Agricultural employment shrinks

Agricultural employment shrinks

TIRANA, May 28- According to official data by the Albanian Institute of Statistics (INSTAT), the structure of employment by sectors was shifted from agriculture to services and production. The trade and services sector accounted for 25.7 percent of total employees

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Businesses call for the political crisis settlement

Businesses call for the political crisis settlement

TIRANA, May 27- The American Chamber of Commerce in Albania (AmCham) together with DIHA (German Industry and Trade Association in Albania) and the International Chamber of Commerce (ICC), have expressed their concern to the political situation in the country in

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Economy In Brief

Economy In Brief

Government indirectly raises online purchases taxes The Customs in Albania changed the law for online purchases, by now including in the taxes the shipping costs. Albanian citizens who buy products online which value exceeds 22 euros, have to pay a

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Spa business in Albania is booming

Spa business in Albania is booming

TIRANA, May 23- This year has found the Spa business on a strong competition between one another, which has led to an activity expansion on luxury hotels that provide all sorts of wellness related services. As being healthy is the

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After Serbia, Kosovo also declares trade war on Albanian products

After Serbia, Kosovo also declares trade war on Albanian products

TIRANA, May 22 – Albania and Kosovo finalized a trade facilitation meeting on Tuesday that was supposed to ease trade between the countries but which reportedly opened an even tougher trade war. The superficial engagement of the Albanian government to

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New “On Investments” draft law expects approval

New “On Investments” draft law expects approval

TIRANA, May 22- Investments are equal whether they are foreign or domestic. Basically this seems to be the principle of the new “On Investments” bill, now sent to stakeholder discussion tables. Inside it are included additional elements that unify all

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Cooperation with China strengthens in trade and medicine

Cooperation with China strengthens in trade and medicine

TIRANA, May 23- Minister of Agriculture and Rural Development Bledi Cuci, was on a visit this Wednesday to China where he attended the “17 +1” meeting with other Agriculture Ministers from 17 Central and Eastern European countries, as well as

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Environmental risks arise from hydro-plant in Vjosa riverbed

Environmental risks arise from hydro-plant in Vjosa riverbed

TIRANA, May 16- A group of scientists from the University of Natural Resources in Vienna and the Polytechnic University of Tirana presented on Tuesday in Tirana the results of a two-year study on the river Vjosa. According to experts engaged

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Municipalities aren’t paying social security to employees

Municipalities aren’t paying social security to employees

TIRANA, May 19- Through an information request by business and economy magazine Monitor, the General Directorate of Taxation (GDT) provided a list where all municipalities and former former communal centers resulted in tax liabilities, mainly for unpaid social security. By

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EU integration scares some Albanian businesses

EU integration scares some Albanian businesses

TIRANA, May 21-  Albania has turned its eyes to Brussels for this summer, keeping its spirit up to the decision for opening accession negotiations with the European Union. If the answer is negative, most likely a wave of pessimism will

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                    [post_content] => TIRANA, May 28- According to official data by the Albanian Institute of Statistics (INSTAT), the structure of employment by sectors was shifted from agriculture to services and production. The trade and services sector accounted for 25.7 percent of total employees over the past year, with a 0.7 percent increase compared to 2017.

Also, the weight of the manufacturing sector also underwent an increase in the employment structure. Factory employees accounted for 10.6 percent of the total in 2018, from 10.1 percent a year earlier. The construction sector also reflected an expansion in employment as it occupied 7 percent of the total. The industry and public administration sectors on the other hand experienced a decline in the share of the total employed. 

Albania is the most agricultural country in Europe but has the highest share of imported food to total imports. Although agriculture accounts for about 20 percent of the country's gross domestic product (GDP), Albania imports more agricultural products than it exports. In the other regional countries, agriculture accounts for a smaller share in the total economy, but provides higher output and exports than Albania. 

Referring to World Bank (WB) data for 2016, Moldova ranks second after Albania in Europe for the size of agriculture with about 14 percent of the total economy, followed by Ukraine with 13.7 percent. Then the list is followed by the Western Balkan countries. Agriculture in Kosovo for example accounts for 19.4 percent of the GDP.  In Macedonia it is 10 percent, in Montenegro 9 percent, in Serbia 7.9 percent, and last comes Bosnia and Herzegovina with agriculture comprising only 7.7 percent of the country's GDP. In developed European countries, agriculture accounts for less than 5 percent of the economy, with the lowest level being recorded in Belgium, Switzerland, Germany and the United Kingdom by less than 1 percent.

The paradox is that even though we are the most agricultural country in the whole of Europe, we have the highest share of imports for the group of food commodities. Referring to INSTAT data on imports over the years, the share of food imports to total imports is 11.4 percent. This high importing might be also affected the low employment in the sector, among other factors, such as low turnovers, emigration, etc.. 
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                    [post_content] => TIRANA, May 27- The American Chamber of Commerce in Albania (AmCham) together with DIHA (German Industry and Trade Association in Albania) and the International Chamber of Commerce (ICC), have expressed their concern to the political situation in the country in a joint statement posted at AmCham’s website. They urge for a solution to this impasse as it directly affects the business climate and the Albanian economy.

“Many of our members have expressed frustration with the political uncertainty that is negatively affecting Albania’s business environment and economy. Each day that passes without resolution erodes the confidence of citizens in our political system and economy, while deterring potential international investment,” wrote the statement. 

The Associations of foreign businesses in Albania are demanding the government and opposition to act accordingly with responsibility against this situation, on behalf of the country’s stability. DIHA members in Albania have already expressed their pessimism on April regarding the business climate in our country through a survey conducted during February and March 2019. More respectively, regarding the future projections of the economic situation, 43 percent of the participating businesses admitted to a negative trend. Comparing to the previous year this indicator has dropped by 26 percent. On the other hand, over the last three years the number of businesses which predicted an improvement or decline on the business climate in Albania has dropped, which indicates that 60 percent of the surveyed enterprises expect an unchanged situation. All 89 DIHA members participated in this survey.

“The businesses perceive a great decline in the political and social stability, thus this is the greatest difference between 2018 and 2019. The legal security, the public administration, predictability of economic policies, transparency with public tenders, and also the war against criminality and corruption, are the five most negatively evaluated factors regarding conducting  business in Albania for 2018 and 2019,” the survey report writes. 

The foreign embassies in Albania have already expressed their concerns regarding the political crisis which has obviously succumbed our country, but which is loudly rejected by the government. The international’s calls have both regarded the social stability but also the economic situation related to it, but the joint statement from the aforementioned Associations is the first official reaction from the foreign businesses operating in Albania. 

Moreover, Nikollaq Neranxi who is president of the company Neranxi which operates in raw materials importing and processing, and chief of the Association for the Protection of Trade and Market of Albania, demanded an urgent meeting with Albanian enterprises of all sizes (small, medium, large), to find a solution to the critical situation the country and its economy are going through. 

“The decline in consumption as a result of the deepening poverty, as well as the massive departure of Albanians, has brought honest and formal business which is not a customer of power in the conditions of survival,” wrote Neranxi. 

His concerns were regarding the legislative regulations against Albanian businesses with high taxes most enterprises can’t afford, and with the numerous costly fines businesses are taking due to minor violations. This concern is extended to the fact that there is no functioning Constitutional and Supreme Courts for these enterprises to file complaints, which reflects an inner judicial crisis the country is facing due to the Vetting Process, as all judges, prosecutors and other state judicial workers are being examined for their professional integrity and corruption cases.

Neranxi believes that the business is stronger than the government and they should be acting now, “to save our work that we have raised with sweat and who [the government] seek to destroy us deliberately.” So far there are 132 businesses that have filed bankruptcy at the National Business Center. In 2018, 14134 businesses went passive, and 4907 went passive in 2019. There are a number of factors that have induced this alarming numbers, the declining turnovers, low inflation, the tax system and the reduced VAT threshold from 5 to 2 million lek, and the population emigration. Other factors not mentioned in this article might have affected these numbers.
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                    [post_content] => Government indirectly raises online purchases taxes

The Customs in Albania changed the law for online purchases, by now including in the taxes the shipping costs. Albanian citizens who buy products online which value exceeds 22 euros, have to pay a 20 percent VAT and a 2.4 percent customs tax. The shipping costs were previously inconsiderable. However, as of March 1 this year, the customs changed the law to include the shipping cost for every product over the floor price as taxable. That increases expenditure, however, it also discourages citizens to make online purchases, and Albania is already the last in Europe with only 15 percent of citizens having made at least one online purchase, according to a Life Quality Survey. The EU average is 67 percent. 

 

Albania with high female STEM graduates

According to data from the World Bank regarding the percentage of female graduates per country in the fields of Science, Technology, Engineering and Mathematics (STEM), Albania is ranked eighth among 114 worldwide countries enlisted. More nominally four out of ten STEM graduates in our country are female, or 49 percent of the total, holding thus the highest number of female STEM graduates in Europe. As the world is turning digital by hour, females are encouraged to study in the STEM fields so the gender gap can be reduced. However, some of the reasons they choose to not follow this career path are because they publish less, get paid less for their research, and do not progress as much as men in their careers. However, there is very little data at the international level that shows the scale of these inequalities, but nevertheless international institutions including UNESCO are conducting researches for more in-depth analysis.

 

Tax revenue increases

The General Directorate of Taxes (GDT) has declared that it has collected 7.6 billion lek (61.9 million euros) in unpaid obligations during the first quarter of 2019. Comparing to the same period last year, the revenue has increased by 41 percent. 2.6 billion lek (21.1 million euros) were collected in April alone. This growth has come from better management of debt collection measures from the directorates of collecting unpaid obligations. Also GDT has increased the level of preventive information to taxpayers through various channels of communication regarding deadlines, ways of paying the debt, and raising awareness of the austerity measures.

 

Albania with highest self-employed persons

According to data from the European Institute of Statistics (Eurostat), 55.9 percent of employed persons in Albania are either self-employed in their own businesses and/or are employed in family enterprises. This indicator is 20 percentage points higher than the EU mean, which indicates that six in ten employed persons are working under such conditions. Turkey has one in three persons as self-employed or working for family, Kosovo and Serbia has one-fourth of the employed persons, and FYROM, Bosnia-Herzegovina and Montenegro has one-fifth of the employed working in such conditions. These high comparative percentages reflect the relative weight of agricultural activities to some extent, with a small distribution scale of small family farms or agricultural cooperatives. Self-employment is an indicator of a less competitive economy, with low productivity and value added, and that it is difficult to benefit from economies of scale. 

 

Slow energy reforms reduce reliability

As the energy production in Albania has significantly dropped by 2.5 times (1.281 GWh from 3.213 GWh) in the first quarter of 2019 compared to last year which led to its importing, the government has received some strong criticism from the Energy Community Secretariat regarding its slow reforms in the sector. Some of the points regarded in their report were the constant postponing of the Energy Stock Exchange which impede the coordination of the energy market for the sale with neighboring countries; the market liberalization which would decrease competitiveness; a negative response to the idea of unifying the  Electricity Power Distribution Operator with the Albanian Power Corporation to lower the latter’s arrears; the rules for market balancing; and the questionable independence of the Energy Regulatory Entity. 

 

New bill on youth awaits approval

A new Youth Bill which is expected to start discussions in the Assembly soon, focuses on funding policies, programs and youth activities to empower this group that promises the future of the country. Funding of projects and youth activities will be planned and implemented through grant funds with the aim of improving youth infrastructure, financing the construction of youth facilities, financing of youth organizations activities and projects, funding for membership and participation in international programs, studies, observations and analyzes, etc., where the direct beneficiaries are young people. The estimated funding is 868 million lek, of which 468 million will be from the state budget while the rest from grants or other legitimate financing. The funding is expected to increase for the next year at 1.06 billion lek, while in 2021 it will be 1.25 billion lek.

 

Municipality to add more cameras for traffic tracking

The main intersections of Tirana are currently monitored by 23 cameras which convey images to the Traffic Monitoring and Management Center (TMMC). Yet, the Municipality of Tirana plans to install 51 additional cameras at 44 intersections, with the aim to track and improve traffic flow management, reducing the waiting time at the intersections, reducing the amount of pollution from the exhaling gases, especially during peak times. A procedure with a 55 million lek (447 thousand euros) was called to install and integrate this surveillance service with the other existing subsystems of the center, thus complementing a clear picture of the city for TMMC operators to improve traffic management and real-time monitoring by users via the My Tirana application.

 
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                    [post_content] => TIRANA, May 23- This year has found the Spa business on a strong competition between one another, which has led to an activity expansion on luxury hotels that provide all sorts of wellness related services. As being healthy is the new trend right now, the stress and mania relevant with being healthy are encouraging people to attend these relaxing centers more often, which on its hand has led to an oversaturated market on this business type. 

Instagram is marketing the trend of food, fitness and treatments to get the full ‘being healthy’ package. The main success of wellbeing centers and races between them has created a new wave of ways to sell wellness services. Spa Centers are growing fast all over the country, risking market oversaturation. Comparing to last their number have risen again, counting more than 50. Main market and business actors give several reasons that encourages this business to grow, such as our dynamic life and the need to rest, Instagram's trend and the mania to follow a pattern; a form of entertainment, especially for a category of people who are no longer attracted to night life or similar forms. The price reduction from the competition has made these services more affordable for a substantial part, but more than anything there is a health need to receive such services.

“Another thing we can add is that with the dynamic life and stress we experience every day, the spa will be chosen as a detoxification service. We live in a time where pollution is high, food security is low, so there is a need to relax. These demands will come more and more on the rise,” said Emona Begolli who is administrator of Bamboo Spa & Hammam.

Spas are no longer luxurious, but are instead turning into a necessity. Aging, lifestyle related illnesses, and deficiencies in the traditional healthcare system in the prevention and treatment of certain diseases, are driving more people into receiving wellness services as a form of prevention. According to some Spa executives in the capital, increasing attendance and awareness over the importance of wellness services over the years have spurred non-professionals in the field to open such businesses in Tirana, bringing the small Albanian market into an oversaturation.

Emona Begolli said the number of spa center in the capital has increased, both by professionals or not, who have simply set up a business. She said that the time has come to work with the star rating of the Spa centers, known in the hotel sector but which happens everywhere worldwide. Begolli is assured that this would be fairer for market players to be evaluated according to the services they provide and all the components together.

Manager to Nobis Alban Hamzaj, adds that embracing wellness services has come to Albania as a trend from the outside and is very demanded. He noticed a difficulty in the beginning, as a client would prefer to perform just one of the activities and did not consider it reasonable to make some simultaneously. The idea was that people to treat all the areas so as to receive the highest benefits for a better wellbeing. Hamzaj added that over the years the mentality changed and people realized what really gave wellness. After the 2000s the desire to switch from fitness to wellness services changed all around the world. He said that they initially trained the staff to persuade people to try out the three areas. Then they started noticing an increased over a seven-year period that allowed annual investments for improving infrastructure. Hamzaj said that this year they are linking this package of well-being with food, as they have opened a healthy menu restaurant to complement a full service. 

Brikena Maloku who is manager to AS SPA, said that the self-care culture has been part of the lifestyle of every individual in Albania, with an expansion especially in the last two years. She said the costs of such a business is high. If one was to have a center with contemporary parameters, they will have to invest in giving the best, and finally get your return on investment. The Diplomat Spa manager in Tirana said that hotel guests who are mostly foreigners, are the main Spa visitors in their hotels. Moreover, their construction as part of the main activity came from the growing demand and development of this market. The manager said that their foreign customers always asked them about such a center, as a need to rest after a long day of business meetings. Over the past two or three years, a large part of Albania's coastline hotels have included the Spa center in their environment as a retreat for customers.

According to the Global Wellness Institute (GWI) which is a nonprofit education source for the wellness industry, the world wellness market grew by 10.6 percent to 3.72 trillion dollars from 2013 to 2015 (the latest figures available), while the world economy shrank by 3.6 percent over the same period. GWI senior researchers Katherine Johnston and Ophelia Yeung said “the growth trajectory of the health industry seems unstoppable.” Among the key factors affecting the growth of this sector, the Global Wellness Report mentions the “growing consumer interest in all things related to maintaining and improving health, driven by aging, increased chronic illnesses and stress, the negative impacts of health due to atmospheric pollution and failure of the medical model for the care of the sick, to improve the quality of life.” 

 

Thermal waters

According to a report by Global Wellness Tourism, there are about 26,000 counted centers built near thermal waters, in 103 countries around the world offering massages for well-being and tranquility, as well as cures and therapies. In total, all these centers in 2013 earned more than 50 billion dollars. Among these centers, 6500 provided only Spa services such as body and face massages, etc., most of which are located in large cities away from thermal springs. The study of the Global Wellness Tourism Economy points out that so-called wellness tourism anticipates the travels that are made for acquiring wellbeing services in other countries. This kind of tourism is growing, especially in the last decade, with the decision to visit a specific Spa arising as a need to be relieved of a busy week’s fatigue, or because of a doctor's recommendation. Spa facilities are a good place to take a new diet and exercise regimen, which fits a special lifestyle. Regarding the springs of thermal and curative waters in Albania, we can mention:
  • Bilaj Thermal Spas in Fushe-Kruja, rich in sulfur and mineral substances which have curative effects on rheumatism, skin, and nervous system.
  • Elbasan hot springs which waters have high therapeutic values ​​for treating respiratory, stomach and skin diseases. These hot springs also have cosmetic treatments values and have been used since the Roman period.
  • Peshkopi hot springs which contain potassium and sulfate. Advised for respiratory diseases, rheumatisms, skin diseases and gynecological problems.
  • Vronomeros thermal baths in Leskovik; Postenam steam baths, as well as useful curative waters such as Kroi i Bardhe (White Fountainhead) in the Selita Commune in Mirdita; Kroi i Nënës Mbretëreshë (Mother Queen’s Fountainhead) in the National Park of Qafe Shtama, etc..
  • The thermal waters of Benja, also known as Benja’s Baths. Located 14 kilometers from the town of Permet in the Petran Commune, where the six main springs are at the foot of massive rocks on both sides of the Langarica River. Benja's thermal springs have special values ​​for skin treatments.
[post_title] => Spa business in Albania is booming [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => spa-business-in-albania-is-booming [to_ping] => [pinged] => [post_modified] => 2019-05-23 19:00:00 [post_modified_gmt] => 2019-05-23 17:00:00 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.tiranatimes.com/?p=141848 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) [4] => WP_Post Object ( [ID] => 141859 [post_author] => 338 [post_date] => 2019-05-24 14:21:55 [post_date_gmt] => 2019-05-24 12:21:55 [post_content] => TIRANA, May 22 - Albania and Kosovo finalized a trade facilitation meeting on Tuesday that was supposed to ease trade between the countries but which reportedly opened an even tougher trade war. The superficial engagement of the Albanian government to facilitate trade has not worked as expected, resulting to Kosovo stating that if Albania does not remove hindering barriers for flour, beer and potatoes in the next two months, the Kosovo government will apply reciprocity in trade relations with Albania, announcing a 100 percent tax on Albanian products. This was confirmed by Nikolin Jaka, Chairman of the Chamber of Commerce of Tirana. Jaka said that the Kosovo government has undertaken efforts to remove all obstacles Albanian exports to Kosovo might face, but the Albanian government is failing to meet its commitments on some of the emergency requests considered by Kosovo's businesses. In a survey conducted with Kosovo businesses on the trade climate within the region, Albania is ranked second, right after Serbia, for the high trade barriers it applies to Kosovo products. Even Kosovo authorities have stated that Albania is almost identical to Serbia concerning the trade barriers to goods from Kosovo. Tired of empty promises made in summits between the governments of the two countries while in reality commercial barriers only increase, the Kosovo government has given Albania deadlines. If trade is not eased within two months and trade fees for beer, potato and flour from Kosovo will not be lifted, tariffs will be raised to 100 percent for all Albanian products. Trade relations between Albania and Kosovo have slowly evolved, but the beneficiary has mainly been Albania. Exports to Kosovo marked a strong growth in the first half of this year, especially in April, driven by two groups, that of minerals and fuels (mainly oil) and construction materials and metals, which together caught 74 percent of exports to this country for January-April 2019 According to INSTAT data, in the period January-April, goods were sold in the value of All 8.9 billion, with a growth of 52 percent over the same period last year. Kosovo is ranked as the second-largest export destination after Italy, with 9 percent of the total, down from 5.8 percent this year in the first quarter of last year. The biggest increase was in April, when exports jumped by 70 percent. The main effect of this growth was the group "Minerals, fuels and energy", which quadrupled for the four months, reaching ALL 2.3 billion. This group has accounted for 26 percent of total exports. Its growth is related to the resumption of the ARMO refinery activity, which makes part of the processed oil to Kosovo. ARMO has boosted production in the country in the first months of this year as it received more crude oil from Bankers Petroleum and the latter has cut exports to other states. The largest exporter group is "building materials and metals", mainly metals. The biggest exporter is Kurum, which has Kosovo one of its main export destinations. For the 4-month period, exports of construction materials and metals were ALL 4.1 billion, an increase of 18 percent on an annual basis. This group occupies the largest share, with 46 percent of total exports to Kosovo. Albania did not seem to have benefited much from setting the 100 percent tax that Kosovo placed on Serbian goods, as the growth of these two groups was more affected by internal factors such as the resumption of ARMO's work. However, other products have increased, albeit from a small base. Exports of food and beverages, although increased by 38 percent, accounted for about 10 percent of the total. Chemical and plastic products grew by 60 percent over the four months, accounting for 6.2 percent of the total. [post_title] => After Serbia, Kosovo also declares trade war on Albanian products [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => after-serbia-kosovo-also-declares-trade-war-on-albanian-products [to_ping] => [pinged] => [post_modified] => 2019-05-24 14:21:55 [post_modified_gmt] => 2019-05-24 12:21:55 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.tiranatimes.com/?p=141859 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) [5] => WP_Post Object ( [ID] => 141845 [post_author] => 338 [post_date] => 2019-05-24 10:51:50 [post_date_gmt] => 2019-05-24 08:51:50 [post_content] => TIRANA, May 22- Investments are equal whether they are foreign or domestic. Basically this seems to be the principle of the new “On Investments” bill, now sent to stakeholder discussion tables. Inside it are included additional elements that unify all current legislation into one, while there are other elements related to land use, strategic investments, and above all, the establishment of a mechanism of appeals and settlement of disputes outside the court, where the Prime Minister's office is also included. An attempt to unify the protection given to investors, which currently focuses on foreigners, and the need to summarize the issue of investment in a single law, has brought to the stakeholder tables the first draft that have these objectives. An “On Investments” bill has first corrected the point of ‘discrimination’ for domestic investors, offering them the same protection and guarantees as foreign ones, while simultaneously seeking faster resolution of disputes to avoid arbitration. The draft is expected to be subject to long discussions before the adoption of the government and it sanctions at its end that perhaps it will be in effect by January 2020. But what are the aspects that this “On Investment” bill brings?   Domestic and foreign investors are equal “Foreign investors and their investment, subject to the provisions of this law or the legislation in force, shall be offered no less favorable treatment than that offered in the same circumstances to domestic investors in connection with the establishment, purchase, expansion, management, direction, operation, and sale, or other forms of disposition of their investment,” the law writes, underlining that there will be no differentiation between investments. The same document emphasizes in a separate article, the article on freedom to manage its enterprise. Thus, every investor enjoys the freedom to run his enterprise, according to the legislation in force. According to the draft law this freedom includes the ability to hire and dismiss employees, as provided by the Labor Code, to determine production processes, raw materials, final product and prices, and freedom to close and sell the company within the law. Another article specifies the right to transfer funds abroad after tax payments have been paid internally. According to the draft law the income generated by investment in Albania and that can be transferred include, but is not limited to, investment income received in the form of profit, dividends, interests, and other forms. Likewise it also includes funds received by investors after the full or partial liquidation of their investment in the Republic of Albania, or disposal of property, property rights, or compensation and expropriation.   The issue of land ownership and expropriation The issue of ownership when it comes to investments is one of the hot topics that in many cases serves as a limitation for their development. This is mostly related to the inherited problem that has a long history of overlapping, expropriation, and the famous division according to law 7501. In the draft law “On investments” regarding the right to land the government has sanctioned in a separate paragraph that investors have the right to use, enjoy, or dispose the land for investment purposes in accordance with the law of land bargaining, or the law on the transfer of ownership of agricultural land, forests, meadows and pastures, or rent, or emphyteusis. With regard to expropriation cases, the draft underlines that investors should not be subjected to any direct or indirect nationalization of expropriation, or measures having equivalent effect to them, with the exception of the public interest, in accordance with the due legal process without any type of discrimination and payment of appropriate compensation. Regarding the use of shores, the draft law only stops on special investments known as strategic. “Allowing the use of the shores of the sea, lakes, rivers and their beds, as well as of the respective areas in function of the realization of a strategic investment project, it is approved by a decision of the Council of Ministers upon the proposal of the Minister responsible for Economy, after the discussion and approvement by the Strategic Investment Committee having priorly received an opinion from the institutions whose competencies extend to these areas,” the draft writes.   Strategic investments, sectors, and extra contracts in the Assembly Strategic investments are currently dealt with by a separate law adopted in 2015. The new “On investments” draft law has included the strategic investment part, once again defining the sectors that will be seen with priority for the development of these investments. Being a relatively new law the sectors have remained the same in the draft. Strategic sectors include the energy and mining sector, the transport sector, infrastructure, electronic communications, urban waste, the tourism sector with its structures, the agriculture sector with its large farms, the fisheries, and the economic area sector that have developmental priority. To the category of investors that are able to obtain the ‘strategic’ status, as in the current law, are offered a series of facilities related to the priority of document preparation, land consolidation and updating, support programs, state aid, support with ancillary infrastructure, as well as making available the state’s real estate for the development and realization of projects. What brings the draft as a novelty is to provide an additional guarantee for investors who want their contract with the state to pass another passage of approval, such as the Assembly. “The entity receiving the status of strategic investment, a special procedure, other than the services and facilities listed above, has the right to request approval by the Assembly upon the proposal of the Council of Ministers, of the relevant strategic investment contracts, for increase security of the legal relationship born between it and the Albanian state,” the draft law notes.   Strategic Investment Committee and AIDA hold their positions The Strategic Investment Committee, a body that currently functions under the law “On Strategic Investments,” continues to remain in the context that is under discussion. According to this draft  this Committee has four main responsibilities. The first is the approval of projects to which the status of “Strategic Investment, Assistance/Special Procedure” is given. Secondly, adopting the action plan for the measures, procedures, and deadlines, in terms of services and facilitation of procedures for drafting and implementing the strategic investment project, in which the commitments, concrete tasks and deadlines for the central institutions and units local government are defined for all phases of project implementation and enforcement. The third responsibility of the Committee is monitoring the functioning of the “single counter” system for the services provided to the strategic investor. Lastly, monitoring the performance impact of strategic investments and the performance of the investment itself, as well as adopting concrete support programs and incentives for strategic investments. The members of the Committee are nominally appointed by order of the Prime Minister. On the other hand, the Albanian Investment Development Agency (AIDA) is considered an important part of the entire architecture of the institutions involved with investments where besides the duties and obligations provided in its organic law, it is also charged to follow the procedure for granting the status of strategic investment. The draft law writes that it serves as the only window for strategic investments, provides the service of investor support in preparing and applying for the status as a strategic investment, serves as their subsidiary agent, and also provides later support in monitoring and data collection.   Prime Minister involved in the complaints mechanism Cases of disagreements between the state and investors are not something without precedents. In order to avoid cost and arbitration the new draft law provides a new mechanism for investor complaints, and finding a solution outside the courts. According to the draft law, an investor may file a written complaint to the state institution for the complaint mechanism if it is damaged by a behavior, action, or decision of a public institution that is related to the investment. Thereafter, the responsible institution investigates the matter and takes any action necessary to find a solution acceptable to all parties within a reasonable time. The responsible institution requires the authorities involved to provide information on the complaint made and then draw up a written report on the findings of the investor, the institutions chiefs and ministers involved, within a deadline of seven days. “With the decision of the state institution responsible for the complaints mechanism, the dispute can be sent at any time to the Prime Minister's Office for further treatment and decision,” the draft law notes. Article 26 states that a dispute born between an investor, and one or more state entities in the Republic of Albania in relation to the invested capital, or the interpretation or application of the provisions of this law, should be resolved in a friendly manner.   New law offers guarantees to existing investors Among other things the draft law also underlines how existing investments will be addressed at the time when the new legal framework becomes effective. Thus, an investment governed by this law which already existed at the moment when the new “On Investments” law was enforced, has the right to choose the protection under the previous law or by this one, whichever is considered more favorable to the investment. On the other hand, the rights that a business has acquired under this law are maintained in case the law gets abrogated. The draft writes that in case the law is abolished, the investor has the right to choose between the rights and guarantees provided by this law and those to be foreseen by the new legislation. Entities that have applied for the status of “Strategic Investment/Investor, assisted/special procedure” with the previous law, have the right to choose the previous law or this one to regulate the legal relations between them and the State. [post_title] => New “On Investments” draft law expects approval [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => new-on-investments-draft-law-expects-approval [to_ping] => [pinged] => [post_modified] => 2019-05-23 18:57:34 [post_modified_gmt] => 2019-05-23 16:57:34 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.tiranatimes.com/?p=141845 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) [6] => WP_Post Object ( [ID] => 141842 [post_author] => 338 [post_date] => 2019-05-23 18:50:39 [post_date_gmt] => 2019-05-23 16:50:39 [post_content] => TIRANA, May 23- Minister of Agriculture and Rural Development Bledi Cuci, was on a visit this Wednesday to China where he attended the “17 +1” meeting with other Agriculture Ministers from 17 Central and Eastern European countries, as well as China, which is the initiator of this initiative. During this visit, Minister Cuci had a meeting with his Chinese counterpart, Han Changfu, with whom he discussed the increase of trade cooperation between two countries. In the focus of the conversation was the launch of China's export of products of animal origin. The minister took the promise of the Chinese counterpart to push this process forward and within 2019 to sign the Quarantine Protocol for products such as milk, cheese, honey, fish etc. Likewise, the Minister of Agriculture invited his Chinese counterpart to visit Albania. Following the visit to China, Minister Cuci also made a visit to Longwu village, where farmers cultivated the green tea called Dragon. This village was also a tourist attraction for Zhejiang province. In this visit, Cuci was accompanied by Deputy Mayor of Hangzhou, Wang Hong. “Initiative ‘17 +1’ further enriches bilateral cooperation between Albania and China. Our active participation in this initiative also serves as a factorization in the framework of the political discussions that develop Euro-Atlantic structures in the framework of empowerment and penetration in this area of ​​China. There are also opportunities to apply and attract investment for our projects on energy, road, and rail infrastructure and naturally in the agricultural sector,” said Cuci. On the other hand, Health Minister Ogerta Manastirliu hosted an official meeting with Chinese Minister of Health, Mr. Ma Xiaowei and the delegation that accompanied him by emphasizing the importance of cooperation between the two countries in the field of health. This led to an expansion of the cooperation between the Albania and the People's Republic of China, by exchanging experiences of experts from both countries in the areas of healthcare, prevention and control of chronic diseases, rehabilitation medicine, etc. “It's a step forward that we are working together to live Action Plan 2018-2020 in the field of health between our two countries, which serves the exchange of experience and improvement of health systems, the acquisition of experiences and best practices,” said Minister Manastirliu. Presenting the achievements so far in the field of health, Manastirliu stressed the importance of training of professionals health. She said that despite the investments being done, it is very much important to have professionals who update the knowledge, capable of developing the health care system in order to move towards the goals the government has set regarding the quality and standards that should be offered in health care. While the Chinese Minister of Health, Ma Xiaowei introduced the developments in the health system of the People's Republic of China, which is focused on supporting hospitals in rural areas by the hospitals large in urban areas. Mr. Xiaowei praised the progress made by the Albanian government to provide access to health care near the residence. “I am impressed by the achievements so far in Albanian healthcare and I express my commitment to continue the cooperation between the two countries and our two peoples who have a deep friendship,” said Mr. Xiaowei. The meeting of the two Ministers of Health comes in the framework of the implementation of the Action Plan between our two countries, signed in July 2018 in Sofia, Bulgaria, during the “16+1” Summit of Southeast European countries and China. The Action Plan 2018-2020 in the Field of healthcare aims to strengthen cooperation in some areas. More namely, it foresees cooperation in the field of health system, prevention and control of chronic diseases, contagious diseases, rehabilitative medicine, medical examinations near the residence, etc.. The exchange of staff, experts, and study groups will be ongoing during the implementation of this action plan. The established cooperation between the health institutions of both countries will be concretized with mid-term training of medical personnel. The Chinese delegation is holding a three-day official visit to Albania, where they will have meetings in the main health institutions in our country with the aim of strengthening the cooperation between our two countries.  [post_title] => Cooperation with China strengthens in trade and medicine [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => cooperation-with-china-strengthens-in-trade-and-medicine [to_ping] => [pinged] => [post_modified] => 2019-05-23 18:50:39 [post_modified_gmt] => 2019-05-23 16:50:39 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.tiranatimes.com/?p=141842 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) [7] => WP_Post Object ( [ID] => 141786 [post_author] => 338 [post_date] => 2019-05-22 14:41:23 [post_date_gmt] => 2019-05-22 12:41:23 [post_content] => TIRANA, May 16- A group of scientists from the University of Natural Resources in Vienna and the Polytechnic University of Tirana presented on Tuesday in Tirana the results of a two-year study on the river Vjosa. According to experts engaged in the study of the river Vjosa sediment and the impact of two hydropower plants along it in Pocem and Kalivac, the plants would adversely affect the natural course of sediment. Dr. Christoph Hauer from the Water Management, Hydrology and Hydraulic Engineering Institute in Vienna estimated that because of the high rates of transport of Vjosa sediments, the samples show an annual loss of the reservoir of about 2 percent in the case of Kalivac and more than 2 percent in the case of Pocem. “This is more than twice the global average of accumulated annual losses, which significantly reduces energy production starting from the first year of operation,” Hauer said. Experts estimated that this is expected to have very high economic costs for sediment management and treatment if it is intended to avoid technical problems. Researchers also estimated that the lack of sediment transport will lead to fragmentation of the river bed in the downstream, affecting groundwater levels and will cause coastal erosion and biodiversity loss. For the leader of the environmental organization EcoAlbania focused on biodiversity protection of Vjosa, Olsi Nika, the results of the study prove that the Albanian government will not meet the energy expectations it has in Vjosa. “On the contrary, these projects will only bring a threefold loss situation - in economic, environmental and social terms,” ​​Nika said. Present at the presentation of the study was also Theresa Schiller who is coordinator of the campaign “Save the Blue Heart of Europe” by EuroNatur, which promotes the protection of the rivers in Europe, drew attention to the importance of Vjosa's defense. She said Vjosa is a rare river in Europe and should be preserved as part of our natural heritage. Hydropower projects will completely and irreversibly destroy this unique river ecosystem. Experts warned the government that the plants will have adverse effects on the tourism and agriculture sector in the watershed of Vjosa, which is one of the last wild rivers in Europe. In 2017, an international team of scientists recorded during a short expedition hundreds of new living species in the River Vjosa, two of which were previously unknown to science, adding rumors of its basin protection from hydropower plant construction projects. Hydropower plans have been incessantly criticized by environmental activists, residents of the area, and the European Parliament in recent years. They are seen as a shortcut taken by the government for the exploitation of rivers at the expense of the severe environmental consequences, residents and the future of the country. Meanwhile CleanTechnica, which calls itself the “#1 cleantech-focused news & analysis website in the US & the world, focusing primarily on electric cars, solar energy, wind energy, & energy storage,” praised the building of the new floating solar panels in Banje of Elbasan. We recall that Statkraft Albania signed a contract with Norwegian company Ocean Sun AS on March 2019 for cultivating solar panels with a maximal capacity of 2 MW at the hydropower tank of Banje. The project will consist of four floating units with 0.5 MW capacity each, and the overall investment amounts to 2.3 million euros. CleanTechnica used this example to further write an article on the beneficence of solar panels for electricity production. They made an interview with Christian Rynning-Tønnesen who is CEO of Norway’s Statkraft, about his insights on renewable energy in general and floating solar in particular. Rynning-Tønnesen described a scenario in which 50 percent to 66 percent of electricity production globally will come from renewables within the next 20 years. Statkraft foresees solar taking the biggest share, followed by wind and hydropower in that order. According to that scenario hydropower comes in last, but floating solar gives hydro-centric companies like Statkraft a hand in the first place position as well. “Solar by day and hydro by night can all be done in one plant, at a large scale,” Rynning-Tønnesen explained. Floating solar panels can get a conversion efficiency boost, thanks to the cooling effect of the water upon which they rest. There are some technological challenges, but on the other hand there isn’t much need to invest in site prep when there is no ground to prep. Rynning-Tønnesen pointed out several other benefits at play in the Albania project, such as having no conflict with land area, since they will be using the surface of the reservoir. “It is quite convenient to use the same power lines and some of the electrical equipment, and we already have people on the site,” Rynning-Tønnesen said One criticism of floating solar is the cost compared to conventional ground or roof-mounted installations. According to Rynning-Tønnesen, the cost of the Albania project is about double the typical market rate. However, he noted that the project is a first generation, first of its kind thing. He pointed to the downward spiral in conventional solar costs as an indication that floating solar can become competitive, without subsidies, within a few years. CleanTechnica said that an interesting thing about Albania is that it is almost entirely dependent on hydropower for electricity. The news site wrote that hydropower is subject to management issues as the impacts of climate change build up. The addition of floating solar panels to hydro plants could provide for more 24/7 stability, as Rynning-Tønnesen noted. In that context, consider that the Banja plant is practically brand new, having opened in 2016 as a project of Statkraft’s Albanian wing, Devoll Hydropower. It is the first of a series of hydropower stations under the umbrella of the Devoll River. When Banja’s sister plant, Moglicë, opens later this year the two facilities will have a total capacity of 256 megawatts. They will also increase Albania’s total energy production by an impressive 17 percent to 20 percent. That’s not including new clean megawatts from the floating solar project, which developer Ocean Sun puts at 2 megawatts. This is a sort of demo project however, as our country is only putting its legs on the renewable energy choice, and if all goes well, Albania’s hydro reservoirs could be blooming with solar panels. CleanTechnica also added that a third hydropower plant could also be in the works on the Devoll River, depending on how it goes with the first two. All this is by way of saying that Albania does not appears to be on track for building its long-coveted nuclear power plant. According to the news site, Albania has been eyeballing nuclear power since at least 2007, though neighboring Montenegro is not so keen on the idea of locating it at Durres on the Adriatic Sea. That’s in line with Statkraft’s forecast. Rynning-Tønnesen told CleanTechnica that globally “we will see a massive change from coal and natural gas to renewables and natural gas,” which does not leave much wiggle room for nuclear energy. [post_title] => Environmental risks arise from hydro-plant in Vjosa riverbed [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => environmental-risks-arise-from-hydro-plant-in-vjosa-riverbed [to_ping] => [pinged] => [post_modified] => 2019-05-22 13:56:58 [post_modified_gmt] => 2019-05-22 11:56:58 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.tiranatimes.com/?p=141786 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) [8] => WP_Post Object ( [ID] => 141836 [post_author] => 338 [post_date] => 2019-05-22 13:54:26 [post_date_gmt] => 2019-05-22 11:54:26 [post_content] => TIRANA, May 19- Through an information request by business and economy magazine Monitor, the General Directorate of Taxation (GDT) provided a list where all municipalities and former former communal centers resulted in tax liabilities, mainly for unpaid social security. By the end of 2018 unpaid social security debts amounted to 14 billion lek or 114 million euros, and a considerable part of it belongs to local government. GDT did not separately report the debt created by the vendors due to confidentiality reasons, referring to the law on tax procedures. The former mayor of Kukes was sentenced to jail in May 2016 by the court, accusing him of abusing about 45 million lek (367 thousand euros) of social security contributions to sponsor the city's football team. It seems that almost all local government units, former communal centers and all municipalities continue to follow the same practice today by not paying employees social security, which in the expenditure hierarchy are the first to be paid as a liability arising from law. The General Directorate of Taxation has currently imposed a measure of forced execution of unpaid tax obligations for the municipalities of Libohova, Memaliaj, Permet, Tepelena, Pustec, Sukth, Himara, Polican, Fushe-Kruja, Kruja, Kavaja, Rrogozhina and Divjaka. However, all municipalities in the country are tax debtors. Official sources at the GDT stated that the debt of municipalities and communes is comprised of unpaid social security. From a legal point of view, GDT must act for municipalities as well as for businesses, confiscating bank accounts and selling valuable items to cover liabilities, but in practice this does not happen. “If a municipality can not pay social security, the finance experts have dropped the bells that the municipality is in danger of real bankruptcy,” argues renowned economist Arben Malaj who is also a former finance minister. According to him, in a functional democracy and a legal state, municipalities, like any other country's governing body, must face the risk of bankruptcy. Malaj added that for the municipalities in difficulty, the central government should buy their debt with five to seven year instruments/bonds, and should set these fusions clear and sound conditions and restrictions on their financial management where after the payroll , insurance, and fiscal obligations, the payment of the annual proportion of the purchased debt must be ahead any other expense or investment. Beqir Nuredini who is the Mayor of Rrogozhina, said the cause for the financial situation was the early suspension of payments from the central government treasury last year. During 2018 the treasury payments to local government were blocked in November, when the deadline in the previous years was December 15, as the new budget was opened late in January. Nuredini said that blocking treasury operations for more than two months created arrears. He also said that  settlements are being made on the meantime. Executive Director of the Association of Municipalities Agron Haxhimali, explained that non-payment of social insurance by the municipalities is intolerable. He said that budget planning for a public institution, such as the municipality, is based on rules and laws, and clearly expenditure planning starts off with wages and social security that are inseparable. He said there can be no salary payment without paying off the social security in accordance to the percentage stipulated by the law. Haxhimali added that finance offices in the municipality, municipal councils, and internal auditors should take responsibilities. According to a United Nations Program (UNDP) analysis however, as fiscal decentralization has risen after territorial reform, budgeting and internal audit in local government structures had some shortcomings in some cases. The Ministry of Finance for its part, claims that local government structures are often not correct in bringing payroll sheets in the Treasury and abuse treasury payments instructions.   Municipalities in bankruptcy In most major cities, the municipality is the largest employer. Lack of economies of scale and the massive takeoff of people has put the private sector at a disadvantage to develop at a sustainable pace, as the public sector and local government are the main employers. When the territorial reform took place in 2015, preliminary analysis by the Ministry of Finance predicted to save over 60 million euros from cutting the communal administration. According to data from the Association of Municipalities the local government had employed about 33,500 persons in 2018, from 22,000 in 2015. From the transfer of new functions there are no more than 10 thousand employees. Even without the transfer of new functions such as pre-school education, forest management, maintenance, fire protection etc., the municipal administration is more swollen than prior the reform. For this reason, municipalities throughout the country have failed to pay social security for employees. Because of this situation the crisis in some municipalities may be described as a bankruptcy, as taxes have started seizure procedures in some of them.The financial problems of local government have in some cases been exacerbated by the central government, which has transferred the administration's functions, but not all funds for their administration. According to a State Supreme Audit Report, the transfer of functions has created additional problems in the financial administration of municipalities. At national level nearly 7,300 educators and support staff working in preschool and pre-university education institutions are managed by municipalities since 2017. The administration function of the fund for pre-university education was transferred to the Municipality of Shkodra in 2016. In the specific 2016 transfer, funds were allocated to educational and assisting staff of pre-school education as well as funds for assisting staff of pre-university education. In this transfer to the Municipality of Shkodra funds for salaries and social security (not in the full value required to be transferred) of staff (employee and educator), and operating expenses for dormitories were not included. The other municipalities are in a similar situation as well, which in the absence of solutions, were unable to meet the tax obligations related to social security, putting them in a theoretical state of affliction.   Municipalities that don’t pay security rose According to an official list provided from the General Directorate of Taxation through the right to information, all municipalities are debtors for non-payment of insurance. The list was further expanded after the territorial reform. However, the list of taxes currently includes over hundreds of state entities and institutions that have not paid employee benefits. In the list of institutions, debtors are many state water utilities that have not made insurance payments. If a business is struggling to pay tax debts, the first to be paid are insurances. This also applies to state institutions. According to the Law on Tax Procedures, payments of insurance contributions and tax liabilities are made in this order:
  • compulsory health insurance contributions;
  • compulsory social security contributions of the employee;
  • compulsory supplementary social security contributions;
  • compulsory social security contributions of the employer;
  • taxes;
  • interest rate delays,
  • fines and, finally, administrative costs.
  Even when debts are received by force, after the court hearings are completed, the first to be settled are insurance liabilities. But in the case of the state this order does not work because no paralyzing or blocking measures have been taken against water companies, municipalities and regional agencies, even though they have not paid the insurances. Social Security Institute (SII) experts advise that all state employees should routinely verify whether their institution is actually deposited the insurances taken off their wages. For the last six years, these checks can be made online at the E-Albania portal. They advise that these checks should be made by employees at the retirement age so that they can solve the problem created while still at work. The accumulated tax liabilities in the form of unpaid social security by the end of 2018 amounted to 13.8 billion lek or 112.9 million euros. According to official data from taxes, these liabilities expanded by 20 million euros in 2018 or by 18 percent. Taxes claimed that a large part of these obligations belong to public entities and local government, as private companies have been subjected to coercive measures. If businesses do not pay employee obligations in time, their bank accounts are blocked. For state institutions this approach cannot be taken. The bank accounts of water utilities are difficult to block because of the strategic function they have in services to the public. Tolerance against state entities is formalized, as the state is supposed to settle liabilities at a second moment after it has created the debt. SII experts argue that unlike other obligations that the state may create from non-payment of other taxes, the negative effects of the social security debt are multiple. The damage to monetary benefits is far greater than the pay now and on the other hand, the social consequences that are created to the persons are immaterial.  tabela-bashkive (1) [post_title] => Municipalities aren’t paying social security to employees [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => municipalities-arent-paying-social-security-to-employees [to_ping] => [pinged] => [post_modified] => 2019-05-22 13:54:26 [post_modified_gmt] => 2019-05-22 11:54:26 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.tiranatimes.com/?p=141836 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) [9] => WP_Post Object ( [ID] => 141826 [post_author] => 338 [post_date] => 2019-05-21 16:12:16 [post_date_gmt] => 2019-05-21 14:12:16 [post_content] => TIRANA, May 21-  Albania has turned its eyes to Brussels for this summer, keeping its spirit up to the decision for opening accession negotiations with the European Union. If the answer is negative, most likely a wave of pessimism will cause very damaging consequences for the country's economy rather than the tough process of EU membership itself. In the real aspect regarding benefits, the economy as a whole will not benefit from any additional EU funding at least in the next four years, whether negotiations start or not. On the other hand “Made in Albania” production can take the final blow if membership talks start. The Balkan Eurobarometer for 2018 found that 4 percent of businesses in Albania think that EU integration is a very bad thing, 19 percent think the situation will be the same, and 75 percent of them consider the integration process as a good thing. The survey showed how both Albanian businesses and citizens alike want EU integration more than any other Balkan country. Tired of the destructive internal policies and the high level of poverty, both citizens and Albanian businesses tend to take every offer from abroad without being clear about the consequences. In this case the integration requires high-cost standards that will put Albanian businesses in the face of real bankruptcy. But if negotiations are opened, then the Albanian businesses are too late to cope with the consequences. Alban Zusi from the Exporters Association said the government should have started a consultation process with manufacturing businesses in time to inform them about the consequences. Businesses affected by the EU integration process need to conduct in-depth analysis of costs in order to have arguments to demand protective measures from EU products. Nikolin Jaka who is Chairman to the Chamber of Commerce and Industry in Tirana, said implementation of standards is a long process which will continue even after Albania's EU membership. Their full implementation requires not only a lot of time, but also considerable funds that Albania does not hold today. Full implementation of these standards will also require a further increase of EU financial support. Jaka said this situation requires rigorous cooperation with the private sector, especially in terms of monitoring, information, and support with technical assistance and financial funds for businesses to achieve the implementation of these standards.   Two negative effects by the negotiations Zusi said the Albanian businesses will be negatively affected in two directions by the integration process. Firstly, the abolition of customs tariffs for all EU imports will make Albanian products uncompetitive in domestic markets as well. Albania has high costs because it lacks economies of scale and consequently the goods coming from the largest and most advanced economies risk destroying Albanian production at the beginning. This process will most probably affect the agro-processing industry. Secondly, meeting the standards that the membership process requires is costly and only affordable in some cases by small industries like those of Albania. If in the case of customs tariffs there is negotiation space, there is no tolerance for the standards. Each production line should invest at least 300 to 400 thousand euros in water discharge plants and hundreds of thousands of euros in terms of environmental standards and food safety. This means that if the negotiations are opened the profits through years of Albanian businesses will go to meeting the standards rather than activity expansion or new technology investments. When Bulgaria and Romania joined the EU in 2008, many businesses were definitively or temporarily closed because they did not meet the standards required by the EU. Slovenia negotiated that Gorenje electrical household products were also protected with tariffs, even four years after EU membership. The protective measures are negotiable. Albanian meat or milk producers may require EU products to enter our market with customs rates of over 10 percent, both during the negotiation period and post-accession, until our industries become competitive. Zusi said that as soon as Albania joins the EU, local producers will either block production or make important investments, unaware whether they can afford them due to high costs. The dairy processing sector, the fruit-vegetable processing industry, such as cottage cheese, pickled peppers or cucumbers, the chicken, egg-producing industry, and the confectionary one which uses milk and eggs, are expected to be the most affected . Zusi said the EU does not allow subsidies for more than 200,000 euros for a company, however the needs of Albanian companies today only for improving water spillings need higher investments than that amount. Hypothetically, if Albania joins the EU all Albanian companies need to be shut down.   Costs if negotiations won’t start Adrian Hackaj who is a renowned economist from the Cooperation and Development Institute (CDI), said the opening of negotiations is not linked to direct benefits to the Albanian economy at least in the first three to fours years of the process. Even if negotiations are opened Albania will continue to be treated financially by the EU through IPA funds, as well as currently. Hackaj said that if the negotiations are not opened the country's image is mostly damaged in the eyes of investors. If the European Union decides to open negotiations for Macedonia and not for Albania, it would position Albania at a non-competitive level, especially in terms of foreign investment. If a foreign company wants to expand into the Balkans and hypothetically all countries offer the same regulatory and fiscal conditions, it would choose Serbia, Macedonia, or Montenegro because of their opened membership negotiations. Hackaj said that from an economic point of view this would cost the economy as a whole. The prolongation of the integration process would have a negative psychological effect on the citizens who seeing themselves in the EU, will be more urged to migrate to other Union member countries. According to the Gallup International survey, Albania has the highest emigration potentials in Europe. 60 percent of Albanians expressed the desire to leave the country in 2018, as Albania has the highest number of asylum seekers in the EU since 2015. The high level of emigration is restraining the country's economic development because the Albanian businesses are beginning to feel the lack of workforce. In the absence of opening negotiations, Albanian citizens will be deprived of the standards offered by the accession process, especially in terms of food security. They will also be deprived of freedom of movement, to work and stay without deadlines in the union countries. Precedents from other Eastern European countries which have joined the EU, show that the countries' GDP has increased after accession. Trade with EU countries would further expand and with full membership EU import prices would become cheaper. Currently, about 80 percent of Albanian imports come from EU. Integration will provide a better business climate as the regulatory framework in this area needs to be aligned with EU standards. Perspectives on employment and education will also become easier and cheaper. Trade and goods costs will be reduced by lifting barriers and tariffs. Jaka said that in the rapid reaction, the opening of the negotiations for Albanian entrepreneurship is undoubtedly an encouraging signal and strengthens the confidence of investors, both domestic and foreign, which in turn creates the premises for growth of employment and economic growth. He added that entrepreneurship confidence is strengthened as to clarify its plans for long-term investments, but also as a reflection to prepare for laying the foundations for a competitive economy focusing on priority sectors and offering competitive advantages. In the short term, Jaka said that a large market in which Albanian producers can export their products will open. But on the other hand Albanian producers will be even more exposed to the risk of high competitiveness from European goods. Jaka said this competition should be counteracted by the growth of Albanian exports, as well as by the opening of new businesses with Albanian or foreign capital, in order to create more export space to the European Union market.   How the egg industry will be affected The agri-food industry will be the most affected by the EU integration process. The dairy processing sector, the fruit-vegetable processing industry, the poultry and confectionary industry that uses milk and eggs, are expected to be the most affected as they will be put in front of huge and immediate investment obligations at the time of imposing EU food security measures. Sami Gjergji who is a doctor of sciences in the field of zootechnics, explained how the integration process will affect the egg business. He said that currently the Ministry of Agriculture is preparing the standards of coding and trading of eggs according to EU standards, with four codes where the Code 0 is for biological eggs produced by chickens which grow in an open environment and have the entire chain from land to bio foods. Code 1 is the open access system for chickens with outside access which requires 4 square meters for each chicken. Code 2 is growth in land without outside access, and code 3 are industrial eggs from chickens grow in cages. Since 2012 the EU directives have changed the cage residence rate, reducing the number of poultry in the cage. Another requirement for the eggs that are traded is the code that must be stamped on the egg, which contains the state, region, enterprise code, and date of production. According to EU rules, eggs should be consumed up 28 days after production, then the eggs should pass for industrial use. None of these standards apply today. The eggs are all according to the standard of industrial production and the manufacturers here set the exit from the warehouse date, and not the production one. When enforcing standards and putting codes, companies will be forced to lower the number of chickens. Gjergji predicts that at the moment of EU accession, our egg production industry will automatically collapse. He adds that today integration is seen as a political process when it is far more than that, and preparing for standard implementation should receive maximum attention.   Micro-businesses will be less competitive The Albanian economy is characterized by small businesses with one to four employees which account for over 90 percent of the total enterprises, where self-employment prevails. These businesses are often at the margins of existence and do not have sufficient capital to adapt the standards that will need to compulsory meet as the country will gradually integrate. Gentian Elezi who is an expert on integration issues, believes that market opening and integration with the European market puts small entrepreneurs in trouble, as has happened elsewhere. Consequently, this process will also bring changes in the economic structure within the sector, enhancing competition and the need for scale economies and businesses that can withstand the market. It anticipates that the consequences are gradually expected in these ventures, but the impact will not be the same in each sector. In the medium to long term, a reallocation of the labor force according to the needs of the new integrated market will occur. Stefan Pinguli who is an entrepreneur and the producer of Birra Stela, said that for domestic products in Albania, the measures for the balancing of prices between the small and the big producers don’t apply. Concretely in the European Union an agreement is set that big producers, whether of beer or other products, will have differentiated tax levels to balance the high costs of small business. He proposed that this EU directive should be extended to all industries, but above all to those foodstuffs for which the country has installed most of the industry and labor forces.   31 chapters with difficult obligations The opening of the negotiations and Albania's accession to the European Union will go through a long process which consists in the compliance of 31 chapters involving all of the country's vital activity from democracy and its institutions, to economic and social criteria. Currently, 31 chapters are in effect since the country assumed the status of candidate. To date, the 31 chapters are at the initial stage of implementation which implies the compliance of Albanian legislation with that of the EU in all sectors. Later, law enforcement will be the challenge of the process of opening negotiations and full membership. The first chapter is the free movement of goods, which basically removes the trade barriers and national safeguards for specific categories. Albania has received an average rating in this chapter for the required stage, as we have not met the legislation yet and we have not strengthened market surveillance institutions. The progress report provided positive assessments for public procurement procedures, copyright and food security, as well as fully assessed without progress the developments in the agricultural sector and investment in science and technology. The latest progress report that gave the positive recommendation for the opening of negotiations emphasized the establishment of a functioning market economy, and the ability to cope with competitive pressures and market forces within the Union. According to the report, Albania has made some progress and is moderately prepared for the development in the functioning of the market economy. The European Commission notes that reforms to improve the business environment are crucial and require further efforts. “The laws and rules that support the business climate remain difficult and the gaps in the rule of law continue to hinder businesses and investments,” the report notes.   Primitive agriculture fades the perspective Developments in the agricultural sector received a negative assessment from the latest Progress Report, which noted that the Albanian government is not progressing on elementary EU issues such as property titles and farm registers. The government failed to make accounts in the agriculture sector, which also suffers from land fragmentation where about 350 thousand farms own an average of one hectare. It is not known how far the farm business goes because sales and profit are not reported in the sector. At these levels, a technology-based sector development is farfetched, and competition with the EU can’t even be discussed at this stage. The Progress Report notes that public spending on farmers' support is very low and there is no yearly follow-up on the amount of aid provided. Regarding the organization of the common market, two legal acts have been adopted in olive oil, which partially approximate the relevant national legislation with the EU. There are currently no special support schemes aimed at protecting landscapes, natural habitats, and biodiversity, or preventing adverse effects. Our economy is driven by the service sector, but agriculture still plays an important role. Services accounted for about 54 percent of the GDP in 2017. Agriculture remained the second most important sector with about 22 percent contribution, the industry with 13.3 percent has gradually increased its share of the economy over the last 10 years  mainly as a result of the growth in crude oil production. Within industry the production is relatively small at 6.4 percent, and mainly produces low value products and high-intensity products such as textiles and footwear at 10.5 percent.   Problematic food security EU overseers confirm the concerns of Albanian experts that food security will be the most problematic issue in the country's integration process. EU’s hygiene rules for the production of foodstuffs provide a high level of food safety. Animal health and food safety of animal origin prevail. Also, the food production chain from plant to processing requires high quality assurance. In the EU's 2018 progress report it was noted that Albania has started preparing on the fields of food security, veterinary and phytosanitary policies. Some progress in implementing relevant policies in the field of food and veterinary safety are made, but the problem remains to update the relevant legislation to bring it into line with the latest EU legislation on animal health and plant health checks, and enforce food safety rules including controls on imports and maximum levels of waste pesticides. The EU requires Albania to complete the restructuring of the veterinary sector in accordance with the duties and functions set out in the amended legislation. Albania needs to update animal registries to provide solid traceability systems for food of animal origin. On the general food safety, the National Food Authority for the second consecutive year will carry out official controls under a risk-based plan adopted at the beginning of 2017. The EU notes that Albania needs to match internal control procedures with those of the EU. The National Food Authority began using the TRACES system during 2017, to issue veterinary export certificates for animal products such as fish and eggs. As far as veterinary policy is concerned, mass vaccinations against rabies, brucellosis, skin diseases in cattle, and anthrax in infected areas have continued. Although positive efforts have been made during the second half of 2017 to update information on the animal identification and registration system, there is still insufficient or inaccurate data on the ground due to the lack of reporting in previous periods. The veterinary services reform announced since 2015 was intended to consolidate the veterinary to create a clear chain of communication. The EU assessed that the pace of reform is slow, the services remain fragmented, and there are no personnel with various remaining functions that are being discovered, such as animal waste management, farm biosecurity, or aquaculture. Monitoring of unwanted substance residues has covered pesticide residues in ten plant products. Albania's capacity to improve food security in the market is expected to grow further in 2018 with the help of IPA funds. Improvements are recorded in the microbiological monitoring methodology of raw materials such as milk, based on samples from each milk processing unit or dairy factory with a capacity of more than one ton per day. Samples are analyzed for counting somatic plates and cells every three months. This approach provides a clearer picture of the situation for crude milk. In addition to the general rules contained in the Food Law, no progress has been made in preparing the legislation required for specific food rules.   The precedent Croatia is the last Balkan country to join the European Union through a lengthy negotiation process of almost nine years, from 2004 to 2013. Croatia was the most developed country in the region after Slovenia. The shipping industry and tourism brought the country 10 billion euros exports a year prior membership, but now, four years after joining the EU the country is going through a difficult period. Public debt has risen 10 percentage points since 2013 while the deficit in goods trade has deepened further as the country is facing aging populations and high emigration that incited membership. The country faced difficulties in the recent years after Agrokor, the country’s biggest company which used to employe 60,000 persons, filed bankruptcy as among other things it could not withstand competition from opening up markets with the EU. But membership has further strengthened institutions and democracy in the country at all levels, and Croatian citizens benefited from the opening of trade with the EU by buying more quality goods at cheaper prices. Foreign investment has been on the rise and air travel tickets have become cheaper. Following Croatia from other regional countries, Montenegro and Serbia are in the process of negotiating membership with the EU and are expected to join by 2025, while Albania and Macedonia are expected to receive the green light in June for opening the talks that could lead to membership in the next decade. Albania's biggest challenge is facing the EU markets opening up and preparing its businesses to become competitive in this process. Unlike the entire region, agriculture in Albania accounts for a large part of the economy, at 20 percent in GDP and around 40 percent in employment. The European Commission  gave a low rating to this sector in its latest Progress Report, compared to other chapters that received the most average rating. “During the negotiation process, Albania needs to diversify into value-added sectors and find the way to become part of the EU's economies of scale,” the report wrote.   Balkan Federation prior EU integration The prime ministers of Serbia, Albania, Macedonia, Montenegro, Bosnia, and Kosovo, have signed an agreement, and an action plan is currently underway to create a free trade zone by 2023, as in the EU countries. In some respects, this facilitation which has started with the CEFTA agreement, significantly reduces barriers and trade procedures between countries, but puts some industries in difficulty to become uncompetitive with the opening up of markets for several reasons. Adi Haxhiymeri from the Flourery Processing Association and administrator to Bloja factory, said that even under conditions when the market was not fully liberalized, the Albanian industry is not coping the competition of the regional flour. Serbia, Macedonia and other countries in the region apply subsidy policies for wheat production, while Albania does not. Although Albanian flour-mills have invested in modern technology, they do not have the same access to raw material as other flour-processing businesses in Serbia and Macedonia. Haxhiymeri said that if measures are not taken to prevent subsidies, the flour industry in the country will go bankrupt in the face of customs-free trade. But as the free trade agreement has taken the consensus of the respective prime ministers, Albanian businesses are not informed and are not even aware of the process. Albania is undergoing an internal transition  this year due to elections, the political crisis, and the crippled justice system. The Regional Cooperation Council (RCC), set up with the contribution of the six countries to create the common WB6 market and with the support of donors, has started to operate. In addition to the free trade space, progress has been made on the establishment of a common energy market. A study on a common foreign investment platform has been completed, where it will intervene in six areas since the laws and the level of taxation for investors. The transport sector has completed a study on regional corridors and businesses to be developed by infrastructure and logistics. In the field of tourism, countries have drafted a joint bid for the Balkan tour that has started to be applied this summer. Also, a regional task force has been set up for anti-corruption and improvements in justice systems. In the field of free movement it is agreed in principle for the recognition of diplomas in the field of medicine, dental services, engineering, and architecture. At the service of all these reforms there are already available 2 billion euros donated by the donors to be used according to the initiatives for each reform. The prime ministers of the six countries have signed that until 2023 in our region the goods, services, investments, and people can freely move without tariffs just like the EU today, without quotas or barriers and where trade is facilitated by the World Trade Organisation (WTO) rules. Joint border control with one stop should start working during 2018-2019. The lifting of barriers to trade in services and the electronic recognition of certificates should take place by 2023. By 2020 additional protocol for the settlement of CEFTA disputes should be implemented and countries should also have completed investments in the internal trade infrastructure without a fee. By 2020, a Task Force must also be in place to stop the secretive subsidies of individual states to certain sectors. Albania currently has limited trade with the countries of the region. According to CEFTA data, Albania's trade with these countries has not been significantly affected as expected since the signing of the agreement in 2013.   Why should Balkan countries unite Macroeconomic stability has been difficult in the Western Balkans, especially after the 2008 crisis. The global financial crisis tensed fiscal positions in the six countries, significantly reducing fiscal performance and boosting public debt pressure on the other hand. Countercyclical policies led to doubling of primary deficits in the region from 1.7 percent of GDP in 2008 to 3.8 percent in 2009, continuing by over 2 percent by 2016. As a result the average gross debt in the region grew from about 30 percent of GDP in 2008 to over 50 percent in 2016, where Albania and Serbia have the highest level in over 70 percent. The crisis also highlighted some other structural weaknesses. The World Bank (WB) analyzed that there is a need to improve efficiency, equity, and transparency of fiscal discipline and policies for more effective resource mobilization, and improve the delivery of public services. Public spending in the region remains concentrated on salaries, pensions and social payments, leaving little room for investment. The WB estimates that there is room for improving tax collection and for greater progress in tax policies. After the financial crisis, there is now a common need in the Western Balkans to ensure macroeconomic stability to consolidate public finances and to increase capacities in attracting direct investment flows. Transition towards the consolidation of the market economy remains incomplete in the Western Balkans. The region has made considerable progress in price liberalization, foreign trade, and privatization, but structural transformation remains lagging behind and at the back of other small transitioning economies. Particularly today, the result of transition in the Western Balkans is similar to that of other European transitioning economies in 1996. Progress has been slow in the areas of competition, governance, restructuring of state-owned enterprises, and large-scale privatization. In recent years the convergence to reach EU countries has been low in the countries of the region. Albania, Bosnia and Herzegovina, Kosovo, Macedonia, Montenegro, and Serbia, marked a sharp decline in poverty since the beginning of transition to market economies. Living standards increased nearly sixfold in Bosnia and Herzegovina, almost tripling in Albania, and doubling in Serbia between 1995 and 2015. During 2000-2008, living standards in the Western Balkans expanded faster than in other countries of the world and the EU average. During this period, creating new jobs helped reduce poverty. In the early 2000s, nearly one in three people in the region lived in less than 5 dollars a day. By 2008, this figure dropped to only one in five. Indicators such as longevity, skill, and access to services also improved during this period.  [post_title] => EU integration scares some Albanian businesses [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => eu-integration-scares-some-albanian-businesses [to_ping] => [pinged] => [post_modified] => 2019-05-21 16:12:16 [post_modified_gmt] => 2019-05-21 14:12:16 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.tiranatimes.com/?p=141826 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) ) [post] => WP_Post Object ( [ID] => 141927 [post_author] => 338 [post_date] => 2019-05-30 16:46:47 [post_date_gmt] => 2019-05-30 14:46:47 [post_content] => TIRANA, May 28- According to official data by the Albanian Institute of Statistics (INSTAT), the structure of employment by sectors was shifted from agriculture to services and production. The trade and services sector accounted for 25.7 percent of total employees over the past year, with a 0.7 percent increase compared to 2017. Also, the weight of the manufacturing sector also underwent an increase in the employment structure. Factory employees accounted for 10.6 percent of the total in 2018, from 10.1 percent a year earlier. The construction sector also reflected an expansion in employment as it occupied 7 percent of the total. The industry and public administration sectors on the other hand experienced a decline in the share of the total employed. Albania is the most agricultural country in Europe but has the highest share of imported food to total imports. Although agriculture accounts for about 20 percent of the country's gross domestic product (GDP), Albania imports more agricultural products than it exports. In the other regional countries, agriculture accounts for a smaller share in the total economy, but provides higher output and exports than Albania. Referring to World Bank (WB) data for 2016, Moldova ranks second after Albania in Europe for the size of agriculture with about 14 percent of the total economy, followed by Ukraine with 13.7 percent. Then the list is followed by the Western Balkan countries. Agriculture in Kosovo for example accounts for 19.4 percent of the GDP.  In Macedonia it is 10 percent, in Montenegro 9 percent, in Serbia 7.9 percent, and last comes Bosnia and Herzegovina with agriculture comprising only 7.7 percent of the country's GDP. In developed European countries, agriculture accounts for less than 5 percent of the economy, with the lowest level being recorded in Belgium, Switzerland, Germany and the United Kingdom by less than 1 percent. The paradox is that even though we are the most agricultural country in the whole of Europe, we have the highest share of imports for the group of food commodities. Referring to INSTAT data on imports over the years, the share of food imports to total imports is 11.4 percent. This high importing might be also affected the low employment in the sector, among other factors, such as low turnovers, emigration, etc..  [post_title] => Agricultural employment shrinks [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => agricultural-employment-shrinks [to_ping] => [pinged] => [post_modified] => 2019-05-30 16:46:47 [post_modified_gmt] => 2019-05-30 14:46:47 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.tiranatimes.com/?p=141927 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) [queried_object] => stdClass Object ( [term_id] => 5 [name] => Economy [slug] => economy [term_group] => 0 [term_taxonomy_id] => 5 [taxonomy] => category [description] => [parent] => 0 [count] => 7817 [filter] => raw [cat_ID] => 5 [category_count] => 7817 [category_description] => [cat_name] => Economy [category_nicename] => economy [category_parent] => 0 ) [queried_object_id] => 5 [post__not_in] => Array ( ) )

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