely  over  the  last  decade,  to 

19   SELDI  policy  brief  no.  11,  November  2020,  Hidden  economy  in  the  Western  Balkans  2020:  Trends  and 

policy options 

20 ILO 2021: Overview of the informal economy in Albania, based on 2019 labour force survey data. 
21 OECD competitiveness in Southeast Europe 2021 

57 

 
 
 
                                                           
40.8  %  in  2019,  but  labour  market  transition  remains  challenging.  Albania  lacks  tools  to 
monitor  skills  needs  of  the  labour  market  regularly,  thus  curricula  are  not  well  adapted  to 
business requirements, and skills mismatches persist. Although medium and large enterprises 
ranked an inadequately educated workforce as the third of their top three business obstacles22, 
they are not able to absorb the increasing number of graduates.  

The  proportion  of  companies  investing  in  R&D  (about  18%)  was  the  second  lowest  in  the 
region23  and  the  0.03%  of  GDP  public  spending  on  research  remained  insufficient  to 
strengthen  the  link  between  business  and  academia.  At  the  same  time,  the  share  of  young 
people not in employment, education or training (NEET) further increased in 2020, as a result 
of the crisis induced by COVID-19 (27.9% of the 15-29 year old) 27.9, while the vocational 
training  and  remedial  education  offer  for  the  lower  educated  young  and  middle-aged  work 
force  remains  limited,  underfunded  and  unattractive.  A  modernisation  of  the  legislative 
framework  to  provide  vocational  education  and  training  (VET)  is  on  its  way,  but 
implementation of the reforms is hampered by a lack of staffing at the responsible Ministry of 
Finance and Economy as well as at the newly established National Agencies for Employment 
and Skills (NAES) and for VET and Qualifications.   

Physical capital and quality of infrastructure 

Overall  investment  levels  declined  over  the  last  five  years  but  digital  infrastructure 
improved.  Overall investment in the economy in terms of real gross fixed capital formation 
(GFCF) fell from 24.5% of GDP in 2015 to 22.9% of GDP in 2020, because of contracting 
real growth of GFCF since 2019. This was mainly due to declining private investment from 
19.1% of GDP in  2015,  to  17% in  2019, and 16% in  2020, and  a decreasing level  of  FDI-
inflows. Annual public investment, on the other hand, remained broadly stable over the 2015-
2019 period, averaging 5.4% of GDP (incl. local government investments), but jumped to est. 
7.3%  of  GDP  in  2020,  mainly  because  of  post-earthquake  reconstruction  of  housing  and 
public  buildings.  Despite  continuous  relatively  high  levels  of  public  investment,  Albania’s 
infrastructure  remained  below  the  level  of  regional  peers.  On  the  positive  side,  water  and 
electricity  distribution  progressed  and  digital  infrastructure  improved,  with  a  growing 
proportion of households having internet access.  

Reforms  of  the  energy  sector  regulation  advanced  and  first  steps  were  taken  towards 
diversification  of  the  energy  mix.  Since  2018,  Albania  has  successfully  promoted 
investments  into  solar  power  to  begin  diversifying  its  energy  mix,  so  far  dominated  by 
hydropower,  which is  dependent  on rainfall, a  resource that is  forecasted to  decline, due to 
climate  change.  In  May  2020,  Albania  amended  the  Power  Sector  Law,  which  improved 
compliance  with  the  EU  energy  legislation  and  allowed  for  the  effective  separation  of  the 
electricity  distribution  system  operator  from  the  production  operator.  Consequently, 
Albania’s ranking in the Energy Transition Index climbed from 52nd in 2020 to 25th is 2021. 
In February 2021, Albania adopted a new Energy Efficiency law, and has begun drafting the 
legislation  for  the  energy  certification  of  buildings.  However,  the  third  National  Energy 
Efficiency  Action  Plan  has  expired  without  being  fully  implemented  and  a  strategy  for 
increasing industrial energy efficiency is missing.  

Sector and enterprise structure 

During  the  pandemic,  the  shift  to  services  and  manufacturing  stalled,  and  agriculture 
and  construction  gained  relative  significance.  Although  the  relative  weight  of  the 
agricultural sector in the economy declined from almost 19.8% of GDP in 2015 to 18.4% in 

22   World Bank 2019 
23   World Bank / European Investment Bank / OECD, Enterprise survey – Albania (2019). 

58 

 
 
                                                           
2019, it remained larger than in all other countries in the region. In 2020, agriculture gained 1 
pp.  weight  due  to  its  growth  and  the  low  performance  of  almost  all  other  sectors,  while 
construction  recovered  from  its  2019  low  to  9.2%  of  GDP.  The  increase  of  the  share  of 
services stalled at 48.5% of GDP, due to the contraction of the accommodation, food-related 
services and retail trade sectors, and manufacturing lost ground slightly from 6.3% in 2019 to 
6.2%  of  GDP  in  2020.  The  business  registry24  reflects  this  shift  in  an  increasing  share  of 
goods  producers  (due  to  an  increasing  registration  of  agricultural  enterprises)  and  a 
decreasing share of services producers from 2019 to 2020. The overall number of registered 
non-agricultural enterprises slightly decreased by 0.4%. 

SMEs’ contribution to employment and value added increased in 2019. SMEs are 99.8 % 
of all enterprises (1-249 employees), while large enterprises (250+ employees) only account 
for 0.2 %25. These shares are the same as the EU average, though the share of medium size 
enterprises with 50-249 employees is slightly higher in Albania than in the EU. In contrast to 
the EU, Albanian SMEs account for a much larger share of employment (81.6% vs 66.7%) 
and  value  added  (72.4%  vs  56.5%),  in  particular  the  37%  of  employment  by  micro 
enterprises  in  Albania  (29.9%  in  EU).  Microenterprises  are  the  largest  employment 
contributors  and  account  for  the  largest  share  of  employees,  in  particular  in  the 
accommodation  and  food  services,  and  trade  sectors,  which  have  been  most  hit  by  the 
COVID-19  pandemic.  These  sectors’  employment  importance  is  not  matched  by  their 
contribution to investments, which is the lowest of the four groups of enterprises, reflecting 
their sectoral focus, but also indicating their low productivity and growth potential. However, 
SMEs’ contribution to employment and value added increased in 2019 compared with 2018, 
while  large  enterprises  only  contributed  positively  to  investment.  Enterprises  continued  to 
increase their use of the internet.  The share of businesses using social media for marketing 
increased by 7 pps to 89.7%, but computer use for internal business processes remained low. 

Economic integration with the EU and price competitiveness 

The EU remained the main trading partner and  source of FDI for Albania but overall 
trade and FDI fell sharply due to the COVID-19 pandemic. The trend for overall trade has 
been decreasing slightly since 2017, but the pandemic caused a notable drop from 77.1% of 
GDP in 2019 to 61.8% of GDP in 2020 (in real terms). The COVID-19 pandemic caused the 
exports of Albania’s goods to the EU to drop by 11.4 % in 2020, about 2 pps more than total 
exports,  while  imports  of  merchandise  from  the  EU  dropped  by  6.4%,  1  pp  less  than  total 
imports.  The  difference,  partly  due  to  base  effects,  means  that  the  EU  absorbed  a  slightly 
lower share of Albania’s goods exports (74.7%, compared to 76.3% one year earlier), while 
its  share  in  Albania’s  imports  slightly  increased  to  58%.  Italy  remained  Albania’s  largest 
trade  EU  partner  for  both  imports  and  exports.  The  shares  of  trade  with  CEFTA  countries 
increased by 0.6pps to 17.8% for exports and by 1 pp to 6.5% for imports, and the share of 
trade  with  the  rest  of  the  world  increased  too,  both  indicating  a  gradually  increasing 
diversification in  trade partners. The largest  goods export categories  remained commodities 
and  processed  goods  with  low  value  added  such  as  metals,  minerals,  footwear  and  textiles. 
The export base remains limited and service exports continued to dominate Albania’s foreign 
sales, accounting for 79% of all exports in 2019. Hit by the impact of the pandemic on travel 
and  tourism,  they  dropped  by  34.5%  year-on-year  in  2020.  In  2019  (2020  data  not  yet 
available), the EU was the destination of 66% of Albania’s service exports and more than half 
of  the  total  exports  to  the  EU  were  services.  The  EU’s  share  in  Albania’s  FDI  inflows 

24 INSTAT, Statistics based on business register 2020. 
25  INSTAT,  Structural  Survey  of  Enterprises  for  2019,  classification  of  size  in  line  with  EU  definition,  not 
including agricultural and fishing activities. 

59 

 
 
                                                           
increased  in  2020  to  52.8  %,  despite  the  exit  of  the  UK,  and  its  share  in  the  FDI  stocks 
increased to 54.9%. In terms of annual change, FDI flows from the EU fell much less (-7.5 
%) than FDI inflows of the rest of the world (-18.3%) in 2020. The index of the real effective 
exchange rate (REER) of the Albanian lek continued to appreciate, by 1.8% in 2020 (3.5% in 
2019) as well as in the first half of 2021, mainly as a result of the lek’s nominal appreciation 
against the Turkish lira and the euro.   

2.4. PUBLIC PROCUREMENT, STATISTICS, FINANCIAL CONTROL  

Chapter 5: Public procurement 

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

Albania  is  moderately  prepared  in  public  procurement.  Good  progress  was  made,  in 
particular  by  adopting  the  new  law  on  public  procurement  and  the  public  procurement 
strategy  following  extensive  public  consultations.  Further  efforts  are  needed  to  improve 
compliance  with  procedures  and  prevent  corruption  in  the  procurement  cycle.  The 
Commission’s recommendations from 2020 were largely implemented. The recommendation 
on adequate  administrative capacity  was  reflected in  the public procurement strategy 2020-
2023 and now requires follow-up. 

In the coming year, Albania should in particular: 

  adopt the remaining  legislation to implement the new public procurement law; 

  develop  and  implement  the  electronic  contract  management  system  and  the  electronic 

registry of complaints for improved monitoring and transparency; 

  ensure  that  conditions  of  intergovernmental  agreements  concluded  with  third  countries 
comply  with  acquis  requirements  contained  in  the  SAA,  notably  in  the  area  of  public 
procurement. 

Institutional set-up and legal alignment 

The  legal  framework  on  public  procurement  is  largely  in  line  with  2004  EU  directives  on 
public procurement and procurement of utilities as well as relevant administrative and budget 
provisions.  In  December  2020,  further  partial  alignment  with  the  2014  EU  public 
procurement  directives  was  achieved  through  the  adoption  of  a  new  law  on  public 
procurement following wide public consultation. Part of the necessary secondary legislation 
remains to be adopted to ensure implementation of the new law. Following the  new law on 
defence and security procurement adopted in April 2020, bylaws were adopted in December 
2020,  thus  largely  aligning  the  framework  in  this  area  with  the  relevant  EU  Directive.  The 

60 

 
 
 
 
 
Law  on  concessions  and  public-private  partnerships  (PPPs)  is  partly  aligned  with  the  EU 
Directive  on  the  award  of  concession  contracts.  In  response  to  the  Covid-19  situation, 
procurement  procedures  were  conducted  mostly  under  the  rules  of  competitive  procedure, 
direct  award  procedure,  and  negotiated  procedure  without  prior  publication  alongside 
instructions  to  delay  or  cancel  non-essential  procurements.  The  strategic  framework  for 
public  procurement  2020-2023  was  adopted 
in  November  2020  following  public 
consultation. 

The Public Procurement Agency  (PPA) is the central public procurement entity mandated 
to propose regulatory measures and monitor compliance with public procurement rules, and 
since  the  new  law,  also  to  verify  the  compliance  of  cancelled  procedures,  and  to  monitor 
contract  implementation.  The  PPA  also  provides  contracting  authorities  with  information, 
support and guidance. Its staffing remains at 44 posts, three of which are vacant.  

Implementation and enforcement capacity 

Albania’s public procurement market represented about 9.4% of GDP in 2020 compared to 
4.8  %  in  2019.  The  increase  was  largely  driven  by  post-earthquake  reconstruction  and  a 
decline in GDP due to COVID-19 economic impact. In 2020, the average number of bids per 
tender was 2.57 as compared to 2.37 in 2019 and 3.05 in 2018. The planning and preparation 
of  public  procurement  procedures  are  generally  transparent,  and  efficient  principles  and 
public procurement forecasts are published regularly. 

The  new  public  procurement  law,  in  line  with  EU  directives,  foresees  the  use  of  the  most 
economically  advantageous  tender.  However,  simplified  procurement  regime  for  social 
services, and innovation partnership procedure still require the adoption of bylaws as well as 
capacity building in contracting authorities. 

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. 

inter-governmental  agreements  concluded  with 

third  countries 

for 

On the monitoring of contract awarding and implementation, following close monitoring 
by the PPA, the number of negotiated procedures without prior publication continued to fall 
in 2020, not considering COVID-19 and reconstruction (to 151, from 192 in 2019, and 531 in 
2018). In 2020, the number of negotiated procurement procedures without prior publication 
related  to  COVID-19  and  post-earthquake  reconstruction  amounted  to  191  and  74, 
respectively, accounting for 1.45% and 1.47%, respectively, of value of all procurements in 
that  period.  The  use  of  framework  agreements  remained  high  in  terms  of  numbers  (677  in 
2020,  compared  to  763  in  2019  and  627  in  2018)  with  further  increase  in  value  procured 
through framework agreements (approx. EUR 216 million in 2020, compared to approx. EUR 
166 million in 2019 and approx. EUR 86 million in 2018). 

Albania has a central electronic public procurement portal on which it publishes tender and 
contract  notices,  and  other  important  information  and  guidance.  Use  of  the  portal  is 
mandatory,  including  for  low-value  procurement.  Standard  tendering  documents  for  each 
type  of  procedure  and  contract  are  published  on  the  PPA  website,  and  the  procurement 
forecast register is prepared and posted online. 

By  the  end  of  2020,  the  concessions  registry  contained  information  on  226  PPPs,  two  of 
which had been signed in 2020. Although required by law, value-for-money analysis is still 
not  systematically  carried  out  before  approval  of  all  PPPs.  The  Ministry  of  Finance  and 
Economics  made  attempts  to  establish  regular  monitoring  and  reporting  on  PPPs.  The 

61 

 
 
technical  skills  and  capacity  to  design  and  assess  concessions  and  PPPs  require  further 
development.  

The  PPA  applies  a  monitoring  system  to  assess  procurement  performance,  procurement 
compliance  and,  since  2019,  contract  implementation,  with  information  available  for  2,888 
contracts  (as  compared  to  1,006  in  2019).  The  monitoring  system  is  based  on  a  variety  of 
performance indicators. There is still a need for: (i) further support for 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  processes 
effectively.  In  this  respect,  in  2020  training  was  provided  to  more  officials  in  contracting 
authorities than in the previous year (970 in 2020 as compared to 526 in 2019). Compliance 
is  still  generally  weak,  especially  in  more  complex  procedures.  Regarding  integrity  and 
conflicts of interests, the PPA issued instructions on the declaration of conflicts of interest 
by procurement officials and adopted a regulation on prevention of conflicts of interest in the 
exercise of public functions in the PPA. Based on a smaller sample than in previous years, the 
State Audit Institution (SAI) reported irregularities in public procurement, with an estimated 
loss to the state budget of around EUR 2.8 million (as compared to EUR 13.9 million in 2019 
and EUR 9.4 million in 2018).  

Efficient remedy system  

The Constitution and the Law on public procurement contain provisions on the right to legal 
remedy  that  are  mostly  in  line  with  the  Remedies  Directive.  The  remedy  system  is  easily 
accessible  to  economic  operators,  without  discrimination.  However,  the  complainant  must 
pay a fee, which is refunded once the complaint has been fully or partially been accepted by 
the Public Procurement Commission (PPC). For refused complaints, the fee is transferred to 
the state budget. 

The  PPC  is  an  independent  review  body  dealing  with  complaints  related  to  public 
procurement procedures. Its decisions can be challenged before the Administrative Court of 
Appeals. The new public procurement law provides the possibility to file a complaint to the 
contracting authority and the PPC at the same time. The processing of complaints within the 
legal time limit improved in 2020 to 78% (as compared to 71% in 2019) with a lower number 
of  complaints  received  (741,  as  compared  to  1,052  in  2019)  but  still  needs  to  be  further 
strengthened.  An  electronic  database  for  PPC  decisions  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  a  high  number  of  appeals  needs  to  be  further  improved. 
There are no specialised training courses on public procurement. 

Chapter 18: Statistics 

EU rules require that Member States are able to produce good quality statistics in line with 
the  principles  of  the  European  statistics  Code  of  Practice  and  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,  notably  on  the 
alignment  with  ESA  2010  standards,  faster  publication  of  statistics,  and  increased 
transmission to Eurostat. With regard to last year’s recommendation, the appointment of the 
General  Director  of  INSTAT  was  ensured,  and  the  action  plan  was  prepared,  however  it 

62 

 
 
 
needs  to  be  finalised,  and  the  other  recommendations  remain  valid.  The Population  Census 
Law was  adopted. The  role of Albania’s  National  Statistical  System (INSTAT) was  further 
strengthened  and  its  resources  improved;  however,  data  collection  methods  need  to  be 
modernised  and  the  statistical  production  processes  improved.  Communications  with 
stakeholders needs to be improved. 

In the coming year, Albania should in particular: 

  implement  the  Population  and  Housing  Census  in  line  with  the  relevant  EU  legislation 

and international standards; 

  finalise  the  action  plan  and  the  detailed  estimated  budget  for  the  2024  census  of 

agriculture; 

  implement the amended Law on Official Statistics and continue to improve its role as the 
coordinator of the national statistics and expand the number of statistical agencies.  

With  regard  to  statistical  infrastructure,  Albania’s  national  law  on  official  statistics  is  in 
line with the European  Statistics Code of Practice, and most classifications are in  line  with 
EU standards. The revised statistics Annual Plan 2020 and the Annual Plan 2021 have been 
approved and work continues on the implementation of Albania’s 5-year programme on the 
official statistics for 2017-2021. 

The Institute for Statistics (INSTAT) continued its organisational restructuring following the 
2018  amendments  to  the  national  law  on  official  statistics,  and  the  appointment  of  the 
General  Director  of  INSTAT  has  been  finalised.  However,  INSTAT’s  budget  and  staffing 
continued  to  be  insufficient  for  fully  implementing  the  EU  acquis  in  the  field  of  statistics. 
INSTAT needs to continue to make further efforts to fill its remaining vacancies, reduce staff 
turnover, and ensure that its staff is trained on latest statistical developments.  

On macroeconomic statistics, annual and quarterly GDP data are produced according to the 
production and expenditure approach, in current and previous year prices as well as in chain-
linked volume and seasonally adjusted. Supply and use tables and derived input-output tables 
are  harmonised  with  the  definitions  of  the  European  System  of  National  and  Regional 
Accounts (ESA 2010). The data transmission to Eurostat has gradually improved in terms of 
timeliness  and  regarding  the  length  of  time  series  for  annual  national  accounts.  However, 
significant improvement is still needed to achieve full compliance.  

Regarding  the  Gross  National  Income  (GNI)  resource,  further  progress  was  made  on 
alignment  with  ESA 2010 standards, but  Albania still needs to  further improve  compliance 
and to start drafting the GNI Inventory, on the basis of the existing description of sources and 
methods used to compile its national accounts. 

Further  efforts  are  needed  to  improve  the  completeness  of  the  excessive  deficit  procedure 
notification  tables,  which  are  sent  regularly  to  Eurostat  on  a  best-effort  basis.  Further 
improvements  are  needed  in  government  finance  statistics  in  order  to  meet  legislative 
requirements. INSTAT produces and publishes the harmonised index of consumer prices and 
ensures the generation of income accounts.  

As  regards  structural  business  statistics,  data  collection  and  production  have  further 
improved. Albania carried out an industrial production survey, although data is not collected 
by  the  PRODCOM  list  in  force,  nor  transmitted  to  Eurostat.  In  addition,  Albania  is  partly 
compliant for all Short Term Statistics domains (industry, construction, retail trade and other 
service), but some important indicators are still not transmitted to Eurostat, in particular the 
industrial  production,  industrial  turnover  and  the  services  producer  prices.  A  special 

63 

 
 
publication  was  finalised  in  cooperation  with  the  Bank  of  Albania  on  the  main  tourism 
indicators  for  the  period  2014-2018  and  Albania  has  completed  the  data  collection  for  the 
enterprise tourism survey "Accommodation structures survey", which was published in May 
2021.  INSTAT  has  good  relationships  with  respondents,  and  achieves  quite  high  response 
rates in both business and household surveys.  

On  social  statistics,  the  labour  force  survey  is  conducted  regularly  and  micro-data  are 
provided  to  Eurostat.  INSTAT  does  not  produce  job  vacancy  statistics  yet.  Labour  cost 
statistics are calculated on the basis of a labour cost survey. A Structure of Earnings Survey 
was conducted for the first time in 2018 and data was published in November 2020. INSTAT 
conducted the survey of income and living conditions wave 3 (SILC 2019) between April and 
July 2019 and the data has been validated and published by Eurostat. 

In 2020 INSTAT published the gender equality index for Albania for the first time. The index 
measures gender equality in six core domains: work, money, knowledge, time, power, health, 
and  two  additional  domains:  intersecting  inequalities  and  violence.  Statistics  on  external 
migration  and  asylum  are  partly  aligned  with  the  EU  legislation.  Crime  statistics  are 
published on a quarterly basis.  

The  population  and  housing  census  has  been  postponed  to  2022  due  to  the  impact  of  the 
COVID-19 pandemic and the national elections. The law on population and housing census 
has been adopted. Albania should ensure funding for its full implementation, to  carry out  a 
second pilot census and take the opportunity to explore the use administrative of data. 

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  farmer  register,  individual 
register of animals and the animal holding registers, among others.  INSTAT should finalise 
the strategic document for the census of agriculture holdings, planned for 2024, including a 
corresponding action plan and the budget. INSTAT is working to introduce the possibility to 
move from a system based on an expert estimates to survey-based agriculture statistics.  

Environmental  statistics  are  in  line  with  the  EU  acquis  to  a  very  limited  extent,  while 
energy  statistics  are  moderately  aligned.  INSTAT  produces  the  balance  of  electricity  on  a 
quarterly basis and publishes the general energy balance produced by the National Agency of 
Natural  Resources.  Short-term  energy  statistics  are  still  produced  as  volume  data  for 
electricity  only..  Air  emission  accounts  and  material  flow  accounts  are  partially  in 
compliance  with 
the  collection  of 
environmentally  related  taxes  by  economic  activities  and  waste  statistics  (generation  and 
treatment).  Data  on  packaging  waste  are  increasingly  important  as  they  are  the  basis  for  a 
new EU Budget own resource on non-recycled plastic packaging waste.  Data on municipal 
waste are collected. 

the  EU  requirements.  Albania  shall 

improve 

Chapter 32: Financial control  

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

Albania is moderately prepared in this area. Some progress was made during the reporting 
period,  especially  with  the  approval  of  a  policy  document  for  the  strengthening  of  public 
internal  financial  control  (PIFC),  instructions  on  delegation  of  financial  responsibilities, 
guidelines for the monitoring and reporting on follow-up of internal audit recommendations, 
and  revision  of  external  audit  quality  control  and  quality  assurance  procedures.  The  proper 

64 

 
 
and effective functioning of internal  control is not  yet ensured across budget entities. Since 
only partial progress was made with the Commission’s 2020 recommendations, these remain 
valid. 

In the coming year, Albania should in particular: 

  implement  the  instructions  on  financial  delegation  of  responsibilities  and  issue 
instructions  on  delegation  of  management  responsibilities  with  a  view  to  improve 
managerial accountability; 

  monitor    and  follow-up    the  implementation  of  recommendations  made  in    the  annual 

PIFC report across budget institutions;  

  increase parliamentary scrutiny of audited bodies in the implementation of external audit 
recommendations,  through  more  frequent  parliamentary  hearings  and  the  establishment 
of  a  parliamentary  monitoring  framework  to  regularly  assess  government’s  follow-up 
action. 

Public internal financial control  

A  strategic  framework  for  PIFC  is  in  place.  PIFC  measures  are  included  in  the  PFM  and 
PAR  Strategy  2019-2022,  and  further  defined  in  a  PIFC  policy  document  2021-2022 
approved in December 2020. Clear institutional responsibilities in the central government are 
required  for  steering  PIFC  reforms  in  a  coordinated  approach  with  public  administration 
reforms, and strengthened efforts are needed on implementation of PIFC reforms beyond the 
Ministry of Finance and Economy.   

Managerial  accountability  is  not  yet  fully  enshrined  in  the  legislation  and  administrative 
practice.  The  adopted  instructions  on  the  delegation  of  financial  responsibilities  need  to  be 
implemented  and  accompanied  with  a  wider  reform  on  delegation  of  operational  and 
administrative  responsibilities  in  order  to  have  a  comprehensive  approach  on  managerial 
accountability.  A  very  small  number  of  administrative  decisions  are  delegated  in  practice. 
Reporting focuses mainly  on  financial performance, however  with  an increasing number of 
institutions  also  reporting  on  performance  against  objectives.  The  reoccurrence  of  and 
increase in arrears is an indicator for not yet fully effective attribution of responsibilities and 
commitment controls. The law on state administration, law on civil servant and relevant laws 
on integrated policy planning and the budget system law need to be assessed and if necessary 
amended to  ensure a consistent basis for implementation of managerial accountability.  (See 
also Public administration reform). 

The  legislation  on  internal  control  is  largely  in  line  with  international  standards. 
Declarations of assurance are systematically signed by senior management, but in the absence 
of  a  delegation  framework,  this  remains  more  of  a  formal  exercise.  Books  of  business 
processes need to be drafted throughout the public administration in order to reinforce PIFC, 
including  the  clarification  of  roles  and  responsibilities  in  the  different  procedures,  the 
definition of objectives and outputs, the specification of tasks to be delegated, the reporting 
lines, and identification of risks specific to procedures. 

In December 2020, changes to the methodology were approved for assessing the performance 
of  the  internal  control  systems  in  the  units  of  general  government.  Sub-ordinated  agencies 
and local government units remain the weakest institutions as regards functioning of internal 
control systems. At all levels, risk management is still at an early stage and needs to be better 
incorporated  in  the  management  of  financial  and  operational  processes.  Particularly,  risk 
registers and risk strategies need to  be developed by budget  users  at  central  and local  level 
and integrated in the management process of public entities The budget inspection function is 

65 

 
 
centralised  within  the  Ministry  of  Finance  and  Economy  performs  ex-post  activities  upon 
request. The number of requests introduced by internal audit units remains relatively low. 

The legislation on internal audit practice is in line with international standards. In 2020, the 
number  of  certified  auditors  in  the  public  sector  was  largely  maintained.  The  internal  audit 
function still does not issue audit opinions on the effectiveness of the internal control systems 
across  budget  entities.  The  internal  audit  quality  control  procedures  still  need  to  become 
generally compliant with the standards and fully operational.  In October 2020, the Ministry 
of Finance and Economy approved guidelines and instructions for improving the monitoring 
and reporting of the implementation of internal audit recommendations. 

The central harmonisation unit (CHU) provides methodological guidance and monitors the 
performance of internal control and internal audit in the public sector on the basis of quality 
reviews  and  self-assessment  reports  from  institutions.  In  2020,  the  CHU  carried  out  19 
quality  assessments  of  internal  audit  and  completed  further  12  by  June  2021.  In  2021,  the 
CHU started quality assessments for internal control in five institutions. The capacity of CHU 
needs to be strengthened. The annual PIFC report is presented to the Council of Ministers and 
discussed in the Parliament.  

External audit 

In  line  with  the  standards  of  the  International  Organisation  of  Supreme  Audit  Institutions 
(INTOSAI) Albania’s constitutional and legal framework provides for independence of the 
State  Audit  Institution  (SAI).  Adoption  of  proposed  legal  amendments  is  pending  to 
strengthen the scope of the audit mandate to cover all public entities. 

In accordance with its 2018-22 strategic development plan, the SAI is implementing actions 
to  improve  its  institutional  capacity.  A  working  group  has  been  established  in  order  to 
improve current legislation and among others ensure continuity after the end of mandate of 
the  SAI  chair.  In  recent  years,  the  SAI  has  taken  measures  to  improve  the  professional 
development of its audit staff. In 2020, detailed tasks in the field of ethics and integrity were 
defined.  The  SAI  continued  to  raise  awareness  among  academia  and  civil  society  on  the 
importance of external audit. 

The quality of audit work needs to be further improved to fully comply with the INTOSAI 
standards.  In  June  2020,  regulations  of  audit  procedures  were  revised  to  improve  quality 
control  and  assurance  procedures.  The  SAI  audit  objectives  have  shifted  from  compliance 
and regularity  audits towards audits. The SAI  follows a risk-based external  audit approach. 
The  number  of  performance  audits  has  increased  accounting  for  approximately  11%  of  all 
conducted audits  in  recent  years. Due to  the COVID-19 situation, about  50% of the annual 
audit  plan  2020  could  not  be  performed;  yet,  audits  on  COVID-19  related  emergency 
procurements were and are conducted. 

The  impact  of  audit  work  has  shown  some  progress.  ALSAI  compiles  annual  reports  on 
their performance and those are published on its website and reported to the Parliament.  The 
2017  Memorandum  of  Understanding  between  the  SAI  and  the  Ministry  of  Finance  on 
monitoring  the  follow-up  of  audit  recommendations  resulted  in  the  creation  of  a  technical 
secretariat with representatives of both parties, which became fully operational in 2020. The 
monitoring  of  the  effective  and  timely  implementation  of  audit  recommendations  has 
improved.  In 2020, ALSAI  reported that 75% of its recommendations are in  the process  of 
being implemented, and some of them have been fully implemented. Despite a high rate of 
implemented 
recommendations  being  accepted  by 
recommendations needs to be improved.  The electronic platform for the follow-up of audit 

institutions, 

rate  of 

fully 

the 

66 

 
 
recommendations is functional since end 2019, and in June 2020 the corresponding manual 
has been approved. 

Protection of the EU’s financial interests  

Albania has ensured some level of acquis alignment, yet still needs to fully harmonise with 
the  EU  Directive  on  the  fight  against  fraud  to  the  EU’s  financial  interests  by  means  of 
criminal  law.  The  national  anti-fraud  coordination  service  (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.  In 
January  2021,  the  newly  created  SPAK  has  been  added  to  the  AFCOS  service  reporting 
network. 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. In 2020, Albania 
has  reported four cases via the online irregularity management system out of which one as 
suspected  fraud.  Albania  should  adopt  a  national  anti-fraud  strategy.  Although 
cooperation  on  investigations  has  improved,  Albania  needs    to  step  up  its  efforts  in 
developing  a  solid  track  record  on  cooperation  on  investigations  and  reporting  of 
irregularities. 

Protection of the euro against counterfeiting 

In November 2019, Albania 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 and the Scientific Police Institute. However 
formal cooperation between  Bank of Albania, State Police in  Interior Ministry and General 
Prosecutor Office has still not been established.  In 2020, Albania seized 307 euro coins and 
banknotes  totalling  EUR  6  000,  representing  18  %  of  all  seized  counterfeit  currencies. 
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 between European 
Commission and the Bank of Albania 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. 

3. 

GOOD NEIGHBOURLY RELATIONS AND REGIONAL COOPERATION 

Good neighbourly relations and regional cooperation form an essential part of Albania’s 
European  integration  process  and  contribute  to  stability,  reconciliation  and  a  climate 
conducive to addressing open bilateral issues and the legacies of the past. 

Albania maintained its engagement in number of regional cooperation initiatives, such as the 
Central  European  Free  Trade  Agreement  (CEFTA),  Energy  Community,  Transport 
Community,  the  South  East  European  Cooperation  Process  (SEECP)  and  the  Regional 
Cooperation Council26. As of January 2021, Albania holds the Chairmanship-in-Office of the 
Black Sea Economic Cooperation Organisation (BSEC).  

The  Covid-19  pandemic  has  accelerated  the  ambition  to  enhance  regional  integration,  by 
displaying the important links between markets in the region as well as between the EU and 
the six Western Balkans economies. Given the European perspective of the Western Balkans, 

26 Albania actively participates in around 35 regional organisations and initiatives. 

67 

 
 
                                                           
the EU has continued to treat the region as privileged partners by associating them with the 
Union’s  mechanisms  and  instruments,  including  an  exemption  from  temporary  EU  export 
restrictions of medical equipment. Albania has approved the Joint Proposal prepared by the 
Permanent  Secretariat  of  the  Transport  Community  and  the  CEFTA  Secretariat  to  facilitate 
the  transport  and  trade  of  essential  goods  within  the  Western  Balkans,  creating  the  Green 
Corridor,  an  initiative  to  facilitate  the  transport  of  priority  products  during  the  COVID-19 
pandemic  period.  In 
the  Green 
Lanes/Corridors  with  EU  Member  States,  namely  with  Greece  at  the  Kapshtica  -  Kakavija 
border crossing point. 

this  respect,  Albania  has  worked  on  extending 

At  the  Sofia  Summit  on  10  November  2020,  the  six  Western  Balkans  leaders  adopted  the 
Declaration on the Common Regional Market and the Declaration on the Green Agenda for 
the  Western  Balkans.  This  followed  upon  previous  commitments  taken  at  the  EU-Western 
Balkans  Zagreb  summit  in  May  2020  and  the  recognition  of  the  role  of  deepened  regional 
economic integration to support the economic recovery of the Western Balkans.  

The  Common  Regional  Market  is  structured  around  the  four  freedoms  (free  movement  of 
goods,  services,  capital  and  people)  while  also  covering  aspects  of  digital,  investment, 
innovation and industrial policy. This makes it the most ambitious regional integration effort 
to  date  in  the  Western  Balkans.  The  Common  Regional  Market  builds  on  EU  rules  and 
standards  and  represents  a  stepping-stone  to  integrate  the  region  more  closely  with  the  EU 
Single Market already before accession.  

The  Common  Regional  Market  will  be  critical  in  increasing  the  attractiveness  and 
competitiveness  of  the  region.  It  will  help  Albania  to  speed  up  the  recovery  from  the 
aftermath  of the pandemic, notably to  attract  investors looking for diversification of supply 
and shorter value chains and to maximise the benefits of the infrastructure investments under 
the  Economic  and  Investment  Plan.  It  is  therefore  important  that  all  parties  play  a 
constructive  role  in  building  the  Common  Regional  Market  and  deliver  on  their  joint 
commitments. Albania has played a pro-active part in the process, hosting related summits in 
Tirana on 10 November 2020 and 10 June 2021.  

The Green Agenda for the Western Balkans aims at reflecting the European Green Deal in a 
proportionate  and  adapted  manner  in  the  Western  Balkans.  The  objective  is  to  turn 
environmental  and  climate  challenges,  similar  in  the  region,  into  opportunities.  Given  that 
natural  resources  and  climate  change  do  not  know  any  border,  the  Green  Agenda  foresees 
joint  actions,  which  will  contribute  to  the  sustainable  socio-economic  development  and  the 
green recovery of the entire region in the post-pandemic period. Albania should contribute to 
successfully implement  this joint  regional vision, with  a high level  of ambition.  The Berlin 
Process  summit  on  5  July  2021  was  an  occasion  for  the  Commission  to  announce  targeted 
assistance related to combating the COVID pandemic and post-pandemic recovery, as well as 
the  preparations  of  a  2021  financial  package  under  WBIF  for  the  implementation  of  the 
Economic and Investment Plan. The participants also took stock of the achievements of the 
connectivity agenda with the region, which now includes 45 investment  projects, supported 
by EUR1 billion in EU grants that have leveraged EUR 3.8 billion EUR in loans. Regrettably, 
despite  good  technical  progress,  the  Western  Balkan  partners  were  not  able  to  conclude 
several important agreements related to the Common Regional Market and CEFTA, because 
of bilateral and status issues. The participating Member States and the Commission called for 
a  constructive  approach  to  making  progress  on  the  Common  Regional  Market,  which  will 
help the region take full advantage of the Economic and Investment Plan.  In July 2021, the 
regional agreement on roaming fees signed at the April 2019 Western Balkans digital summit 
in Belgrade entered into force, enabling “roam like at home” (RLAH). 

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On  29  July  political  leaders  from  Albania,  North  Macedonia  and  Serbia,  met  to  launch  the 
Open Balkan Initiative, aiming to remove economic barriers between the three countries by 
2023.  Two  memorandums  were  signed  one  on  trade  facilitation  and  movement  of  persons, 
the second on steps towards a single labour market. 

Albania  has  continued  to  engage  in  a  constructive  way  in  dialogue  with  neighbouring 
countries  to  address  bilateral  issues  and  to  ensure  good  neighbourly  relations.  During  the 
COVID-19 pandemic, Albania sent 30 doctors and nurses to Italy to assist in coping with the 
pandemic.  In  December  2020,  Albania  provided  monetary  support  to  Croatia  after  the 
earthquake.  In  March  2021  during  the  shortage  of  vaccines  against  COVID-19,  Albania 
offered the Kosovo government to vaccinate in the Kukesi municipality the doctors from the 
Pristina hospital. 

Relations  with  Bosnia  and  Herzegovina  are  friendly  and  without  open  issues.  In  October 
2020,  the  Chairman  of  Bosnia  and  Herzegovina’s  Presidency  visited  Albania.  In  2020, 
Bosnia and Herzegovina expressed its intention to open a resident Embassy in Albania.  

Albania’s  relations  with  Kosovo  remain  good  overall.  In  October  2020,  both  governments 
met  and  signed  14  agreements,  mainly  on  economic  cooperation  and  connectivity.  In 
December 2020, the Acting Kosovo President visited Albania. Albania continues to support 
the resumption of the EU-sponsored Kosovo-Serbia dialogue.  

Relations  with  Montenegro  remain  good  politically.  The  two  countries  cooperate  on  EU 
enlargement,  NATO,  the  Berlin  Process,  the  Trilateral  Initiative  Albania–Montenegro–
Croatia,  and  other  regional  and  international  initiatives.  Albania  concluded  a  cultural 
agreement with Montenegro regarding the Marubi museum in Shkodra. 

Relations  with  North  Macedonia  remained  good,  including  with  frequent  high-level  visits 
from  both  sides.  In December 2020, the Prime Minister of North  Macedonia, together with 
the  Minister  of  Education  of  North  Macedonia,  visited  Pustec,  an  Albanian  village.    A 
cultural and information centre opened in Tirana at the end of 2020, implementing a bilateral 
agreement signed with North Macedonia in April 2019.  

The  relation  with  Serbia  remains  good.  In  January  2021,  the  bilateral  agreement  signed  in 
November 2020 on the free movement of citizens with biometric ID cards entered into force. 
Trade reached a volume of €233 million in 2020. 

Albania  has  considerably  strengthened  its  relations  with  Turkey  over  the  reporting  period. 
During  his  visit  to  Turkey  in  January  2021,  the  Prime  Minister  signed  a  joint  political 
declaration  on  the  establishment  of  the  High-Level  Strategic  Cooperation  Council  with  the 
Turkish President, thus upgrading the bilateral relations at the level of strategic partnership. 
In addition, five bilateral agreements were signed with a focus on security and fight against 
terrorism, education and cultural  heritage as  well as cooperation in  the health field.  Turkey 
provided  support  to  the  country  in  facing  the  COVID-19  pandemic.  In  April  2021,  a  new 
hospital  funded  by  the  Turkish  Government  in  the  Fier  area  was  inaugurated  with  much 
publicity.  The  Turkish  Government  supported  the  construction  of  522  apartments  in  the 
aftermath  of  the  November  2019  earthquake  in  Albania.  Turkey  continues  to  exercise 
pressure on Albania to deliver on dismantling the so-called Gülen movement in the country.   

Relations with Greece remained generally good with both sides agreeing to refer the issue of 
delimitation  of  the  maritime  border  to  the  International  Court  of  Justice  in  The  Hague.  In 
October 2020, both sides agreed to formally upgrade bilateral relation beyond the Treaty of 
Friendship and Cooperation (in force) with a Declaration of Strategic Partnership. In January 
2021,  the  Prime  Minister  of  Albania  visited  his  counterpart  in  Athens.  In  January  2021, 
Greece and Albania signed an agreement establishing a new joint centre on the land border 

69 

 
 
between  the  two  countries,  aimed  at  strengthening  cooperation  between  police  forces  and 
customs offices to tackle irregular migration and fight against cross-border crime. In January 
2021, both parties signed an agreement on the €2.5 million donation from Greece to rebuild a 
vocational  school  in  Tirana  as  the  contribution  of  Greece  to  the  post-earthquake 
reconstruction. Greek minority rights in general and more particularly property rights of this 
minority remain a subject of disagreement in the bilateral relation.  

Relations with Italy remained very good. Political dialogue intensified with high-level visits 
on both sides. In November 2020, both sides signed an agreement establishing a Permanent 
Joint Committee and foreseeing closer economic cooperation, including on energy, tourism, 
transport,  infrastructure,  agriculture.  In  March  2021,  the  Prime  Minister  of  Albania  visited 
Bari  to  mark  the  30th  anniversary  of  the  first  ‘exodus’,  when  a  first  wave  of  Albanian 
migrants crossed the Otranto strait to Italy after the fall of communism. Bilateral cooperation 
in  the  field  of  justice  and  security,  as  well  as  in  the  fight  against  illicit  trafficking  and 
narcotics remains good. 

4. 

ABILITY TO ASSUME THE OBLIGATIONS OF MEMBERSHIP 

CLUSTER 2: INTERNAL MARKET  

his  cluster covers: free movement  of  goods (Chapter 1); freedom  of movement  for workers 
(Chapter  2);  right  of  establishment  and  freedom  to  provide  services  (Chapter  3);  free 
movement  of  capital  (Chapter  4);  company  law  (Chapter  5);  intellectual  property  law 
(Chapter 7); competition policy (Chapter 8); financial services (Chapter 9); and consumer and 
health  protection  (Chapter  28).  This  cluster  is  key  for  Albania’s  preparations  for  the 
requirements  of the EU’s  internal  market  and is  of high  relevance  for  early integration  and 
the development of the Common Regional Market. 

Albania is moderately prepared in most of the areas of the internal market, namely the free 
movement of goods, services and capital, competition policy, and financial services, whereas 
its  preparations  are  at  an  early  stage  on  consumer  and  health  protection.  Albania  has  made 
some progress in particular by adopting of a law on compulsory insurance in transport and in 
further  aligning  its  banking  legislation,  but  the  State  Aid  Commission  needs  to  be  made 
independent  and  sufficiently  resourced.  Preparations  are  at  an  early  stage  on  consumer  and 
health protection, as the country made no progress on health outside its COVID-19 response. 
Albania needs to implement the One Health approach and to ensure that everyone has quality 
healthcare coverage.  

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.  Progress  was  limited  over  the  reporting  period  on  alignment  with  the 
EU  "new  and  global  approach"  product  acquis.  While  there  was  progress  regarding  the 
general  principles  and  on  structures  related  to  the  quality  infrastructure,  last  year’s 
recommendations  remain  valid,  as  efforts  are  needed  to  ensure  more  legislative  alignment 
and to strengthen enforcement. 

In the coming year, the country should in particular: 

→  complete  the  alignment  of  its  legislation  with  the  EU  acquis  relevant  to  the  quality 
infrastructure; 

70 

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

General principles 

Albania removed the remaining measures in place that affected the production, distribution 
and  marketing  of  industrial  products.  Over  the  reporting  period,  measures  regarding  (i) 
price of products, (ii) import licences or permits for imported goods and (iii) the obligation to 
have storage facilities in specific areas, were all repealed. Plans for further alignment with the 
EU acquis are set out in the 2019-2021 national plan for European integration, and the 2020 
consumer protection and market surveillance strategy. 

Non-harmonised area 

Albania  still  has  no  action  plan  for  screening  national  technical  regulations  for  compliance 
with Articles 34-36 of the Treaty on the Functioning of the European Union (TFEU).  

Harmonised area: quality infrastructure 

Albania’s legislation on accreditation and market surveillance is partially aligned with the EU 
acquis.  Administrative  structures  exist  to  deal  with  technical  regulations,  standardisation, 
conformity assessment, metrology, accreditation, and market surveillance. The recruitment of 
specialised staff to the Market Surveillance Inspectorate is still ongoing. Albania has mutual 
cooperation  agreements  on  accreditation,  standardisation  and  conformity  assessment  with 
countries in the region and other non-EU countries. 

On standardisation, 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  the  European  Committee  for 
Electrotechnical Standardisation (CENELEC), and an associate member of the International 
Electrotechnical  Commission  (IEC).  National  standards  are  adopted  in  conformity  with 
European  standards  (CEN,  CENELEC  and  ETSI  standards).  In  the  reporting  period,  2  449 
European and international standards were adopted (including 899 CEN, 486 CENELEC, 500 
ETSI ones, as well as 389 ISO, and 175 IEC standards). In total, the GDS has adopted about 
95 % of all standards issued by CEN and CENELEC.  

National legislation on the accreditation of conformity assessment bodies is partially aligned 
with the EU acquis. It regulates the functioning of the General Directorate of Accreditation 
(GDA), its accreditation board, its technical committees and various procedural matters. The 
General  Directorate  of  Accreditation  (GDA)  was  restructured  in  January  2021,  with  an 
increase  in  the  number  of  staff  from  14  to  20  employees.  There  are  now  88  accredited 
conformity  assessment  bodies  (37  testing  laboratories,  4  medical  laboratories,  1  calibration 
laboratory,  6  certification  bodies  of  management  system,  12  certification  bodies  of  persons 
and  28  inspection  bodies).  The  GDA  is  a  signatory  of  the  European  Cooperation  for 
Accreditation  Multilateral  Agreement  (EA  MLA)  in  the  fields  of  inspections  and 
management systems certification, testing and, since 26 May 2020, certification of persons. It 
is  also  a  full  member  of  the  International  Laboratory  Accreditation  Organisation  Mutual 
Recognition Agreement (ILAC MRA) in the field of inspection and has a mutual recognition 
agreement with ILAC. The General Directorate of Metrology maintained its capacity of 104 
employees.  

The state inspectorate for Market Surveillance (SIMS) was restructured in June 2020; this 
envisages  an  increase  from  45  up  to  80  staff.  It  should  continue  to  increase  staff  numbers, 
including inspectors. During the reporting period SIMS carried out 819 inspections, leading 
to  55  administrative  measures,  including  13  fines,  11  warnings  and  37  urgent  measures 

71 

 
 
(prohibition of trading and destruction of products). In total 8 057 products were controlled, 
of which 118 had non-conformities; 9 products (978 units) were banned from trading. 

Harmonised area: sectoral legislation 

Albania’s  ‘new  and  global  approach’  product  legislation  is  designed  to  be  fully  aligned 
with the EU acquis on non-automatic weighing instruments, medical devices and low voltage 
equipment  (following  government  decisions  adopted  in  the  reporting  period).  However, 
alignment has not yet started on cableways, gas appliances, simple pressure vessels, outdoor 
equipment  noise  emissions,  explosive  atmospheres  equipment,  construction  products, 
recreational craft, eco-design and energy labelling. 

As regards the ‘old approach’ product legislation, Albania finalised a legal gap analysis on 
alignment with the EU old approach acquis and the procedural measures. National legislation 
is partly aligned with the EU acquis on detergents, pre-packaging, textiles, footwear, crystal 
glass and units of measurement, and is designed to be aligned with Registration, Evaluation, 
Authorisation  and  Restriction  of  Chemicals  (REACH)  and  on  chemical  classification, 
labelling  and  packaging  (CLP)  it  is  aligned  with  the  United  Nations  Globally  Harmonised 
System of Classification and  Labelling  of Chemicals.  It  is  not  aligned on Good  Laboratory 
Practice  (GLP)  or  medical  product  pricing.  Progress  was  made  in  the  reporting  period  to 
ensure partial alignment with the EU acquis on aerosol dispensers. 

Albanian  legislation  is  not  aligned  on  drug  precursors,  though  the  list  of  controlled 
substances tallies with the relevant lists in the EU acquis. On procedural measures, Albania 
is  partly  aligned  on  firearms,  textile  labelling  and  mixtures,  and  the  pricing  of  medicinal 
products. Albania also made some progress towards partial alignment with the EU acquis on 
defence  and  security  procurement.  The  legislation  on  defence  products  and  the  return  of 
cultural  objects  unlawfully  removed  from  the  territory  of  a  Member  State  is  partly 
aligned with the EU acquis. 

Chapter 2: Freedom of movement of workers 

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

Albania has some level of preparation in freedom of movement for workers. Some progress 
was  made  on    implementation  of  the  2020  report’s  recommendations  regarding    free 
movement  of  family  members  of  EU  citizens,  conclusion  of  new  social  security  bilateral 
agreements and the development of the IT system for mapping job seekers vacancies that is 
preparing  the  implementation  of  the  European  network  of  employment  services  (EURES) 
upon accession. In the coming year, Albania should: 

  continue the development of the IT system to enable connection to EURES; 

  continue  negotiating  and  implementing  new  bilateral  agreements  on  social  security, 

notably with EU Member States.  

As regards access to the labour market, EU citizens are eligible to work in Albania without 
a work permit,  in  line with the law on  foreigners under  which nationals  of an EU Member 
State or Schengen country, legally residing in Albania do not need a work permit or business 
registration  certificate.  Immigration  admission  policies  do  not  present  obstacles  to  the 
permanent  settlement  of  EU  workers’  family  members.  Parliament  adopted  in  2020  an 
amendment to the law on foreigners, enabling family members of EU citizens, irrespective of 

72 

 
 
 
their citizenship, to work in Albania without a work permit in line with the EU acquis in this 
area. 

In  preparation  for  joining  the  European  network  of  employment  services  (EURES), 
Albania  has  established  an  integrated  database  for  its  employment  services.  This  will 
facilitate  exchanges  of  information  between  IT  departments  on  civil  status,  the  tax  system, 
the  compulsory  healthcare  system  and  the  economic  assistance  system.  A  new  National 
Agency for Employment and Skills service IT system was developed to enable connection to 
EURES,  upon  accession.  The  Unit  for  Migration  Services  and  Labour  Relations  under  the 
National Agency for Employment and Skills has also the tasks related to EURES. Under the 
new system of employment services, the national list of occupations has been supplemented 
with competencies in line with European skills/competences, qualifications and occupations 
(ESKO).   

On  the  coordination  of  social  security  systems,  Albania  has  bilateral  agreements  in  place 
with  Austria,  Belgium,  Czechia,  Germany,  Hungary,  Luxembourg,  North  Macedonia, 
Romania, and Turkey. The agreement with Kosovo is under revision. The negotiations with 
Bulgaria for a new agreement were concluded in March 2021, expected to enter into force in 
2022.  Exchanges  with  Croatia,  France,  Spain  and  Montenegro,  on  coordinating  social 
security schemes have taken place. A technical cooperation agreement is in place to continue 
negotiations  for  a  bilateral  agreement  with  Italy.  Negotiations  and  implementation  of  new 
bilateral agreements on social security between Albania and EU Member States have yet to 
be fostered.  

Chapter 3: Right of establishment and freedom to provide services 

EU natural and legal persons have the right to establish themselves in any Member State and 
to provide cross-border services. For certain regulated professions, there are rules on mutual 
recognition of qualifications. Postal services are open to competition since 2017. 

Albania  is  moderately  prepared  in  the  right  of  establishment  and  freedom  to  provide 
services.  Some  progress  was  achieved  in  the  reporting  period,  in  particular  through  
initiating  the  screening  exercise  of  the  legislation  to  be  aligned  with  the  acquis  in  some 
sectors.  The  country  should  focus  on  fully  implementing  the  following  Commission’s 
recommendations from 2020, which still remain valid. 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; 

  step  up  efforts  to  align  its  legislation  with  the  EU  acquis  and  ensure  appropriate 
institutional capacity in the area of mutual recognition of professional qualifications. 

On  the  freedom  of  establishment  and  the  free  movement  of  services,  the  Albanian 
legislation  is  broadly  in  line  with  the  Services  Directive  when  it  comes  to  mining.  The 
legislation  on  the  veterinary  sector  still  requires  amendment,  notably  to  allow  for  the 
licensing  of  private  veterinary  clinics  and  hospitals.  The  legislation  regulating  the  legal 
profession  (lawyer,  notary  and  mediator)  is  partially  aligned  with  the  EU  acquis  while 
remaining restrictions apply in particular to public notaries and private bailiffs. The screening 
of legislation is managed and monitored by the Ministry of Finance and Economy (MOFE), 
which  follows  a  sector-by-sector  approach  whereby  it  has  identified  34  service  sectors  and 
around 125 subsectors. Currently, the process is focusing on sectors covered by MOFE, the 
Ministry  of  Agriculture  and  Rural  Development  and  the  Ministry  of  Tourism  and 

73 

 
 
Environment.  In December 2020, Albania concluded the first stage of screening of selected 
11 sectors out of 20 identified 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 desks throughout the country 
and virtual desks on the government`s e-Albania portal. As defined in the law on services, the 
e-Albania.al  governmental  portal  serves  as  a  single  contact  point  for  electronic  public 
services.  

On postal services, the national legislation is aligned with the EU Postal Services Directive 
since  2017,  when  the  postal  market  was  opened  to  competition.  Partial  alignment  with  the 
Regulation on cross-border parcel delivery services has recently been completed. Albania is 
preparing  a  new  strategy  on  postal  services  2021-2025  setting  objectives  to  improve  postal 
sector performance in line with EU acquis. There is one designated universal service provider 
(Albanian Post S.A.), for a period of 5 years starting in July 2020, and 25 other postal service 
providers on the market. The Electronic and Postal Communication Authority (AKEP) is the 
independent national regulatory authority for the postal sector.  

No progress was made during the reporting period on aligning the professional qualifications 
framework with the EU acquis on the mutual recognition of professional qualifications. A 
road map on professional qualifications is planned to be finalised in 2022. Albania needs to 
strengthen institutional capacity in this area.  

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  by  the  implementation  of  the  2020  payment 
systems  legislation  that  entered  into  force  in  January  2021.  As  regards  last  year’s 
recommendations, Albania continued to implement the action plan on fulfilling some of the 
Moneyval report recommendations. There was no progress in enabling EU citizens to acquire 
agriculture and pasture land. 

In the coming year, Albania should in particular: 

  continue  implementing  the  recommendations  of  the  Moneyval  report  and  aligning  with 

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

  take short- and medium-term measures to address the commitment under the Stabilisation 
and  Association  Agreement  (SAA)  on  granting  rights  to  acquisition  of  land  by  EU 
citizens, which is outstanding since 2016. 

As  regards  capital  movements  and  payments,  the  expiry  date  for  the  law  on  strategic 
investments  which  provides  special  protection  to  foreign  investments  was  extended  until 
December 2021. The unified law on investments has yet to be adopted and the acquisition of 
real estate by foreigners still remains subject to restrictions: foreigners, including EU citizens, 
are  not  allowed  to  acquire  agricultural  land,  forests,  meadows  or  pasture  lands.  Albania  is 
therefore late in delivering on its commitment under the 2006 Stabilisation and Association 
Agreement  (SAA)  to  amend  the  arrangements  for  the  acquisition  of  property  by  EU 
nationals/entities, a step due since 2016. Provisions regulating the acquisition of real estate by 
foreigners  remained  unchanged  and  uncertainties  over  ownership  rights,  in  addition  to  the 
negative impact of the COVID-19 pandemic, continued to discourage investment.  

74 

 
 
On  payment  systems,  foreign  banks  can  open  branches  and  agencies  in  Albania  and  offer 
cross-border payments. The Bank of Albania (BoA) Regulation governs non-cash payments 
on the payment system and instruments. Payment transactions can be carried out not only by 
banks  but  also  by  non-bank  financial  institutions  and  savings  and  loans  associations.  The 
measures that the BoA put in place in March 2020 due to COVID-19 lockdown to reduce the 
costs of payment systems services and promote home banking, remain in place. The legal and 
regulatory framework for electronic payments in Albania remains the same for national and 
cross-border payments.  

The  National  Payment  System  Committee  is  open  to  representatives  of  non-bank  financial 
institutions  and  payment  system  operators,  and  it  is  implementing  Albania’s  national  retail 
payments strategy (NRPS) for 2018-2023, notably via with the adoption of the 2020 law on 
payment services, which aims at alignment with the Payment Service Directive II (PSD II). 
The law, which will bring the full implementation effects to the market by July 2022, follows 
the  PSD  II  approach  on  transparency  conditions  and  information  requirements  for  payment 
services. One of the objectives of the strategy yet to be achieved is the increase of financial 
literacy in Albanian population, with adult account ownership ratio of 70% by 2023. 

s  regards  the  fight  against  money  laundering,  Albania  continues  its  efforts  to  address  the 
deficiencies  in  technical  compliance  identified  in  the  2018  Moneyval  mutual  evaluation 
report on Albania. Albania is on the Financial Action Task Force (FATF) list of jurisdictions 
under  increased  monitoring  since  February  2020.  Albania  made  a  high-level  political 
commitment to implement the FATF action plan, which will allow Albania’s removal from 
this  list.  The  action  plan  covers  inter  alia  the  identification  of  money  laundering  risks, 
registration of properties, transparency of beneficial ownership and increased convictions and 
confiscations.    Amendments  to  the  law  on  money-laundering  to  align  it  legislation  on  anti-
money laundering with the EU acquis have been prepared by the Council of Ministers. The 
beneficial ownership register has been set-up  and is  in  the process  of being populated with 
data from businesses and non-governmental organisations.   

Albania  is  working  towards  further  alignment  of  its  legislation  with  the  EU  acquis  on  the 
prevention of the use of the financial system for the purposes of money laundering or terrorist 
financing.  Albania  continues  to  implement  the  "Moneyval  package"  which  covers  i)  the 
prevention  of  money  laundering  and  financing  of  terrorism,  ii)  measures  against  terrorism 
financing, iii) tax procedures and iv) the National Registration Centre and the adoption of a 
new  law  on  the  administration  of  seized  assets.  A  new  law  on  international  restrictive 
measures was adopted in November 2020.  

Albania  has  in  place  the  Bank  of  Albania  regulatory  package  that  strengthened  the  risk 
management  standards  and  licensing  requirements  of  financial  institutions,  including  non-
banks  and  foreign  exchange  bureaus,  following  the  Moneyval  recommendations.  In  April 
2021,  Moneyval  adopted  its  second  enhanced  follow-up  report  on  Albania,  which  granted 
Albania  an  upgrade  of  its  rating  on  one  of  the  FATF  recommendations.  A  study  on  the 
establishment of the Asset Recovery Office was finalised in July 2020. After the law on the 
Register of beneficiary owners was adopted in July 2020, the register became operational at 
the end of June 2021, with data registered by businesses and NGOs. The Albanian Financial 
Intelligence Unit is in the process of increasing its staff from 39 to 45. 

The BoA carried out inspections of 74 foreign exchange offices (FEO) in 2020, of which 4 
led it to proposing license revocation and 16 revealed substantial discrepancies. This led the 
to  provide  relevant 
BoA 
recommendations and/or assistance to 11 FEOs. Albania ratified the International Convention 
for  the  Suppression  of  Counterfeiting  Currency  in  November  2019.  In  2021,  the  Financial 

take  administrative  measures, 

including  fines,  and 

to 

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Supervisory Authority started an assessment on the regulations related to Virtual Assets (VA) 
and  Virtual  Asset  Service  Providers  (VASPs)  and  cryptocurrencies  in  order  to  adjust  them 
according  to  the  FATF  recommendations.  The  Albanian  Financial  Intelligence  Unit  (FIU) 
received 1 409 suspicious transaction reports in 2020, slightly lower than in 2020; 268 cases 
were referred to the law enforcement agencies, similar to 2020.  

Chapter 6: Company law 

The  EU  has  common  rules  on  the  formation,  registration  and  disclosure requirements  of  a 
company,  with  complementary  rules  for  accounting  and  financial  reporting,  and  statutory 
audit. 

Albania is moderately prepared in the field of company law. Some progress was made in 
the  reporting  period,  in  particular,  by  improving  the  transparency  of  company  financial 
statements  in  the  business  register,  and  further  alignment  of  its  framework  with  the  EU 
acquis  in  the  area  of  non-financial  and  corporate  governance  reporting.  There  was  no 
progress however on the company law recommendation. 

In the coming year, Albania should in particular: 

  review  the  existing  legislation  in  the  area  of  company  law  with  a  view  to  identifying 

amendments needed to complete alignment with the EU acquis,  

  further  align  the  legal  framework  on  accounting  and  audit  with  the  latest  EU  acquis  in 

these areas.  

Although  there  is  some  alignment  with  the  EU  acquis  in  a  range  of  company  law  areas, 
including  on  takeovers  and  cross-border  mergers,  there  was  no  legislative  progress  in  the 
reporting period. Further alignment is needed with the 2019 company law acquis on the use 
of digital tools and on cross-border operations, as well as with rules on the encouragement of 
long-term shareholder engagement. The National Business Centre is responsible for company 
registration, allowing free online registration and online access to data (some services related 
to  registration  of  legal  entities  are  offered  only  online  on  the  e-Albania  electronic  service 
window  since  1  January  2020  and  the  work  is  ongoing  to  enable  other  services).  Since 
February  2020  Albania  is  part  of  the  commercial  register  in  the  South  Eastern  Europe 
Regional  Business  Registries  Portal  (BIFIDEX),  which  has  launched  its  first  set  of  data 
services in May 2021. 

On  transparency,  the  Law  on  capital  markets,  which  entered  into  force  on  1  September 
2020, provides specific rules on transparency for listed companies in areas related to initial 
reporting and financial reporting including fines in case of non-compliance. 

In  the  area  of  corporate  accounting,  the  Law  on  accounting  and  financial  statements  is 
partially  aligned  with  the  EU  Accounting  Directive  (e.g.  on    company  size,  management 
report  requirements,  exemptions  for  small  companies  from  the  obligation  for  detailed 
disclosures, and rules for large and public interest economic entities active in the extractive or 
logging  industries).  The  National  Accounting  Council  (NAC)  monitors  the  enforcement  of 
financial  reporting  and  accounting  standards.  In  June  2020,  it  adopted  guidelines  on  non-
financial reporting in line with the Commission communication in this area to  comply with 
the  EU  Directive  on  disclosure  of  non-financial  and  diversity  information  by  certain  large 
undertakings and groups. In December 2020, it published recommendations on the quality of 
corporate governance reporting following the relevant Commission recommendation. Albania 
also took some steps to ensure transparency of financial statements. Since 2019, the National 
Business  Centre  has  an  electronic  reporting  system  for  filing  and  publishing  financial 
statements. In 2020, the Law on the Register beneficiary owners was adopted and the register 

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was populated with data by businesses and NGOs by the end of June 2021. On auditing, the 
Public Oversight Board (POB) is the independent competent authority for quality assurance 
(with its own budget). In the reporting period, the Investigation and Disciplinary Commission 
of  statutory  auditors  issued  10  disciplinary  measures  (nine  fines  and  one  temporary  licence 
suspension).  Albania  should  further  strengthen  POB  capacity  and  align  with  EU  statutory 
audit rules. 

Chapter 7: Intellectual property law 

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

Albania  has  some  level  of  preparation/is  moderately  prepared  on  intellectual  property 
rights.  Limited  progress  was  made  during  the  reporting  period,  in  particular  with  the 
legislative  alignment  with  the  EU  acquis  in  the  area  of  copyright  and  other  related  rights. 
Recommendations from the previous year were only partially met and remain valid. 

In the coming year, Albania should in particular: 

  further align its legislation on copyright and neighbouring rights with the EU acquis;  
  improve  the  functioning  of  collective  management  organisations  and  the  payment  of 

royalties to right holders; 

  further align legislation on industrial property rights and the IPR enforcement system.  

In the area of copyright and neighbouring rights, the two main bodies responsible are the 
General  Directorate  of  Industrial  Property  (GDIP),  which  is  in  charge  of  registering, 
administrating and promoting intellectual property  objects  and the Copyright  Directorate of 
the  Ministry  of  Culture.  The  National  Copyright  Council,  consisting  of  five  members 
appointed  by  the  Minister  for  Culture,  is  responsible  for  certifying  the  tariff  methodology. 
The staff recruitment of the Copyright Directorate was completed in February 2021. 

In  the  reporting  period,  draft  amendments  to  the  law  on  copyright  and  other  related  rights 
were  prepared,  which  aim  to  further  align  the  legal  framework  with  the  EU  acquis  and 
regulate the functioning  of Collective Management  Organisations (CMO). Furthermore, the 
Minister  of  Culture  issued  guidelines,  which  aim  at  improving  the  process  of  issuing  of 
licenses for all categories of right  holders not  represented by CMO. The functioning of the 
collective  management  system  and  the  payment  of  royalties  to  right  holders  needs  to  be 
further improved. 

On industrial property rights, a law on trade secrets was adopted in July 2021 to align the 
legal framework with the EU acquis in this area. 

In  2020,  the  number  of  applications  for  registration  of  trademarks  continued  to  rise, 
amounting to 1,164 national applications and 2,936 international applications. As for patents, 
898  patent  applications  were  filed  at  the  GDIP  in  2020,  of  which  12  (double  compared  to 
2019)  were  national  patent  applications  with  Albanian  national  applicants,  and  885  patent 
applications were patents issued by the European Patent Office seeking protection in Albania. 
The GDIP participated in 18 court proceedings during 2020. 

The Copyright Division of the State Inspectorate for Market Surveillance (SIMS) carried out 
384  inspections  resulting  in  28  administrative  measures  (13  fines  and  15  warnings).  The 
SIMS  Industrial  Property  Division  carried  out  12  inspections  and  issued  2  administrative 

77 

 
 
fines. 

The customs administration suspended the release of more than 23,000 products suspected of 
infringing IPR. The high number of counterfeit products in the country remains a cause for 
concern. 

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  limited  progress  during  the  reporting  period,  in  particular  with  the  adoption 
several  guidelines  by  the  Albanian  Competition  Authority  (ACA),  including  the  ones  on 
effective  enforcement  and  ensuring  the  proper  functioning  of  the  market.  However,  no 
progress was made in improving legislative alignment with the EU acquis in the area of State 
aid.  Despite  recommendations  in  previous  years,  the  operational  independence  of  the  State 
aid  Commission  (SAC)  has  not  yet  been  ensured.  Its  enforcement  record  needs  to  be 
significantly improved. 

In the coming year, the country should in particular: 

  ensure  the  operational  independence  of  the  SAC  and  significantly  increase  the 

administrative capacity of SAC’s secretariat; 

  further align the legislative framework in the area of State aid with the EU acquis; 

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

Antitrust and mergers 

Albania’s legislative framework is broadly in line with the EU acquis and the Stabilisation 
and  Association  Agreement  (SAA).  The  Law  on  the  protection  of  competition  is  largely 
aligned  with  Article  101  TFEU  (restrictive  agreements)  and  Article  102  TFEU  (abuses  of 
dominant  position).  It  also  provides  for  prior  control  of  mergers,  in  line  with  the  Merger 
Regulation. Implementing legislation is broadly in line with the relevant EU regulations and 
Commission guidelines. In the reporting period, the Albanian Competition Authority (ACA) 
approved  guidelines  on  effective  enforcement  and  ensuring  the  proper  functioning  of  the 
market,  further  aligning  the  framework  with  the  acquis  in  this  area,  as  well  as  on  best 
practices for the submission of economic evidence and data. 

As regards the institutional framework, the ACA is responsible for implementing the Law 
on  the  protection  of  competition.  It  is  an  operationally  independent  authority  reporting  to 
Parliament.  It  can  adopt  implementing  legislation,  impose  fines  and  remedies,  prohibit 
mergers or authorise them with or without conditions. It can conduct sector enquiries and, on 
its  own  initiative,  issue  opinions  and  recommendations  on  draft  laws  that  may  affect 
competition. A leniency programme is in place for companies providing information on cartel 
cases.  Parties  may  appeal  against  the  ACA’s  decisions  before  the  courts.  As  regards 
enforcement  capacity,  the  ACA  has  maintained  its  number  of  staff  to  46  and  its  staff 

78 

 
 
 
benefitted from training on international best practices. On implementation, in the reporting 
period  ACA  took  131  decisions,  including  11  on  prohibited  agreement,  8  on  abuse  of 
dominant  position  and  29  authorising  concentrations.  In  the  reporting  period,  the  ACA 
concluded sector enquiries in the higher education and hospital services sectors and continued 
investigations in the following sectors investigations, including dawn raids, in the following 
sectors:  printing  services,  liquid  gas,  fuels,  fertilisers,  medical  devices,  and  non-banking 
financial  entities.  The  ACA  should  continue  to  strengthen  the  enforcement  of  competition 
rules. 

State aid 

The legislative framework on State aid is broadly in line with the EU acquis and the SAA. 
The  Law  on  State  aid  largely  reflects  Articles  107  and  108  TFEU.  The  implementing 
legislation is partially aligned with the EU acquis only in some areas e.g. the General Block 
Exemption  Regulation.  Further  alignment  with  EU  implementing  legislation  on  State  aid 
control is needed. 

As regards the institutional framework, the State Aid Commission (SAC) is responsible for 
implementing  the  Law  on  State  aid.  Its  operational  independence,  which  is  required  by  the 
SAA, remains to be ensured. Under the Law on State aid, new aid measures must be notified 
to the SAC, which must find them compatible before they can be put in place. The SAC can 
order the recovery of illegal and incompatible aid but has not done so to date. Its decisions 
are subject to court appeal. 

The enforcement capacity of the SAC remains insufficient as the staffing of its secretariat 
needs to be significantly increased. On implementation, the track record on State aid control 
remains poor. In the reporting period the SAC adopted eight decisions on notified State aid 
schemes,  three  of  which  related  to  COVID-19  measures.  No  negative  or  recovery  decision 
was taken.  It is important to step up advocacy activities among aid grantors to ensure prior 
notification of aid measures.  The SAC needs to ensure the implementation of the State aid 
rules also in large projects involving Albania and other countries.  

Liberalisation 

The  Law  on  State  aid  applies  to  all  legal  and  natural  persons  performing  an  economic 
activity. There has been no investigation of State aid for public undertakings or undertakings 
with special or exclusive rights.  

Chapter 9: Financial services 

EU rules aim at ensuring fair competition 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  on  last 
year’s recommendations was made by the adoption of the Law on compulsory insurance in 
the  transport  sector  and  in  further  aligning  the  legislation  on  bank  recovery,  resolution  and 
supervision  and  on  post-trading.  There  was  limited  progress  on  the  implementation  of  the 
non-performing loan resolution strategy.  

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; 

79 

 
 
  ensure full implementation of the non-performing loan resolution strategy by all relevant 

actors. 

On banks and financial conglomerates, the  Bank of Albania (BoA) continued to  align its 
banking  regulation  with  Basel  III,  notably  on  the  liquidity  coverage  ratio  and  the  macro-
prudential  framework.  Albania  continued  to  monitor  the  investment  and  performance  of 
financial  assets  of  the  resolution  fund,  based  on  the  quarterly  reporting  from  its  Deposits 
Insurance Agency (the resolution fund administrator). Relevant implementing legislation was 
adopted on the functioning of the Committee of Resolution Fund, on minimum requirements 
of regulatory capital instruments and eligible liabilities, on the operationalisation of bail and 
on an amended regulation on resolution plans, designed to align to the relevant regulation of 
the European Banks Authority.  

In April 2021, the Bank of Albania adopted the regulation “On the contractual recognition of 
write-down and  conversion powers” to  further align with  the relevant  EU  acquis. The non-
performing loan ratio continued to decrease from 8.4% in December 2019 to 7.9% in April 
2021,  mainly  due  to  write-offs  and  some  loan  restructuring.  BoA  monitors  the  non-
performing loans ratio, notably in view of the third extension of the COVID-19 moratorium 
until  to  the  end  of  March  2021.  Further  actions  on  credit  scoring  are  still  needed.  Full 
the  Non-performing  Loans  Resolution  Strategy  requires  further 
implementation  of 
improvement of the credit registry and full implementation of the bankruptcy law. Part of the 
collateral  execution  system  is  currently  the  subject  of  court  proceedings,  which  reduces  its 
efficiency.  

Albania has a system to identify systemically important banks that is similar to EU practice. 
BoA  approved  the  investment  policy  for  financial  assets  of  the  resolution  fund.  New 
regulations on the leverage ratio of banks and on the net stable funding ratio of banks, which 
aim at  further approximation of bank legislation with  Basel  III,  were adopted in  November 
and December 2020. These will enter into force in January 2022. In response to the COVID-
19  emergency,  in  March  2020,  BoA  announced  a  temporary  change  on  provisioning 
requirements,  enabling  clients  to  ask  banks  and  other  financial  institutions  to  defer  loan 
instalments  without  penalties.  Loan  classification  relaxation  measures  and  provisioning  for 
loans  were  restructured  between  12  March  and  December  2020,  then  were  extended  until 
March  2021.  BoA  also  temporarily  suspended  the  2019  and  2020  dividend  distribution  for 
banks, in order to boost capital and support lending. The implementation deadline of the “On 
out-of-court treatment of distressed borrowers by banks” regulation was postponed to January 
2022. In March 2021 the Albanian Register of Securities was approved as indirect participate 
to  the  Albanian  Interbank  Payment  System  for  large  value  payments.  This  is  designed  to 
render the post-trade system fully operational.  

In the area of insurance and occupational pensions, amendments to the law on compulsory 
insurance  in  the  transport  sector  entered  into  force  in  July  2021,  and  are  designed  to  align 
with  the  relevant  EU  acquis.  It  opted  for  voluntary  implementation  of  the  bonus  malus 
system by insurance agencies. Implementation of the 2018-2020 Strategy on consumers and 
investors'  confidence  in  the  supervised  markets  continued  through  activities  to  improve 
public  financial  education  and  consumer  awareness.  In  July  2020  the  Albanian  Financial 
Supervisory Authority (AFSA) board adopted a decision on the organisation of the Insurance 
Market  Supervision  Department  into  two  directorates:  The  Insurance  Market  Supervision 
Directorate and the Risk Management Directorate, maintaining the total number of staff at 96 
employees.  To  ensure  financial  sustainability  in  the  face  of  the  COVID-19  pandemic 
situation,  the  AFSA  decided  in  March  2021  to  require  insurance  companies  to  suspend  the 
distribution of profit for 2020, in any form of dividends or other form of payments.  

80 

 
 
In  the  area  of  financial  market  infrastructure,  the  Albanian  Stock  Exchange,  which  is  a 
private entity, continues to operate with government bonds only. The public stock exchange 
remains suspended. A Central Securities Depository (AFISAR) is in place, operated by BoA. 
The  Albanian  Securities  Registry  (ALREG),  a  private  company,  ensures  the  settlement  of 
non-government  securities  since  December  2019.  According  to  the  agreement  between  the 
BoA  and  the  AFSA,  BoA  is  responsible  for  minimising  the  systemic  risk,  while  AFSA  is 
responsible  for  investor  protection.  In  March  2021,  the  Board  of  AFSA  approved  the 
regulation on the guarantee fund of the ALREG; i.e. assets held by the ALREG Register on 
behalf  of  clearing  and  settlement  members,  for  the  purpose  of  securing/guaranteeing 
completed  transactions  on  stock  exchanges,  that  fail  to  be  settled  due  to  lack  of  monetary 
values and/or securities. In September 2020, the Law on Financial Markets entered into force, 
based on distributed ledger technology. The expiry period of the privatisation vouchers was 
extended until December 2021. Following the adoption of the Law on collective investments 
in April 2020, implementing acts were adopted on collective investments, suspension clauses, 
risk management, and licensing procedures. The Law on capital markets was adopted in May 
2020,  along  with  five  implementing  regulations.  These  partially  align  Albania’s  legal 
framework  with  MiFID  II,  and  EU  acquis  on  transparency,  market  abuse,  prospectuses,  on 
settlement and central securities depositaries.  

As  regards  securities  markets  and  investment  services,  AFSA  continues  to  supervise 
regulated  markets  in  accordance  with  the  Law  on  capital  markets.  Companies  were 
authorised to issue bonds for private offerings to institutional investors, their shareholders or 
individuals. The liquidity requirements for investment funds were strengthened.   

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 
no progress on last year’s recommendations. On public health, the COVID-19 pandemic has 
shown  an  increased  need  for  emergency  preparedness  and  to  enhance  the  capacity  of  the 
emergency health infrastructure. Significant progress still needs to be made to implement the 
One  Health  approach  and  all-hazard  health  preparedness,  and  more  needs  to  be  done  in 
general to strengthen the policy framework and ensure that everyone in Albania has quality 
healthcare coverage. There was some progress on alternative dispute resolution of consumers. 

In the coming year, the country should in particular: 

  strengthen  the  policy  framework  on  public  health  with  adoption  of  the  new  Health 
Strategy 2021-2030 and ensure its implementation and sustainability, including financial 
protection,  and  further  align  its  legislation  with  the  EU  health  acquis  on  substances  of 
human origin and on medicines for human and veterinary use; 

  use  the  lessons  learnt  from  the  COVID-19  pandemic  to  strengthen  all-hazard  health 
emergency preparedness, including threats beyond communicable diseases and responses 
both at central and local level; 

  continue  to  improve  access  to  health  and  services  for  disadvantaged  populations, 
including  Roma  and  Egyptian  minorities,  older  people,  people  with  pre-existing  mental 

81 

 
 
health  problems,  people  with  disabilities;  and  populations  in  rural  or  remote  areas, 
notably  for  women  and  girls  belonging  to  these  groups  who  are  often  subjected  to 
multiple forms of discrimination. 

Consumer protection  

On horizontal aspects, in 2020 Albania’s Consumer Protection Commission (CPC)  received 
55 complaints (45 by individual consumers, consumer organizations or local government, 10 
from  businesses)  while  during  Q1+Q2/2021  CPC  received  19  complaints,  out  of  which  18 
were from consumers and 1 from traders. In September 2020, an administrative penalty has 
been issued against a local company for non-compliance with consumers’ rights; 9 individual 
complaints  were  solved  and  others  referred  to  competent  authorities.  In  December  2020, 
Albania  established  a  General  Directorate  on  Alternative  Dispute  Resolution  of  consumers 
and additional criteria for functioning of structures for the alternative dispute resolution were 
determined.  However,  the  legal  framework  in  the  area  of  consumer  credit  and  distance 
marketing of financial services still needs to be further aligned with the EU acquis.  

National  legislation  is  partially  aligned  with  the  EU  acquis  on  product  safety.  In  the 
reporting period, despite two months suspension due to COVID-19, the State Inspectorate for 
Market  Surveillance  (SIMS  carried  out  891  inspections,  leading  to  58  administrative 
measures, including 13 fines, 11 warnings and 40 urgent measures (prohibition of trading and 
destruction  of  products).  In  total  8  057  products  were  controlled  of  which  118  were  found 
with  non-conformities  (mostly  formal,  though  9  products  (978  units)  were  banned  from 
trading). On non-safety-related issues, progress was made towards partial alignment to the 
EU acquis on alternative dispute resolution for consumer disputes.  

Public health 

On public health, Albania’s 2016-2020 national health strategy expired in 2020, and a new 
policy  framework  is  under  preparation  covering  the  period  2021-2030,  in  line  with  the 
national  2030  Agenda  for  Sustainable  Development.  A  new  five-year  action  document  on 
primary health care was adopted in May 2020 and is now under implementation. Following a 
surge  in  public  spending  on  communicable  health,  due  to  the  urgent  needs  to  prevent  and 
fight against COVID-19 pandemic in 2020-2021, public spending increased by 3% of GDP in 
the reporting year. However, it remains low, with disproportionately low resource allocations 
to  primary  health  care,  especially  in  maternal  and  child  health.  The  mortality  rate  remains 
high, particularly neonatal mortality (6 per 1,000 live births), under 5 mortality (9 per 1,000 
live  births)  and  infant  mortality  rates  (8  per  1,000  live  births).  The  governance  of  public 
hospitals and healthcare quality needs to be strengthened, across the whole country. Albania 
has ratified most international conventions related to the protection of fundamental rights, but 
obstacles to the exercise of the right to health and to sexual and reproductive health services, 
particularly  for  vulnerable  groups,  persist  across  the  country.  While  abortion  care  is 
guaranteed by law, women from  vulnerable  groups, especially Roma and Egyptian women, 
face barriers in accessing it. 

The  Ministry  of  Health  and  Social  Protection  and  the  National  Agency  of  Information 
Society  (NAIS)  are  responsible  for  e-health.  The  Ministry  is  currently  implementing  and 

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operating  an  electronic  system  for  collecting  and  reporting  health  information  of  medical 
records  based  on  European  Core  Health  Indicators  (ECHI),  but  the  system  is  not  yet 
operational. The e-Register, the electronic database available on the e-Albania portal, is used 
for the identification of the insured persons and the generation of Health Cards. It enables the 
registration  of  patients  to  primary  healthcare  health  centres  and  determines  their  benefit 
category  based  on  its  interaction  with  other  institutional  databases.  It  was  upgraded  during 
2020, with more functions related to the prescriptions for drugs, the organisation of the anti-
COVID-19 vaccination campaign, and the issue of vaccination cards. Despite some progress 
in  statistical  governance,  technologic  infrastructure/means  and  human  resources  are  still 
inadequate.   

Legislation  on  blood,  tissues,  cells  and  organs  is  not  fully  aligned  with  the  relevant  EU 
acquis.  On  tobacco  control,  the  law  to  protect  public  health  against  tobacco  products, 
designed  to  be  aligned  with  the  EU  acquis,  is  being  implemented.  Albania  still  needs  to 
accede  to  the  Illicit  Trade  Protocol  of  the  World  Health  Organization’s  Framework 
Convention  on  Tobacco  Control,  and  to  start  work  on  establishing  a  tobacco  traceability 
system  in  line  with  the  EU  acquis.  In  the  field  of  serious  cross-border  health  threats 
including  communicable  diseases,  the  COVID-19  pandemic  has  shown  significant 
shortcomings. The legal  basis for communicable disease prevention and control is designed 
to be in line with the EU acquis, however secondary legislation needed to implement has not 
been  fully  adopted.  Albania  also  does  not  have  an  antimicrobial  resistance  action  plan. 
Albania  has  strengthened 
its  national  alert,  response  and  surveillance  system  for 
communicable  diseases  during  the  COVID-19  pandemic,  but  no  national  plan  for 
implementing international health regulations was in place when the pandemic broke out. Its 
impact was worse due to the lack of systemic preparation.  

In terms of preparedness and response to the COVID-19 pandemic, Albania made progress 
on strategic risk-assessment and health emergency preparedness, including the development 
of  capacities  and  of  relevant  guidelines  and  Standard  Operating  Procedures  (SOPs)  to 
strengthen  and  maintain  routine  and  emergency  capacities  at  points  of  entry  (e.g.  airports, 
ports). However, Albania needs to make more effort to address all-hazard crisis preparation 
and  the  management  of  threats  beyond  communicable  diseases,  both  at  central  and  local 
level, and also to  ensure adequate resources and statistics to capitalise on the lessons learnt 
from the COVID-19 epidemiological crisis and build a resilient health system.  

In  response  to  the  COVID-19  pandemic,  the  Albanian  Ministry  of  Health  and  Social 
Protection  adopted  a  decision  on  health  surveillance  and  other  measures  for  preventing  the 
transmission of the pandemic. A coordination body was established to coordinate the national 
response to COVID-19, empowered to take adequate precautionary measures. These included 
nationwide  curfews,  social  distancing,  a  ban  on  public  gatherings  and  public  and  religious 
ceremonies, a country-wide lockdown during weekends and during the most critical periods. 
Sports  and  recreational  activities  were  banned  for  part  of  2020  and  flights,  buses  and  taxi 
services were suspended during the most critical months. Schools, restaurants, and cafés were 
closed  initially  and  then  as  necessary,  and  masks  were  made  compulsory  in  indoor  spaces. 
Self-isolation and quarantine periods were initially imposed for people arriving from affected 
countries  and  subsequently  to  all  individuals  at  epidemiological  risk.  During  2020  Albania 
moved  from  a  lockdown  approach  to  a  regulated  approach,  schools  resumed  in  September, 
although  secondary  education  was  partially  disrupted  and  universities  resumed  online. 
Albania continued to participate in the EU Health Security Committee as an observer, with 
also access to the EU Early Warning and Response System. Albania continued to make use of 
the EU Joint Procurement Agreement on medical counter-measures to which it is a signatory 
and joined the European COVID-19 Surveillance Network, reporting COVID-19 data to the 

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European  Surveillance  System  (TESSy)  managed  by  the  European  Centre  for  Disease 
Prevention and Control (ECDC).  

Legislation on patients’ rights in cross-border healthcare has yet to be aligned with the EU 
acquis  Legislation  on  medicines  for  human  and  veterinary  use  is  designed  to  be  partly 
aligned  with  the  EU  acquis.  There  was  no  significant  progress  on  standards  in  the 
pharmaceutical sector despite Albania’s approval of the Convention on the Elaboration of a 
European  Pharmacopeia  last  year.  There  is  no  specific  legislation  to  address  the  risk  of 
falsified  medicine  in  the  legal  supply,  although  some  provisions  are  in  place.  Additional 
efforts  are  needed  to  protect  the  public  from  falsified  medical  products  and  cross-border 
cooperation  for  sustainable  access  to  medicines  and  their  correct  use.  There  is  no 
development  of  or  expertise  available  on  paediatric  medicinal  products,  medicinal  products 
for  the  diagnosis,  orphan  medicinal  products,  medical  products  based  on  genes  (gene 
therapy),  cells  (cell  therapy)  or  tissues  (tissue  engineering).  Investments  and  capacity 
building in this sector should increase.  

On preventive measures, a national cancer control plan is in place. Appropriate structures 
for  cancer  screening  services  are  in  place,  but  a  cancer  registry  is  yet  to  be  set  up.  A 
programme for breast cancer screening was adopted in July 2020, which includes systematic 
examinations for 50-60 year old women, along with free clinical breast examinations.  There 
is a national plan for cervical cancer screening, but the lack of health care service integration 
limits its effectiveness. COVID-19 has severely impacted the prevention and control of non-
communicable diseases, though essential treatment services were ensured. 

On  nutrition  and  physical  activity,  malnutrition  is  a  critical  issue,  especially  for  children 
and pregnant women. Albania should develop a nutrition plan and raise awareness in schools 
and community centres of the risks of malnutrition. The national legislation on the pricing of 
medical devices is partly aligned with the EU common procedural framework and acquis. On 
drug  abuse  prevention and  harm  reduction,  prevention  activities  are  only  sporadic,  they 
should be conducted in a more systematic way. The National Drug Observatory established in 
2011 should be reactivated with adequate resources.  

On  health  inequalities,  Albania’s  2020-2025  Primary  Health  Care  Strategy  foresees  better 
access to health care services for vulnerable communities, as well as an increased community 
coverage  with  Primary  Health  Care  services,  giving  priority  to  vulnerable  groups,  and  the 
national  community  health  care  programme  continues  to  provide  residential  health  care 
mainly  for  marginalised  Roma  and  Egyptian  minorities.  There  was  a  slight  increase  in  the 
number  of  Roma  and  Egyptians  in  informal  settlements  benefiting  from  health  services 
delivered by mobile teams, and HIV awareness activities continue to be conducted for Roma 
and Egyptians communities. Nevertheless, the recently introduced health mediator is not yet 
operational and Roma people and Egyptians continue to face barriers, and further efforts are 
needed  to  improve  their  access  to  services  for  them  and  other  vulnerable  groups,  including 
women, people with disabilities and populations in rural or remote areas.  

CLUSTER 3: COMPETITIVENESS AND INCLUSIVE GROWTH  

This  cluster  covers:  information  society  and  media  (Chapter  10);  taxation  (Chapter  16); 
economic  and  monetary  policy  (Chapter  17);  social  policy  and  employment  (Chapter  19); 
industrial policy, science and research (Chapter 25); education and culture (Chapter 26); and 
29-customs  (Chapter 29).  

There is a moderate level of preparation in Albania in many areas linked to competitiveness 
and  inclusive  growth,  namely  information  society  and  media,  taxation,  economic  and 

84 

 
 
 
monetary  policy,  enterprise  and  industrial  policy,  education  and  culture,  and  the  customs 
union. Albania has some level of preparation in social policy and employment, and in science 
and research. Albania has made progress in particular with the Smart Specialisation Strategy 
and in its participation in the Horizon 2020 research programme, but progress was limited on 
the economic and monetary policy, and the customs union.  

This cluster and the reforms concerned have significant links to Albania’s Economic Reform 
Programme. Socio-economic reforms must be pursued to help address the existing structural 
weaknesses,  low  competitiveness,  high  unemployment,  as  well  as  the  impact  of  the 
COVID-19 pandemic.  

Chapter 10: Information society and media 

for  electronic 
The  EU  supports 
communications,  electronic  commerce  and  audio-visual  services.  The  rules  protect 
consumers and support the 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 implementing the recommendations of the previous report, with 
the approval of the National Strategy for Cyber Security 2020 – 2025 and its Action Plan.  

Progress was made with the approval of extended action plan for the existing digital agenda 
strategy  and  e-government  services,  and  with  the  signature  of  the  Memorandum  of 
Understanding on Regional Interoperability and Trust Services in the Western Balkans. The 
finalisation of the digital switchover was completed in December 2020 and further financial 
efforts are still required to implement the European emergency number 112. 

In the coming year, Albania should in particular: 

 continue to adopt the necessary amendments to the Law on Electronic Communication, in 

alignment with the new European Electronic Communications Code  

 improve 

the  collection  of  statistical  data  on  digital  performance  and  digital 

competitiveness 

 finalise and adopt the Digital Agenda 2021-2025. 

On  electronic  communications  and  information  and  communications  technologies 
(ICT), no progress was made in implementing the single European emergency number 112. 
As planned in the Medium Term Budget Programme 2020-2022, the unified 112 emergency 
number 112 is expected to be implemented throughout Albania by 2021. The last member of 
the Steering Board was nominated by the Albanian Parliament in February 2021.  

Fixed internet broadband penetration is still low, with 508,937 subscribers connected in 2020 
(463,133  household  subscribers  and  45,804  businesses),  a  17%  increase  from  2019,  with  a 
penetration rate of about 15.6% of the population and 52 % of the households being covered. 
The gap in fixed internet-broadband penetration between urban and rural areas remains. Rural 
areas  account  for  40%  of  the  population,  but  only  3.7%  are  connected  to  the  internet.  The 
mobile penetration rate at the end of 2020 was 70% compared with 61.8% at the end of 2019. 
In 2020, there were 2 million active users of mobile broadband.   The volume of data usage 
during 2020 increased by 29.4% compared with 2019. 

In  the  area  of  information  society  services,  the  revised  Action  Plan  of  the  Cross-sectorial 
Strategy “Digital Agenda of Albania” 2020-2022 was approved and the National Agency for 
the Information Society (NAIS) is finalising the draft Digital Agenda 2021-2025.  

85 

 
 
In  October  2020,  Albania  hosted  the  third  Western  Balkans  Digital  Summit  Tirana  2020 
aimed  at  exploring  opportunities  offered  by  the  digital  transformation.  A  Memorandum  of 
Understanding on Regional  Interoperability and  Trust  Services in  the Western Balkans was 
signed during the ministerial meeting held in Tirana. 

NAIS  continues  to  manage  the  e-government  portal  e-Albania  offering  on-line  public 
services.  In  the  reporting  period,  95%  of  the  applications  for  public  services  can  be  done 
online,  with  4,431,205  e-sealed  documents  downloaded  by  more  than  2,000,000  registered 
users on the e-Albania portal for more than 20 million e-services uses. 

The National Broadband Plan 2020-2025 is in place. In July 2020, the Government approved 
the “multi-annual programme for spectral policy and action plan” which is partially aligned 
with  the  Decision  No  243/2012/EU  of  the  European  Parliament  and  of  the  Council  of  14 
March  2012  establishing  a  multiannual  radio  spectrum  policy  programme.  The  deadline  to 
free up the 700 MHz for 5G networks was set at 30 June 2022. In addition, a draft 5G road 
map is under preparation. A Memorandum of Understanding on 5G for digital transformation 
in the Western Balkans was signed in Tirana on 2 November 2020 by ministers of Western 
Balkans.  The  new  national  frequency  plan  was  approved,  introducing  important  changes  to 
the spectrum available for new services and technologies, mobile broadband including bands 
for 5G.  

No further steps were taken to align further the Law on cybersecurity with the EU Directive 
on the security of network and information systems. Albania has established a list of critical 
information infrastructures and the necessary implementing legislation. The National Strategy 
for Cyber Security 2020 – 2025 and its Action Plan were approved in December 2020.  

Albania  still  needs  to  improve  the  collection  of  statistical  data  on  digital  performance  and 
digital competitiveness. 

In the field of audio-visual policy, the digital switchover was concluded in December 2020.  

The national audio-visual regulator is currently operating with limited human resources. Most 
positions  of  its  steering  board  became  vacant  in  the  course  of  2021.  The  Parliament  has 
initiated the procedures to fill vacancies and make AMA fully operational. In doing so, it is 
important  that  the  new  appointments  ensure  the  independence  and  legitimacy  of  the 
regulatory authority. 

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,  in 
particular  by  achieving  partial  alignment  with  the  Merger  Directive,  reducing  the  stock  of 
arrears  in  VAT  refunds,  and  the  first  non-reciprocal  exchange  of  financial  accounts 
information.  Recommendations  from  last  year  were  partially  addressed,  in  particular  on 
reducing the stock of arrears in VAT refunds. 

In the coming year, the country should in particular: 

  simplify the taxation system to encourage enhanced tax compliance;  

  approve  a  new  calendar  on  tobacco  excise  with  a  view  to  progressively  aligning  the 

excise rates to the EU minima; 

  comply with the agreed repayment schedules for VAT refunds.  

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On indirect taxation, the standard VAT rate is 20% and the reduced rates are 6% and 10%. 
However,  there  is  further  increase  in  the  number  of  exemptions  such  as  for  yachts  and 
watercraft  not  older  than  20  years.  The  April  2020  easing  of  risk  criteria  and  simplified 
procedures resulted in faster VAT refund payments. Since April 2020, the quarterly stock of 
VAT  refund  arrears  is  regularly  published.  By  March  2021,  it  was  reduced  to  EUR  48.5 
million compared to EUR 93.3 million in December 2019 and EUR 137 million in December 
2018.  As  of  January  2021,  in  response  to  the  impact  of  COVID-19,  only  taxpayers  with 
annual  turnover  above  EUR  81  750  (the  previous  threshold  amounted  to  EUR  16  350)  are 
subject to VAT and those with annual turnover above EUR 40 870 can opt to be subject to 
VAT. 

Excise  taxation  is  partially  aligned  with  the  EU  acquis.  Mineral  oils  are  marked  for  some 
uses. Favourable excise taxation for manufactured tobacco with tobacco leaves cultivated in 
Albania persists. Small producers of alcoholic beverages enjoy reduced tax rates. 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. In response to the COVID-19 situation, the 
deadline to  submit the financial statements was extended, exemption of profit tax for small 
businesses,  and  temporary  deferral  of  and  profit  tax  payments  for  all  other  businesses  with 
few  exceptions  were  introduced.  Furthermore,  changes  were  made  in  direct  taxation  to 
support  taxpayers  affected  by  the  COVID-19  pandemic.  As  a  result,  since  January  2021, 
taxpayers with a total annual income up to ALL14 million (approx. EUR 115 000) are subject 
to a 0% rate on profit tax, while those whose total annual income exceeds the threshold are 
subject to a 15% rate. Since December 2020, Albania partially aligned its framework with the 
Merger Directive by allowing deferral of capital gain taxation until assets/ liabilities are sold 
by  the  receiving  company  if  both  the  transferring  and  receiving  company  are  residents  in 
Albania.  

On  administrative  cooperation  and  mutual  assistance,  Albania  is  yet  to  sign  double 
taxation  agreements  with  Denmark,  Cyprus,  Lithuania,  Portugal,  Slovakia  and  Finland.  In 
January  2020,  the  Law  on  automatic  exchange  of  information  on  financial  accounts  was 
adopted,  aiming  at  alignment  with  Conformity  Reporting  Standards  and  partial  alignment 
with  the  relevant  2014  EU  Directive.  First  non-reciprocal  information  was  exchanged  in 
2020, but no reciprocal automatic exchange has yet taken place.  

As regards operational capacity and computerisation, in March 2020 the personnel of the 
tax administration was further reduced from 1,512 to 1,450. As of April 2021, the number of 
vacancies remained very high at 168 (11.6%) despite some improvement as compared to 193 
(13.3%)  in  last  year’s  report.  The  annual  training  programme  is  needs-based  and  1,040 
employees  of  the  GDT  received  online  training  in  2020.  Since  January  2021,  electronic 
invoices  have  become  mandatory  for  cashless  transactions  between  businesses  and 
government in an effort to increase tax compliance and reduce informality. 

Albania  does  not  yet  have  the  technical  capacity  to  facilitate  the  efficient  exchange  of 
information.  The  electronic  tax  administration  system  has  been  operational  since  January 
2015,  but  there  are  no  deadlines  to  achieve  interconnection  and  interoperability  with  EU 
systems. 

The implementation of the legal basis for the fiscal cadastre, approved in 2018, was delayed, 
due  to  incomplete  data,  impeding  its  functionality.  The  municipalities  continued  compiling 
the necessary information, while the legal base is planned to be amended. 

Chapter 17: Economic and monetary policy 

87 

 
 
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.  Limited 
progress was made on the National Accounts and Excessive Deficit Procedures notifications, 
significant  improvement  is  still  needed  to  achieve  full  compliance  with  ESA  2010.  In 
addition, no progress was made on last year’s recommendations in regard to complying with 
the  EU  acquis  regarding  the  Bank  of  Albania’s  independence  and  its  accountability  to  the 
Parliament,  and  government’s  policy  coordination  and  consultation  mechanism  with  non-
governmental stakeholders.  

Albania should therefore: 

  align  with  the  EU  acquis  the  legislation  on  the  Bank  of  Albania’s  independence  and 

accountability to the Parliament; 

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

  increase  reporting  capacities  for  governmental  financial  statistics  according  to  the  EU 

(ESA 2010) and ensuring regular monitoring of the standards 

In the area of monetary policy, the central bank’s primary objective, set out in the Law on 
the  Bank  of  Albania  (BoA),  remains  to  achieve  and  maintain  price  stability.  The  BoA  is 
financially independent, with sufficient instruments, competence and administrative capacity 
to function effectively and to conduct an efficient monetary policy. It has a fully operational 
Supervisory Council. . Monetary policy is  conducted using a standard set of instruments: i) 
open  market  operations;  ii)  standing  facilities;  iii)  required  minimum  reserves  and  within  a 
free-floating exchange rate regime.  

The  Medium-Term  Development  Strategy  2020-2022  of  BoA  foresees  alignment  of  its 
organic  Law  with  the  Statute  of  the  European  System  of  Central  Banks,  the  alignment 
Albania’s with the EU acquis is incomplete on the personal independence of the Supervisory 
Council members  and  BoA’s accountability  to  the Parliament.  In  response to  the economic 
impact COVID-19, BoA cut the policy rate to a new historic low of 0.5%, and lowered the 
overnight  lending rate from  1.9% to  0.9% on 25 March 2020.  It  maintained this during the 
reporting  period.  It  is  also  providing  unlimited  liquidity  to  the  banking  system  to  maintain 
private sector, enhanced its capacities to guarantee the sufficient cash supply to the economy 
and  facilitated  electronic  payments.  Macro-prudential  measures  introduced  in  2020  were 
extended  to  December  2020,  and  legislation  that  allows  banks  to  restructure  loans  was 
extended  until  March  2021.  In  December  2020,  new  legislation  was  adopted  reinforcing 
transparency and introducing new instruments to intervene in the domestic foreign exchange 
market. 

In  the  area  of  economic  policy,  further  alignment  of  legislation  with  the  EU  acquis  on 
requirements for budgetary frameworks is needed. Albania has complied with the fiscal rule 
since its adoption in 2016, with the exception of 2020 and 2021 due to the impact of COVID-
19. In July 2020, a new fiscal rule was stipulated in the amended organic budget legislation 
which  targets  a  positive  primary  balance  by  2023.  However,  in  June  2021  this  target  was 
postponed to 2024 to allow the government to continue with fiscal stimulus in 2021 with  a 
higher  deficit  and  public  debt  target.  Excessive  Deficit  Procedure  notification  tables  are 
submitted regularly to Eurostat on a best-effort basis, but they are not fully in line with the 
European  System  of  National  and  Regional  Accounts  (ESA  2010)  requirements.  Following 

88 

 
 
the completion in July 2019 of the pilot project on source data required for the calculation of 
the macroeconomic imbalance procedures (MIP) indicators, Albania has reported to Eurostat 
and has shared the metadata for 14 available MIP scoreboard indicators. Further progress is 
needed on the calculation of nominal unit labour costs and house price index deflated.  

Albania amended its 2020 budget four times during 2020 to include additional expenditure to 
buffer the economic fall-out of the COVID-19 pandemic, which resulted in a large increase 
of debt and deficit. It adjusted the planned fiscal deficit from 2.2 % to 3.9 % and then to 8.4 
%, in view of the expected drop in revenue and to plan the financing of the additional deficit. 
These  budgetary  measures  were  intended  to  provide  additional  funds  to  the  health  sector, 
support small businesses and self-employed, affected by the lockdown and cushion the socio-
economic  impact  of  the  pandemic.  In  addition,  the  government  allowed  businesses  to 
postpone  certain  tax  payments,  waived  penalties  for  late  utility  payments  and  issued  two 
sovereign guarantees for loans to businesses.  

Albania  mobilised  financial  support  from  the  EU  (a  EUR  180  million  Macro-Financial 
Assistance  loan  and  via  reprograming  of  the  IPA  national  programme),  the  IMF  and  the 
World Bank to cope with budgetary constraints and to enable support measures to businesses 
and households.  In its  2021 budget,  Albania initially targeted  a deficit of 6.4 % of GDP to 
accommodate  earthquake  reconstruction  spending  and  a  substantial  wage  increase  of  about 
40  %  for  heath  sector  workers  and  of  about  15  %  for  the  education  sector.  In  its  fourth 
amendment to the 2021 budget, the government plans to increase capital expenditure to 7.7 % 
of GDP, a higher deficit target of 6.9 %, and to extend public debt from 76.1 % of GDP in 
2020  to  80  %.  It  intends  to  maintain  the  expansionary  fiscal  policy,  including  tax  policy 
measures,  mainly  aimed  at  stimulating  small  business  and  new  public  investment  projects, 
which are considered crucial for the overall economic recovery.  

Albania  submitted  its  Economic  Reform  Programme  2021-2023  on  time,  reflecting  the 
government’s  support  measures  to  deal  with  the  impact  of  COVID-19  during  2020  and  its 
mid-to-long term macro-fiscal projections and policy priorities towards fiscal consolidation in 
2023.  Albania  needs  to  strengthen  its  inter-institutional  coordination  mechanism  for 
comprehensive  strategic  policy  planning,  including  for  the  preparation  of  the  programme. 
Challenges to ensure efficient coordination for the timely and adequate formulation of reform 
measures  by  the  line  institutions  continues  to  persist.  Albania  should  increase  its 
administrative  capacity  for  designing  and  coordinating  economic  policy  and  for  monitoring 
the implementation and impact of structural reforms in consultation with local stakeholders.  

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.  Despite  the 
negative impact of COVID-19 pandemic on the labour market, some progress was made in 
implementing  recommendations  of  the  previous  report,  especially  by  strengthening  the 
quality  and  effectiveness  of  labour  market  institutions  and  providing  services  to  the  most 
vulnerable groups. During 2020, Albania continued restructuring its employment governance, 
in line with the revised policy framework and the laws on vocational education and training 
and employment promotion. Albania’s labour market contracted slightly due to the COVID-
19  pandemic  with  informal  workers  hit  harder.  Social  services  reform  is  progressing, 
however  financial  and  administrative  efforts  should  be  stepped  up  to  strengthen  the  local 
level  capacities for service delivery and linkages to  active labour measures.  Albania should 
ensure a sustainable and inclusive recovery from the pandemic, with  an increased  coverage 

89 

 
 
and  financial  allocation  on  the  Social  Fund  for  financing  social  care  services  of  all 
municipalities  and  ensure  implementation  in  practice  of  secondary  legislation  on  public 
procurement on social services... In the coming year, the country should: 

 ensure  that  the  legal  provisions  are  in  place  for  the  implementation  of  the  Social 

Employment Fund and continue strengthening the employment structures:  

 aensure implementation of the bylaw on representativeness criteria for membership in the 
National  Labour  Council  and  adopt  the  by-laws  for  the  establishment  of  the  tripartite 
regional council; 

 take  steps  to  establish  and  implement  the  Youth  Guarantee  by  developing  a  Youth 

Guarantee Implementation Plan in line with the EU model and guidance. 

Regarding  the  labour  law,  the  amended  Labour  Code  is  under  implementation.  Despite  a 
significant  slowdown  of  inspection  activities  during  the  COVID-19  pandemic  (minus  43% 
from 2019 to 2020, from 13,079 in 2019 to 5,994 in 2020), some progress was made on the 
promotion  on  the  e-inspection  platform,  especially  for  the  assessment  of  anti-COVID 
measures. During 2020, the structure of the State Inspectorate of Labour and Social Services 
(SLISS) was revised with the establishment of a new Department of Risk Assessment, which 
is not yet fully staffed. Further steps should be taken to strengthen the capacities of the SLISS 
when it comes to human resources, regular training and adequate means, including vehicles, 
to  perform  duties  and  to  enhance  coordination  with  social  partners  for  proper  enforcement 
and  monitoring  of  the  occupational  health  and  safety  legislation  in  place  and  to  promote 
decent work.  

During  2020,  out  of  the  5,993  inspections  carried  out,  1,409  uninsured  employees  were 
identified  (31%  women),  of  which  1,163  were  formalised  (29.6%  women).  The  sectors  in 
which  irregularities  were  assessed  include:  manufacturing,  transport  and  communication, 
agriculture,  forestry  and  fishing,  mining,  electricity,  gas  and  water,  construction,  trade  and 
hospitality.  The  informal  economy  remains  significant  with  the  share  of  informal 
employment  at  29,1% in the non-agricultural  sector (LFS 2020). The highest percentage of 
informal  employment  was  reported  in  trade  activities,  including  hotel  bar  and  restaurant 
(4.2%), manufacturing (3.2%) and construction (7.6%), according to the ILO (2020).  

On child labour, Albania still needs to strengthen the system for monitoring child labour and 
other  forms  of  exploitation,  as  well  as  the  coordination  of  law  enforcement  between  the 
Agency for the Protection of Children’s Rights and the Labour Inspectorate.  

On  health  and  safety  at  work,  Albania  progressed  with  the  adoption  of  most  of  the 
legislation transposing the EU Framework Directive on health and safety at work. However, a 
new policy framework has to be developed and adopted based on a gap analysis and in line 
with  the  upcoming  EU  OSH  Strategy  2022-2027.  Furthermore,  the  implementation  and 
enforcement  of  health  and  safety  at  work  legislation  remains  limited,  due  to  insufficient 
financial and human capacities. This remains a particular issue in the shoe/textile and mining 
sectors.  Reported  accidents  at  work  increased  from  176  in  2019  to  182  in  2020,  most  in 
building and production enterprises (77% of cases for work-related reasons) while fatalities at 
work slightly decreased from 38 to 36 in the same timeframe.  

Bipartite social dialogue remains fragile in both the private and the public sector, mainly due 
to insufficient experience of trade unions, lack of a culture of dialogue, as well as employers’ 
scepticism towards trade unions. Coverage by collective bargaining agreements is higher in 
the public sector in comparison with the private sector. Regarding tripartite social dialogue, 
decision of the Council of Ministers (54 of 2020) sets out the representativeness criteria for 

90 

 
 
 
the membership in the National Labour Council (NLC).  The nomination of the new National 
Labour Council (NLC) members is still not complete. Despite the number of meetings of the 
NLC  increased  in  2020  compared  to  previous  years,  significant  efforts  are  needed  to 
transform the NLC into an effective and regular social dialogue forum, aiming at ensuring an 
effective and timely consultation on relevant laws and policy initiatives. Meetings of the sub-
committees  of  the  National  Labour  Council  are  currently  not  held,  which  decreases  the 
meaningfulness  of  discussions  at  the  level  of  NLC.  At  regional  level,  tripartite  Regional 
Consultative Councils, consisting of representatives of employers’ organisations, trade unions 
and representatives of state structures, provided for by law need to be duly operationalised. 

On  employment  policy,  Albania  is  implementing  the  National  Employment  and  Skills 
Strategy (NESS) 2020-2022, extended by two years during 2019. During the reporting year, 
additional  efforts  were  put  on  the  promotion  of  employment  services  at  local  level,  along 
with territorial and social cohesion.  

Labour market participation for the 15-64 year olds reached 69.1% in 2020, which despite a 
0.5  percentage  point  decrease  compared  to  2019  represents  an  overall  increase  by  9.5 
percentage  points  since  2013).  However,  under-employment  and  informality  remain 
important  and  strong  efforts  are  needed  regarding  the  alignment  of  education  and  training 
(including  adult  education  and  lifelong  learning)  to  the  needs  of  the  labour  market. 
Furthermore, solid interventions are needed to ensure targeted support to low skilled people 
and  people  more  at  risk  of  exclusion,  especially  after  the  prolonged  epidemiological  crisis 
that  has  exacerbated  vulnerabilities.  In  2020,  job  creation  remains  one  of  the  major  cross-
sectoral  priorities  of  the  government,  along  with  emergency  measures  aimed  at  expanding 
social protection and preserving jobs in the context of COVID-19 and ensuring employment 
in small businesses in crisis.  

Between December 2019 and December 2020, the number of registered jobseekers increased 
by 34.5% from 68,589 to 92,236 and it continued this also in 2021, when there were 94,529 
registered  unemployed  jobseekers  (June  2021).  Meanwhile,  according  to  the  2020  Labour 
Force Survey, the total number of the unemployed jobseekers in the last quarter of 2020 was 
164,733, only slightly higher than in 2019.The profile of registered jobseekers tends to be the 
one  of  lower  educated  people,  having  at  most  primary  education  (55.4%),  with  a  lower 
proportion  of  people  having  upper  secondary  education  (36%)  and  a  very  low  coverage  of 
unemployed having university education (9%). This is in stark contrast with the composition 
of  unemployed  work  force  according  to  Labour  Force:  32.8%  of  unemployed  jobseekers 
come from primary education, 43% from upper secondary education and 24% have university 
education. In addition, almost two thirds of young people not being in employment, educated 
or trained were not actively seeking a job and are out of reach of the labour offices.  

The number of vacancies announced in the Labour Offices (Los) reached 25,141, down from 
50,785 in 2019. In 2020, 23,118 registered unemployed jobseekers found a job through LOs 
compared  to  30,391  in  2019,  largely  reflecting  the  labour  market  challenges  resulting  from 
the  COVID-19  pandemic.  By  the  end  of  December  2020,  only  a  very  low  proportion  of 
registered  unemployed  (5,820  individuals  corresponding  to  6.3%)  were  receiving  an 
unemployment  benefit  and  31.4%  were  beneficiaries  of  economic  aid).  Furthermore,  only 
16%  of  those  newly  registered  as  unemployed  between  the  first  and  the  third  quarter  were 
eligible  for  unemployment  benefits.  The  Start  Smart  scheme  delivered  to  unemployed 
jobseekers continued in 2020 for only 2,285 individuals, especially young people, due to the 
closure  of  public  training  institutions,  which  represents  a  strong  decrease  compared  to  the 
previous  year  (-81%  from  12,327  unemployed  jobseekers  in  2019).  A  total  of  4,421 
unemployed jobseekers were participants in vocational training courses in 2020 (compared to 

91 

 
 
8,714 in the previous year) and 4,141 unemployed jobseekers were beneficiaries from EPPs 
(compared  to  5,338  in  2019),  of  whom  2,778  women  and  overall  16.8%  from  vulnerable 
groups  (disabilities,  Roma  and  Egyptians,  returned  immigrants,  long  term  unemployed  job 
seekers).  

The employment rate for the 20-64 year olds slightly contracted in 2020 (-0.8 pp) to 66.3% 
under  the  impact  of  the  COVID-19  pandemic  and  despite  measures  undertaken  to  protect 
jobs,  although  with  a  rebound  in  the  summer  due  to  seasonal  work.  In  the  last  quarter  of 
2020, 1.23 million people were in employment (47.7% employees, and 27.9% self-employed 
without  paid  employees,  21.2%  unpaid  family  workers  and  3.2%  self-employed  with  paid 
employees),  43.400  less  workers  than  in  2019.  Before  the  onset  of  the  unprecedented 
COVID-19 crisis, Albania had made progress toward ensuring that Albanian men and women 
had  access  to  increased  employment  opportunities  and  the  employment  rate  consistently 
improved by 10.5 percentage points between 2014 and 2020 mirroring trends in GDP growth, 
to  reach  a  record  high  of  67.1%  at  the  end  of  2019.  The  COVID-19  pandemic  hit  women 
harder than men, with employment rates declining by 0.9 percentage points for women, and 
only 0.7 percentage points for men.  

The  unemployment  rate  (15–64  years)  slightly  increased  during  the  pandemic  year  by  0.2 
percentage  points,  with  12.3%  in  the  fourth  quarter  of  2020  compared  to  a  record  low  of 
11.6%  a  year  earlier.  Due  to  the  prolonged  pandemic  and  the  fragile  economic  system,  the 
overall unemployment rate increased particularly among vulnerable groups including women, 
young  people,  Roma  and  Egyptians,  and  people  with  disabilities.  The  unemployment  rate 
(15-64 age range) for women increased from 11.8% in 2019 to 12.4% in 2020.  

The  strengthening  and  expanding  of  NAES  structure  (from  36  to  90  employees),  started  in 
June 2020, slightly delayed by the COVID-19 pandemic. By the end of 2020, 54% of NAES 
vacancies were filled. The Agency has started managing the implementation of employment 
and skills policies and administering the employment offices at the regional and local level, 
as  well  as  the  network  of  public  vocational  education  and  training  (VET)  providers  (VET 
high  schools, 
resources 
allocated,additional efforts are needed to complete staff recruitment and it is crucial that the 
Agency is fully equipped financially to implement its mandate, and that partnership with the 
business community is strengthened.  

training  centres).  Besides 

the  positive 

increase 

the 

in 

Public employment services made further progress in establishing and following performance 
indicators  and  procedures,  improved  visibility  and  outreach  services  for  vulnerable  groups. 
Work is advanced on the development of an information management system that will enable 
automation of many processes and will assist in profiling the job seekers and ensuring instant 
traceability.  Progress  has  been  made  in  encouraging  internal  mobility  for  employment,  as 
well as on the promotion of e-tools for gaining access to employment services, which proved 
effective in the context of COVID-19. The organigram of the local labour offices was revised 
in 2020 to ensure adequate level of staffing based on the labour market needs at local level, 
and the new organigram is in place.  

In  2020,  Albania  progressed  its  reform  on  the  Employment  Promotion  Programmes  (EPPs) 
portfolio  and  provisioning,  as  set  out  in  the  National  Employment  and  Skills  Strategy.  In 
particular,  in  2020  Albanian  completed  the  legal  and  operational  framework  for  the 
implementation of the reformed EPP packages. Seven new and revised EPPs were approved 
in  2020,  operational  guidelines  were  developed,  but  their  implementation  started  only  in 
September due to the COVID-19 pandemic. Of these, two temporary EPPs were approved in 
mid-2020 as a response to lay-offs due to COVID-19 crisis. One of the programmes targets 
people  who  self-declare  as  informal  workers  prior  to  their  lay-off,  the  other  targets 

92 

 
 
unemployed  jobseekers  laid  off  during  the  peak  period  of  quarantine  measures  between  10 
March  and  23  June  2020.  New  programmes  further  subsidise  orphan  beneficiaries,  single 
parents with children under 6 years of age, parents of children with disabilities, victims and 
potential  victims  of  trafficking,  victims  of  domestic  violence  or  gender-based  violence, 
beneficiaries of economic assistance, Roma and Egyptian groups. A total of 4,141 jobseekers 
benefited from the EPPs during 2020, of which 2,822 from the reformed EPPs (68% women 
and 40% young women and men).   

implementation  challenges  have  persisted 

The overall budget for active labour market measures for 2020 increased by more than 50%, 
but 
to  an 
unprecedented  low  level  of  fund  utilization.  These  can  be  attributed  to  the  COVID-19 
pandemic but also to the still limited capacity of the newly established NAES as well as to 
resistance to the revised EPPs from employment offices and employers alike.  

throughout 

the  year, 

leading 

Some progress was made in strengthening linkages between active labour market policies and 
social  assistance  scheme,  after  the  adoption  of  the  operational  plan  for  labour  market 
integration of cash assistance beneficiaries for the year 2019-2020. During 2020, 455 former 
beneficiaries of social assistance were employed (out of 1,374 beneficiaries of EPPs). Close 
monitoring of this programme alongside with the employment promotional measures will be 
crucial to ensure a long-term solution for beneficiaries of the economic aid scheme.  

In 2020, youth labour participation rate (15-29 years) continued to be lower than the rest of 
the  adult  population  (51%  with  a  gender  gap  of  14.5%).  The  unemployment  rate  for  the 
category 15-29 age range in 2020 stood at 20.9%, down from 21.5% in 2019 but the share of 
young  people  neither  in  employment,  nor  in  education  or  training  increased  from  26.6%  in 
2019  to  27.9%  in  2020,  indicating  a  particularly  difficult  transition  of  young  people  to  the 
labour market, which has been further exacerbated by the COVID-19 pandemic.  

The initiative of the government on establishing a  youth  guarantee scheme is considered as 
positive.  The  youth  guarantee  has  been  included  in  the  legal  framework  for  employment 
promotion in 2019 and it is part of the new strategy on Employment and Skills (2020-2022). 
Albania has endorsed the Western Balkans Declaration on ensuring sustainable labour market 
integration of young people (8 July 2021) and committed to take concrete steps to gradually 
establish and implement the Youth Guarantee scheme. The government should step up efforts 
to establish an inter-ministerial the coordination mechanism for the development of the Youth 
Guarantee  Implementation  Plan  and  to  involve  the  relevant  stakeholders  as  well  as  to 
strengthen  capacities  of  the  National  Employment  and  Skills  Agency  to  start  the 
implementation of the youth guarantee scheme.  

The difficult transition from upper-secondary (VET and gymnasia) and university graduates 
to  jobs  persists,  as  attested  by  a  higher  NEETs  rate  for  these  groups  as  compared  to  lower 
NEETs  rates  for  young  people  having  primary  education.  Despite  some  improvements,  the 
positive developments registered in 2019 have been obscured by the impact of the COVID-19 
pandemic  on  growth  and  employment  in  2020,  with  a  particular  emphasis  for  services 
industries, which constitute a large size of the Albanian economy. Long-term unemployment 
remains  a  challenge  that  Albania  should  to  address  through  more  flexible,  tailored  and 
integrated policy interventions.  

There  were  no  developments  as  regards  preparations  for  the  European  Social  Fund.  (See 
Chapter 22 - Regional policy and coordination of structural instruments). 

On social protection and inclusion, the 2015-2020 national strategy on social protection was 
revised  and  extended  until  2023.  Public  spending  on  social  care  services  programmes  is 

93 

 
 
modest and there is no mechanism for monitoring the situation of those who are vulnerable 
and with no access to such services.  

As  a  response  to  the  COVID-19  crisis,  during  March  2020,  the  Government  undertook 
several  emergency  measures  to  respond  and  protect  the  most  vulnerable  groups.  Around 
73,000  individuals  and  families  in  need  benefited  from  relief  packages  (food  and  hygiene 
items)  for  a  period  of  3  months,  the  cash  assistance  and  unemployment  payment  were 
doubled  but  only  for  people  already  in  the  schemes  prior  to  the  lockdown,  not  for  new 
arrivals.  In  spite  of  several  measures  undertaken,  the  government  shall  step  up  efforts  to 
reflect on new vulnerabilities created as a result of the COVID-19 pandemic, on the different 
types of benefits provided, adequacy and links with the active labour measures.  

The capacity of social transfers (excluding old age and family pensions) to reduce the at-risk-
of-poverty  rate  is  low,  standing  at  only  11.88%  in  2019,  below  regional  peers  and 
significantly below the EU-27 average reduction of 32.38% (EU-SILC data). This indicates a 
need to review the adequacy of benefits. After an emergency doubling of the cash assistance 
(Economic Aid) in 2020 over a prior of three months, a new doubling was approved in the 
government budget for the first six months of 2020. This is however not a structural solution 
to increase the adequacy of benefits. To gauge benefit adequacy an assessment is first needed 
that  will  take  into  account  poverty  data  (EU-SILC),  minimum  salary  and  other  important 
information. This has been included as a condition for the payment of the second instalment 
under the EU’s Macro-Financial Assistance. 

Without cash transfers, the social care services accounted for only 0.35% of the government 
budget  in  2020.  Cash  transfers  continue  to  constitute  about  95%  of  the  social  protection 
sector’s overall budget. The needs assessment for social services conducted for 2020 by the 
State  Social  Service  in  the  12  regions  of  Albania  highlights  that  28%  of  municipalities  (17 
municipalities) do not provide yet any social care services. 59% or 36 municipalities do  not 
have  services  for  elderly  and  57  %  or  35  municipalities  do  not  provide  services  for  people 
with  disabilities.  Albania  only  provides  five  of  the  seven  types  of  services  defined  by  law. 
Para-social services and specialised services are not available yet. Local social care services 
are undeveloped and lack investments and adequate human resources in many municipalities. 

According  to  Social  Services  data,  social  care  coverage  is  critically  low,  with  only  about 
16,054  beneficiaries  in  2020  (0.57%  of  the  population).  Increased  investment  in  the 
development of new social care services and wider geographical coverage are needed. Local 
government  units  (LGUs)  are  expected  to  assess  needs  in  their  territory  and  prepare  local 
social  care  plans.  In  2020,  the  number  of  municipalities  with  an  approved  social  plan 
increased  substantially  from  24  to  50  (of  61)  with  the  help  of  donors  and  NGOs  due  to  a 
general  lack  human  and  financial  resources  to  deliver  on  this  task.  Local  governments’ 
capacity  to  assess  needs,  apply  for  government  funds  and  manage  social  services  remains 
weak.  The  government  should  step  up  efforts  to  implement  the  Information  Management 
system for social care services in all 61 municipalities and non-public licenced social service 
providers in order to ensure accurate reporting on beneficiaries of social care services.  

Secondary  legislation  implementing  the  Law  on  social  care  services  specifies  that  central 
government  have  to  resource  the  social  fund  with  central  budget  allocated  to  the  approved 
local  social  care  plans.  However,  the  application  is  open  only  to  municipalities  with  an 
approved  and  budgeted  social  care  plan.  In  October  2020,  the  government  launched  the 
second call for proposals for municipalities; 40 municipalities applied and 16 municipalities 
are selected to be awarded.    

94 

 
 
The implementation of the reform of the disability assessment system on the basis of a ‘bio-
psycho-social’  model  is  continuing  and  is  extended  in  Tirana  and  Durres  municipalities. 
Some progress was achieved with the initial (pilot phase) implementation of the management 
information  system  for  people  with  disabilities.  The  accessibility  and  availability  of  many 
public  services  and  in  particular  of  specialised  services  is  still  a  critical  issue.  Access  to 
services for people with disabilities in rural areas is significantly lower than for those living 
in urban areas and in particular for those over 21 years of age.  

The EU Survey on income and living conditions were published for the second time in May 
2021. 

On  non-discrimination  in  employment  and  social  policy,  legislative  amendments  were 
adopted  on  employment  and  the  workplace  environment  for  women,  defining  sexual 
harassment  and  reversing  the  burden  of  proof.  Albania  also  performed  a  review  to  assess 
whether  it  meets  the  minimum  requirements  to  ratify  the  ILO  Convention  No.  190  on 
Violence and Harassment and is planning to ratify the Convention in the second half of 2021. 

As regards equality between women and men in employment and social policy, according 
to 2020 LFS data, The labour force participation rate for the population aged 15-64 years old 
is  69.1%.  For  male  population  aged  15-64,  the  labour  force  participation  rate  is  15.9 
percentage points higher than females. The employment rate for the population aged 20-64 is 
58.8%  for  females  and  74.0%  for  men,  resulting  in  a  gender  employment  gap  of  15.2 
percentage  points.  The  gender  pay  gap  decreased  by  3.5  percentage  points,  from  10.1%  in 
2019, down to 6.6% in 2020.  

According to the 2021 World Economic Forum’s gender gap index report, Albania ranked 25 
out of 153 countries (compared to the rank 20 for 2020), reflecting consequences created by 
the earthquake and COVID-19 pandemic.  

The changes to the Labour Code introduced more measures to support gender equality in the 
labour  market,  mainly  related  to  raising  the  awareness  and  supporting  the  economic 
empowerment  of  women  in  the  labour  market,  but  there  is  no  monitoring  of  the 
implementation  of  these  changes.  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.  

Women have been spending an increased time on unpaid domestic work during the COVID- 
19 pandemic lockdown period, while also working remotely. Reduced income due to loss of 
jobs  and  diminished  paid  working  hours  have  largely  affected  the  lives  of  many  women, 
especially  the  most  vulnerable  like  women  head  of  families,  women  living  in  poverty  and 
rural  areas.  Many  vulnerable  women  have  been  obliged  to  work  in  unsafe  work  conditions 
and have risked their health as they could not risk losing their jobs.  

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  with  the  endorsement  of  the  Investment  Policy  Reform  Action  Plan  as 
part  of  the  MAP-REA/Common  Regional  Market  regional  efforts  on  investments, 
maintaining  incentives  to  stimulate  investment  in  the  tourism  sector  and  implementing  an 
innovation support programme and on enhancing education on entrepreneurship and business 

95 

 
 
incubation  support,  mainly  in  the  field  of  innovation.  Though  some  progress  on  last  year’s 
recommendations  was  made  on  further  alignment  with  the  EU  acquis  on  late  payments, 
further efforts to ensure full alignment and in speeding up the implementation of the triple-
helix  action  plan.  Efforts  to  improve  the  business  environment  continue,  but  have  limited 
impact. 

In the coming year, Albania should, in particular: 

  address  the  main  challenges  to  the  business  environment,  notably  reducing  regulatory 
burden and enhancing participation in the available funding programmes for businesses, 
progress  with  the  adoption  of  the  Law  on  innovation  and  the  establishment  of  the 
Albanian  start-up  agency,  and  ensure  the  full  functioning  of  the  Albanian  Investment 
Development Agency; 

  accelerate the full alignment of national legislation with the EU acquis on late payments; 

  accelerate the adoption of the unified investment Law and the next Business Investment 
Development Strategy to address challenges to competitiveness and growth as stressed in 
the joint recommendations of the Economic Reform Programmes of 2019 and 2020. 

Albania should finalise its 2021-2027 business and investment development strategy (BIDS). 
This  will  set  the  strategic  framework  for  Albania’s  enterprise  and  industrial  policy, 
covering  SME  skills  development,  innovation,  sustainable  growth,  and  conditions  for 
attracting  foreign  investment.  Albania  adopted  a  2020-2024  Country  Programme  for 
Inclusive  and  Sustainable  Industrial  Development  (ISID).  This  has  three  main  pillars: 
industrial  competitiveness  and  market  access;  productive  employment  and  entrepreneurship 
development; and sustainable energy for productive uses and environmental management.   

Albania  continues  to  implement  the  South-East  Europe  2020  regional  initiative  and  actions 
under  the  Western  Balkans  Multi-Annual  Action  Plan  for  the  development  of  Regional 
Economic Area (MAP-REA) and the recent Common Regional Market action plan. Despite 
delays  due  to  the  COVID-19  pandemic  Albania  is  implementing  its  action  plan  based  on  a 
model that involves the public and private sectors together with universities, mainly related to 
drafting of innovation start-up legislation. It is also implementing its 2017 national Strategy 
on  Innovation  and  Technology.  In  addition,  it  is  has  adopted  a  programme  on  Urban 
Partnership Acceleration that would serve as a matchmaking to connect Albanian innovation 
organisations,  including  universities,  industry  players  and  start-ups,  who  are  committed  to 
solving  urban  challenges  is  under  implementation.  Albania  supported  the  establishment  of 
several innovation facilities. 

Albania follows the implementation of the Small Business Act. Despite some improvement in 
the business environment, the impact of the COVID 19 pandemic on businesses highlighted 
structural  challenges.  SMEs  identify  their  main  challengers  as  the  informal  economy 
(particularly  in  tourism),  corruption  and  lack  of  transparency  in  public  procurement 
(especially  as  regards  Public  Private  Partnerships  (PPPs)),  the  need  for  stable  state 
institutions,  unclear  ownership  of  property  titles,  and  the  need  to  enforce  the  rule  of  law. 
Enhancing  good  governance  and  quality  of  institutions,  skills  and  product  diversification, 
while maintaining macro-economic stability, are crucial to supporting economic growth.  To 
combat the informal economy, Albania is mainly focused on measures to expand the taxpayer 
bases, enforcing compliance and contributing to  creating a level-playing  field  for economic 
operators. In January 2021, it started a “fiscalisation” process, enabling e-invoicing between 
businesses  and  public  entities.  As  of  July  business-to  business  transactions  can  be  handled 
electronically. A transition period has been introduced, lasting until the end of 2021, during 
which both paper-based and electronic invoices can be issued. The third transaction category, 

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business-to-consumer  transactions,  are  foreseen  to  join  the  “fiscalisation  process”  in 
September 2021.  

Albania  continued  to  privatise  state  assets,  partly  through  privatisation  vouchers;  some  of 
which  were  purchased  by  landowners  exercising  their  right  of  pre-emption.  A  law  on  the 
establishment and operation of economic zones exists, though none been established. The law 
establishing  an  Albanian  Investment  Corporation  became  operational  in  April  2020.  A 
Technological  Economic  Development  Area  (TEDA)  for  the  construction  of  an  industrial 
plant  for  processing  in  Rashbull,  Durres,  is  still  in  a  development  phase.  A  contract  to 
construct,  maintain  and  operate  a  technology  and  economic  development  zone  in  Elbasani 
was signed in March 2020, and a strategic investor was designated in May 2020. The expiry 
of the 2015 Strategic Investments Law was postponed to the end of 2021, but the finalisation 
of  the  draft  investment  law  is  delayed.  Fifteen  investment  projects  received  'strategic 
investment' status, mostly in the tourism, agriculture and energy sectors, 23 applications are 
under consideration.  

In  the  area  of  enterprise  and  industry  policy  instruments,  the  Albanian  Investment 
Development  Agency  (AIDA)  continues  to  offer  funding  instruments  to  stimulate  start-ups 
and  entrepreneurship  in  tourism,  handicrafts,  competitiveness  and  innovation.  However,  no 
funds were distributed during 2020, as the funds were re-oriented towards COVID-response 
measures for businesses, and revising the support schemes under AIDA. An online access to 
finance platform was launched by AIDA to enable interested businesses to access information 
on  available  financing  opportunities.  Access  to  finance  remains  a  serious  challenge  for 
Albanian  businesses.  As  part  of  response  to  the  impact  of  COVID-19,  two  sovereign 
guarantee  loans  were  adopted  by  the  government  and  agreements  were  signed  with  second 
tier  banks  to  provide  liquidity  to  businesses  to  pay  employees’  salaries  and  to  finance 
operational costs. Tax legislation was amended in February 2021 for a three-year royalty tax 
exclusion for extraction industry companies to boost pre-export mineral processing.  

The Albanian National Agency for Information Society established “TechSpace”, a creative 
environment  for  developing  start-ups  dedicated  to  training  on  technology,  innovation  and 
entrepreneurship  activities,  and  mentoring  start-ups  in  the  field  of  ICT.  Since  its 
establishment,  100  start-up  ideas  have  been  registered.  The  “Roadmap  to  Silicon  Valley” 
pilot  programme  for  start-ups,  launched  in  January  2020,  with  an  incubation  phase  at 
lean  start-up  methods.  Cooperation 
TechSpace,  workshops,  extensive  research  and 
agreements  were  signed  with  public  universities,  and  public  and  private  vocational  high 
schools.  Albania  developed  an  IDEA  Business  Plan  Competition  to  establish  a  business 
mentor  and  business  angel  network,  and  continued  its  2017-2020  mentor  club  with 
participation of entrepreneurs and universities 

Albania  participates  in  the  EU’s  COSME  programme  for  SMEs,  including  Erasmus  for 
Young  Entrepreneurs  (EYE),  and  the  Enterprise  Europe  Network  (EEN).  Two  financial 
intermediaries were selected to provide COSME financial instruments to SMEs; however, the 
potential  of  COSME  to  assist  SMEs  in  accessing  markets  remains  underused  in  Albania. 
Albania is preparing to participate in the EU Horizon Europe programme as a follow up to its 
participation in Horizon 2020.  Albanian legislation was further partially aligned with the EU 
acquis  on  late  payments  in  May  2021.  Full  alignment  should  be  accelerated,  including  the 
issues  related  to  retention  of  title,  and  recovery  procedures  for  unchallenged  claims. 
Albania’s SMEs definition is partly aligned with the EU recommendation, however, national 
capacity in the field of SME policies and support remains very limited.  

On  sectoral  policies,  incentives  for  the  agro-processing  industry  continued  to  be 
implemented. The 2019-2023 national strategy for the sustainable development and tourism 

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and its action plan are being implemented. A  maritime tourism activity law was adopted in 
June  2020,  followed  by  a  law  introducing  VAT  exemptions  for  imported  tourism 
boats/yachts. A ministerial guideline on recovery measures in tourism was adopted in March 
2020,  focusing  on  the  areas  affected  by  the  November  2019  earthquake.  Financial  support 
measures for small businesses were introduced to respond to the impact of COVID-19. These 
include the relaxation of fiscal policy, the postponement of tax filing and tax payment in the 
end  of  2020,  removal  of  corporate  tax  for  SMEs  for  2020,  the  postponement  of  profit  tax 
instalments to 2021 for some other business categories, and some relaxation measures under 
local  taxes. Salary-payment  support schemes were introduced for categories most at  risk of 
unemployment  due  to  business  closures,  and  bonus  payment  for  employees  of  other 
businesses affected by confinement. Specific measures are foreseen to address business needs 
in the most affected sectors such as tourism, inward processing and manufacturing.  

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 has some level of preparation in the area of science and research. Good progress 
was  made  over  the  reporting  period,  especially  with  the  completion  of  the  quantitative  
analysis phase of the Smart Specialisation Strategy, in the further improved participation in 
Horizon  2020,  in  reaching  out  to  the  diaspora,  and  in  academia  business  cooperation. 
However,  last  year’s  recommendations  have  not  been  fully  addressed  and  therefore  remain 
valid. 

In the coming year, the country should in particular: 

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

area priorities; 

  continue the development of the Smart Specialisation Strategy; 

  ensure timely association to and participation in Horizon Europe.  

On research and innovation policy, the implementation of the 2017-2022 national strategy 
for scientific  research, technology  and innovation was monitored for the first  time in  2019. 
Key  recommendations  included  carrying  out  a  review  of  resources  planned  in  the  draft 
midterm  2020-2022 budget  planning  for increasing scientific research  funds to  1% of  GDP 
by 2022. The figure for 2020 – some 0.03% of GDP – remains far below. Earmarked national 
resources  for  scientific  research  and  development  funds  for  2021  (0.06 %  of  GDP)  and  for 
2022  (0.05  %  of  GDP)  are  still  well  below  the  target.  Albania  still  needs  to  step  up 
investments  in  scientific  research  and  associated  measures  to  strengthen  research  and 
innovation capacity at national level, also given the relevance of innovation to the Economic 
and Investment Plan for the Western Balkans. 

Albania  still  needs  to  develop  a  clear  methodology  to  establish  funding  for  research  and 
science.  The  research  infrastructure  mapping  is  ongoing.  The  Prime  Minister’s  Office 
initiated  a  plan  to  continuously  update  Albania’s  research  infrastructure  data,  based  on  the 
OECD’s Frascati manual.  

Limited progress was made with the implementation of the 2017-2021 action plan to support 
the  development  of  innovative  policies,  which  is  aimed  at  promoting  better  links  between 
academia, industry and government. Efforts are still needed in the fields of open access and 
open data. 

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The draft law on scientific research is still pending adoption.  

The development of a Smart Specialisation Strategy (S3) under the lead of the Ministry of 
Education, Sports and Youth.  a road map for the S3 process was drafted, in cooperation with 
the European Commission. Both  qualitative and quantitative analysis phases were completed 
and the launch of the Entrepreneurial Discovery Process is expected in 2021.  

As  regards  EU  framework  programmes,  Albania  participates  in  Horizon  2020  as  an 
associated  country.  Its  participation  in  Horizon  2020  has  improved  and  shows  a  very  good 
result  for  2020,  nonetheless  its  overall  success  rate  continues  to  be  low.  As  of  May  2021, 
Albanian entities have participated in 52 actions of Horizon 2020, receiving EUR 5.5 million 
of direct EU contribution. The success rate of proposals with Albanian participation is 8.7 % 
(up from 7.8% since last year) compared to 12.1% Horizon 2020 success rate. Private sector 
participation in the programme continues to remain particularly low. A further positive trend 
is the new national support measure facilitating academia-business cooperation, with 21 R&D 
projects submitted by academia and business partnerships The National Agency for Scientific 
Research  and  Innovation  (NASRI)  continued  its  efforts  to  raise  awareness  on  Horizon 
funding opportunities. Increased measures should be implemented to raise the awareness on 
participation in Horizon Europe.  

On integration into the European Research Area (ERA), Albania should be more active in 
all  areas,  and  should  improve  its  linking  with  European  partners  to  engage  in  international 
cooperative research. There is already active engagement in European Cooperation in Science 
and  Technology  (COST)  with  200  Albanian  researchers,  of  which  60  are  new,  during  the 
reporting  period.  Albania  has  become  a  full  member  of  EUREKA  in  2021.  Both 
memberships  are  expected  to  advance  Albania’s  research  and  innovation  international 
cooperation capacity. 

Albania  still  does  not  participate  in  the  European  Innovation  Scoreboard.  Albania  should 
make  stronger  efforts  to  produce  statistics  and  reliable  data  on  science  and  technology, 
including  the  indicator  on  gross  domestic  expenditure  on  Research  and  Innovation,  with  a 
view to participating in the European Innovation Scoreboard. 

On brain circulation, considering that the human capital in the diaspora is an important asset 
for  Albania,  establishing  a  platform  for  brain  circulation  linking  Albanian  specialists/ 
researchers/ experts working abroad is considered a good initiative.  The efforts to reach out 
to the diaspora and to link it to national research and innovation activities are commendable. 

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 
registered with the strengthening of the new National Agency for Employment and Skills, the 
continued  restructuring  of  the  National  Agency  for  Education,  Vocational  Training  and 
Qualifications, the continued implementation of the Albanian Qualification Framework Law 
and the adoption of the Optimization Plan for VET providers. Special measures were taken in 
adapting quickly to a remote education model imposed by the COVID-19 pandemic. Further 
efforts are required to finalise the adoption of the necessary implementing legislation for the 
Vocational  Education  and  Training  reform,  including  inspection  and  autonomy  of  VET 
providers  and  to  operationalise  sector  skills  committees.  Some  progress  was  made  in  the 

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implementation  of  the  strategy  on  culture  for  2019-2025,  but  efforts  should  be  done  to 
complete  the  adoption  of  implementing  legislation  on  the  Law  on  Cultural  Heritage  and 
Museums.  

In the coming year, Albania should in particular: 

  adopt  the  new  strategy  on  education,  covering  all  levels  and  ensuring  the  adequate 
financial  protection  as  well  as  targeted  public  spending  for  the  people  affected  by  the 
earthquake and the COVID-19 pandemic; 

  finalise  the  implementing  legislation  of  the  VET  Law  and  implement  the  Optimization 
Plan by 2022 to develop services and competences in line with the needs of the private 
sector at local level;  

  adopt the National Youth Strategy for the period 2021-2026. 

On education and training, 2020 was a challenging year due to the impact of the November 
2019 earthquake in central Albania, which damaged 24 % of the educational facilities, as well 
as the emergency adjustments taken for the provision of online education during the COVID-
19  pandemic.  As  a  consequence  of  the  earthquake  21  000  children  in  11  municipalities 
moved  to  host  schools  and  attended  classes  in  shifts,  straining  resources  and  affecting  the 
quality of teaching. Frequent school interruption increased pressure on the provision of online 
education  at  all  levels  underscoring  the  need  for  additional  resources  and  investments  to 
allow digitalisation. At least 11 000 children from vulnerable groups were unable to follow 
online classes due to unavailability of devices, lack of internet connection or quality support.  

Both  the  earthquake  and  the  COVID-19  pandemic  caught  the  system  unprepared,  which  as 
such  was  not  equipped  with  adequate  teachers’  training  and  teaching  practices  to  ensure 
effective distance-learning. Albania is  encouraged to  conduct  an in-depth  assessment of the 
learning  gaps,  of  the  inequalities  and  marginalisation  induced  by  the  prolonged  pandemic, 
and  in  particular  of  the  impact  of  school  interruption  for  the  most  vulnerable  children  and 
children with disabilities, to ensure a systemic recovery and resilience to further shocks and 
promote digital transformation in education.  

With  regard  to  quality  in  education,  progress  was  made  with  the  appraisal  of  the  current 
policy  framework  and  drafting  of  the  new  National  Strategy  of  Education  and  Action  Plan 
2021 – 2026, covering the stages from pre-school to higher education, the implementation of 
curricular and legislative frameworks and the delivery of free textbooks to pupils in primary 
education. The number of children benefiting from  free textbooks program  in  the academic 
year  2020-2021  remained  stable.  These  include  children  from  minority  groups  (Roma  or 
Egyptian  community),  children  coming  from  disadvantaged  backgrounds,  pupils  from 
families benefitting from economic assistance and children with disabilities.  

Albania’s budget allocation to education is very low at 2.7% of GDP in 2021, 0.6 pps. lower 
than in 2019 and 1.9 pps. below the EU-27 average (2018 figures), thus falling   short of the 
prediction of the current National Pre-University Education Strategy, which has foreseen a 5 
% share of GDP devoted to education. The budget in 2021, expected to drop at 3.5% of the 
GDP,  should  be  enhanced  to  support  the  efforts  to  modernise  the  educational  system  and 
ensure  quality  and  inclusiveness  in  education  for  all  pupils.  The  expected  school  financial 
autonomy has not progressed in 2020 as the sublegal acts and provisions for providing actual 
financial autonomy in the school were not developed despite the existing legislation.  

The  efforts  to  finalise  the  preschool  reform  as  per  the  highest  quality  standards  continued 
during  the  reporting  year  with  the  capacity-building  development  of  pre-school  teachers. 
However,  resources  remain  inadequate  with  only  0.5%  of  GDP  allocated  for  pre-primary 
education in 2020. To respond to the unexpected challenges of the COVID-19 pandemic and 

100 

 
 
the need for remote or blended education, more efforts were invested in teacher development 
and the revision of ICT curricula. ICT standards for teachers were quickly developed and 1 
200  teachers  benefitted  from  ICT  training  in  2020.  The  training  program  continues  with  a 
further 800 teachers in 2021.  

Enrolment rates in the pre-university education system decreased by 4.4% during the 2020-
2021 academic year, with a notable decrease of 8.4% in the preparatory/pre-school education 
for 5-6  years old, most probably due to the impact of the COVID-19 crisis. 286 486 pupils 
are currently enrolled in basic education, 55.3 % in primary education and 44.7 % in lower 
secondary  education.  Attendance  in  basic  education  dropped  by  2.8%  compared  to  the 
previous academic year. The Educational Management Information System (EMIS) system is 
still  not  yet  operational,  thus  preventing  the  provision  of  real  time  and  accurate  data  on 
education participation and quality as well as on the number of children who remain out of 
school. A non-operational EMIS also restrains the development of evidence-based policies. 

According to  2019  Labour Force Survey data, adult (25-64) participation  in  formal or non-
formal  education  and  training  was  extremely  low  at  0.9%  compared  to  the  EU  average 
(10.8%).  The  Adult  Education  Survey  (AES),  which  measures  participation  over  a  longer 
time  span  of  one  year,  also  shows  a  significant  gap  between  Albania  (9.2  %)  and  the  EU 
average (45.1 %).  

Although already very low, the participation rates of Roma and Egyptians children declined 
in both pre-university (13 086 against 14 515 in 2019-2020) and early childhood education 2 
514 against 2 996 of the year 2019-2020) and care. The gap in access to education between 
Roma/Egyptian children and other children living in the same areas remains very large. The 
measures  planned  to  facilitate  access  to  universities  (a  quota  system  and  university  fee 
waivers) are in general not implemented. Due to financial resource and capacity constraints, 
the quality of education remains an issue across the country, particularly inadequate in rural 
and isolated areas where school premises, often in poor conditions, are used for both early 
childhood education and care and primary education, and it is difficult to attract qualified 
teachers.  

Implementing  legislation  on  establishing  sectoral  skills  committees  was  completed  but  still 
remain  to  be  operationalised.  Albania  is  currently  preparing  the  referencing  of  its  National 
Qualifications  Framework  to  the  European  Qualifications  Framework,  planned  for  October 
2020.  19  occupational  and  qualification  standards  were  developed  and  23  frame  curricula 
improved for levels 2-5 of the Albanian Qualification Framework. Validation of non-formal 
and informal learning is one of the priority measures in the national strategy for employment 
and skills 2014-2022 and provided for, in both the vocational education and training (VET) 
and  AQF  laws.  So  far,  implementation  has  been  confined  to  pilot  projects  and  has  not  yet 
been applied countrywide. 

Regarding Vocational Education and Training (VET), the implementing legislation of the 
2017 VET Law is not  yet fully adopted. A by-law on work-based learnings was adopted in 
2020,  but  implementing  legislation  on  the  inspection,  financial  autonomy  of  and  on 
organisation, function and activities of VET providers still needs to be adopted. Qualification 
standards  and  framework  curricula  for  most  VET  programmes  are  being  modernised,  but 
some  schools  lack  the  teaching  skills  and  equipment  to  put  them  into  practice.  The 
government  consolidated  the  VET  institutional  framework,  by  reinforcing  the  newly 
established  National  Agency  for  Employment  and  Skills,  further  restructuring  the  National 
Agency  for  VET  and  Qualifications,  including  through  provision  of  additional  human 
resources  to  cover  the  extended  mandate,  and  reinforcing  the  quality  assurance  framework. 
Nevertheless, further efforts are needed to finalise staffing of both agencies and to reinforce 

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monitoring  and  evaluation  structures  at  central  level  and  ensure  adequate  planning.  Work-
based learning has been highly impacted by the effects of the pandemic and the difficulties 
encountered by the private sector, and the ongoing crisis is disclosing the urge for reskilling 
and upskilling. Qualification standards and framework curricula for most VET programmes 
are being modernised, even though some Albanian schools still lack the teaching skills and 
adequate equipment to put them into practice.  

The  Optimisation  Plan  of  VET  providers  was  endorsed  in  September  2020,  leading  to  a 
revision of the  capacities  based on local  labour  market  needs. Albania is  expected to  adopt 
the  implementing  legislation  on  organisation,  functions  and  activities  of  VET  providers  as 
well  on  their  financial  autonomy  and  fully  implement  this  Plan  by  2022  to  ensure  the 
rationalisation and modernisation of the VET offer. Meanwhile, the career guidance function 
within Development units in VET providers was institutionalised in 2020, supporting young 
people with the necessary orientation towards occupations required by the labour market as 
well  as  on  the  VET  offer  of  further  qualifications.  In  2020,  85  %  of  teachers  received 
training.  Further  training  is  required  to  ensure  the  implementation  of  digital  education  and 
ensure  digital  competences  for  online  teaching  in  VET.  Despite  promotional  activities  and 
support to students from rural areas in following VET education, participation in VET is low 
with only 18.2 % of upper secondary students enrolled in vocational schools in 2020.  

The  enrolment  in  VET  has  not  increased,  despite  demonstrated  faster  transition  into 
employment  for  VET  graduates.  Efforts  have  to  be  undertaken  to  properly  address  the 
learners’ aspiration and labour demands.   

Albania  continued  to  participate  actively  in  EU  programmes,  in  particular  Erasmus+,  with 
very  good  results  in  2020,  especially  in  terms  of  mobility  (Albania  was  involved  in  4,078 
mobilities,  including  students,  academic  and  administrative  staff)  and  capacity  building  in 
higher education projects, where three Albanian higher education institutions were selected as 
lead project coordinators out of 12 projects selected from Albania.  

The  results  of  Albania’s  2018  participation  in  the  OECD  PISA  evaluation  illustrated 
continued poor performances: 50.3 % of 15-year olds underperformed at PISA levels I or II 
in  reading  and  53.3  %  in  mathematics.  The  country  participated  in  Trends  in  International 
Mathematics  and  Science  Study  2019  and  is  participating  in  the  2021  Progress  in 
International Reading Literacy Study. Despite some progress over the past years, compared to 
the  average  across  OECD  countries  Albania  tends  to  use  more  teacher-directed  instruction 
and  less  adaptive  methods  that  focus  on  meeting  students’  individual  needs.  The  practices 
commonly used by teachers in Albania are associated with lower reading scores. Provision of 
educational resources in Albania is low and inequitable.  

Regarding  the  culture  sector,  the  national  strategy  is  in  place.  During  2020,  the  Ministry 
adopted  important  implementing  legislation  regarding  the  licensing  for  the  projects  in  the 
culture heritage field.  Due to pandemic the number of projects approved were developed in 
accordance  with  the  rules  and  protocols  adopted  for  COVID-19.  During  2020,  only  37 
internal projects were carried out, with participation of 1,460 artists from different genres.  

In  November  2020,  Albania  reported  for  the  4-year  period  regarding  the  2005  UNESCO 
Convention on Protection and Promotion of the Diversity of Cultural Expression. 

Albania  continued  to  participate  in  the  EU  Creative  Europe  programme.  In  2020,  Albania 
benefited  from  seven  projects  prepared  by  NGOs  and  public  institutions  under  this 
programme, and during the reporting period, the Ministry organised one information session 
about  the  programme.  In  February  2021,  a  workshop  was  organised  regarding  the  best 

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practices and lessons learned in the previous EU Creative Europe Programme for the period 
2014-2020.  

The  adoption  of  the  Law  on  youth  was  a  positive  step  towards  policymaking  on  youth, 
however further efforts should be made for the approval of the remaining bylaws (3 out of 5 
have  been  approved)  and  the  establishment  of  relevant  youth  structures.  The  criteria  for 
national youth representative organisations to be recognised by the institution responsible for 
youth  have  to  be  approved  by  decision  of  the  Council  of  Ministers.  Youth  organisations 
expressed concerns about the new Law, especially the representativeness of the structures to 
be put in place. No new centres have been established during 2020.  

The  National  Plan  of  Action  for  Youth  2015-2020  has  been  completed  in  2020  and  a 
thorough assessment is needed on its achievements, challenges and problems encountered. In 
addition,  the  Ministry  of  Education,  Sports  and  Youth  shall  finalise  the  National  Youth 
Strategy and Action Plan 2021-2026. 

During 2020, more than 32,000 student cards have been  distributed in Tirana, however, the 
student card is implemented mostly in Tirana and includes only limited services. There is no 
available data on its implementation, allocated budget and user rate among students.  

The Regional Youth Cooperation Office continues to be active in the region. Good level of 
participation  of  Albania  was  noted  also  in  2020,  where  Albania  had  the  highest  number  of 
applications.  

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.  Limited  progress  was 
made  in  particular  with  the  first  registrations  of  authorised  economic  operators  and  first 
appointment  of  a  coordinator  of  the  anti-corruption  network  in  the  customs  administration. 
Preparatory work for the development  of the New Computerised Transit System continued. 
Last  year’s  recommendations  were  partially  addressed.  In  the  coming  year,  the  country 
should in particular: 

  approve legal provisions and develop the New Computerised Transit System;  
  intensify  efforts  in  pursue  the  fight  against  smuggling,  corruption  and  imports  of 
counterfeit  products  including  through  strenthening  administrative  capacities  and 
improving cooperation among the bodies involved; 

  accede to the FCTC Protocol to Eliminate Illicit Trade in Tobacco Products. 
As regards customs legislation, Albania’s customs code is broadly aligned with the acquis. 
Its  system  for  customs  debt  and  guarantees  is  harmonised  with  EU  rules.  However,  the 
levying of  “scanning  fees” per customs declaration continue to  contravene the Stabilisation 
and  Association  Agreement  which  prohibits  customs  duties  or  charges  having  equivalent 
effect on trade between the EU and Albania. No progress was made to implement common 
transit.  Albania  is  implementing  its  authorised  economic  operator  programme  with  the  first 
four  registrations  in  June  2021.  Awareness  raising  activities  regarding  the  benefits, 
procedures and programmes are taking place, but capacity still requires development. 

Binding  tariff  information  and  explanatory  notes  are  published  by  the  Albanian  Customs 
Authority (ACA), and anonymised decisions on administrative appeals by the relevant court. 
The Customs Code contains rules of non-preferential origin and Albania applies the Regional 

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Convention on Pan-Euro-Mediterranean preferential rules of origin and follows the European 
Commission guidance related to the COVID-19 crisis period. 

The customs code's provisions on valuation are aligned with EU rules. The risk management 
system is automated and compares import, export and transit data against active risk profiles. 
The legislation on customs enforcement of intellectual property rights (IPRs) is harmonised 
with  the  EU  acquis.  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.  Cross-border  smuggling  of 
tobacco products and other illicit activities in the border regions continue to be an important 
area where further improvements in cooperation and antifraud tools are needed. As part of the 
antifraud  effort,  the  accession  to  the  FCTC  Protocol  to  Eliminate  Illicit  Trade  in  Tobacco 
Products  is  recommended.  The  national  rules  on  cash  and  goods  transported  in  travellers’ 
baggage  still  differ  from  the  EU  acquis  as,  as  regards  amounts  to  be  declared  and  the 
declaration  form.  ACA  can  impose  sanctions  for  non-  or  mis-declarations  of  cash  at  the 
border.  

On administrative and operational capacity, in January 2021, the Customs authority signed 
a memorandum of cooperation with the police for access to the Europol SIENA platform for 
exchange of information. In March 2021, the nCEN (national customs enforcement network) 
database has become operational. The position of coordinator of the anti-corruption network 
was  created  in  November  2020.  Following  authorisation  by  the  Ministry  of  Justice  the 
coordinator was appointed in March 2021 for a period of two years. The number of foreseen 
staff positions in the Customs Administration has been stable, with a current vacancy rate of 
9%. 

CLUSTER 4: THE GREEN AGENDA AND SUSTAINABLE CONNECTIVITY  

This  cluster  covers:  transport  policy  (Chapter  14);  15-energy  (Chapter  15);  trans-European 
networks  (Chapter  21);  and  environment  and  climate  change  (Chapter  27).  Albania  is 
moderately  prepared  in  most  areas  related  to  the  Green  Agenda  and  sustainable 
connectivity,  namely  the  trans-European  networks,  energy,  and  environment  and  climate 
change. It has some level of preparation in the area of transport policy. The country has made 
some progress  in  most areas in  particular through revised transport planning and on energy 
connectivity.  More  efforts  are  needed  to  improve  the  performance  of  ships  under  the 
Albanian flag and to enforce energy and environmental legislation, not least in the protected 
areas. 

The green transition and sustainable connectivity are key to economic integration within the 
region  and  with  the  European  Union,  facilitating  cross-border  trade  within  the  region  and 
creating real benefits for businesses and citizens. This cluster and the reforms concerned have 
significant  links  to  Albania’s  Economic  Reform  Programme,  the  Commission’s  Economic 
and Investment Plan and the Green Agenda for the Western Balkans endorsed by Albania in 
December 2020.  

Chapter 14: Transport  

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

Albania has some level of preparation in the area of transport policy, with some progress 
achieved in the past year. The recommendations of last year have been partly addressed with 

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the  implementation  of  the  revised  national  transport  plan  (ANTP3),  adoption  of  the  ITS 
strategy for roads, and starting drafting the National Transport Strategy for 2021-2026. Work 
advanced on extending the Green Lanes/Corridors with EU Member States. Legislation has 
been adopted for setting up the rail agency. Efforts to further align the legislation remain to 
be made. The recommendations of last year remain partly valid. 

In the coming year, Albania should in particular: 

  complete and adopt the new National Transport Strategy 2021-2026; 

  prepare  and  adopt  the  new  Road  Safety  Strategy  in  compliance  with  the  Transport 

Community Road Safety Action Plan; 

  aImplement  legislation  on  the  railway  sector  reform  in  compliance  with  the  Transport 

Community Rail Action Plan and ensure full operability of the network; 

  accelerate  taking  concrete  measures  to  improve  the  performance  of  maritime  vessels 

under the Albanian flag. 

As regards the general transport acquis, the inter-institutional working group monitoring the 
implementation  of  the  national  transport  strategy  and  action  plan  for  2016-2020  and  the 
sustainable  transport  plan  for  all  transport  modes,  published  its  fourth  monitoring  report  in 
July  2021.  Meanwhile  the  final  report  on  2016-2020  Sectorial  Strategy,  completed  by  the 
Ministry,  guide  their  work  for  preparing  the  upcoming  National  Transport  Strategy  and 
Action Plan 2021-2025, which is to be aligned with the mid-term budget programme 2022-
2024. Efforts should be made to its completion and adoption. Albania continues to participate 
actively in the EU strategy for the Adriatic and Ionian Region (EUSAIR) and chairs since 1 
June for one  year the Governing  Board.  It  should make further efforts  to  align its transport 
policy  with  public-service  obligations  and  the  acquis  on  public-service  contracts.  Further 
efforts are required to transpose fully the Intelligent Transport Systems  (ITS) Directive and 
implement relevant national laws in compliance with the Transport Community Action Plans. 
The ITS strategy for roads sector was adopted in June 2020. It has yet to adopt a national ITS 
strategy for all transport modes and allocate adequate resources for its implementation. 

Administrative capacity needs to be strengthened throughout the transport sector, particularly 
in  rail  transport,  for  which  several  capacity-building  events  were  organised.  The  reform  of 
Albanian  Road  Authority  needs  to  be  followed  by  the  adoption  and  implementation  of  the 
required legislative changes.  The law on  the  establishment, organisation  and functioning of 
the National Authority of investigating railway and marine accidents was adopted on 1 July 
2021.  Funding  for  road  and  railway  infrastructure  maintenance  is  insufficient,  resulting  in 
continued deterioration of that infrastructure. Further efforts are needed to support the 2018-
2022 rail maintenance plans.  

Albania has made further progress in aligning its national legislation on road transport with 
the acquis by establishing common conditions for practising the profession of road transport 
operator.  In  March  2021,  an  agreement  was  signed  with  Italy  on  the  mutual  recognition  of 
driving  licenses.  The  guidelines  on  the  criteria,  rules  and  procedures  for  the  issuance  of 
licences,  authorisations and certificates for the operation of international  transport of  goods 
by road, partially aligned with the acquis, have been adopted in December 2020.  

Albania should prepare and adopt the new Road Safety Strategy and its Action Plan, in line 
with  the  Transport  Community  Road  Safety  Action  Plan.  Albania  further  aligned  its 
legislation on periodic roadworthiness  tests.  Albania has not  yet  strengthened its inspection 
capacity.  More  efforts  are  needed  to  align  Albania’s  legislation  on  traffic-management 
systems  and  road  safety  (including  road-safety  education  and  enforcement).  Several  road-

105 

 
 
 
safety interventions are being implemented to improve the safety in roads’ intersections. On 
the implementation of the law on dangerous goods, Albania has yet to adopt licensing criteria 
and  procedures  of  professional  training  institutions,  as  well  as  guidelines  on  training  and 
testing  program  of  safety  advisers.  During  the  reporting  period,  the  related  legal  acts  have 
been prepared by the Ministry of Infrastructure and Energy and sent for further consultation 
with the relevant line Ministries.    

During the period 2021-2023, Albania plans to align its legislation with the amendments to 
the social  and market  legislation introduced by the Mobility Package  I  and adopted in  July 
2020,  respectively:  regulation  2020/1054  regarding  minimum  requirements  on  maximum 
daily  and  weekly  driving  times,  minimum  breaks  and  daily  and  weekly  rest  periods  and 
positioning by means of tachographs; EU regulation 2020/1055 adapting previous regulations 
to developments in the road transport sector; and Directive 2020/1057 on posting drivers in 
the road transport sector. 

As regards railway transport, implementing legislation to the 2016 Railway Code, aiming at 
unbundling  train  operations  from  infrastructure  management  as  well  as  establishing  a 
Railway Regulatory Body and a Safety Authority was adopted on 1 July 2021. Albania needs 
to ensure full operability of the rail network. In that respect, further efforts are needed to draw 
up  the  strategic  framework  for  implementing  ITSs  on  the  core  rail  network.  Albania  has 
published the Rail Network Statement for 2021 only in Albanian language. 

On  maritime  transport,  significant  efforts  are  still  needed  to  substantially  reduce  the 
detention rate of Albanian-flagged vessels in order to leave the current “Black List” of poor 
flag  performance  considered  a  high  risk  and  to  resume  the  country’s  application  for 
membership of the Paris Memorandum  of Understanding on Port State Control. A working 
group  of  representatives  of  the  responsible  Ministry  and  the  Albanian  Register  of  Shipping 
has  prepared  a  gap  analysis  and  proposed  several  recommendations  as  well  as  legal, 
operational  and  technical  measures,  which  are  currently  implemented  to  improve  the 
performance  of  the  maritime  fleet.  Further  efforts  are  needed  to  draw  up  a  strategic 
framework to implement ITSs on the core maritime network. Full alignment with the acquis 
on EU vessel-traffic monitoring and information systems (VTMIS) is underway and planned 
to be completed within 2022. A project and loan agreement for establishing those systems in 
Albania are in place since 2020. 

Albania  needs  to  align  with  the  acquis  on  ports  and  enact  legislation  based  on  the  Port 
Services Regulation ((EU) 2017/352). 

There were no new developments regarding inland waterway transport which is limited to 
two lakes shared with neighbouring countries and regulated by bilateral agreements. Albania 
and neighbouring Montenegro continued to implement their July 2018 agreement on the joint 
Ckla-Zogaj border crossing for international road passenger and lake transport.  

On  aviation,  Albania  continued  preparations  for  the  assessment  visit  requested  under  the 
European Common Aviation Area Agreement (ECAA), which is planned for 2022, following 
the  complete  adoption  of  the  relevant  national  legislation.  The  new  Air  Code,  intended  to 
align  Albanian  regulations  with  the  EU  Regulations  set  out  in  Annex  1  of  the  ECAA 
Agreement, was adopted in July 2020. In December 2020 the Council of Ministers approved 
a  decision  on  essential  requirements  in  the  field  of  civil  aviation  fully  aligned  with  EU 
Regulation  2018/1139.  Provisions  on  aviation  security  in  the  new  Air  Code  were 
supplemented  by  the  adoption  of  the  National  Civil  Aviation  Security  Programme  in 
December  2020  and  of  basic  standards  on  aviation  security  in  March  2021.  A  reduction  of 
salaries of air traffic controllers (ATCO) due to the Covid-19 pandemic triggered temporary 

106 

 
 
strike actions in  March 2021, giving rise to  possible issues with the safe functioning of the 
Albanian air traffic control system.  As a consequence, the European Union Aviation Safety 
Agency  issued  a  standardisation  finding  to  the  Albanian  Civil  Aviation  Authority  and  will 
assess  the  safe  and  uniform  implementation  of  ATCO  licensing  rules  during  its  next  Air 
Traffic Management/Air Navigation Services standardisation inspection in Albania, which is 
planned for early 2022. 

Although the national transport strategy includes some priority actions for the development of 
combined  transport,  there  is  only  limited  legislation  in  this  area  through  definition  of 
multimodal transport in the Railway Code. In February 2021, Albania finalised the strategy 
for  the  performance  of  the  combined  transport  which  forms  an  integral  part  of  the  national 
transport strategy 2021-2025. 

Albania should increase efforts to implement EU passenger rights legislation in all modes of 
transport. 

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  on  the  electricity 
market reforms and connectivity reform measures, in the renewables and gas sectors and on 
regional  interconnection  lines,  as  well  as  in  switching  from  exclusive  and  hydropower 
generation to photovoltaic and wind renewable energy sources. Such efforts should be further 
pursued taking into account its commitments under the Paris Agreement on Climate Change 
and the need to engage in clean energy transition in line with the Green Agenda on Western 
Balkan as endorsed by the Sofia Summit in November 2020. Albania made some progress on 
the  legal  framework  for  Energy  Efficiency  (EE)  while  the  implementation  of  the  Energy 
Efficiency  plan  remained  slow.  Alternative  EE  funding  mechanisms  to  the  abandoned  EE 
fund have not advanced. The Energy Efficiency Agency is not fully operational. Last year’s 
recommendations have not been sufficiently addressed and remain valid. 

In addition to addressing the shortcomings set out above, in the coming year Albania should 
in particular:  

  continue  diversifying  electricity  production  away  from  hydropower,  and  ensure  a  fully 

operational Power Exchange (ALPEX) and day-ahead electricity market; 

  complete  the  functional  unbundling  of  energy  companies,  abolish  legal  obstacles  to  the 
right  of  customers  to  change  their  electricity  supplier  and  ensure  full  access  to  the 
liberalised market for all customers connected to 20kV;  

  implement  secondary  legislation  related  to  the  Energy  Performance  of  Buildings 
Directive, accelerate the training and certification of energy auditors and managers, put in 
place financing incentives and mechanisms on energy efficiency, and increase financing 
of EE projects; 

  adopt the integrated National Energy and Climate Plan (NECP)  2020-2030 and set up a 
fully  operational  energy  agency  in  line  with  the  NECP  ambitions,  covering  Renewable 
Energy and Energy Efficiency, and equipped with adequate staff and budgetary resources. 

On security of supply, Albania is at a moderate stage of preparation. Its oil-stock legislation 
is not in line with the acquis. There was no progress in creating a central stockholding body 
for oil. Albania must complete alignment with the acquis on minimum oil stocks of crude oil 

107 

 
 
and/or petroleum products required for security of supply. It must also amend its emergency 
oil-stock model.  

Albania’s  electricity  system  has  been  connected  with  neighbouring  systems  in  Greece  and 
Montenegro  since  2014.  A  bilateral  agreement  to  establish  a  joint  electricity  control  block 
with Kosovo which was hampered in past years due to a dispute between transmission system 
operators  of  Serbia  and  Kosovo,  entered  into  force  in  October  2020.  The  Power  Exchange 
(ALPEX)  has  been  established  and  is  expected  to  be  fully  operational  during  2021.  The 
construction  of  a  connection  with  North  Macedonia  is  much  delayed,  with  the  works 
contracts  signed  only  in  the  first  half  of  2021.  In  2020,  Albania  continued  to  reduce 
electricity distribution losses in the power grid (20%, compared with 23.03% in 2019). The 
trans-Adriatic  pipeline  (TAP),  a  major  natural  gas  connection  between  Greece  and  Italy 
through Albania, is now operational (see Chapter 21 – Trans-European networks).  

On the internal energy market, following the amended power law adopted in June 2020, the 
unbundling and independence of the transmission system operator OST from KESH can be 
considered completed. The Council of Ministers approved in 2020 several implementing acts 
that  provide  a  legal  basis  for  setting  up  the  market  operator  and  establishing  the  Albanian 
Power Exchange (ALPEX), which is now set up and due to be fully operational by the end of 
2021.  New  balancing  rules  are  in  force  as  of  1  April  2021.  They  introduce  market  based 
procurement  of  balancing  services  and  imbalance  price  formation.  A  full  and  effective 
functional unbundling of the distribution system operator OSHEE SA is still pending due to 
the uncompleted transfer of activities, assets and staff to the new companies.  

Electricity prices are not yet fully liberalised. Since 1 January 2021, all distribution customers 
connected to 35kV, but only part of those supplied at 20 kV level benefit from an unregulated 
market. The next step of de-regulating all supply at all voltage levels, except the 0.4 kV level, 
is  envisaged  for  January  2022  The  electricity  market  is  still  dominated  by  the  regulated 
wholesale contract between state-owned generation company KESH and OSHEE companies 
(distribution  system  operator;  service  supplier).  This  contract  should  be  terminated 
immediately after ALPEX becomes fully operational in 2021.  

ERE’s  legal  framework  is  generally  in  line  with  the  acquis,  except  for  a  few  (albeit 
important)  missing  competences:  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 level of the penalties that ERE can impose. Following the approval of its new 
organisational structure in April 2020, ERE needs to develop its capacity as an independent 
institution  in  order  to  address  shortcomings  in  the  national  energy  markets  much  more 
actively.  

Albania intends to connect the Vlora thermal power plant, built in 2011 for oil-fired energy 
production but never put into operation due to technical problems, through the construction of 
a 40 km natural gas pipeline with the TAP. This would stabilise the generation of electricity 
during droughts in the southern part of Albania, and increase the country`s energy security. 
Albania adopted acts implementing the 2015 Law on the natural gas sector. 

Albania’s legislation is only partly aligned with the Hydrocarbons Licensing Directive, with 
some progress on its secondary legislation. It has not transposed the Directive on the safety of 
off-shore oil and gas installations.  

Albania  has  recently  made  good  progress  in  putting  in  place  the  regulatory  framework  for 
renewable energy although the target of the national consolidated renewable energy action 
plan (NCREAP) for 2019-2020, extended to 2021, of a 38% renewable energy sources share 
in  total  2020  consumption    was  not  reached.  Major  contracts  for  two  solar  PV  farms 

108 

 
 
(cumulated 240MW) have been signed, and an auction on wind farms has been launched in 
2021. Albania adopted new legislation in January 2021 aiming at transformation of the feed 
in tariff support scheme into a contract for difference, which will be implemented through the 
Renewable Energy Operator, Free Market Supplier and ALPEX.  

Albania  depends  almost  exclusively  on  hydropower  for  its  electricity  generation,  making  it 
very  vulnerable  to  unfavourable  hydrological  conditions  and  climate  change  impacts.  In 
addition,  it  is  a  net  importer  of  electricity  of  annually  up  to  30%,  as  electricity  from 
hydropower  is  not  sufficient  to  meet  its  current  and  future  needs.  Progress  in  power 
interconnection with neighbouring countries and in setting up an integrated regional energy 
market will strengthen the security of supply, as well as open opportunities for green energy 
development and trading. Albania could significantly improve its energy security and reduce 
energy  system  vulnerability  to  climate  impacts  by  deploying  its  vast  solar  and  wind 
resources.  It  has  recently  started  to  switch  from  exclusive  and  controversial  hydropower 
generation to PV and wind renewable energy sources.  

The  numerous  concession  contracts  for  hydroelectric  power  plants  are  not  a  sustainable 
option  for  Albania.  Particularly  the  small  HPPs  generate  significant  impacts  on  local 
biodiversity and communities, notably in protected areas where around 20% of the more than 
500  contracts  are  located  or  planned.  Plans  for  hydroelectric  power  plants  have  generated 
much  debate,  protests  and  court  action,  casting  doubts  on  the  concession  processes  legality 
and  on  the  quality  and  validity  of  environmental  impact  assessments  (EIAs).  Moreover,  no 
strategic  environmental  assessments  (SEAs)  have  been  conducted  despite  the  cumulative 
impacts generated in the river basins. The case of two proposed large HPPs on Vjosa River 
and another one on the Drina River have generated societal debates and opposition by local 
and  international  community.  Such  investments  require  full  compliance  with  the  national 
legislation  as  well  as  with  the  environmental  and  Energy  Community  acquis,  and  notably 
with regard to public consultations (Aarhus Convention) and quality of EIAs and SEAs.  

The  implementation  of  the  energy  efficiency  action  plan  NEEAP  2017-2020  has  not  met 
expectations in terms of cumulative saving of the energy used in Albania by 2020 (about 2% 
instead  of  6.8%).  The  Energy  Efficiency  Agency,  set  up  in  2016  to  implement  energy 
efficiency policies and measures and operational since late 2018, is still not fully staffed and 
efficient.  After  abandoning  plans  for  establishing  an  Energy  Efficiency  Fund,  no  EE 
incentives are in place and EE financing mechanisms still need to be promoted. Nevertheless, 
some  progress  was  made  in  terms  of  compliance  with  the  Energy  Community  acquis  by 
amending  the  Energy  Efficiency  Law  in  March  2021  to  align  with  the  Energy  Efficiency 
Directive,  and  in  terms  of  secondary  legislation,  such  as  several  procedural  and  legal  acts 
adopted before end of 2020 in the area of energy performance in buildings.  

Albania should complete and adopt by the end of 2021 the National Energy and Climate Plan 
(NECP)  2020-2030.  This  Plan  will  complement  the  present  Energy  Strategy  2018-2030, 
replace  the  NEEAP  and  set  new  EE  targets  for  2030,  including  measures  for  reaching  this 
target,  in  line  with  its  commitments  under  the  Paris  agreement  and  in  compliance  with  the 
Green Agenda for the Western Balkans. In view of these ambitions, Albania needs to ensure 
that a fully operational energy agency is in place, equipped with adequate staff and budgetary 
resources, so as to implement efficiently the RE and EE measures of the plan as from 2022.  

Albania  has  made  little  progress  on  nuclear  energy,  nuclear  safety  and  radiation 
protection.  In  December  2020,  it  adopted  a  Regulation  on  the  safe  process  of 
decommissioning  of  facilities  which  carry  out  activity  with  radioactive  sources  which 
determines  the  general  safety  requirements  that  must  be  met  during  the  process  of 
decommissioning facilities. 

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Chapter 21: Trans-European networks 

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

trans-European  networks 

the  areas  of 

(TENs) 

in 

Albania  has  some  level  of  preparation  in  the  area  of  trans-European  networks.  Some 
progress  was  made 
including  full 
operationalisation  of  the  trans-Adriatic  pipeline  (TAP)  completed  in  2020.  Albania  did  not 
sufficiently address the recommendations of last year which remain valid. 

transport  and  energy  networks, 

in  developing 

In the coming year, Albania should in particular: 

  continue developing the core transport and energy networks in line with: (i) the national 
strategies for transport and energy; (ii) the infrastructure investment prioritisation under 
the single project pipeline; and (iii) the Economic and Investment Plan for the Western 
Balkans while contributing to the Green Agenda;. 

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

  implement  Transport  Community  Treaty  action  plans  on  road,  road  safety,  rail  and 
transport  facilitation  and  strengthen  the  institutional  framework  and  administrative 
capacity to develop and monitor TENs. 

Albania is making progress on its strategic framework for transport networks. It continued 
to  harmonise  its  legal  and  institutional  framework  with  the  EU  Trans-European  Transport 
Networks  (TEN-T)  Regulation  and  the  Transport  Community  Treaty  (TCT).  It  is  actively 
participating  in  all  activities  of  the  TCT  Permanent  Secretariat,  such  as  Regional  Steering 
Committee and Contact Points meetings, technical committees on railways, roads, road safety 
and  transport  facilitation.  The  Albanian  authorities  are  encouraged  to  strengthen  their  close 
cooperation  in  the  framework  of  the  TCT  and  implement  the  action  plans  on  road,  road 
safety, rail, and transport facilitation 

The  2016-2020  national  transport  strategy  and  action  plan  provide  for  the  extension  of  the 
TEN-T  core  and  comprehensive  networks  to  Albania  and  its  alignment  with  TEN-T 
guidelines,  EU  standards  and  regulations.  Albania  has  further  aligned  the  national  legal 
framework  with  TEN-T  Regulation  1315/2013/EU  through  an  additional  implementing 
decision.  The  Ministry  of  Infrastructure  and  Energy  started  drafting  of  the  2021-2026 
national transport strategy and action plan (see Chapter 14 - Transport).  

Albania has made some progress in repairing and maintaining its core road infrastructure. It 
is  progressing  with  the  preparation  of  road,  rail  and  port  infrastructure  projects,  especially 
along  the  Adriatic-Ionian  corridor  and  corridor  VIII  (Varna–Durrës).  Fieri,  and  Tepelena 
bypasses  are  now  completed  and  open  for  traffic  since  mid-2020.  Vlora  bypass  works  are 
progressing  intensively  and  from  15  July  the  bypass  was  open  to  traffic  for  the  summer 
season.. The Study on Adriatic Ionian road corridor was completed in December 2020. The 
contract for rehabilitation of the Durrës-Tirana rail line and construction of a new line to the 
international  airport  have  been  signed  in  February  2021.  Works  are  due  to  start  by  3rd 
quarter-2021  and  completed  in  2023.    The  design  for  the  Vore-Hani  Hotit  Railway  was 
completed in June 2021 while the design studies are ongoing for the rail Corridor VIII section 
from Durres to the border with North Macedonia and Greece. Works for the construction of 

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transport  infrastructure  should  be  implemented  in  full  respect  to  the  environment  and  the 
related protective measures foreseen under their Environmental Impact Assessment Studies. 

In  June  2021,  the  two  Prime  Ministers  of  Albania  and  Northern  Macedonia  signed  the 
Agreement  on  the  establishment  of  joint  crossings  and  customs  controls  at  the  crossings 
between  the  two  countries.  This  agreement  is  another  step  towards  facilitating  cross-border 
crossing procedures for citizens of the two countries and of the region. 

During  the  reporting  period,  the  government  decided  to  relocate  the  cargo  activities  of  the 
ports of Durres and Vlora. The Durres port, which is the only core network port in Albania 
and  for  which  EU  support  is  envisaged  on  the  rehabilitation  of  two  quays,  will  relocate  its 
cargo activities to the Porto Romano area several km north of Durres, and to turn the current 
port into a touristic one. In November 2020 the Government concluded a ten-year agreement 
on  economic  cooperation  with  the  Government  of  the  United  Arab  Emirates  (UAE), 
including  the  redevelopment  of  the  Port  of  Durres.    The  UAE  Company  Emaar  Group 
(EMAAR) will be in charge of transforming the port into a large marina. In June 2021, the 
Port  of  Durres  Authority  launched  the  tender  for  a  service  contract  to  transfer  the  cargo 
activities from Durres Port to Porto Romano.  

In  April  2021,  Albania  officially  inaugurated  the  Kukës  airport  in  the  north  of  Albania 
designed to serve as the country’s second international civil airport. The airport is now poised 
to start normal operations from 15 July 2021, and will focuses on low-cost airlines. The first 
flights  are  scheduled  between  Kukes  and  Zurich  and  Kukes  and  Istanbul.  The  government 
signed  in  April  2021  the  contract  to  build  a  third  international  airport  in  Vlora  within  the 
Vjosa-Narta Protected Area, south of Albania (see Chapter 27 - Environment).  

Albania is partially aligned with the acquis on a single European railway area, railway system 
interoperability and rail freight  corridors for  competitive freight.   Progress have been made 
for adoption of roads ITS strategy however, further efforts should be made to fully align the 
country  with  the  ITS  Directive,  develop  a  national  strategy  on  the  deployment  of  ITS  and 
prepare for the implementation of the strategy.  

Albania  should  ensure  that  its  transport  network  projects  are  implemented  in  line  with  the 
TEN-T  regulatory  framework  and  the  TCT  Action  Plans  while  contributing  to  the  Green 
Agenda  for  the  Western  Balkans.  Current  and  future  infrastructure  investments  should 
comply  with  EU  standards  on  public  procurement,  State  aid  as  well  as  SEAs  and  EIAs. 
Investments need to be implemented in accordance with cost/benefit analyses carried out in 
line  with  EU  best  practice.  Projects  are  channelled  through  a  single  project  pipeline, 
confirming the country’s strategic orientation towards TENs. More serious measures on road 
safety should be taken, particularly to eliminate ‘blackspots’ identified on stretches with high 
accident rates resulting in fatalities and injuries. The adoption of the multiannual maintenance 
plans for the entire (rail) core network remains a challenge.   

On  energy  networks,  further  efforts  are  necessary  to  adopt  the  strategic  environmental 
assessment (SEA) and project identification plan under the gas master plan. This will help the 
development  of  TEN-E  projects.  The  trans-Adriatic  gas  pipeline  became  operational  in 
December 2020, with 1 billion cubic meters (bcm) already transported by March 2021. The 
gas  master  plan  provides  for  major  gas  interconnector  projects  such  as  the  Ionian-Adriatic 
pipeline  and  the  Albania-Kosovo  gas  interconnector  pipeline  (ALKOGAP)  which  are  at  an 
early stage of planning.  

Progress  was  made  on  improving  the  infrastructure  for  power  transmission.  Albania  has 
functional  power  interconnection  lines  with  Greece  and  Montenegro.  The  400kV  line 
between  Albania  and  Kosovo  became  operational  in  December  2020,  after  Kosovo 

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transmission  system  operator  KOSTT  SA  concluded  a  new  connection  agreement  with  the 
European  Network  of  Transmission  System  Operators  ENTSO-E  in  April  2020.  With  this 
agreement,  KOSTT  and  Kosovo  have  finally  left  the  Serbia,  Montenegro  and  North 
Macedonia control block and joined the Kosovo-Albania control block, which also paved the 
way for KOSTT to integrate into the regional energy market, and participate in the Albanian 
Energy Exchange (ALPEX), which is expected to be functional by 2021.  

The government approved the construction of a 400kV line between Elbasan in Albania and 
Bitola in North Macedonia in June 2016 but construction is much delayed. Selection of the 
winning bidders for the pre-qualification phase was completed in 2019. The contract for Lot 
1 and Lot 2 were signed respectively in January 2021 and April 2021. Completion is expected 
24  months  after  the  entry  into  force  of  the  contract.  The  technical  stage  procedure  is  still 
ongoing. The line is projected to cost €70 million and the project is scheduled for completion 
by end 2022. 

Albania  participates  in  EUSAIR,  under  which  the  improvement  of  regional  connectivity 
(transport and energy networks) is a top priority. 

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,  chemicals,  environmental  crime  and  civil  protection.  However,  significant 
efforts are still needed on implementation and enforcement, especially on waste management, 
water and air quality and climate change.  

The  2020  recommendations  remain  valid  and  in  the  coming  year,  in  addition  to  addressing 
the shortcomings set out below, Albania should in particular:  

  align  further  with  key  water  directives  by  adopting  the  newly  prepared  legal  package; 
adopt the new strategy for water supply and sewerage 2021-2030; substantially increase 
the  budgetary  resources  and  implementation  capacity  of  its  key  national  agencies  for 
Water Resource Management and for Water Supply, Sewerage and Waste Infrastructure, 
and  of  the  national  agencies  for  implementing  a  national  water  monitoring  programme 
financed through a statutory budget line created to this aim; develop a basin management 
plan for the Vjosa River; 

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

  take  immediate  measures  to  fight  environmental  crime  and  increase  policy  and  law 
enforcement for nature and biodiversity protection, especially in the protected areas; 

  implement the national strategy on climate change and related action plans on mitigation 
and  adaptation,  adopt  the  relevant  legislation  and  develop  and  adopt  its  integrated 
National Energy and Climate Plan in line with Energy Community obligations.  

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Environment  

As regards horizontal issues, Albania needs to step up efforts to achieve full alignment and 
implementation in most areas. The implementation of the Environmental Impact Assessment 
(EIA)  and  Strategic  Environmental  Assessment  (SEA)  Directives  needs  to  be  significantly 
improved  with  regard  to  concrete  projects  before  construction  and  operation,  especially  for 
large  infrastructure  projects  in  the  energy,  transport,    tourism  and  mining  sectors.    Habitat 
connectivity  and  ecological  corridors  are  rarely  taken  into  consideration  causing  habitat 
fragmentation  and impacting populations  of many  species. The EIA for  Kukës Airport was 
submitted in January 2021, while the construction works were already well underway. Public 
participation and consultation in decision-making needs to be improved as well, particularly 
at  local  level.  Implementation  of  the  Law  amending  the  2019  Penal  Code  and  fully 
transposing  the  Directive  on  protection  of  the  environment  through  criminal  law  has  to  be 
improved  as  only  a  small  fraction  of  those  crimes  reported  lead  to  convictions.  The 
implementation of the polluter-pays principle in secondary legislation is weak. The process of 
approving geographic information standards in compliance with the Directive establishing an 
Infrastructure for Spatial Information in the European Community (INSPIRE) was completed 
at the end of 2020. Further progress is needed to achieve full alignment with the directive on 
environmental liability. Following a reorganisation of environmental inspectorate in 2020 and 
change of responsibilities, the share of competences for environmental enforcement should be 
clarified  and  enforcement  itself  should  be  rapidly  strengthened,  especially  to  address 
environmental crimes more effectively. The already limited State budget for environment and 
climate change was further reduced for 2021 by more than 7% to EUR 8.9 million. It needs to 
increase to meet all requirements of EU directives. 

Albania has to put more efforts to align with the air quality acquis, including on extending 
and  improving  the  air  monitoring  system.  Implementation  of  the  2014  national  air  quality 
strategy is still pending. The current national plan on air quality management adopted in June 
2019  does  not  provide  for  a  functional  monitoring  system  and  focuses  mostly  on  transport 
measures. Due to a lack of funding, air monitoring is not in line with the EU standards on air 
quality.  An  Action  Plan  for  Air  quality  presents  the  current  state  of  alignment,  tasks  to  be 
carried  out  in  the  short  (2021-2023)  and  medium  term  (2024-2027)  and  the  human  and 
financial resources needed to fulfil the relevant tasks. Albania showed a strong interest to get 
more  involved  in  the  works  of  the  Air  Convention  (UNECE  Convention  on  Long-range 
Transboundary  Air  Pollution  -  CLRTAP)  and  implement  the  Convention  and  its  protocols. 
Albania  has  to  strengthen  its  administrative  capacities  to  determine  the  national  emission 
ceilings  and  align  with  the  National  Emissions  reduction  Commitments  Directive. 
Implementation  of  the  Directive  on  sulphur  content  in  certain  liquid  fuels  is  ongoing  while 
the  implementation  of  Directive  94/63/EC  on  the  control  of  volatile  organic  compound 
(VOC)  emissions  resulting  from  the  storage  of  petrol  and  its  distribution  from  terminals  to 
service  stations  and  2009/126/EU  on  Stage  II  petrol  vapour  recovery  during  refuelling  of 
motor vehicles at service stations needs to start.  

The legal framework for waste management is partially aligned. Closing of numerous non-
compliant landfills and dumpsites remains a challenge. Separate collection of waste streams 
and  economic  instruments  to  promote  recycling  and  reuse  and  to  prevent  waste  generation 
remain  limited.  The  construction  of  a  new  incinerator  apart  from  the  two  existing  ones  in 
Elbasan and Fier poses growing concerns in terms of compliance with the EU waste acquis 
including  the  waste  hierarchy  principle  and  the  recycling  targets.  Albania  should  promote 
circular  economy  and  should  incentivise  preventing,  reducing  and  recycling  waste  to  cut 
down landfilling. The implementation of the waste streams legislation should be speeded up. 
The  enforcement  and  compliance-checking  role  of  the  institutions  should  be  clarified  and 

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strengthened, with appropriate staffing and budget. The recommendations of the waste master 
plan  are  sometimes  in  conflict  with  the  national  waste  legislation  and  EU  acquis  on  waste. 
This should be reviewed.  

On  water  quality,  the  level  of  alignment  slightly  increased  with  the  adoption  of  a  new 
Council  of  Ministers  decision  in  December  2020,  but  still  remains  globally  unchanged  and 
partial.  An  inter-institutional  Legal  Group  under  the  leadership  of  the  Water  Resource 
Management Agency (AMBU) has been set up in April 2021 to adopt a new legal package on 
integrated water management. Specific Implementation Plans are scheduled to be available in 
2022  for  the  two  EU  directives  where  major  investments  are  required  for  compliance 
(Drinking  Water  Directive  and  Urban  Wastewater  Treatment  Directive).  AMBU  needs  to 
enhance its national role and to structure and strengthen its resources and capacities for river 
basin  management  and  implementation  of  the  EU  water  acquis.  Albania  should  promptly 
start implementing the Drini-Buna and Seman River basin management plans, following their 
adoption  at  the  end  of  2020,  and  proceed  with  the  completion  and  adoption  of  the  four 
remaining  river  basin  management  plans.  In  line  with  the  Green  Agenda  for  the  Western 
Balkans,  Albania  should  strengthen  transboundary  basin  management  with  its  neighbours, 
and develop a basin management plan for the Vjosa River, in view of its regional importance, 
its high ecological value and eco-tourism potential.  

The  water  quality  and  quantity  monitoring  network  as  well  as  the  reporting  and  licensing 
systems should be substantially enhanced and aligned with the acquis requirements. AMBU, 
together  with  the  National  Environmental  Agency  and  other  agencies,  should  urgently 
programme  and  implement  a  national  water  monitoring  programme  financed  through  a 
national statutory budget line to this aim. Albania should amplify and accelerate further the 
water reform measures to increase the performance and sustainability of utilities and the level 
of service delivered to all citizens. Notably, the Law on water supply and sewerage, the 2030 
national strategy for water supply and sewerage and the revised water code should be adopted 
in 2021. 

Water and sewerage utilities face challenges such as lack of licencing and tariffing for waste-
water treatment, insufficient operation and maintenance and limited revenues and impact due 
to underdeveloped sewerage networks and household connections. There is an urgent need to 
ensure  full  alignment  with  the  Urban  Wastewater  Treatment  Directive,  extend  sewerage 
networks,  license  and  apply  adequate  tariffs  for  all  waste-water  treatment  plants  and  build 
new ones, in particular in urban and coastal areas with high tourism development. To achieve 
this,  the  National  Agency  of  Water  Supply,  Sewerage  and  Waste  Infrastructure  needs  to 
structure and strengthen its resources and capacities. 

Alignment  with  the  acquis  in  the  field  of  nature  protection,  in  particular  the  Habitats  and 
Birds  Directives,  is  advanced.  Policy  and  law  enforcement  remain  generally  weak  despite 
numerous  capacity  building  activities  and  technical  assistance.  The  legislation  on  strategic 
investment  raises  concerns  for  the  protection  of  biodiversity,  as  it  may  allow  large  tourism 
and  industrial  investments  in  protected  areas.  In  April  2021,  Albania  signed  the  contract  to 
build  Vlora  Airport  within  the  Vjosa-Narta  Protected  Area,  in  contradiction  with  national 
laws  and  international  biodiversity  protection  conventions  that  Albania  has  ratified.  This 
Protected Area is  a candidate for the Emerald  site network, which provides shelter to  more 
than 62 species of birds listed in the EU Birds directive. Vjosa River, as one of Europe’s last 
wild  rivers,  should  receive  proper  protection  status.  The  National  Protected  Areas  Agency 
still has very limited capacities and financial instruments. Good progress was made with the 
adoption  of  the  set  of  rules  for  the  management  of  revenues  generated  by  fees  paid  in 
Protected Areas, and the establishment of the Special Fund for Protected Areas. In December 

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2020, the National Territorial Council approved without proper public consultations the map 
of  revised  borders  of  the  Protected  Areas,  where  many  protected  areas  are  projected  to  be 
more fragmented and smaller in size, despite an overall total size increase. This jeopardises 
the ecological functionality of certain Protected Areas. Albania should take into account the 
comments of the scientific community and other stakeholders before taking a decision on the 
revision  of  the  borders  of  the  Protected  Areas.  Albania  should  ensure  enforcement  of  the 
forest and logging laws, and prosecute offenders and arsonists. Environmental crime reports 
have increased during 2020 and first half of 2021, especially on deforestation, logging, arson, 
hunting  and  sale  of  wildlife  and  protected  species,  gravel  extraction  from  riverbeds,  and 
dumping of waste in rivers. The poaching of a lynx individual in Elbasan in May 2020, has 
not  yet  been  prosecuted  to-date.  The  moratorium  on  hunting  is  expected  to  expire  in  July 
2021 with no clear follow-up plan and procedure.  

Investments  in  hydropower  should  strictly  comply  with  national  and  international 
environmental,  nature  protection  and  water  management  obligations,  involve  proper  public 
participation  and  consultations,  and  be  subject  of  SEA  and  EIA  reports  that  include  high 
quality assessments of the cumulative impacts on nature and biodiversity. SEAs are lacking 
despite the high number of existing and planned hydropower installations in all river basins. 
They  should  be  conducted  before  any  activity  license  may  be  granted  for  single  projects. 
There is lack of inspection and monitoring of the minimum ecological flow from the current 
hydropower plants. 

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 
the  prevention  of  major  accidents  involving  dangerous  chemicals.  The  limited  data  on 
industrial  pollution  rely  on  companies’  self-monitoring  and  declarations.  The  enforcement 
capacity of the National Environment Agency and the Ministry of Interior is very limited. 

On  chemicals,  Albania  continued  to  align  with  the  EU  Regulation  on  the  registration, 
evaluation,  authorisation  and  restriction  of  chemicals  (REACH).  In  April  2021,  Albania 
approved  the  list  of  candidate  substances  and  groups  of  substances.  However,  the 
implementing legislation remains to be adopted and adequate administrative structures to be 
established.  

Albania performed during the reporting period urban  noise monitoring in  several  cities and 
municipalities in line with the National Monitoring Programme and according to WHO and 
national  standards.  It  should  strengthen  its  administrative  capacity  for  preparing  strategic 
noise maps and action plans. 

The  2019  Civil  Protection  Law  has  led  in  2020  to  the  creation  of  a  National  Agency  for 
Civil  Protection  (NACP).  It  requires  a  rapid  revision  of  the  outdated  national  strategy  and 
national  plan  and  a  review  of  the  related  prefectural  and  local  emergency  plans.  The 
administrative  capacity, 
infrastructure  and  systems  for  early  warning,  prevention, 
preparedness and response are still inadequate. The regular floods in the last decade and the 
2019 earthquakes, as well as the recent forest fires have highlighted the urgency of building 
efficient civil protection and disaster risk reduction (DRR) systems and mainstreaming them 
in  key  sectors  in  order  to  increase  the  country’s  resilience  to  natural  disasters  and  crisis, 
including  health  emergencies  such  as  the  Covid-19  pandemic.  Albania  should  align  further 
with  the  Floods  Directive,  notably  develop  flood  risk  management  plans  in  all  basins, 
enhance flood forecast and the operation and sustainability of the national monitoring stations 
network,  and  urgently  regulate  its  early  warning  and  hydrometric-meteorological  services. 
Albania  is  encouraged  to  accelerate  preparations  for  joining  the  Union  Civil  Protection 
Mechanism (UCPM). It should seek to establish secure trans-European services for telematics 

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between administrations (STESTA), which is a pre-condition for connecting to the Common 
Emergency  Communication  and  Information  System  (CECIS).  The  NACP  should  be 
provided with full capacity for this purpose.  

Climate change  

Albania  has  achieved  some  level  of  preparation  for  tackling  climate  change  by  adopting  in 
December  2020  the  climate  law,  but  alignment  with  the  acquis  still  remains  limited.  The 
2019 national strategy on climate change focuses on energy, transport, agriculture, land use 
and forestry, with a 32% renewable energy target, whereas the climate law aims at lowering 
the emission of greenhouse gases, accelerating the adaptation to climate change, complying 
with  international  obligations,  and  creating  a  legal  framework  in  line  with  the  EU  climate 
legislation. The strategy will require updating in line with the Green Agenda for the Western 
Balkans when Albania comes closer to  accession, due to  the new climate targets  set  by the 
EU.  The  implementation  of  the  climate  law  will  largely  depend  on  future  secondary 
legislation, regulations, and measures delegated to the minister for the environment. Lack of 
specific  administrative  structures  and  available  staff  for  handling  climate  change  issues 
remain a matter of serious concern.  

Albania has started to revise and enhance its Nationally Determined Contribution (NDC) for 
submission  to  the  Secretariat  of  the  UN  Framework  Convention  on  Climate  Change  in  the 
third  quarter  of  2021.  Albania  is  preparing  its  fourth  national  communication  which  will 
focus on climate change scenarios for municipalities alongside the Vjosa River, and its first 
biennial update report with GHG inventories.  

CLUSTER 5: RESOURCES, AGRICULTURE AND COHESION  

This  cluster covers: agriculture and rural  development (Chapter 11); food safety, veterinary 
and  phystosanitary  policy  (Chapter  12);  fisheries  (Chapter  13);    regional  policy  & 
coordination  of  structural  instruments  (Chapter  22);  and  financial  &  budgetary  provisions 
(Chapter  33).  Albania  has  some  level  of  preparation  in  most  areas  linked  to  resources, 
agriculture and cohesion, namely agriculture and rural development, food safety, veterinary 
and phytosanitary policy, fisheries, and financial and budgetary provisions. It is moderately 
prepared  as  regards  regional  policy  and  coordination  of  structural  instruments.  Albania  has 
made  good  progress  in  the  area  of  fisheries  not  least  with  the  introduction  of  the  vessel 
monitoring system. Some progress was made on financial and budgetary provisions as well as 
in  the  areas  of  agriculture  and  rural  development,  but  the  farm  register  needs  to  be  set  up. 
Progress  was  limited  during  the  reporting  period  on  regional  policy  and  coordination  of 
structural instruments. 

This cluster comprises policies linked to sustainable and inclusive territorial development as 
well  as  the  EU’s  funding  system,  requiring  particular  preparation  for  developing  the 
capacities to assume responsibilities of a future Member State. 

Chapter 11: Agriculture and rural development 

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

Albania has some level of preparation in agriculture and rural development. Some progress 
was achieved by ensuring administrative capacities for the implementation of the instrument 
for pre-accession assistance for rural development programme (IPARD II). Albania received 
entrustment  for  the  ‘Technical  Assistance’  measure.  Progress  was  also  achieved  in  further 
alignment  of  the  legal  framework  for  organic  production  with  the  EU  acquis.  The 

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Commission’s  recommendations  from  2020  were  not  fully  implemented  and  remain  valid,  
even if progress was made in the implementation of IPARD II. 

In the coming year, Albania should in particular:  

 set  up  a  farm  register  by  the  end  of  2021  at  the  very  latest,  further  improve  the  animal 
registers and adopt an implementation plan to establish the farm accountancy data network 
(FADN) to provide validated data for policy-making;  

 ensure  administrative  capacity  required  to  prepare  the  IPARD  III  programme  and  to 

submit for entrustment relevant measures available under it; 

 complete  the  legal  frameworks  on  vineyards  and  wine,  for  quality  schemes  and  organic 
production;  ensure the institutional and administrative capacity for their implementation. 

As  regards  horizontal  issues,  continuous  capacity  building  of  the  IPARD  authorities  is 
required  to  receive  entrustment  for  implementation  of  new  measures  under  the  IPARD 
programme. Strong cooperation among responsible national authorities should be ensured to 
facilitate  the  successful  implementation  of  the  IPARD  programme.  Full  staffing,  business 
continuity and institutional memory should be ensured for both operating and management, 
and control structures. 

There was limited progress  towards the establishment of a farm  register.  A fully functional 
farm register remains a key priority and should be established by the end of 2021 at the very 
latest. This is an element of the integrated administration and control system (IACS), but can 
be of assistance to implement the IPARD  III programme. Albania registered no progress in 
establishing  a  land  parcel  identification  system  (LPIS)  and  has  no  farm  accountancy  data 
network  (FADN).  It  continued  some  basic  preparatory  work  on  the  latter,  but  adopting  an 
implementation plan with a concrete timeline for the establishment of FADN remains to be 
achieved. 

Direct payments coupled to production and not subject to cross-compliance rules decreased 
from  2020  to  2021  both  in  absolute  terms  and  in  comparison  to  indirect  support  (i.e. 
distribution  of  diesel  to  farmers).  The  national  agriculture  budget  continues  to  be  low,  and 
IPARD should not be seen as a substitute for national support. A clear strategy is  yet to be 
adopted to complete the reform of the advisory system. 

There was no progress on common market organisation (CMO). Draft legislation on wine 
remains to be adopted and Albania should take additional steps to align this sector with the 
EU acquis. 

On  rural  development,  on  28  June  2020,  the  EU  granted  Albania  full  entrustment  of  the 
‘Technical  Assistance’  measure  under  the  IPARD  programme.  The  IPARD  implementation 
in Albania continued in a satisfactory manner in terms of number of contracts signed as well 
as  their  corresponding  contracted  value.  Albania  made  use  of  the  short-term  actions  made 
available by the Commission in order to counter the negative effects of the COVID-19 crisis 
and ultimately increase the number of IPARD-funded investment projects finalised and paid. 
Supported  by  a  one-year  funds  validity  extension  granted  by  the  Commission  and  through 
national capacity mobilisation, loss of IPARD II programme funding was avoided at the end 
of  2020.  However,  further  efforts  are  still  needed  as  a  risk  of  de-commitment  remains  for 
2021. 

On  quality  policy,  Albania  adopted  implementing  legislation  for  the  application  of  the 
traditional  speciality  guaranteed  scheme.  Quality  Policy  legislation  remains  partly  aligned 
with the EU acquis.  

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The level of alignment with the EU acquis on organic farming remains low. Partly aligned 
implementing  legislation  was  adopted,  establishing  detailed  rules  on  the  production  of 
processed  biological  food  for  animals,  biological  yeast  and  the  exemption  rules.  Albania 
continued the support for organic farming in 2021. 

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  and  made  some  progress  during  the 
reporting  period.  Albania  established  the  National  Authority  of  Veterinary  and  Plant 
Protection, but the authority has not yet acquired full operational capacity. Albania has made 
no  significant  steps  to  design  a  coherent  sector  policy  or  initiate  the  alignment  of  the  EU 
acquis on official  controls,  animal  health and plant  health. Albania  made some progress  on 
2020 recommendations, but they remain valid as more progress is needed.  

In the coming year, Albania should in particular:  

  complete the staffing of the veterinary service to make the service fully operational in line 

with tasks and functions defined by relevant regulations; 

  establish an effective surveillance capacity on main infectious animal diseases including 

rabies; 

  continue to efficiently implement the rabies vaccination programme (2020-2022);  

  start drafting the relevant laws on official controls, animal health and plant health in line 

with EU acquis under the framework of a consolidated national food safety policy. 

On general food safety, the National Food Authority has carried out regular official controls 
in  accordance  with  the  annual  risk-based  plan.  Nevertheless,  there  is  no  progress  regarding 
the  adoption  of  an  improved  risk  assessment  methodology,  due  also  to  the  absence  of 
necessary  operational  information  technology  systems  that  cannot  be  compensated  with 
existing  human  resources  required  to  analyse  the  data.  The  National  Authority  has  yet  to 
improve the quality of the inspection statistics, not limiting it to the number of inspections or 
measures taken on infringements. 

The National  Food Authority carries out  official  controls  at  Border Control Posts including 
products of animal origin, non-animal origin, live animals, veterinary medical products, plant 
propagation material and plant protection products. TRACES is used regularly. 

There  is  no  progress  regarding  the  scientific  risk  assessment.  Although  such  task  has  been 
confirmed in the relevant Decision of the Council of Ministers of 9 September 2020 “On the 
Organising  and  Functioning  of  the  National  Food  Authority”,  neither  the  Board  nor  the 
Scientific Panels have  convened  as  foreseen in the  provisions of the act.  In this regard,  the 
staff  of  the  National  Food  Authority  will  also  need  training  in  carrying  out  rapid  risk 
assessments to ensure that risk management decisions have a legal and scientific basis.    

As regards the veterinary policy, the government approved the set-up and functioning of the 

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National Authority of Veterinary and Plant Protection. However, the staffing of the structure 
is not yet complete.  

The programmes for the monitoring of brucellosis and tuberculosis in cattle herds with more 
than  10  heads  have  continued  also  during  2020.  Vaccination  against  lumpy  skin  disease  in 
cattle  and  brucellosis  on  replacement  animals  in  small  ruminants  continued  during  2020  as 
well. With the EU support, the first two vaccinations campaigns against rabies for the period 
2020-2022  were  completed.  The  third  vaccination  is  expected  to  take  place  in  November 
2021.  Taking full ownership of  these  vaccination  campaigns,  Albania  should  transition  to 
using  its  own  means  for  such  future  vaccination  campaigns  in  line  with obligations  to 
harmonise  with  the  relevant  EU  acquis.  Country-wide  verification  and  registration  of  the 
number  of  animals  in  Albania  is  being  implemented,  and  the  country  has  done  a  good 
progress  on  the  registration  and  identification  of  ruminants  and  pigs,  although  this  is  still 
ongoing. Also, animal  disease and animal  movement  reporting has improved. Nevertheless, 
the  animal  register  needs  to  include  more  information  on  other  animals,  such  as  swine, 
equine, poultry and other animals as referred to in the relevant EU Animal Health Law.    

The reform of the veterinary service is yet to be completed, including the staffing at all levels 
and the adoption of the internal operational procedures. It is important to establish a structure 
coherent with the requirements of the EU Animal health law. In this regard, Albania should 
establish  the  necessary  capacities  on  passive  and  active  surveillance  including  reliable 
assessments  of  the  prevalence  of  diseases,  thorough  data  analysis  and  appropriate  design, 
planning and implementation of effective systems for disease prevention and/or eradication.   

With  regard  to  the  placing  on  the  market  of  food,  feed  and  animal  by-products,  the 
National Residue Monitoring Plan including veterinary medical products, pesticide residues, 
heavy metals and mycotoxins in live animals and products of animal origin has been carried 
out regularly, in accordance with the requirements and validated analytical methods.   

The  National  Food  Authority  regularly  takes  samples  from  establishments  that  export  fish 
products,  which  are  analysed  for  chemical  and  microbiological  content  including  the 
histamines. 

The capacity to monitor the maximum level of pesticide residues in plant origin products has 
increased.  The  Institute  of  Veterinary  and  Food  Safety  tests  samples  over  a  significant 
number of chemical substances in accordance with the Commission guidelines on analytical 
quality control and method validation procedures for pesticide residues and analysis in food 
and feed. Albania should address the replacing of the annual monitoring plan with a national 
control  plan  based  on  additional  risk  factors  including  consumption  by  vulnerable  groups, 
and processing stages prior to consumption. 

Concerning food safety rules, Albania has continued with amendments to previous national 
regulatory acts regarding specific hygiene requirements for meat and meat products, milk and 
milk  based  products,  live  and  bivalve  molluscs  and  fish  and  fishery  products  to  ensure  a 
partial approximation to Regulation (EC) No 2074/2005. 

On  the  phytosanitary  policy,  the  Ministry  of  Agriculture  and  Rural  Development  has 
continued  approving  active  substances  of  plant  protection  products  in  line  with  relevant 
Commission's  Implementing  Regulations.  Albania  signed  an  agreement  with  North 
Macedonia  for  the  recognition  of  phytosanitary  certificates.  Following  the  reform  in  this 
sector,  the  phytosanitary  service  is  also  included  in  the  National  Veterinary  and  Plant 
Protection Authority (NVPPA) carrying out tasks related to the monitoring and verification of 
the  phytosanitary  condition  for  any  plant  pests  in  the  country,  supervising  the  use  of 

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hazardous plant protection on products posing high risks to human health and environment, 
and issuing phytosanitary certificates for export.   

With  regard  to  legislation  on  feed  or  genetically  modified  organisms,  the  approval  of  the 
decision  on  “The  rules  on  labelling  of  feed  for  animals  used  for  food,  including  those 
consisting or containing GMOs” of May 2020, has not been followed by other acts referring 
to  the  authorisation  procedure,  responsibilities,  organising  and  powers  of  the  competent 
authorities. 

Chapter 13: Fisheries 

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

Albania  has  some  level  of  preparation  in  fisheries.  Albania  made  good  progress 
undertaking  corrective  measures  with  regard  to  the  recommendations  of  the  Commission's 
2020  report,  specifically  on  the  reactivation  of  the  Vessel  Monitoring  System  (VMS). 
Albania  as  a  contracting  party  of  the  General  Fisheries  Commission  for  the  Mediterranean 
(GFCM)  is  fully  implementing  its  recommendations  to  control  the  fishing  effort.  The 
Commission’s recommendations from 2020 partly remain valid. 

In the coming year Albania should in particular:  

  complete staffing of fishery services and build up the necessary administrative capacity of 
the  fishery  sector  to  implement  national  policies  in  line  with  EU  Common  Fisheries 
Policy (CFP) and international agreements;     

  take  concrete  steps  for  implementing  the  Regional  Plan  of  Action  for  small-scale 

fisheries. 

Regarding resource and fleet management, the vessel register and fishery production data 
are  regularly  maintained  and  updated.  A  number  of  legal  acts  were  issued  to  regulate  the 
management  of  commercial  fishing  capacities.  Albania  signed  an  Agreement  with  North 
Macedonia  for  joint  fisheries  management  in  Lake  Ohrid  and  Lake  Prespa.  Specific 
ministerial orders adopting seasonal fishing ban have been issued to protect the fish stocks in 
the main lakes from uncontrolled fishing. With regard to small-scale fisheries, no significant 
step has been taken since the legal amendments to the Fishery Law in 2019.       

Inspection and control capacity has improved. The vessel monitoring system (VMS) was re-
established and is  fully functional  as of May  2021.  It will allow better fisheries  controls in 
marine  waters  and  recovery  of  the  stocks.  The  government  has  issued  an  order  to  increase 
staffing numbers engaged in  fishery inspection and controls.  Recruitment  procedures of the 
new fishery inspectors have been implemented and the relevant services are expected to hire 
the missing staff by second half of 2021. 

Following changes to the structure of the Ministry of Agriculture and Rural Development, a 
directorate  for  fishery  service  was  established.    The  directorate  is  composed  of  two  sectors 
i.e. the sector of Fisheries and Aquaculture Policy and the sector of Monitoring, Processing 
and Analysis of Data. Nevertheless, the capacity of both sectors to interpret and implement 

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the  national  legislation  or  the  EU  CFP  remains  weak  and  has  consequences  on  data 
collection, which needs further strengthening.  

The  government  approved  the  plan  of  allocated  zones  for  aquaculture  in  February  2021. 
However, the licensing of aquaculture ventures will be based on specifically designated areas 
following discussions with line ministries.  

On market policy, the regulations on the organisation of the markets and selling of fishery 
and aquaculture products were approved in 2019 but the relevant infrastructure is still to be 
completed. Sales in these wholesale markets are expected to start during 2021.   

Regarding  international  agreements  for  fisheries  management,  a  cooperation  agreement 
between Albania and North Macedonia has been concluded at the end of 2020. Albania is a 
contracting party of the GFCM and has fully implemented its recommendations to control the 
fishing effort. Albania should continue to  actively  participate in  and implement actions and 
recommendations  of the GFCM, including measures to  limit  fishing effort on small pelagic 
stocks and adoption of multi-annual management plans for the conservation and sustainable 
exploitation of the European eel, and demersal fishing activities in the Adriatic Sea.  

In  addition,  Albania  continues  to  fulfil  the  requirements  related  to  the  recommendations  of 
the  International  Commission  for  the  Conservation  of  Atlantic  Tunas  including  the 
preparation  of  a  multiannual  management  plan  for  tuna  in  the  East  Atlantic  and 
Mediterranean Sea.  

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  are  responsible  for  its  implementation,  which  requires  adequate 
administrative capacity and sound financial management of project design and execution. 

Albania is moderately prepared in the area of regional policy and coordination of structural 
instruments.  Limited  progress  was  made  over  the  reporting  period,  particularly  with  the 
adoption of the Law on Regional Development and Cohesion.  

The recommendations from 2020 remain partly valid. In the coming year, the country should 
in particular:  

 Prepare  for  effective  implementation  of  the  acquis  under  Chapter  22  and  factor  the 
requirements  of  the  future  structural/cohesion  funds  in  the  institutional  set-up,  the 
financial management  and  control systems  and the administrative capacity, ensuring that 
all its instruments and funds are gradually made compliant with EU requirements in terms 
of programming and partnership principles. In view of this, inter-agency coordination for 
pre-accession  assistance  needs  improvement,  and  issues  need  to  be  addressed  as  regards 
strategic  planning,  implementation  and  monitoring  capacity  of  infrastructure  projects 
under the Economic and Investment Plan; 

 Proceed  with  drafting  the  National  Strategy  and  Plan  for  Regional  Development  and 
Cohesion (2021-2027) and complete the Regional Development Plans (2021-2024) which 
should  foster  the development potential of all regions  in  Albania with  a view to  provide 
them  with  opportunities  to  develop  by  themselves  and  to  proceed  with  decentralised 
interventions based on local and/or regional integrated plans and strategies; 

 further  strengthen  the  administrative  capacity  of  central,  regional  and  local  bodies, 
especially  at  central  level  as  regards  the  Central  Finance  and  Contracting  Unit  (CFCU), 
the National Authorising Officer’s Support Office, the Audit Authority, and the National 
IPA Coordinator’s Support Office, in particular by ensuring adequate staffing; 

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As  regards  the  legislative  framework  for  regional  policy,  Albania  is  in  the  process  of 
revising  its  national  strategy  for  development  and  integration,  as  well  as  several  sectoral 
reform strategies. The Deputy Prime Minister’s Office (DPMO) and Albanian Development 
Fund  (ADF),  as  main  institutions  responsible  for  the  Regional  Development  agenda  in 
Albania, have advanced the reform with the approval of the Law on Regional Development 
and  Cohesion  in  September  2020.  The  ex-ante  Regulatory  Impact  Assessment  aimed  at 
ensuring  the  quality  of  legal  and  institutional  set-up  of  the  regional  development  policy  as 
well  as  transparency  in  considering  risks,  costs  and  benefits  has  been  completed.  Adequate 
co-financing capacity for EU programmes remains to be set up at national and local levels. 

On the institutional framework, relevant bylaws on establishing a comprehensive Regional 
Development system need to be adopted to define the role and responsibilities of each of the 
actors  involved  in  cohesion  policy.  As  a  means  of  ensuring  practical  preparations  in  the 
meantime,  a  more  systematic  coordination  on  EU  integration  and  EU  assistance  between 
national entities, in particular the National IPA Coordinator’s Support Office, the IPA Units 
and  the  CFCU,  needs  to  be  established.  Albania  also  needs  to  address  issues  with  strategic 
planning,  implementation  and  monitoring  capacity  of  infrastructure  projects  financed  under 
Economic and Investment Plan.  

On  administrative  capacity,  the  staff  of  the  structures  involved  in  indirect  management 
continued  to  receive  training.  The  administrative  capacity  for  coordinating  and  monitoring 
sectoral  reform  through  the  integrated  policy  management  groups  and  sectoral  steering 
committees  is  in  the process  of being improved.  The involvement of development  partners, 
local  governments  and  civil  society  organisations  in  sectoral  dialogue  is  still  in  need  of 
improvement. 

It should also be noted that Albania is one of the five accession countries participating in the 
European  Strategy  of  Adriatic  Ionian  Region  (EUSAIR),  which  promotes  cooperation  and 
synergies among the participating EU and non-EU countries. 

As regards programming, more efforts are needed to develop an autonomous programming 
capacity  in  the  period  ahead  (2021-2027).  The  national  project  pipeline  of  investments, 
including  those  for  regional  development,  is  not  yet  fully  aligned  with  the  medium-term 
budget  programme  and  the  planning  and  management  of  nationwide  public  investment.  A 
key element for the success of the regional development process will be to build ownership of 
public and private actors at national and sub-national levels. The ADF and DPMO organised 
an Awareness Raising Campaign for Regional Development and Cohesion with stakeholders 
and development partners (institutional and non-institutional actors) with a view to updating 
and  finalising  of  the  National  Plan  for  Regional  Development  and  Cohesion  and  of  the 
Regional Development Plans. 

On  monitoring  and  evaluation,  the  sectoral  monitoring  committee  issued  operational 
recommendations  for  all  IPA  sectors.  However,  the  staffing  of  the  National  IPA 
Coordinator’s Support Office remains insufficient to allow for the adequate monitoring of the 
full  range  of  programme  activities  on  a  daily  basis.  The  support  offices  of  the  National 
Authorising Officer and the National IPA Coordinator has yet to establish a list of operational 
key performance operators to evaluate the performance of operations.  

On financial management, control and audit, the law on the Audit Authority needs to be 
amended  to  ensure  that  management  powers  remain  with  the  General  Director,  and  are  not 
subordinated to  the Supervisory Council. The National  Authorising Officer needs to  ensure 
that  its  management  declaration  adequately  reflects  the  results  of  its  supervision  and 
monitoring  of  management  and  control  systems.  The  Officer’s  Support  Office  has  yet  to 

122 

 
 
establish procedures to ensure immediate dissemination, and the implementation throughout 
the institutions, of any guidance, instructions or recommendations issued by the Commission 
with regard to internal control. Irregularities are still to be registered completely and without 
delay  in  the  irregularity  management  system  and  internal  control  weaknesses  and  non-
compliance events are not yet systematically reported in a dedicated registry. 

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;  (iii)  the  non-recycled  plastic  resource  and  (iv)  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 
progress  in  implementation  of  the  2016  Organic  Budget  Law,  the  fiscal  rule  and  the 
continuation  of  the  public  finance  management  reform.  Alignment  with  EU  acquis  in  the 
last  year’s 
underlying  policy  fields  continued.  Albania  made  some  progress  on 
recommendations,  as  progress  was  made  on  alignment  with  ESA  2010  standards,  but  they 
remain valid as more progress is needed. 

In addition to addressing the shortcomings set out below, in the coming year Albania should 
in particular:  

 continue  aligning  data  on  National  Accounts  to  ESA  2010  (European  System  of 

Accounts), and improving the comprehensiveness of data transmission to Eurostat; 

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

Some  progress  was  made  on  the  underlying  policy  areas  indirectly  affecting  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.  However,  it  has  not  yet  finalised  the  mid-term 
Revenue Strategy (MTRS) that was foreseen to be adopted in 2020. 

As  regards  the  Gross  National  Income  (GNI)  resource,  further  progress  was  made  on 
alignment with ESA 2010 standards, but Albania needs to further improve compliance with 
ESA 2010 and to start drafting the GNI Inventory, on the basis of the existing description of 
sources  and  methods  used  to  compile  its  national  accounts.  It  has  made  methodological 
improvements on statistics and on improving the speed of their publication, and on increasing 
the number of statistical  tables that are reported to  Eurostat.  INSTAT has been working on 
the  next  benchmark  revision  of  national  accounts,  and  has  prepared  a  harmonised  revision 
policy  in  coordination  with  the  Central  Bank  of  Albania  and  the  Ministry  of  Finance  and 
Economy  (MOEF).  Due  to  the  Covid-19  pandemic,  the  benchmark  revision  foreseen  to  be 
adopted in 2020 was postponed to 2024.  

Albania continued preparations for improving the estimation of its non-observed economy. A 
pilot project to improve the exhaustiveness adjustments of GDP/GNI estimates, designed in 
particular to develop new experimental estimates on illegal activities and fiscal audit, is being 

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implemented.  Efforts  to  improve  the  exhaustiveness  of  national  accounts  estimates  are  also 
being undertaken. Continued efforts are needed to ensure that effective measures are taken to 
formalise  the  informal  economy,  improve  the  exhaustiveness  of  the  national  accounts  and 
GDP/GNI calculations and combat fiscal evasion and customs duty fraud. 

On  administrative  infrastructure,  MOEF  has  overall  responsibility  for  financial  and 
budgetary issues. Albania will need to work on establishing the relevant institutions involved 
in  the  own  resources  system,  an  own  resource  coordination  body  and  implementing  rules. 
These are needed to ensure that, on accession, it will be able to  calculate, forecast, account 
for, collect, pay, control, and report to the EU, on own resources in line with the acquis. 

CLUSTER 6: EXTERNAL RELATIONS  

There are two chapters in this cluster: 30-external relations (Chapter 30);  foreign, security & 
defence policy (Chapter 31). Albania has a good level of preparation as regards the latter, as 
it continued to maintain full alignment with all relevant EU decisions and declarations of the 
EU’s  Common  Foreign  and  Security  Policy.  The  country  has  made  good  progress  and 
reached a good level of preparation for the external relations chapter which covers the EU’s 
common trade and commercial policy towards third countries as well as its humanitarian aid 
and its development policy. Albania has in particular adopted and ratified CEFTA additional 
protocols and worked on extending the Green Lanes/Corridors with EU Member States. 

Chapter 30: External relations 

The  EU  has  a  common  trade  and  commercial  policy  towards  third  countries,  based  on 
multilateral and bilateral agreements and autonomous measures. There are also EU rules in 
the field of humanitarian aid and development policy. 

Concerning  the  acquis  on  external  relations,  Albania  has  a  good  level  of  preparation. 
Following  the  successful  chairmanship  of  the  Central  European  Free  Trade  Agreement 
(CEFTA) by Albania in 2019, good progress was made in addressing the recommendations 
of the 2020 report. Albania adopted and ratified the CEFTA Additional Protocol (AP) 6, and 
the  certification  of  the  first  authorised  economic  operators  (AEOs)  under  AP  6  was 
successfully  completed.  Work  also  advanced  on  extending  the  Green  Lanes/Corridors  with 
EU  Member  States.  Progress  was  also  made  on  enhancing  the  trade  policy  related  to 
administrative  capacities  and  the  activities  of  the  national  trade  facilitation  committee  by 
establishing a dedicated trade unit, as well as Albania adopted its national control list of dual-
use goods in  line with  EU  acquis.  Moreover, Albania also  adopted the amendments  to  the 
SAA  on  the  updates  on  preferential  rules  of  origin  of  the  pan-Euro-Mediterranean 
Convention related to the definition of the concept of "originating products" and methods of 
administrative cooperation. 

In the coming year, Albania should in particular: 

  continue  implementing  the  national  action  plan  on  trade  policy  coordination  and 

facilitation,   and strengthening the administrative capacity; 

  continue aligning the relevant legislation with  the acquis in the field of export control of 

dual-use goods;  

  conclude the negotiations and subsequently adopt CEFTA AP 7, continue implementing 
actions  under  the  Common  Regional  Market  (CRM)  action  plan  2021-2024  for  the 
development  of  a  Regional  Economic  Area,  including  on  mutual  recognition  of 
professional qualifications, facilitating trade in services provided by travel agencies and 
tour operators  on removal of the requirements of work permits for professional activities 

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under AP6 and promotion of e-commerce, as well as continue implementing the national 
Investment Action Plan. 

On the common commercial policy, Albania continued to coordinate its positions and align 
its  policies  closely  with  those  of  the  EU,  including  within  the  World  Trade  Organization 
(WTO) as regards the dispute settlement understanding (DSU), proposed mechanisms of the 
DSU  and  the  Joint  statement  on  Services  Domestic  Regulation.  Albania  ratified  the  WTO 
Trade Facilitation Agreement and notified its list of commitments. Due to COVID-19 crisis 
measures,  in  March  2020  Albania  adopted  the  order  on  prohibition  of  export  of  medicines 
and medical equipment, which remains in force. Albania cooperates with the OTAWA Group 
countries on the preparation  of the WTO initiative on trade and health in the framework of 
the global efforts to fight the pandemic situation. 

Albania  adopted  its  national  control  list  of  dual-use  goods  in  line  with  EU  Regulations.  In 
January  2020,  the  Council  of  Ministers  adopted  the  regulation  on  the  organisation, 
functioning  and  status  of  the  State  Export  Control  Authority,  the  procedure  for  sharing 
information  and  gathering  opinions  with  other  institutions  involved  in  the  international 
transfer  of  controlled  goods,  and  the  procedures  for  state  guarantees  and  controls.  Further 
alignment is needed with the EU acquis on export controls of dual-use goods. A specific unit 
dealing  with  dangerous  goods,  dual  use  and  illegal  trafficking  was  set  up  in  the  anti-
trafficking directorate of the General Directorate of customs. While there was no progress on 
its participation in the multilateral export control regimes, Albania aligned its list with the EU 
lists  of  dual-use  goods  and  military  items  deriving  from  those  regimes.  With  regard  to 
participation  in  the  Wassenaar  Arrangement,  Albania  conducted  a  thorough  analysis  and 
concluded  that  would  apply  for  membership.  Albania  prepared  a  draft  law  to  align  its 
legislation  with  the  EU’s  acquis  on  trade  in  certain  goods  that  could  be  used  for  capital 
punishment, torture or other cruel,  inhuman or degrading treatment  or punishment.  Albania 
provided  this  draft  law  to  the  Commission  for  comments.  The  structure  of  the  Albanian 
Export Control Authority has been in place since 2014 and has a staff of 19 employees.  

There is  no progress  in  the area of  export credit guarantee while the second tier banks  do 
provide  guarantees  such  as  payment  guarantee,  performance/contract  guarantee  and  bid 
guarantee.  There  is  no  state-supported  export  credit  insurance  provider.  Banks  have  little 
interest in issuing this type of guarantee without being secured by another body. 

third 

signed 

three  new  bilateral  agreements  with 

countries  on 
Albania 
economic/trade/technical cooperation. In October 2020, Albania signed the memorandum of 
economic  cooperation  with  the  United  States  of  America  on  projects  and  acquisitions  in 
Albania.  An  agreement  on  economic  cooperation  between  Albania  and  the  United  Arab 
Emirates  was  signed  in  November  2020.  Albania  concluded  a  Partnership,  Trade  and 
Cooperation Agreement with the United Kingdom of Great Britain and Northern Ireland that 
entered  into  force  on  3  May  2021,  as  a  result  of  the  latter  withdrawing  from  the  European 
Union, with which Albania has the Stabilisation and Association Agreement (SAA) in force. 
It now has 39 such agreements, including 13 with EU Member States. Albania has Bilateral 
Investment Treaties with 45 countries and seven treaties are under negotiation with Slovakia, 
Iran, Canada, Morocco, Lebanon, Saudi Arabia and Iceland. Negotiations for amending the 
free  trade  agreement  (FTA)  with  Turkey  continued,  with  a  focus  on  trade  in  services  and 
investments,  and implementation  of rules of origin under the Pan-Euro-Med Convention as 
well as on further mutual  concessions for agricultural  products.  In July 2020, the Albanian 
Parliament  ratified  the  changes  to  Protocol  II  of  the  FTA  between  Albania  and  Turkey 
concerning  the  definitions  of  “originating  products”  and  “methods  of  administrative 
cooperation”.  In  January  2021,  Albania  signed  a  declaration  on  the  establishment  of  the 

125 

 
 
High-Level Strategic Cooperation Council with Turkey, thus upgrading relations to the level 
of strategic partnership. This included the signing of five bilateral agreements with a focus on 
security and fight against terrorism, education and cultural heritage as well as cooperation in 
the medical field. In May 2021, the Council of Ministers adopted the decision to amend the 
SAA  to  take  account  of  the  updates  on  preferential  rules  of  origin  of  the  pan-Euro-
Mediterranean Convention related to the definition of the concept of "originating products" 
and methods  of administrative cooperation, which was ratified by the Parliament on 7 July 
2021.   

Interest was expressed in establishing joint committee/economic cooperation agreements with 
Algeria,  Egypt,  Cuba,  India,  Norway,  Georgia,  Ukraine,  and  Lebanon.  Negotiations  have 
started with Kazakhstan for a possible revision of the 2015 agreement on trade and economic 
cooperation.  

In 2019, Albania successfully held the chairmanship of CEFTA, at the end of which the joint 
committee endorsed, among others, the adoption of the CEFTA AP 6 on trade in services and 
the  decision  on  establishing  the  validation  procedure  for  the  mutual  recognition  of  CEFTA 
Parties’  national  Authorised  Economic  Operators  (AEO).  Albania  continued  its  awareness 
campaign with private sector representatives as regards the AEOs application procedures and 
benefits,  and  has  registered  12  applications  from  local  businesses.  The  first  four  authorised 
economic  operators  were  certified  by  the  General  Directorate  of  Customs  and  preparations 
have  started  for  mutual  recognition  by  CEFTA  parties.  Albania  continued  to  work  in  line 
with its commitments under the Western Balkans Multi-Annual Action Plan for developing a 
Regional Economic Area (REA). The government established a mechanism for implementing 
and monitoring of the REA and later, of the Common Regional Market (CRM). It has started 
working  on  facilitation  of  regional  electronic  commerce  and  on  mutual  recognition  of 
professional qualifications, starting with civil engineers, and has established a working group 
on  liberalisation  of  trade  in  the  tourism  sector.  Together  with  other  parties  of  the  CEFTA, 
Albania  has  worked  on  extending  the  Green  Lanes/Corridors  with  EU  Member  States, 
namely  with  Greece  at  the  Kapshtica  -  Kakavija  border  crossing  point;  it  has  prepared  and 
sent to the CEFTA Secretariat the priority list of pharmaceutical products, and vaccines and 
COVID test that will pass through the green corridors; efforts were made to reduce waiting 
times at the border points of the trucks and to harmonise the working hours of all inspection 
authorities  with  neighbour  CEFTA  parties.  Currently,  the  Albanian  authorities  are 
considering a pilot project to extend the green corridors between Durres Port and the Italian 
Port of Ancona.  

CEFTA AP 6 was ratified by the parliament in April 2020 and entered into force in January 
2021.  In  the  framework  of  the  CMR  action  plan  2021-2024  for  the  Western  Balkans  6, 
Albania has expressed its commitment to join efforts in developing regional guidance criteria 
and  procedures  for  FDI  screening  mechanisms  based  on  the  emerging  EU  standards  and 
policy, and taking into account the individual economy and region’s policy priorities. Albania 
continued  its  efforts  to  implement  the  CEFTA  Joint  Committee  Decision  on  Facilitating 
Trade in Fruits and Vegetables, part of which is also the registration by 31 March 2021 of the 
exporting  operators  willing  to  be  involved  in  the  exporting  of  the  agreed  list  of  fruits  and 
vegetables  for  which  the  phytosanitary  situation  in  all  the  Parties  is  similar.  As  part  of 
implementing the national investment action plan (IRAP), Albania has worked on preparing a 
list  of  investment  incentives,  which  is  published  on  the  website  of  the  Ministry  of  Finance 
and  Economy,  and  has  conducted  a  legal  gap  analysis  and  a  diagnostic  report  on  the 
grievance  mechanism  in  Albania.  In  January  2021,  Albania  has  established  a  negotiating 
team and has participated to the discussions on CEFTA AP 7 on dispute settlement, and has 
participated regularly in the negotiation rounds. 

126 

 
 
Some  efforts  were  made  to  strengthen  the  administrative  capacities  on  trade  policy  by 
establishing a trade unit, which is composed of one head of unit and two experts, as part of 
the Directorate of economic development policies. The unit deals with trade policy, including 
with  the  EU,  CEFTA  and  the  WTO,  under  the  supervision  of  the  director  of  the  economic 
development  directorate.  Two  experts  of  the  trade  unit  together  with  one  expert  from  the 
customs  directorate  form  the  Technical  Secretariat  of  the  National  Committee  for  Trade 
Policy  and  Facilitation.  Further  efforts  are  needed  to  strengthen  the  administrative  and 
operational capacities. 

The  National  Trade  Facilitation  Committee  (NTFC),  through  a  decision  of  the  Council  of 
Ministers of August 2020, has expanded the mandate and the scope of its work, by including 
trade in services as an important aspect of the trade facilitation, and therefore adjusting to the 
CEFTA developments as regards starting the implementation of AP 6 on Trade in Services. 
During the reporting period, there were two virtual meetings of the NTFC due to the COVID-
19 pandemic, and its members discussed the results achieved until  the end of 2020 and the 
mid-term  2021-2023  plan  of  activities.  The  NTFC  members  have  agreed  to  focus  on  the 
implementation  of the CMR Action Plan, and proposals  from  the business associations and 
chambers  of  commerce  were  taken  into  consideration.  As  part  of  the  NTFC  plan  for  2021-
2023  Albania  has  included  under  the  WTO  Trade  Facilitation  Agreement  (Article  7)  also 
commitments  such  as  pre-arrival  processing,  post  clearance  audit/control,  risk  based 
inspection,  trade  facilitation  measure  for  authorized  operators,  border  agency  cooperation, 
and an appeal procedure. Albania has no development policy framework for cooperation/aid 
or  agency  for  development  cooperation.  The  country  is  encouraged  to  establish  a  legal 
framework  covering 
international  cooperation  and  development  policy  as  well  as 
humanitarian aid towards non-EU countries, in accordance with EU policies and principles.  

The  2001  Law  on  Non-Profit  Organisations  recognises  the  potential  activities  of  such 
organisations  in  the  field  of  humanitarian  aid,  and  allows  them  to  carry  out  development 
and humanitarian aid activities in Albania and elsewhere.   

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. 

Concerning  the  EU’s  foreign,  security  and  defence  policy,  Albania  has  a  good  level  of 
preparation. The country held the OSCE’s chairmanship-in-office in 2020 and was elected a 
non-permanent  member  of  the  UN  Security  Council  in  2022/2023,  demonstrating  its 
commitment  to  multilateral  cooperation.  Albania  continued  to  participate  in  EU  crisis-
management  missions  and  operations.  It  continued  to  fully  align  with  all  applicable  EU 
positions  and  implement  EU  restrictive  measures  despite  increasing  pressure  from  non-EU 
actors. Some progress was made by making the police’s firearms focal point operational and 
by completing security upgrades of storage facilities for armaments and ammunition.  

In the coming year, the country should in particular: 

  maintain its full alignment with the EU foreign, security and defence policy; 

  continue to implement the national strategy on small arms and light weapons, and step up 

the investigation and prosecution of firearms trafficking. 

The  political  dialogue  between  the  EU  and  Albania  on  foreign  and  security  policy  issues 
continued, including through Albania’s active engagement in the EU’s regional dialogue with 
the Western Balkans at political directors’ level (for more information on relations with other 

127 

 
 
enlargement countries and EU Member States, see Political criteria — Regional issues and 
international  obligations).  Albania  also  participates  in  the  informal  CFSP  expert  seminars 
initiated by the EU in February 2021 

Albania’s  Ministry  for  Europe  and  Foreign  Affairs  and  the  Ministry  of  Defence  have 
appropriate  structures  to  participate  in  the  common  foreign  and  security  policy,  and  the 
common security and defence policy. As regards the  common foreign and security policy 
(CFSP),  when  invited,  Albania  aligned  with  all  relevant  Council  decisions  and  High-
Representative declarations on behalf of the EU, including restrictive measures, and despite 
increasing  pressure  from  non-EU  actors  (100%  alignment).  This  is  a  strong  signal  of  the 
country’s  commitment  to  its  EU  path.  It  implements  EU,  UN  and  other  international 
sanctions. A committee on international restrictive measures led by the Ministry for Europe 
and Foreign Affairs was set up in September 2020. 

Albania  maintains  a  bilateral  immunity  agreement  with  the  United  States,  granting  US 
citizens exemptions from the jurisdiction of the International Criminal Court. In doing so, 
it  does  not  comply  with  the  EU  common  positions  on  the  integrity  of  the  Rome  Statute  or 
with the related EU guiding principles on bilateral immunity agreements. Alignment with the 
EU position is therefore needed. 

Albania continued to implement its national strategy and action plan on small arms and light 
weapons adopted in February 2019. It also remained actively engaged in the implementation 
of the 2018 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, as 
well as other regional forms of cooperation, such as the European multidisciplinary platform 
against criminal threats (EMPACT) on firearms.  

Albania further aligned its law on weapons with the EU acquis through amendments adopted 
in December 2020. The firearms focal point of the Albanian State Police became operational 
and the national electronic registry for weapons continued to be fully functional. Albania also 
made  further  progress  on  improving  the  security  of  storage  facilities  for  armaments  and 
ammunition.  Security  upgrades  of  the  State  Police’s  storage  facility  in  Mullet  have  been 
completed.  

Albania  continued  to  participate  in  some,  but  not  all,  international  export  control 
arrangements  and  instruments  on  non-proliferation.  It  started  procedures  to  join  the 
Wassenaar Arrangement in September 2020 and should conclude the process rapidly.  

Albania  continued  to  engage  actively  with  international  organisations.  It  held  the 
Chairmanship-in-Office of the Organisation for Security and Cooperation in Europe in 2020 
and,  in  June  2021,  was  elected  for  the  first  time  a  non-permanent  member  of  the  United 
Nations Security Council in 2022/2023. Albania maintained a robust presence in a number of 
NATO  missions,  including  some  of  strategic  importance  to  the  EU,  and  contributed  to  the 
United Nations Mission in South Sudan. 

Albania continued to participate in EU crisis management missions and operations under the 
common  security  and  defence  policy  (CSDP),  notably  EUFOR  Althea  in  Bosnia  and 
Herzegovina. The country plans to contribute to the EU battle groups in 2024. 

On hybrid threats, Albania  engaged in  the EU’s hybrid risk survey,  with  the objective of 
identifying systemic vulnerabilities and further improving the assistance provided by the EU 
in this field. 

128 

 
 
 
 
 
ANNEX I – RELATIONS BETWEEN THE EU AND ALBANIA  

The  Stabilisation  and  Association  Agreement  (SAA)  between  Albania  and  the  EU  came 
into force in April 2009. The transitional period of the SAA ended on 31 March 2019 and that 
since  1  April  2019,  Albania  is  thus  fully  associated  with  the  EU.  In  the  reporting  period, 
Albania  continued  to  implement  its  commitments  under  the  SAA.  Regular  political  and 
economic  dialogue  has  continued  through  the  relevant  joint  bodies  under  the  SAA.  The 
Stabilisation  and  Association  Committee  took  place  on  9  December  2020.  Discussions 
focused  on  progress  in  SAA  implementation  as  well  as  of  the  most  important  reforms 
developments.  The  Stabilisation  and  Association  Council  met  on  1  March  2021.  The 
Stabilisation  and  Association  Parliamentary  Committee  did  not  gather  during  the  reporting 
period.  

The  SAA  and  its  Interim  Agreement,  applied  since  2006,  have  allowed  progressive  trade 
liberalisation and mutual duty-free access for most goods. Since 2000 Albania has also been 
benefiting from the ‘Autonomous Trade Measures’. Albania is a WTO member since 2000, 
and  joined  the  Central  European  Free  Trade  Agreement  (CEFTA)  in  2007.  The  EU  is  the 
main  trading  partner  of  Albania,  followed  by  CEFTA  countries.  Trade  integration  with  the 
EU  is  high.  In  2020  the  EU  remained  the  main  trading  partner  of  Albania,  accounting  for 
63% of Albania’s total trade in goods (75% of total exports and 58% of total imports).  This 
represents  a  fall  of  9.4%  in  2020,  which  is  entirely  due  to  the  COVID-19  crisis,  and  is 
broadly in line with trade patterns elsewhere in the region. Total trade in 2020 was worth €4.5 
billion.  The  country’s  trade  deficit  with  the  EU  amounted  to  EUR  1.3  billion  in  2020.  In 
comparison, Albania’s trade with CEFTA represented 10.3% of total trade, a decline of only 
2.6%, which is much less than expected and demonstrates ongoing regional integration. 

Albania is a candidate country since 2014. In 2018, the Commission issued an unconditional 
recommendation to open accession negotiations. On 26 March 2020, the European Council 
endorsed  the  Council’s  decision  to  open  accession  negotiations  with  Albania.  On  12  May 
2021,  the  Commission  informed  the  Council  that  all  conditions  to  be  fulfilled  prior  to  the 
holding of the first Inter-Governmental Conference of accession negotiations were met, since 
the Constitutional Court has regained functionality in December 2020.  

Visa liberalisation for citizens of Albania travelling to the Schengen area has been in force 
since  December  2010.  A  readmission  agreement  between  the  EU  and  Albania  has  been  in 
force  since  2006.  The  Commission’s  August  2021  fourth  report  under  the  visa  suspension 
mechanism27 concluded that Albania continues to meet the visa liberalisation requirements. 

Albania is the only country from the region that has signed cooperation agreements with all 
justice and home affairs agencies of the EU. The only Europol liaison officer in the Western 
Balkans was deployed in Tirana in 2019 for a term currently running into 2022. This further 
intensified  the  cooperation  with  Europol.  A  liaison  prosecutor  was  deployed  to  Eurojust  in 
the Hague in January 2021. The first Frontex joint operation outside the EU deployed at the 
Greek-Albanian border in May 2019 was supplemented in March 2021 with a sea border joint 
operation deployed near Durres. In March 2021 a new working arrangement was signed with 
FRONTEX.  A  second  FRONTEX  liaison  officer  to  the  Western  Balkans  with  a  mandate 
covering  Albania,  Kosovo,  and  North  Macedonia  was  deployed  in  Tirana  in  January  2021.  
Albania  continues  to  cooperate  with  EMCDDA  under  the  working  arrangement  signed  in 
March 2019 on drug related issues. Albania was granted Observer Status to EU Fundamental 
Rights  Agency  by  decision  of  the  EU-Albania  Stabilisation  and  Association  Council  in 

27 COM(2021)602 final and SWD(2021)206 final 

129 

 
 
                                                           
November  2019.  Albania  appointed  an  Observer  to  the  Agency  in  2020  and  a  positive 
engagement with Albanian stakeholders started. 

Albania  has  continued  to  fully  align  with  all EU  common  foreign  and  security  policy 
positions and declarations. Albania continued to actively participate in EU crisis management 
missions  and  operations  under  the  common  security  and  defence  policy,  notably  EUFOR 
Althea in Bosnia and Herzegovina and EUTM Mali.  

Under  the  Instrument  for  Pre-accession  Assistance  (IPA)  Albania  benefits  from  the 
indicative  allocation  of  EUR  758  million  for  the  period  2014-2020.  In  response  to  the 
COVID-19  outbreak,  EUR  50.65  million  was  reprogrammed  from  the  IPA  2019  and  2020 
envelopes,  to  allow  provision  of  urgent  medical  supplies  and  support  for  the  mitigation  of 
socioeconomic  impact  of  the  crisis.  Other  programmes  were  also  reoriented  to  help  reduce 
the impact of the pandemic and Albania signed a loan of EUR 180 million in Macro Financial 
Assistance, of which 90 million were disbursed on 31 March 2021.  

The Commission set aside 70 MEUR in grants from IPA II for the Western Balkan partners 
to reimburse the Member States for the resale of doses they obtained under the EU Advance 
Purchase  Agreements  with  COVID-19  vaccine  producers,  of  which  Albania  received  EUR 
11.2 million; the first vaccines provided under this grant were a total of 649,350 Pfizer doses 
for the region (143,910 for Albania) facilitated by Austria, which are being delivered between 
May  and  August  2021.  EU  Member  States  donated  another  140,000  COVID-19  vaccine 
doses by September. The EU supported COVAX initiative also delivered over 143,400 doses 
to Albania by the same date. 

Following  the  November  2019  earthquake,  the  EU  pledged  EUR  115  million,  which  have 
been  translated  into  two  programmes.  The  EU4Schools  supports  reconstructing  and 
rehabilitating education  facilities damaged by the earthquake. The EU4Culture supports the 
rehabilitation  of  the  cultural  heritage  sites  gravely  damaged  by  the  earthquake,  as  well  as 
related economic activities to support the tourism related to these sites.  

While the recent focus has been on mobilising support in response to the double shock of the 
earthquake  and  the  COVID-19  pandemic,  IPA  has  also  continued  to  help  the  country  to 
deliver on key reforms such as the justice reform, for instance in the process of reevaluation  
of  judges  and  prosecutors  (“vetting”),  and  in  supporting  the  specialised  structures  against 
corruption and organised crime. 

Furthermore,  Albania  benefits  from  the  IPA  multi-country  and  regional  programmes  and 
participates  in  five  cross-border  cooperation  programmes,  as  well  as  in  transnational 
cooperation  programmes.  Albania  participates  with  IPA  support  in  the  EU  programmes 
Erasmus+, Creative Europe (Culture and Media strands), Employment and Social Innovation, 
Horizon 2020, Customs 2020, Fiscalis  2020, Competitiveness  of Enterprises and Small  and 
Medium-Sized  Enterprises  Programme  (COSME),  Justice,  Europe  for  Citizens  and  EU 
Fundamental Rights Agency (FRA) (observer). 
The IPA III Regulation for the 2021-2027 financial period28 will continue to provide financial 
support to the region and will also finance the regional Economic Investment Plan (EIP) for 
the Western Balkans. The EIP, accompanied by the Green Agenda for the Western Balkans, 
was agreed by the Commission and the countries of the region in October 2020 and aims to 
spur  the  long-term economic recovery  of  the  region,  support  a  green  and  digital  transition, 
and foster regional integration and convergence with the European Union. 

28  

Official Journal L 330, 20.9.2021 

130 

 
 
 
                                                           
STATISTICAL DATA (as of 09.09.2021) 
Albania 

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

National accounts 
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-27 = 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 (%) 
Unit labour cost growth, relative to the previous year (%) 
**3 year change (T/T-3) in the nominal unit labour cost growth index (2015 = 100) 
Labour productivity per person employed: GDP (in PPS) per person employed relative to EU 
average (EU-27 = 100) 
Gross value added by main sectors 
Agriculture, forestry and fisheries (%) 
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 (%) 

Business 
Industrial production volume index (2015 = 100) 
Number of active enterprises (number) 

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

Note 

Note 

2008 
2 958 s 
28 748 w 

2015 
2 886 s 
28 748 w 

2016 
2 876 s 
28 748 w 

2017 
2 877 s 
28 748 w 

2018 
2 870 s 
28 748 w 

2019 
2 862 s 
28 748 w 

2008 
1 080 676 
8 800 
2 990 
6 500 
25.3 
: 
: 
: 

2015 
1 434 307 
10 264 
3 560 
8 770 
30.5 
: 
: 
: 

2016 
1 472 479 
10 720 
3 730 
8 630 
29.8 
: 
: 
: 

2017 
1 550 646 
11 559 
4 020 
8 930 
29.9 
: 
: 
: 

2018 
1 636 731 
12 828 
4 480 
9 360 
30.4 
: 
: 
: 

2019 
1 691 729 p 
13 753 p 
4 820 p 
9 840 p 
30.8 
: 
: 
: 

: 
: 
: 

19.4 
10.8 
18.2 
51.5 s 
93.5 
33.9 
1.8 b 
25.3 d 
52.1 d 
: 

: 
: 
: 

22.5 
14.6 
10.1 
52.7 s 
91.8 
24.4 
1.4 
27.3 
44.5 
: 

: 
: 
: 

22.6 
14.0 
10.2 
53.2 s 
92.2 
24.4 
0.9 
29.0 
45.8 
: 

: 
: 
: 

21.8 
12.8 
10.5 
54.9 s 
91.1 
24.6 
0.5 
31.6 
46.6 
: 

: 
: 
: 

21.1 
14.1 
10.3 
54.6 s 
90.4 
23.9 
0.0 
31.6 
45.2 
: 

: 
: 
: 

21.0 p 
13.8 p 
9.8 p 
55.4 ps 
91.2 p 
22.3 p 
1.3 p 
31.3 p 
45.0 p 
: 

2008 
40.1 w 
66 718 w 

2015 
100.0 w 
95 184 w 

2016 
82.0 w 
98 262 w 

2017 
81.4 w 
97 352 w 

2018 
96.6 w 
97 272 w 

2019 
95.5 w 
93 563 w 

18.5 w 

: 

19.5 w 

15.3 w 

12.5 w 

10.8 w 

Note 
1) 
2) 3) 
4) 
5) 

131 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Death rate: number of enterprise deaths in the reference period (t) divided by the number of 
enterprises active in t (%) 
People employed in SMEs as a share of all persons employed (within the non-financial 
business economy) (%) 
Value added by SMEs (in the non-financial business economy) (EUR million) 
Total value added (in the non-financial business economy) (EUR million) 

Inflation rate and house prices 
Consumer price index (CPI), change relative to the previous year (%) 
**Annual change in the deflated house price index (2015 = 100) 

Balance of payments 
Balance of payments: current account total (million euro) 
Balance of payments current account: trade balance (million euro) 
Balance of payments current account: net services (million euro) 
Balance of payments current account: net 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 year backward moving average of the current account balance relative to GDP (%) 
**Five year change in share of world exports of goods and services (%) 
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-27 countries (million euro) 
Foreign direct investment (FDI) in the reporting economy (million euro) 
of which FDI of the EU-27 countries in the reporting economy (million euro) 
**Net international investment position, relative to GDP (%) 
Year on year rate of change in gross inflow of remittances (in national currency) from migrant 
workers (%) 

Public finance 

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

Financial indicators 

Gross 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) 

: 

: 

: 

: 

2) 3) 

81.8 sw 

81.7 sw 

81.4 sw 

80.5 sw 

: 

: 

: 

: 

1 247 sw 
2 201 w 

2 083 sw 
3 124 w 

2 276 sw 
3 388 w 

2 520 sw 
3 687 w 

2 881 sw 
4 187 w 

3 263 sw 
4 511 w 

2008 
: 
: 

2008 
- 1 381.2 w 
- 2 608.5 w 
246.5 w 
44.0 w 
936.8 w 
: 
: 
: 
609.8 w 
55.4 w 
: 
665.2 w 
: 
: 
: 

2008 
-  5.6 w 
51.8 w 
26.9 w 
32.5 w 

2015 
: 
: 

2015 
-  883.6 
- 2 298.8 
524.7 
122.2 
768.4 
5.5 
: 
-  17.4 w 
818.4 w 
33.9 
: 
852.4 w 
: 
-  43.3 w 
5.8 s 

2015 
-  4.1 w 
68.8 w 
26.4 w 
30.5 w 

2016 
1.5 w 
: 

2016 
-  811.5 
- 2 602.5 
796.5 
174.0 
820.4 
47.8 
: 
-  2.2 w 
936.5 w 
58.0 
9.9 w 
994.4 w 
163.0 w 
-  44.3 w 
5.7 s 

2016 
-  1.8 w 
68.8 w 
27.6 w 
29.5 w 

2017 
3.2 w 
: 

2017 
-  870.6 
- 2 823.1 
1 086.8 
18.3 
847.5 
69.6 
-  7.9 
14.5 w 
993.8 w 
23.4 
14.6 w 
1 017.0 w 
404.7 w 
-  47.1 w 
5.5 s 

2017 
-  2.0 w 
67.0 w 
27.8 w 
29.8 w 

2018 
1.8 w 
: 

2018 
-  865.7 
- 2 869.7 
1 110.3 
-  13.6 
907.2 
67.1 
-  7.3 
21.6 w 
1 022.2 w 
69.1 
32.4 w 
1 092.1 w 
248.0 w 
-  49.4 w 
5.2 s 

2018 
-  1.6 w 
65.0 w 
27.5 w 
29.1 w 

2019 
1.7 w 
: 

2019 
- 1 089.2 
- 3 144.1 
1 263.8 
-  180.3 
971.3 
67.1 
-  7.4 
: 
1 036.3 w 
114.2 
39.1 
1 150.5 w 
649.4 
-  50.1 w 
5.1 ps 

2019 
-  1.9 w 
63.8 w 
27.4 w 
29.3 w 

2008 
: 
149.7 w 
2 303.4 w 

2015 
74.4 s 
272.7 w 
2 748.7 w 

2016 
73.5 s 
253.5 w 
3 170.1 w 

2017 
68.8 s 
217.6 w 
3 440.8 w 

2018 
65.1 s 
205.8 w 
3 752.1 w 

2019 
59.9 ps 
191.3 w 
4 259.5 w 

2) 3) 
2) 3) 

Note 

Note 

Note 

Note 

132 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Money supply: M2 (M1 plus deposits with maturity up to two years, million euro) 
Money supply: M3 (M2 plus marketable instruments, million euro) 
Total credit by monetary financial institutions to residents (consolidated) (million euro) 
**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 (2010 = 100) 
**3 year change (T/T-3) in the trade-weighted effective exchange rate index, 42 countries 
(2010 = 100) 
Value of reserve assets (including gold) (million euro) 

External trade in goods 
Value of imports: all goods, all partners (million euro) 
Value of exports: all goods, all partners (million euro) 
Trade balance: all goods, all partners (million euro) 
Terms of trade (export price index / import price index * 100) (number) 
Share of exports to EU-27 countries in value of total exports (%) 
Share of imports from EU-27 countries in value of total imports (%) 

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

4 519.6 w 
6 642.5 w 
3 200.8 w 
: 
: 
: 
6.06 w 
11.75 w 
6.93 w 
122.800 
: 
: 

5 173.6 w 
8 703.1 w 
3 983.1 w 
: 
: 
: 
2.26 w 
7.77 w 
1.35 w 
139.740 
: 
: 

5 365.1 w 
9 198.2 w 
4 046.4 w 
: 
: 
: 
1.49 w 
5.89 w 
0.80 w 
137.360 
: 
: 

5 508.2 w 
9 444.2 w 
4 086.0 w 
: 
: 
: 
1.34 w 
5.98 w 
0.75 w 
134.150 
: 
: 

5 732.2 w 
9 906.4 w 
4 223.7 w 
: 
: 
: 
1.24 w 
5.66 w 
0.73 w 
127.590 
: 
: 

6 160.4 w 
10 717.6 w 
4 514.2 w 
: 
: 
: 
1.10 w 
6.27 w 
0.49 w 
123.010 
: 
: 

1 675.4 w 

2 880.0 w 

2 945.0 w 

2 995.9 w 

3 399.0 w 

3 359.6 w 

2008 
3 796 
703 
- 3 094 
98.3 sw 
73.9 s 
62.8 s 

2008 
5.9 

11.1 
: 
: 

2015 
3 882 
1 728 
- 2 154 
100.0 sw 
75.3 s 
60.8 s 

2015 
3.6 

7.1 
76.3 
79.7 

2016 
4 169 
1 771 
- 2 399 
96.9 sw 
77.7 s 
62.4 s 

2016 
3.6 

8.7 
77.1 
80.1 

2017 
4 648 
2 026 
- 2 622 
99.8 sw 
77.0 s 
60.8 s 

2017 
3.0 

8.0 
77.1 
80.1 

2018 
5 026 
2 431 
- 2 596 
103.6 sw 
75.9 s 
60.0 s 

2018 
2.5 

8.9 
77.4 
80.5 

2019 
5 269 
2 426 
- 2 843 
99.2 sw 
76.4 s 
57.7 s 

2019 
2.3 

10.3 
77.6 
80.7 

6) 
7) 
8) 

Note 

Note 

Labour market 

Economic activity rate for persons aged 20–64: proportion of the population aged 20–64 that 
is economically active (%) 
*Employment rate for persons aged 20–64: proportion of the population aged 20–64 that are 
in employment (%) 
Male employment rate for persons aged 20–64 (%) 
Female employment rate for persons aged 20–64 (%) 
Employment rate for persons aged 55–64: proportion of the population aged 55–64 that are 
in employment (%) 

Note 

2008 
69.3 ew 

2015 
71.3 ew 

2016 
73.3 ew 

2017 
73.9 w 

2018 
74.8 ew 

2019 
75.9 ew 

60.8 ew 

59.3 ew 

62.1 ew 

63.9 w 

65.6 ew 

67.1 ew 

72.1 ew 
51.0 ew 
44.0 ew 

68.1 ew 
50.7 ew 
53.6 ew 

69.4 ew 
55.0 ew 
54.8 ew 

72.1 w 
55.6 w 
55.5 ew 

73.9 ew 
57.4 ew 
58.2 ew 

74.7 ew 
59.7 ew 
60.4 ew 

133 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Employment by main sectors 
Agriculture, forestry and fisheries (%) 
Industry (%) 
Construction (%) 
Services (%) 
People employed in the public sector as a share of total employment, persons aged 20–64 
(%) 
People employed in the private sector as a share of total employment, persons aged 20–64 
(%) 
Unemployment rate: proportion of the labour force that is unemployed (%) 
Male unemployment rate (%) 
Female unemployment rate (%) 
Youth unemployment rate: proportion of the labour force aged 15–24 that is unemployed (%) 
Long-term unemployment rate: proportion of the labour force that has been unemployed for 
12 months or more (%) 
Unemployment rate for persons (aged 25–64) having completed at most lower secondary 
education (ISCED levels 0-2) (%) 
Unemployment rate for persons (aged 25–64) having completed tertiary education (ISCED 
levels 5-8) (%) 

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) (2016 = 100) 
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 (%) 

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) 
Mobile broadband penetration (per 100 inhabitants) 
Fixed broadband penetration (per 100 inhabitants) 

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

Length of motorways (kilometres) 

: 
: 
: 
: 
: 

: 

41.3 ew 
11.6 ew 
6.9 ew 
40.2 ew 
16.7 ew 

40.2 ew 
12.8 ew 
6.5 ew 
40.5 ew 
15.6 ew 

38.2 ew 
12.5 ew 
6.9 ew 
42.4 ew 
16.4 ew 

37.4 ew 
12.7 ew 
7.0 ew 
42.9 ew 
15.9 ew 

36.4 ew 
13.1 ew 
7.0 ew 
43.5 ew 
15.3 ew 

83.3 ew 

84.4 ew 

83.6 ew 

84.1 ew 

84.7 ew 

13.0 ew 
12.5 ew 
13.5 ew 
27.2 ew 
8.5 ew 

17.1 ew 
17.1 ew 
17.1 ew 
39.8 ew 
11.3 ew 

15.2 ew 
15.9 ew 
14.4 ew 
36.5 ew 
10.1 ew 

13.7 ew 
14.6 ew 
12.6 ew 
31.9 ew 
8.9 ew 

12.3 ew 
12.7 ew 
11.9 ew 
28.3 ew 
8.3 ew 

11.5 ew 
11.6 ew 
11.4 ew 
27.2 ew 
7.3 ew 

9.9 ew 

12.0 ew 

11.8 ew 

11.2 ew 

9.2 ew 

8.6 ew 

: 

: 

13.3 ew 

11.7 ew 

11.5 ew 

9.7 ew 

Note 
9) 
10) 
10) 

2008 
36 537 ew 

2015 
47 900 ew 

2016 
47 522 ew 

2017 
48 967 ew 

2018 
50 589 ew 

2019 
52 380 ew 

: 

102.1 ew 

100.0 ew 

101.1 ew 

102.3 ew 

104.5 ew 

28 w 
2.4 w 
39.0 ew 

: 
: 
21.3 ew 

: 
: 
19.6 ew 

37 
33.4 
19.6 w 

35 
32.4 
17.4 w 

34 
28.6 
16.3 w 

Note 

2008 
89.5 sw 
1 013.0 ew 

2015 
139.9 sw 
1 658.6 w 

2016 
151.6 sw 
1 836.2 w 

2017 
146.7 sw 
1 934.4 w 

2018 
160.3 sw 
1 445.6 w 

2019 
174.5 sw 
1 183.8 w 

: 
: 

2008 
13.9 sw 

: 

: 
8 w 

2015 
13.2 sw 

: 

: 
9 w 

2016 
11.6 sw 

: 

: 
11 w 

2017 
11.6 sw 

: 

: 
13 w 

2018 
11.6 sw 

: 

62.7 w 
15 w 

2019 
5.9 sw 

: 

Note 

134 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Innovation and research 
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 (%) 

Environment 
*Index of greenhouse gas emissions,  CO2 equivalent (1990 = 100) 
Energy intensity of the economy (kg of oil equivalent per 1 000 euro GDP at 2015 constant 
prices) 
Electricity generated from renewable sources relative to gross electricity consumption (%) 
Road share of inland freight transport (based on tonne-km) (%) 

Energy 
Primary production of all energy products (thousand TOE) 
Primary production of crude oil (thousand TOE) 
Primary production of solid fuels (thousand TOE) 
Primary production of gas (thousand TOE) 
Net imports of all energy products (thousand TOE) 
Gross inland energy consumption (thousand TOE) 
Gross electricity generation (GWh) 

Agriculture 
Agricultural production volume index of goods and services (at producer prices) (2010 = 100) 
Utilised agricultural area (thousand hectares) 
Livestock numbers: live bovine animals (thousand heads, end of period) 
Livestock numbers: live swine (thousand heads, end of period) 
Livestock numbers: live sheep and live goats (thousand heads, end of period) 
Raw milk available on farms (thousand tonnes) 
Harvested crop production: cereals (including rice) (thousand tonnes) 
Harvested crop production: sugar beet (thousand tonnes) 
Harvested crop production: vegetables (thousand tonnes) 

Source: Eurostat and the statistical authorities in Albania 

: = not available 
  b = break in series 
  d =  definition differs 
  e = estimated value 

Note 

Note 

Note 

Note 

135 

2008 
3.5 sw 
: 
: 

2015 
3.1 sw 
: 
: 

2016 
3.1 sw 
: 
: 

2017 
3.1 psw 
: 
: 

2018 
3.2 psw 
: 
: 

: 

: 

: 

: 

2008 
93.0 ew 
: 

73.3 
: 

2008 
1 148 
578 
14 
7 
1 065 s 
2 140 
3 797 

2015 
: 
: 

79.2 
: 

2015 
2 073 
1 279 
34 
27 
280 s 
2 199 
5 895 

2016 
: 
: 

82.1 
: 

2016 
1 961 
1 056 
2 
35 
465 s 
2 272 
7 782 

2017 
: 
: 

91.0 
: 

2017 
1 637 
959 
68 
40 
920 s 
2 371 
4 526 

84.0 

2018 
: 
: 

92.5 
: 

2018 
2 001 
911 
144 
35 
504 s 
2 353 
8 553 

2019 
: 
: 
: 

85.0 

2019 
: 
: 

88.5 
: 

2019 
1 736 
1 005 
52 
58 
753 s 
2 355 
5 206 

2008 
: 
1 156.7 
541.0 w 
161.0 w 
2 620.0 sw 
1 040.0 w 
608.5 
0.0 
715.4 w 

2015 
: 
1 175.0 
505.8 e 
177.4 
2 850.0 es 
1 131.0 w 
695.5 
0.0 
1 030.0 w 

2016 
: 
1 181.7 
497.0 p 
183.6 p 
2 912.7 ps 
1 145.0 w 
698.4 
29.6 
1 129.0 w 

2017 
: 
1 174.1 
475.2 
180.1 
2 858.6 s 
1 156.0 w 
: 
0.0 
1 157.1 w 

2018 
: 
1 174.0 
467.3 
184.1 
2 781.0 s 
1 144.4 w 
678.2 
27.5 
1 166.3 w 

2019 
: 
1 174.1 
415.6 
183.9 
2 621.2 s 
: 
666.1 
30.7 
1 258.0 w 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  p = provisional 

s = Eurostat estimate 

  w = data supplied by and under the responsibility of the national statistical authority and published on an "as is" basis and without any assurance as regards 

their quality and adherence to EU statistical methodology 
* = Europe 2020 indicator 
** = Macroeconomic Imbalance Procedure (MIP) indicator 

  Footnotes: 
1)  Activity  B_D 
2)  Based on NACE Rev. 1.1. Coverage is Divisions 10 to 74. 
3)  Based on NACE Rev. 2. Coverage is Divisions 05 to 82 and 95. 
4)  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 and they have operated in the informal economy for some years. 

5)  A Directive made some farmers part of the SBR. Reform by the Albania Government to reduce the informal economy as well as the registration of farmers 

resulted in the SBR keeping just enterprises registered within the year and not newly created enterprises. As a result the birth rate can not be calculated from 
these data. 

6)  Annual average of the Tribor rate – interbank rate for overnight loans. 
7)  Average weighted rate applied to new 12-month loans over the respective month, on 12-month maturity. 
8)  Deposit interest rate represents the average weighted rate for newly accepted deposits over the respective month, on 12-month maturity. 
9)  Public sector only. 

10)  Source of information: General Directorate of Taxation, social insurance contributors; INSTAT's calculation 

136